Dontzin v. Myer

• Decision Date: 23 May 1997
• Citation: 301 N.J.Super. 501,694 A.2d 264
• Parties: Benjamin DONTZIN and Nancy Dontzin, Plaintiffs-Respondents, v. William MYER and Susan Myer, Defendants-Appellants.
• Court: New Jersey Superior Court — Appellate Division

Page 501

301 N.J.Super. 501

694 A.2d 264

Benjamin DONTZIN and Nancy Dontzin, Plaintiffs-Respondents, v. William MYER and Susan Myer, Defendants-Appellants.

Superior Court of New Jersey,

Appellate Division.

Argued March 25, 1997.

Decided May 23, 1997.

Henry Gurshman, Metuchen, for defendants-appellants (Mr. Gurshman, on the brief).

Robert M. Benbrook, Clinton, for plaintiffs-respondents (Benbrook & Benbrook, attorneys; Sieglinde K. Rath, on the brief).

Before Judges DREIER, D'ANNUNZIO and NEWMAN.

The opinion of the court was delivered by

D'ANNUNZIO, J.A.D.

Defendants appeal, pursuant to leave granted, from an order granting plaintiffs' motion to compel the deposition of defendant William Myer and his attorney, Henry Gurshman, "with respect to matters falling within the attorney client privilege."

Plaintiffs, Benjamin Dontzin and his wife Nancy, entered into a contract with defendants, William Myer and his wife Susan, in which defendants agreed "to purchase real property consisting of 130± acres, with farmhouse and other improvements situate thereon, located in the Township of Lebanon, Hunterdon County ... and identified on the Lebanon Township Tax Map as Block 57, Lots 27 and 28...." This was the entire contract description of the property. The purchase price was $1,100,000, and the contract required plaintiffs to convey "good and marketable title." The contract was dated August 14, 1995, and was signed by plaintiffs and defendants. It provided for a closing on November 30, 1995.

By letter dated August 23, 1995, defendants' lawyer, Gurshman, advised plaintiffs' lawyer that "my clients have advised me that they wish to withdraw their offer to purchase your clients' property as embodied in the contract which I sent to you in my letter of August 9, 1995." Gurshman requested the return of his clients' deposit. The record establishes that on August 22, 1995, defendants contracted to buy a property in Union Township, Hunterdon County for $600,000.

By letter dated November 22, 1995, Gurshman wrote to plaintiffs' lawyer explaining defendants' position:

In the above matter, my clients' position is that they contracted to purchase two specifically designated Lots on the Tax Map, that this was the description incorporated into the contract, and that they will not purchase the property since the title search has revealed that your clients do not in fact own all of the property which they purported to sell.

Plaintiffs commenced this action for breach of contract in July 1996. In their answer to the complaint, defendants alleged that plaintiffs had breached the contract and that there was a failure of consideration. According to Gurshman's certification in opposition to plaintiffs' discovery motion, these defenses are based on plaintiffs' alleged lack of title to all of Block 57, Lots 27 and 28.

In granting plaintiffs' motion, the trial court relied on In re Kozlov, 79 N.J. 232, 398 A.2d 882 (1979), which recognized that the attorney-client privilege may be pierced in certain circumstances where there is a legitimate need for the evidence, the evidence is relevant and material to the issues in a case, and the information could not be secured from a less intrusive source. Id. at 243-44, 398 A.2d 882. We reproduce the trial court's application of Kozlov in the present case:

This case does meet the first requirement; namely plaintiffs' legitimate need for the evidence.

To be successful, plaintiffs need to prove that at the time the contract was signed, defendants knew where the property's actual boundaries were.

Plaintiffs need to show that defendants did not rely on the tax map. Thus, they need to know what communications occurred between defendants and their attorney on the subject.

This case also meets the second requirement from Kozlov, which is relevance and materiality. Not only is the evidence relevant and material to plaintiffs' proofs, as stated above, but it is also relevant and material to defendants' case. Defendants' first affirmative defense is that plaintiffs breached the contract by not providing marketable title.

Arguably, whether defendants relied on the description of the property contained in the contract is relevant to this defense. Communications between defendants and their attorney may reveal that in deciding whether to enter into the contract with plaintiffs, defendants relied solely on a visit to the property and did not rely at all on the tax map.

Finally, plaintiffs meet the final prong of Kozlov. This information cannot be secured from any less intrusive source. The only person whom defendants would have discussed the full details of their purchase of plaintiffs' property with would be their attorney. Since plaintiffs meet the three prongs of Kozlov with respect to any communications between defendants and Mr. Gurshman regarding the purchase of plaintiffs' property, this Court hereby permits plaintiffs to depose Mr. Gurshman and William Myer on this issue, and to request documents on the issue.

