JAMES KENNEDY, II, ETC. VS. WEICHERT CO. D/B/A WEICHERT REALTORS (L-2266-19, ESSEX COUNTY AND STATEWIDE) ( 2020 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-0395-19T2
JAMES KENNEDY, II, on
behalf of himself and those
similarly situated persons,
Plaintiff-Respondent,
v.
WEICHERT CO. d/b/a
WEICHERT REALTORS,
Defendant-Respondent.
____________________________
NEW JERSEY REALTORS®,
Appellant.
____________________________
Argued February 10, 2020 – Decided February 21, 2020
Before Judges Messano, Ostrer and Susswein.
On appeal from an interlocutory order of the Superior
Court of New Jersey, Law Division, Essex County,
Docket No. L-2266-19.
Darren C. Barreiro argued the cause for appellant
(Greenbaum Rowe Smith & Davis LLP, attorneys;
Barry S. Goodman and Darren C. Barreiro, of counsel;
Darren C. Barreiro and Conor J. Hennessey, on the
brief).
Ravi Sattiraju argued the cause for respondent James
Kennedy, II (Sattiraju & Tharney, LLP, attorneys; Ravi
Sattiraju, of counsel and on the brief; Anthony S.
Almeida, on the brief).
PER CURIAM
By leave granted, New Jersey Realtors® (NJR) appeals from the trial
court's order denying its motion to intervene of right, R. 4:33-1, or permissively,
R. 4:33-2, in this pending putative class action by a real estate salesperson
against his real estate brokerage firm.1 In brief, NJR is concerned that the
precedential or persuasive effect of a pro-plaintiff result will harm its members'
interests. Having reviewed NJR's arguments in light of the record and applicable
principles of law, we conclude that NJR does not satisfy standing as prescribed
by Rule 4:33-3; nor does it meet all four requirements for intervening of right.
1
We denied NJR's motion to deem its appeal to be proper of right. We adhere
to our view in HUNY & BH Assocs. v. Silberberg, 447 N.J. Super. 606 (App.
Div. 2016) that a trial court's order denying a motion to intervene, whether of
right or permissively, is interlocutory and not a final judgment appealable of
right under Rule 2:2-3(a). See also Gov't Sec. Co. v. Waire, 94 N.J. Super. 586,
588-89 (App. Div. 1967); contra Grober v. Kahn, 88 N.J. Super. 343, 360 (App.
Div. 1965), rev'd on other grounds, 47 N.J. 135 (1966).
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Additionally, the trial court appropriately exercised its discretion in denying
NJR's motion to intervene permissively. Therefore, we affirm.
Plaintiff James Kennedy, II, alleges in his March 2019 complaint that
defendant Weichert Co. misclassified him and other real estate salespersons as
independent contractors; and Weichert wrongfully withheld or diverted their
wages for various purposes in violation of the New Jersey Wage Payment Law
(WPL), N.J.S.A. 34:11-4.1 to 4.14. Kennedy contends that his employment
status should be determined according to the so-called "ABC test" in N.J.S.A.
43:21-19(i)(6)(A), (B), and (C), consistent with Hargrove v. Sleepy's, LLC, 220
N.J. 289 (2015). Kennedy seeks damages for himself and the putative class,
attorney's fees, and a declaration that he and the putative class were
misclassified.
Roughly four months later, NJR sought to intervene. NJR is a trade
association of about 55,000 members, including real estate salespersons and
brokers. In its proposed answer denying Kennedy's and the class's right to relief,
NJR professed no knowledge of the factual allegations specific to Kennedy's
relationship with Weichert. NJR proposed to file a counterclaim seeking a
declaration, under the Declaratory Judgment Act, N.J.S.A. 2A:16-50 to -62, that
the exemption in N.J.S.A. 43:21-19(i)(7)(K) governed "whether a New Jersey
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real estate licensee (such as [p]laintiff and the putative class members) is
considered an employee under the [WPL] . . . ." Alternatively, NJR's proposed
counterclaim seeks a declaration that, "consistent with the Real Estate Brokers
and Salesman Act, N.J.S.A. 45:15-3.2, independent contractor agreements,"
between Weichert and Kennedy and the putative class members govern their
relationship.
