A trial judge may grant prejudgment interest at his or her discretion. Cnty. of Essex v. First Union Nat’l Bank, 186 N.J. 46, 61 (2006); see also Meshinsky v. Nicholas Yacht Sales, Inc., 110 N.J. 464, 478 (l988). An appellate court should not interfere with such award unless the award represents a manifest denial of justice. Cnty. of Essex, supra, 186 N.J. at 61. Prejudgment interest in contract actions are not subject to the mandates of Rule 4:42-ll, which apply only to tort actions, but rather are “assessed on a discretionary basis as the result of the application of equitable principles.” DialAmerica Mktg., Inc. v. KeySpan Energy Corp., 374 N.J. Super. 502, 508 (App. Div.), certif. denied, 184 N.J. 212 (2005).

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Prejudgment interest in contract actions are assessed on a discretionary basis as the result of the application of equitable principles originally appeared on NJ Family Issues on February 2, 2012.

New Jersey has a strong public policy favoring the enforcement of property settlement agreements. Matrimonial settlements are “‘entitled to considerable weight with respect to their validity and enforceability’ in equity, provided they are fair and just” because they are “‘essentially consensual and voluntary in character.’” Dolce v. Dolce, 383 N.J. Super. 11, 20 (App. Div. 2006) (quoting Petersen v. Petersen, 85 N.J. 638, 642 (1981)); see also Lepis v. Lepis, 83 N.J. 139, 153 (1980). Such agreements “are generally favored by the courts as a peaceful means of terminating marital strife and discord so long as they are not against public policy.” Konzelman v. Konzelman, 158 N.J. 185, 194 (1999). Consequently, the court accords “particular leniency to agreements made in the domestic arena, and likewise allow[] judges greater discretion when interpreting such agreements.” Guglielmo v. Guglielmo, 253 N.J. Super. 531, 542 (App. Div. 1992).

Mediation is a recognized and appropriate process for the voluntary resolution of family disputes. See Lerner v. Laufer, 359 N.J. Super. 210, 216 (App. Div.), certif. denied, 177 N.J. 223 (2003); see also R. 1:40-5. Additionally, our Supreme Court has approved voluntary agreements between parties to use alternate methods to settle marital issues. Fawzy v. Fawzy, 199 N.J. 456, 477 (2009); Faherty v. Faherty, 97 N.J. 99, 107 (1984).

NOTE: My Law Office is located at 726 West Saint Georges [W. St. Georges] Avenue (Route 27), Linden, Union County, NJ. Telephone: 908-486-2200; EM@IL

The court accords particular leniency to agreements made in the domestic arena, and likewise allows judges greater discretion when interpreting such agreements originally appeared on NJ Family Issues on January 30, 2012.

In a long line of decisions, our Supreme Court has “emphasized repeatedly that matrimonial agreements between spouses relating to [equitable distribution], alimony and support, which are fair and just, fall within the category of contracts enforceable in equity.” Petersen v. Petersen, 85 N.J. 638, 642 (1981) (citing Carlsen v. Carlsen, 72 N.J. 363, 370-71 (1977); Berkowitz v. Berkowitz, 55 N.J. 564, 569 (1970); Schlemm v. Schlemm, 31 N.J. 557, 581-82 (1960)). “Marital agreements are essentially consensual and voluntary and as a result, they are approached with a predisposition in favor of their validity and enforceability.” Massar v. Massar, 279 N.J. Super. 89, 93 (App. Div. 1995) (citing Petersen, supra, 85 N.J. at 642; Dworkin v. Dworkin, 217 N.J. Super. 518, 524 (App. Div. 1987)).