Similarly, plaintiffs meet the requirements regarding any communications about the purchase of the Union Township property. Defendant Susan Myer stated that defendants may have entered into the contract to purchase the Union Township property within eight days of the defendants' August 23, 1995 letter stating that they would not purchase plaintiffs' land. Given this time frame, communications between defendants and Mr. Gurshman regarding the purchase of the Union Township property may be relevant to and in fact joined with communications regarding defendants' alleged reliance on the tax map description in the contract with plaintiffs. Therefore, this Court will allow plaintiffs to discover communications between defendants and Mr. Gurshman about the purchase of the Union Township property.

Plaintiffs also meet the requirements in Kozlov regarding defendants' motive for conducting the title search. Plaintiffs need this information to determine whether defendants refused to comply with the contract because of the discrepancy discovered by the search or whether they reneged on the contract and then sought some justification. The information is relevant and material to the issue of why defendants refused to comply with the contract.

We now reverse. The attorney client "privilege recognizes that sound legal advice or advocacy serves public ends and rests on the need to 'encourage full and frank communication between attorneys and their clients.' " United Jersey Bank v. Wolosoff, 196 N.J.Super. 553, 561, 483 A.2d 821 (App.Div.1984) (quoting Upjohn Co. v. United States, 449 U.S. 383, 389, 101 S.Ct. 677, 682, 66 L.Ed.2d 584, 591 (1981)). Furthermore, "[w]here the privilege is applicable, 'it must be given as broad a scope as its rationale requires.' " Ibid. (quoting Ervesun v. Bank of N.Y., 99 N.J.Super. 162, 168, 239 A.2d 10 (App.Div.), certif. denied, 51 N.J. 394, 241 A.2d 11 (1968)). However, "the privilege results in suppression of evidence and to that extent is at war with the truth." Ibid. (citations omitted).

In New Jersey, the attorney client privilege is found in both N.J.R.E. 504 and N.J.S.A. 2A:84A-20. They provide, in relevant part, that

communications between [a] lawyer and his client in the course of that relationship and in professional confidence, are privileged, and a client has a privilege (a) to refuse to disclose any such communication, and (b) to prevent his lawyer from disclosing it,

[ N.J.R.E. 504(1).]

This rule contains express exceptions, not relevant in the present case, and even in the absence of an express exception, the privilege can be pierced when the three-prong Kozlov test is met. Kozlov, supra, 79 N.J. at 232, 398 A.2d 882 (1979).

In the present case, the substantive law applicable to plaintiffs' breach of contract action is the beginning point in our application of the Kozlov exception to the attorney-client privilege. We can address the substantive law only in general terms, however, because the record generated in connection with the discovery motion is sparse.

In construing a contract we must determine the intention of the parties "as disclosed by the language used, taken as an entirety; and, in the quest for the intention, the situation of the parties, the attendant circumstances, and the objects they were thereby striving to attain are to be regarded." Casriel v. King, 2 N.J. 45, 50, 65 A.2d 514 (1949). Extrinsic evidence is admissible as an aid to understand the significance of the contract language, but not to give effect to an intent at variance with that language. "So far as the evidence tends to show not the meaning of the writing, but an intention wholly unexpressed in the writing, it is irrelevant." Id. at 51, 65 A.2d 514. "In short, we are to consider what was written in the light of the circumstances under which it was written, and give to the language a rational meaning consistent with the expressed general purpose." Ibid. These principles, though expressed nearly fifty years ago, apply today. See Jacobs v. Great Pac. Century Corp., 104 N.J. 580, 586, 518 A.2d 223 (1986); Communications Workers v. Monmouth County Bd. of Soc. Servs., 96 N.J. 442, 452, 476 A.2d 777 (1984).

Moreover, the intent which controls the contract is the "intention common to both [parties]." Friedman v. Tappan Dev. Corp., 22 N.J. 523, 531, 126 A.2d 646 (1956). And "[i]t is not the real [subjective] intent but the intent expressed or apparent in the writing that controls." Ibid. (citations omitted). Agreement on essential terms of a contract is a prerequisite to its enforceability. Weichert Co. Realtors v. Ryan, 128 N.J. 427, 435, 608 A.2d 280 (1992).

The substantive dispute in the underlying contract action is with regard to the property's contract description. The core issue is what did the parties agree to buy and sell. The contract description is not definite. It contains two identifying characteristics. The contract describes a farm "consisting of 130±...