The trial court denied NJR's motion. 2 Judge Garry Furnari concluded that
NJR had no interest in the relationship between Weichert and Kennedy and the
putative class. He stated that NJR's sole interest was "whether the Supreme
Court's decision [in Sleepy's] applies to them." Judge Furnari concluded that
NJR lacked a sufficient interest in the property or transactions at issue in the
case. He also concluded that permitting NJR to intervene, and to engage in
discovery, would significantly complicate the case.
On appeal, NJR contends the court erred in denying its motion to intervene
of right, and abused its discretion in denying its motion to intervene
permissively. We disagree.
Rule 4:33-1 entitles anyone to intervene in an action:
2
On the same day, the trial court denied Weichert's motion to dismiss for failure
to state a claim. We separately granted Weichert's motion for leave to appeal
from that order.
A-0395-19T2
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[1] [u]pon timely application . . . if [2] the applicant
claims an interest relating to the property or transaction
which is the subject of the action and [3] is so situated
that the disposition of the action may as a practical
matter impair or impede the ability to protect that
interest, unless [4] the applicant's interest is adequately
represented by existing parties.
The movant has the burden to demonstrate grounds to intervene, including proof
that existing parties will not adequately represent its interests. Am. Civil
Liberties Union of N.J., Inc. v. Cty. of Hudson, 352 N.J. Super. 44, 67 (App.
Div. 2002). The court must approve the application if all elements are met.
Meehan v. K.D. Partners, L.P., 317 N.J. Super. 563, 568 (App. Div. 1998).
Additionally, Rule 4:33-3 requires the movant to set forth a "claim or
defense" in its pleading. Consequently, a movant must also demonstrate it has
standing to intervene in the case. N.J. Dep't of Envtl. Prot. v. Exxon Mobil
Corp., 453 N.J. Super. 272, 290 (App. Div. 2018).
NJR filed a timely application. However, in all other respects, it has failed
to satisfy the requirements for intervention of right. As a threshold matter, NJR
lacks standing to intervene. While our courts approach standing more liberally
than the federal courts, a party must still have a "real and direct interest" to
establish standing. In re Camden Cty., 170 N.J. 439, 447-48 (2002). We
"will not . . . entertain proceedings by plaintiffs who are mere intermeddlers . . .
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or are merely interlopers or strangers to the dispute." Crescent Park Tenants
Ass'n v. Realty Equities Corp. of N.Y., 58 N.J. 98, 107 (1971) (internal citations
and quotations omitted).
NJR has no real dispute with Kennedy or the putative class of Weichert
salespersons. A nonprofit association may have standing "to seek judicial relief
from injury to itself and to vindicate whatever rights and immunities the
association itself may enjoy." In re Ass'n of Trial Lawyers of Am., 228 N.J.
Super. 180, 186 (App. Div. 1988) (citation omitted). Associations may also
have standing to protect its members' associational ties. Ibid. Alternatively, an
association may have standing as its members' representative, so long as any one
member would otherwise have standing to file suit. Ibid.
However, NJR as an association has no contract with Kennedy or the
putative class. NJR would suffer no alleged injury to itself if Kennedy prevails.
NJR members' associational ties are not at risk in this suit. Furthermore, no
individual NJR member – other than Weichert itself, presuming it is a member
– would have standing to sue Kennedy over his entitlement to damages. Were
NJR to intervene, it would put in issue contractual relationships of which
Kennedy and the putative class have no knowledge.
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The analysis is not altered by NJR filing a declaratory judgment action.
As our courts will not issue advisory opinions, a party still needs "a live dispute"
with the defendant in order to file a declaratory judgment action. See In re N.J.
Firemen's Ass'n Obligation to Provide Relief Applications Under Open Pub.
Records Act, 230 N.J. 258, 278 (2017); Williams v. Borough of Clayton, 442
N.J. Super. 583, 591 (App. Div. 2015) (discussing "live controversy"
requirement). "A declaratory judgment act merely provides a procedural device
to accelerate the resolution of a dispute; the procedural device does not alter the
substance of the dispute." In re Envtl. Ins. Declaratory Judgment Actions, 149
N.J. 278, 302 (1997) (O'Hern, J., dissenting). NJR has no dispute with Kennedy,
and would lack standing to file its own claim, on behalf of itself or its members,
against Kennedy.