Nevertheless, strong public policy considerations mandate that marital settlement agreements be closely scrutinized. Any marital agreement that is unconscionable or is the product of fraud or overreaching may be set aside. Guglielmo v. Guglielmo, 253 N.J. Super. 531, 541 (App. Div. 1992); Capanear v. Salzano, 222 N.J. Super. 403, 407 (App. Div. 1988). “[T]he law affords particular leniency to agreements made in the domestic arena . . . .” Massar, supra, 279 N.J. Super. at 93. “Marital property settlement agreements ‘involve far more than economic factors’ and must serve the strong public and statutory purpose of ensuring fairness and equity in the dissolution of marriages.” Conforti v. Guliadis, 128 N.J. 318, 323 (1992) (quoting Rothman v. Rothman, 65 N.J. 219, 229 (1974)). “Even when a divorce order incorporates agreements reached privately between the parties, such orders can be modified ‘in light of all the facts’ bearing on what is ‘equitable and fair.’” Ibid. (quoting Smith v. Smith, 72 N.J. 350, 360 (1977)).

If there has been moral compulsion sufficient to overcome the will of a person otherwise competent to contract, any agreement made under such circumstances is considered to be lacking in voluntariness and therefore invalid. Rubenstein v. Rubenstein, 20 N.J. 359, 365 (1956). The legal concept of duress is based upon the “unreality of the apparent consent” of a party. Id. at 366. “In determining whether a contracting party is entitled to be absolved from his [or her] contractual obligations due to duress, the court must . . . look to the condition of the mind of the person subjected to coercive measures.” Shanley & Fisher, P.C. v. Sisselman, 215 N.J. Super. 200, 212 (App. Div. 1987). “‘The question is whether consent was coerced; that is, was the person complaining induced by the duress or undue influence to give his consent, and would not have done so otherwise.’” Ibid. (quoting Rubenstein, supra, 20 N.J. at 366).

“[T]he test for duress is subjective, rather than objective, and does not turn on whether the duress is of ‘such severity as to overcome the will of a person of ordinary firmness.’” Id. at 212-13 (quoting S. P. Dunham & Co. v. Kudra, 44 N.J. Super. 565, 570 (App. Div. 1957)). All the attendant circumstances must be considered. Id. at 212. In addition to considering the subjective mindset of the complaining party, the pressure imposed must be wrongful. Rubenstein, supra, 20 N.J. at 367. “The act or conduct complained of . . . [must be] ‘so oppressive under given circumstances as to constrain one to do what his free will would refuse.’” Ibid. (quoting First State Bank v. Fed. Reserve Bank, 219 N.W. 908, 909 (Minn. 1928)); see also Segal v. Segal, 278 N.J. Super. 218, 223-24 (App. Div. 1994).

As the court held in Dworkin, supra, 279 N.J. Super. at 523, “any [matrimonial] agreement may be set aside when it is the product of fraud or overreaching by a party with power to take advantage of a confidential relationship or is unconscionable.”

NOTE: My Law Office is located at 726 West Saint Georges [W. St. Georges] Avenue (Route 27), Linden, Union County, NJ. Telephone: 908-486-2200; EM@IL

Any matrimonial agreement may be set aside when it is the product of fraud or overreaching by a party with power to take advantage of a confidential relationship or is unconscionable originally appeared on NJ Family Issues on January 17, 2012.

The confidentiality provisions of a settlement agreement may be inconsistent with Rule 1:38, which permit free access by the public to the information sought to be concealed.

NOTE: My Law Office is located at 726 West Saint Georges [W. St. Georges] Avenue (Route 27), Linden, Union County, NJ. Telephone: 908-486-2200; EM@IL

The confidentiality provisions of a settlement agreement may be inconsistent with the free access by the public to the information sought to be concealed originally appeared on NJ Family Issues on January 14, 2012.

