06-08-09 KAS ORIENTAL RUGS, INC. v. ELLMAN
A-2567-07T2
In this appeal, the court addressed another variation of
the problems recently considered in Romagnola v. Gillespie,
Inc., 194 N.J. 596 (2008), and Best v. C & M Door Controls,
Inc., 402 N.J. Super. 229 (App. Div.), certif. granted, 197 N.J.
13 (2008), regarding the impact of rule amendments on a rejected
offer of judgment. In its earlier decision in this matter, Kas
Oriental Rugs, Inc. v. Ellman, 394 N.J. Super. 278 (App. Div.),
certif. denied, 192 N.J. 74 (2007), the court found without
merit one aspect of the sales representative's damage award and,
for the first time, made relevant his rejection of his
adversary's offer of judgment; however, by the time the court
decided the earlier appeal, Rule 4:58 had been amended and, in
its amended form, made available defenses to a fee allowance
that were not expressed in the Rule as it existed when the offer
was made and rejected.
The court held that, absent an injustice or interference
with vested rights, the new amendments should apply to cases
pending at the time of amendment. The court held that even if
this were not so, it would apply the new rule amendments in this
case due to its idiosyncratic nature and, as a result, reversed
the allowance of offer-of-judgment fees.
The court also interpreted the fee-shifting provisions of
the Sales Representatives' Rights Act, N.J.S.A. 2A:61A-1 to -7,
as permitting awards to both the sales representative and his
principal where the former had filed claims that should be
viewed independently and where one claim was meritorious and the
other potentially frivolous. As a result, the court remanded
for a determination as to whether the second claim was
frivolous.
Judge Miniman concurred in the holding regarding the offer
of judgment rule and dissented from the majority's
interpretation of the Sales Representatives' Rights Act.
Richard Sadowski
Assistant Editor