Even if NJR had standing, it has failed to "claim[] an interest relating to
the property or transaction which is the subject of the action." R. 4:33-1.
Consequently, resolution of the lawsuit will not "impair or impede the ability
[of NJR] to protect that interest." Ibid.
Under Fed.R.Civ.P. 24(a), which Rule 4:33-1 follows verbatim, the
"interest . . . must be direct rather than contingent, and must be based on a right
which belongs to the proposed intervenor rather than to an existing party to the
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suit." Wade v. Goldschmidt, 673 F.2d 182, 185 n. 5 (7th Cir. 1982) (quoting In
re Penn Cent. Comm'l Paper Litig., 62 F.R.D. 341, 346 (S.D.N.Y. 1974), aff'd
sub nom. Shulman v. Goldman, Sachs & Co., 515 F.2d 505 (2d Cir. 1975)).
Applying that persuasive federal interpretation, NJR does not present such an
interest. See Exxon Mobil Corp., 453 N.J. Super. at 288-89, 296 (referring to
federal case law interpreting Fed.R.Civ.P. 24(a) as persuasive authority).3
Our decision in Sutter v. Horizon Blue Cross Blue Shield of N.J., 406 N.J.
Super. 86 (App. Div. 2009) is instructive. A class of physicians sued and then
proposed to settle a dispute over the defendant's reimbursement methods. Id. at
94-96. The trial court denied intervention of right by three physician societies,
finding they lacked an interest in the subject matter, because they had "nothing
to lose or gain based on the outcome of the settlement." Id. at 107. We affirmed
based on the trial court's reasoning. Id. at 108.
We reach the same conclusion here. The property or transaction at issue
consists of the agreements between, on one side, Kennedy and the putative class,
and on the other side, Weichert. NJR does not have an interest in those
3
Generally, our courts deem it "proper to draw on the experience of the federal
courts" where a federal rule is substantially identical to ours. Baumann v.
Marinaro, 95 N.J. 380, 390-91 (1984) (considering Rule 4:49-2 and
Fed.R.Civ.P. 59(e)).
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agreements separate from Weichert's. "Trade associations . . . may be affected
by (and hence colloquially 'interested' in) the rules of law established by
appellate courts. To allow them to intervene as of right would turn the court
into a forum for competing interest groups, submerging the ability of the original
parties to settle their own dispute (or have the court resolve it expeditiously)."
Bethune Plaza, Inc. v. Lumpkin, 863 F.2d 525, 532–33 (7th Cir. 1988).
NJR argues that it has an interest in the stare decisis or persuasive effect
of the trial court's decision. It contends that it is concerned with the impact of
a decision in this case on the "real estate industry as a whole." However, the
trial court's decision will have no precedential effect on any other court. See
S&R Assocs. v. Lynn Realty, 338 N.J. Super. 350, 355 (App. Div. 2001) (stating
trial court decision not binding on Appellate Division); State v. Martes, 266 N.J.
Super. 117, 120 (Law Div. 1993) (stating trial court not bound by "decision of
a court of coordinate jurisdiction"). Although another judge might find the trial
court decision in this case persuasive, that is not sufficient to establish the
requisite "interest in the property or transaction which is the subject of the
action." See In re Benny, 791 F.2d 712, 721 (9th Cir. 1986) (holding that the
possibility that one Circuit Court of Appeals' decision would persuade other
Circuit Courts was "too tenuous" an interest to justify intervention of right).
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Lastly, regarding its motion to intervene of right, NJR has not
demonstrated that Weichert will not adequately represent its interests. NJR does
not contend it will make arguments that Weichert will omit; that Weichert is
incapable of making the arguments that need to be made; or that Weichert will
neglect matters of interest to NJR. See Builders League of S. Jersey, Inc. v.