When PSA terms are “plain and explicit” and “set forth in clear and unambiguous language, leaving no room for interpretation,” the court will enforce them “as written and agreed to by the parties, absent a substantial change in circumstances” or unless they “would no longer be fair or equitable.” Dolce v. Dolce, 383 N.J. Super. 11, 21 (App. Div. 2006); see also Eaton v. Grau, 368 N.J. Super. 215, 224 (App. Div. 2004) (perceiving “no inequity or manifest injustice in enforcing the plain and clear terms of the PSA as found by the motion judge”). Moreover, “‘fair and definitive arrangements arrived at by mutual consent should not be unnecessarily or lightly disturbed.’” Konzelman v. Konzelman, 158 N.J. 185, 193-94 (1999) (quoting Smith v. Smith, 72 N.J. 350, 358 (1977)).

NOTE: My legal services include family law, divorce, child support, litigation, arbitration, mediation, child custody and visitation, alimony, equitable distribution, separation agreements, palimony, PSA, property settlement agreement, premarital and prenuptial agreements, midmarriage and marital agreements.

When PSA terms are plain and explicit and set forth in clear and unambiguous language, leaving no room for interpretation, the court will enforce them as written and agreed to by the parties, absent a substantial change in circumstances or unless they would no longer be fair or equitable originally appeared on NJ Family Issues on January 8, 2012.

A forum selection clause is enforceable unless it results from “fraud, undue influence, or overweening bargaining power,” is “unreasonable” or “violates” a “strong public policy.” M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 10-15, 92 S. Ct. 1907, 1913-16, 32 L. Ed. 2d 513, 520-23 (1972). Forum selection clauses “are prima facie valid and enforceable in New Jersey[,]” and only if the circumstances fall into one of the three M/S Bremen exceptions will a New Jersey court decline to enforce a forum selection clause. Caspi v. Microsoft Network, L.L.C., 323 N.J. Super. 118, 122-23 (App. Div.), certif. denied, 162 N.J. 199 (1999). Accord Wilfred MacDonald, Inc. v. Cushman, Inc., 256 N.J. Super. 58, 63-64 (App. Div.), certif. denied, 130 N.J. 17 (1992). The party seeking to defeat a forum selection clause bears the burden of establishing its invalidity. Wilfred MacDonald, supra, 256 N.J. Super. at 63-64.

Forum selection clauses are enforceable because “the parties should be allowed to agree in advance to a mutually satisfactory forum, thus insuring a predictable and neutral locus for the resolution of any dispute.” Copelco Capital, Inc. v. Shapiro, 331 N.J. Super. 1, 6 (App. Div. 2000).

However, in Copelco, the court refused to enforce the forum selection clause because it did not inform the defendant of the forum in which any litigation against the defendant would be instituted. Ibid. The court reasoned that a floating forum selection clause was invalid because it could easily have resulted in the defendant being sued “anywhere in the entire country — a forum that would not be identifiable until sometime after the agreement was entered into[.]” Ibid. The court held that such lack of notice was a fatal defect that invalidated the parties’ forum selection clause. Ibid.

The party challenging the enforceability of a forum selection clause bears the burden of establishing a basis for disregarding the provision.

NOTE: My legal services include family law, divorce, child support, litigation, arbitration, mediation, child custody and visitation, alimony, equitable distribution, separation agreements, palimony, PSA, property settlement agreement, premarital and prenuptial agreements, midmarriage and marital agreements.

Forum selection clauses are prima facie valid and enforceable in New Jersey originally appeared on NJ Family Issues on January 5, 2012.

Forum selection clauses are frequently used between commercial parties, and they do not offend due process as long as the agreement is freely negotiated and the provision is not “unreasonable and unjust.” Id. at 9-10. Courts will enforce such a forum-selection clause unless it is the product of “fraud, undue influence, or overwhelming bargaining power,” is unreasonable, or offends a “strong public policy.” M/S Bremen v. Zapata Off-Shore Co., 407 U.S. 1, 12-15, 92 S. Ct. 1907, 1914-16, 32 L. Ed. 2d 513, 521-23 (1972).

NOTE: My legal and mediation services are offered to clients in Union, Middlesex, Somerset, Essex, Hudson, Bergen, and Morris counties in NJ.

Courts will enforce such a forum-selection clause unless it is the product of fraud, undue influence, or overwhelming bargaining power, is unreasonable, or offends a strong public policy originally appeared on NJ Family Issues on January 5, 2012.

The standard in respect of whether a malpractice plaintiff may maintain a suit based on a settlement remains as set forth in Puder’s [Puder v. Buechel, 183 N.J. 428 (2005)] predecessor, Ziegelheim v. Apollo, 128 N.J. 250 (1992), and Puder represents but an equitable exception to Ziegelheim’s overarching rule.

In Ziegelheim, an attorney failed to discover approximately $149,000 of marital assets and failed to properly advise his client about what she might have received if she went to trial. 128 N.J. at 255-57. After “extensive negotiations,” the client agreed to accept a settlement that she affirmed on the record was fair and equitable. Id. at 257-58. Dissatisfied with the settlement, she later sued her former lawyer for malpractice that culminated in the settlement, id. at 254-58, alleging that because of the attorney’s lapses, she agreed to a settlement far less than what she could have obtained had she gone to trial. Id. at 255-57.

Outright rejecting “the rule . . . that a dissatisfied litigant may not recover from his or her attorney for malpractice in negotiating a settlement that the litigant has accepted unless the litigant can prove actual fraud on the part of the attorney[,]” id. at 262, the Court in Ziegelheim concluded that “[t]he fact that a party received a settlement that was ‘fair and equitable’ does not mean necessarily that the party’s attorney was competent or that the party would not have received a more favorable settlement had the party’s incompetent attorney been competent.” Id. at 265. The Court went on to explain that clients rely on their attorneys to advise them what constitutes a “fair” settlement under the circumstances, id. at 263, and that a competent lawyer is obligated to help his client understand “the likelihood of success” of the case and “the range of possible awards in” it, even if the client ultimately chooses another path. Ibid.

That said, the Court did warn, however, that its decision was not meant to “open the door to malpractice suits by any and every dissatisfied party to a settlement” and that “[m]any such claims could be averted if settlements were explained as a matter of record in open court in proceedings reflecting the understanding and assent of the parties.” Id. at 267. With that admonition in mind, the Court, several years later, had occasion to revisit the effect, if any, the settlement of an underlying lawsuit has on a subsequent legal malpractice action arising out of that settled lawsuit.

In Puder, supra, the Court determined that a client’s unconditional declaration of satisfaction with the fairness and terms of a settlement of a lawsuit precludes a later legal malpractice action based on that settlement. 183 N.J. at 437. Unlike Ziegelheim, the dissatisfied client in Puder sought to sue her former lawyers over a rejected settlement despite the fact that she retained new lawyers, that those new lawyers negotiated a settlement that was substantially indistinguishable from the earlier rejected settlement, and that the client had represented to the trial court that the settlement was both fair and acceptable to her. Puder, supra, 183 N.J. at 431-36. In those circumstances, the Court, applying equitable principles, carved out a limited exception to the Ziegelheim standard and held that “fairness and the public policy favoring settlements dictate that [the malpractice plaintiff] is bound by her representation to the trial court that the divorce settlement agreement was ‘acceptable’ and ‘fair[,]‘” explaining that “[t]hose statements clearly reflect [the malpractice plaintiff]‘s satisfaction with the resolution of her [prior litigation], and, therefore, preclude her malpractice claim against her former counsel.” Id. at 437.

In other words, unlike the plaintiff in Ziegelheim, the client in Puder had reason to know of her attorney’s negligence and “entered into the second [materially indistinguishable] settlement admittedly aware of the discovery deficiencies leading up to the first settlement.” Id. at 443; see Schulman v. Wolff & Samson, P.C., 401 N.J. Super. 467, 475 (App. Div.) (noting that in Puder, the client was “fully aware of” her attorney’s negligence “before entering into the final settlement . . . .”), certif. denied, 196 N.J. 600 (2008). Indeed, the Court in Puder expressly reasoned that Ziegelheim “discourages malpractice litigation when a court finds that a plaintiff, although well aware that the attorney was negligent, nevertheless testifies under oath that the settlement was both acceptable and fair.” 183 N.J. at 443.