Gloucester Cty. Utils. Auth., 386 N.J. Super. 462, 469 (App. Div. 2006) (holding
that Builders League adequately represented developer's interests where their
positions were essentially identical); see also People of State of Calif. v. Tahoe
Reg'l Planning Agency, 792 F.2d 775, 778 (9th Cir. 1986) (considering "whether
the interest of a present party is such that it will undoubtedly make all the
intervenor's arguments; whether the present party is capable and willing to make
such arguments; and whether the intervenor would offer any necessary elements
to the proceedings that other parties would neglect").4
When the proposed intervenor and an existing party share the same
ultimate objective, the proposed intervenor must overcome a presumption that
representation is adequate. See Prete v. Bradbury, 438 F.3d 949, 956 (9th Cir.
4
NJR's counsel contended for the first time in oral argument that it represented
the interests of small real estate brokers as well as large ones, like Weichert.
However, he did not explain how the interests of the two diverge. In any event,
we are not obliged to address an argument raised initially in oral argument. In
re Bloomingdale Conval. Ctr., 233 N.J. Super. 46, 48 n. 1 (App. Div. 1989).
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2006); Wade, 673 F.2d at 186; Helgeland v. Wisconsin Municipalities, 745
N.W.2d 1, 22-23 (Wisc. 2008). Differences in litigation strategy do not suffice
to defeat the presumption. Stuart v. Huff, 706 F.3d 345, 353 (4th Cir. 2013);
Arakaki v. Cayetano, 324 F.3d 1078, 1086 (9th Cir. 2003). NJR has not
demonstrated that its ultimate objective differs from Weichert's, or that its
interests differ with respect to the law governing the relationship between
salespersons and brokers. NJR also has failed to rebut the resulting presumption
that Weichert will adequately represent its interests. In sum, the trial court
correctly denied NJR's motion to intervene of right.
NJR's argument regarding its motion to intervene permissively fares no
better. We review a trial court's decision regarding permissive intervention
under an abuse of discretion standard. City of Asbury Park v. Asbury Park
Towers, 388 N.J. Super. 1, 12 (App. Div. 2006). Given that deferential standard,
NJR's argument warrants only brief comment.
"Where intervention of right is not allowed, one may obtain permissive
intervention," pursuant to Rule 4:33-2. Atl. Emp'r Ins. Co. v. Tots & Toddlers
Pre-Sch. Day Care Ctr., Inc., 239 N.J. Super. 276, 280 (App. Div. 1990).
Anyone may intervene permissively "[u]pon timely application . . . if the claim
or defense and the main action have a question of law or fact in common." R.
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4:33-2; see also ACLU, 352 N.J. at 70. The court must consider the impact of
intervention on the existing parties. "In exercising its discretion the court shall
consider whether the intervention will unduly delay or prejudice the
adjudication of the rights of the original parties." R. 4:33-2.
In considering a motion to grant permissive intervention, a trial court will
consider, "promptness of the application, whether or not the granting thereof
will result in further undue delay, whether or not the granting thereof will
eliminate the probability of subsequent litigation, and the extent to which the
grant thereof may further complicate litigation which is already complex."
Pressler & Verniero, Current N.J. Court Rules, cmt. 1 on Rule 4:33-2 (2020).
As with intervention of right, "those without standing in the first instance are
also without sufficient interest to warrant intervention." Exxon Mobil, 453 N.J.
Super. at 287 (quoting Pressler & Verniero, cmt. 1 on Rule 4:33-2).
As we set forth above, NJR lacks standing to bring its counterclaim
against Kennedy and the putative class. In any event, we shall not disturb Judge
Furnari's assessment that permitting NJR to intervene would significantly
expand, complicate, and delay the litigation. He did not abuse his discretion in
denying NJR's motion for permissive intervention.
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Although Kennedy opposed NJR's motion to intervene, he concedes that
NJR's proper role in this case is to serve as amicus curiae. See Rule 1:13-9; see
also In re State ex rel. Essex Cty. Prosecutor's Office, 427 N.J. Super. 1, 5 (Law
Div. 2012). Therefore, we sua sponte grant NJR permission to do so. This will
assure its timely opportunity to participate in Weichert's appeal, by leave
granted, from the court's order denying Weichert's motion to dismiss. NJR may
file an amicus brief in ten days. Kennedy and Weichert may file a reply within
seven days thereafter. NJR may present oral argument.
Affirmed.
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