Puder, in turn, cited approvingly the decision in Newell v. Hudson, 376 N.J. Super. 29 (App. Div. 2005), where — according to the Court’s characterization — the plaintiff, an accountant by education who performs internal auditing for a corporation, “was completely aware of the alleged financial shortcomings of the settlement when she willingly entered into the agreement.” Puder, supra, 183 N.J. at 444. Thus, to allow a client to sue an attorney for malpractice where the client knew the settlement was deficient but nonetheless affirmed that it was a fair compromise would allow the client to “potentially profit from litigation positions that are “clearly inconsistent and uttered to obtain judicial advantage.” Ibid.

A further examination of the issue occurred in Guido v. Duane Morris LLP, 202 N.J. 79 (2010), wherein the Court dispelled any possible tension between Puder and Ziegelheim, explaining “Puder represents not a new rule, but an equity-based exception to Ziegelheim’s general rule[,]” id. at 94, which applies if required “‘to prevent injustice by not permitting a party to repudiate a course of action on which another party has relied to his detriment[,]‘” ibid. or to ensure that “a party [who] has prevailed on a litigated point” be “bound by its earlier representations” to protect the integrity of the judicial process. Ibid. But if these equitable considerations are not present, Ziegelheim’s “overarching rule” applies. Id. at 96.

In Guido, there was a genuine issue of material fact as to whether or not the defendants adequately advised plaintiffs of the impact the voting agreement would have on the value of their shares, and whether or not the failure to do so constitutes legal malpractice. 202 N.J. at 95. Unlike the plaintiff in Puder who had reason to know of her attorney’s negligence, the plaintiff in Guido “specifically contend[ed] that he was not aware of the effect the restrictions on the sale of stock and other provisions of the voting agreement would have on the value of his investment at the time he agreed to the settlement of the General Equity action” and that defendants “were negligent in failing to advise him in that regard.” Id. at 89.

In sum, Puder’s equitable bar only applies when a client knows that her attorney may have been negligent in connection with a settlement but nevertheless testifies that the settlement is satisfactory to her. Where, on the other hand, such an equitable consideration is absent, and there are facts, albeit disputed, in support of a claim of attorney negligence, the legal malpractice claim may proceed despite the client having agreed on the record to settle the underlying divorce action. In such circumstances, the existence of a settlement agreement does not operate to automatically preclude a client from alleging that her attorney’s advice led her to accept an inadequate settlement.

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The existence of a settlement agreement does not operate to automatically preclude a client from alleging that her attorney’s advice led her to accept an inadequate settlement originally appeared on NJ Family Issues on January 5, 2012.

A party to a matrimonial action who seeks a modification of his or her support obligations ordinarily must show changed circumstances since the establishment of those obligations. See Lepis v. Lepis, 83 N.J. 139, 145-49 (1980). However, the parties may enter into a property settlement agreement under which support obligations will be modified at a specific future date without a showing of changed circumstances, at least in a case in which the initial obligations exceed what would be provided under the Child Support Guidelines. See Weber v. Weber, 211 N.J. Super. 533, 535 (App. Div. 1986).

NOTE: This Blog/Blawg, NJ Family Issues, is managed by Paul G. Kostro, Esq., an attorney/lawyer/mediator in Linden, Union County, New Jersey.

Parties may enter into a property settlement agreement under which support obligations will be modified at a specific future date without a showing of changed circumstances originally appeared on NJ Family Issues on December 21, 2011.

“Whether a[] [[child] support] obligation should be modified based upon a claim of changed circumstances rests within a Family Part judge’s sound discretion.” Larbig v. Larbig, 384 N.J. Super. 17, 21 (App. Div. 2006). A motion to modify a support obligation “‘rests upon its own particular footing and [we] must give due recognition to the wide discretion which our law rightly affords to the trial judges who deal with these matters.’” Ibid. (quoting Martindell v. Martindell, 21 N.J. 341, 355 (1956)). An award of child support “will not be disturbed unless it is ‘manifestly unreasonable, arbitrary, or clearly contrary to reason or to the evidence, or the result of whim or caprice.’” Raynor v. Raynor, 319 N.J. Super. 591, 605 (App. Div. 1999) (quoting DeVita v. DeVita, 145 N.J. Super. 120, 123 (App. Div. 1976)).

Nevertheless, a support order is “always subject to review and modification on a showing of ‘changed circumstances.’” Lepis, supra, 83 N.J. at 146 (citations omitted). See also N.J.S.A. 2A:34-23 (stating orders setting child support “may be revised and altered by the court from time to time as circumstances may require”). A party seeking modification of a child support obligation has the burden to show materially changed circumstances warranting relief from the current child support order. See Ibrahim v. Aziz, 402 N.J. Super. 205, 213 (App. Div. 2008) (holding defendant had the burden to show that a decrease in his income warranted a downward modification in his child support obligation).

A showing of changed circumstances requires the party seeking modification “to convince the court that to enforce the agreement would be unconscionable, the same standard that is applied by courts of equity to the specific enforcement of contracts in other fields.” Schiff, supra, 116 N.J. Super. at 561. “Only if such a showing is made does the court have the right to order full discovery regarding the financial circumstances of the other spouse.” Isaacson v. Isaacson, 348 N.J. Super. 560, 579 (App. Div.), certif. denied, 174 N.J. 364 (2002). “[T]he guiding principle [in making this determination] is the ‘best interests of the children.’” Lepis, supra, 83 N.J. at 157.

Some “changed circumstances” that have been found sufficient to modify an existing child support arrangement include: “(1) an increase in the cost of living[;] (2) increase or decrease in the supporting spouse’s income[;] . . . [and] (6) subsequent employment by the dependent spouse[.]” Id. at 151 (internal citations omitted). Moreover, an increase in the child’s needs “whether occasioned by maturation, the rising cost of living or more unusual events — has been held to justify an increase in support by a financially able parent.” Ibid. (citing Shaw v. Shaw, 138 N.J. Super. 436 (App. Div. 1976)).

A trial court is called to consider whether “[t]he circumstances claimed to be changed by defendant’s income are, in reality, the circumstances contemplated by the very agreement plaintiff now seeks to abrogate.” Glass v. Glass, 366 N.J. Super. 357, 376 (App. Div.), certif. denied, 180 N.J. 354 (2004).

NOTE: My legal and mediation services are offered to clients in Fanwood 07023; Garwood 07027; Kenilworth 07033; Mountainside 07092; New Providence 07974; Roselle Park 07204; Roselle 07203; Elizabeth 07201; Linden 07036; Plainfield 07060; Rahway 07065; Summit 07901; Westfield 07090; Berkeley Heights 07922; Clark 07066; Cranford 07016; Hillside 07205; Scotch Plains 07076; Springfield 07081; Union 07083; Winfield; Carteret 07008; Dunellen 08812; East Brunswick 08816; Edison 08817; Jamesburg 08831; Metuchen 08840; New Brunswick 08901; Old Bridge 08857; Perth Amboy 08861; Sayreville 08871; South Amboy 08878; South River 08877; Avenel 07001; Colonia 07067; Iselin 08830; Woodbridge 07095; Somerset 08873; Somerville 08876 and Watchung 07069, New Jersey.

A showing of changed circumstances requires the party seeking modification to convince the court that to enforce the agreement would be unconscionable, the same standard that is applied by courts of equity to the specific enforcement of contracts in other field originally appeared on NJ Family Issues on December 11, 2011.