HARRY B. SCHEELER, JR. VS. GALLOWAY TOWNSHIP(NEW JERSEY GOVERNMENT RECORDS COUNCIL) ( 2017 )


Menu:
  •                         NOT FOR PUBLICATION WITHOUT THE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-2809-15T4
    HARRY B. SCHEELER, JR.,
    Appellant,
    v.
    GALLOWAY TOWNSHIP,
    Respondent.
    _________________________
    Submitted September 6, 2017 – Decided November 15, 2017
    Before Judges Rothstadt and Vernoia.
    On appeal from the New Jersey Government
    Records Council, Complaint Nos. 2015-1 and
    2015-22.
    Pashman Stein Walder Hayden, PC, attorneys for
    appellant Harry B. Scheeler, Jr. (CJ Griffin,
    of counsel and on the briefs; Michael J.
    Zoller, on the briefs).
    Fitzgerald & McGroarty, PA, attorneys for
    respondent Galloway Township (Michael J.
    Fitzgerald, of counsel and on the brief).
    Christopher S. Porrino, Attorney General,
    attorney for the Government Records Council
    (Debra A. Allen, Deputy Attorney General, on
    the statement in lieu of brief).
    PER CURIAM
    Complainant Harry B. Scheeler, Jr., appeals from a final
    decision   of   the   Government       Records    Council   (GRC   or    Council)
    dismissing two complaints alleging defendant Galloway Township
    (Galloway or Township) denied access to a purported settlement
    agreement in violation of the Open Public Records Act (OPRA),
    N.J.S.A.   47:1A-     to   -13.   We    reverse    and   remand    for    further
    proceedings.
    I.
    The record shows that Galloway and its mayor were sued in
    2013 by former Township manager, Steven J. Bonanni, Sr.                  Galloway
    and its mayor were represented in the litigation by an attorney
    assigned by the Township's insurance carrier.               There were efforts
    to resolve the litigation in mediation, and in October 2014
    Bonanni's attorney advised Galloway's defense counsel that Bonanni
    would settle if Galloway approved the settlement by October 28,
    2014, and payment of the settlement proceeds was made within ten
    days thereafter.      On October 28, 2014, Galloway requested that its
    town solicitor prepare a resolution approving the settlement of
    the Bonanni litigation.
    On November 4, 2014, prior to Galloway's adoption of                         a
    resolution approving the settlement, Bonanni signed a document
    entitled "RELEASE AND SETTLEMENT AGREEMENT" (Release).                    In the
    document, Bonanni released Galloway from all claims he may have
    2                                A-2809-15T4
    against it.    The Release did not require or permit execution by
    Galloway's mayor or anyone else on Galloway's behalf.
    That same day, Galloway's township solicitor responded to an
    inquiry concerning the status of the Bonanni settlement.                     In an
    email, the solicitor confirmed he had been authorized to prepare
    a resolution based on a recommendation to settle the Bonanni
    litigation, but that "no settlement agreement [had been] drafted
    yet, let alone approved."
    On November 12, 2014, Galloway's governing body adopted a
    resolution in public session authorizing the settlement of the
    Bonanni   litigation.    In   pertinent           part,   the   resolution    made
    Galloway's agreement to settle "subject to and conditioned upon
    the execution and delivery of a general Settlement Agreement and
    Release . . . resolving the litigation in full and complete
    satisfaction of all issues set forth in the litigation."                       The
    resolution    further   conditioned         the    settlement    on   Galloway's
    defense   counsel's     "review   and       approval"      of   the   "Settlement
    Agreement and Release."       The resolution required execution of a
    settlement agreement by Galloway's mayor, and attestation of the
    mayor's signature by Galloway's acting township clerk, who also
    served as its OPRA records custodian.
    3                                 A-2809-15T4
    Prior to adopting the resolution, Galloway issued a check for
    its portion of the payment due to Bonanni under the settlement,1
    and sent it to Galloway's defense counsel for delivery to Bonanni's
    attorney.    On November 11, 2014, however, defense counsel returned
    the check to the township manager and requested issuance of a new
    check because the first check included tax-withholding deductions.
    In a letter to the manager, defense counsel explained that under
    the terms of the Bonanni settlement, Galloway's payment was not
    to include withholding deductions.                  At the same time, defense
    counsel provided the township clerk with the Release.                     Galloway
    issued a corrected settlement check on November 12, 2014.
    In response to a tip that the Bonanni litigation had been
    resolved, on November 20, 2014, complainant served Galloway with
    an OPRA request for the "settlement agreement with Steve Bonanni."
    By   that   time,   the   Release     had    been    signed    and    delivered    to
    Galloway's defense counsel, the settlement check had been issued,
    corrected    and    reissued,   and    the    attorneys       had    exchanged    the
    stipulations of dismissal they agreed would be filed to terminate
    the litigation.
    1
    As part of the settlement agreement, the remaining portion of
    the agreed upon settlement payment was made by Galloway's insurance
    carrier.
    4                                   A-2809-15T4
    Having never received a written agreement signed by the mayor
    as required by the resolution, on November 20, 2014, Galloway's
    records custodian denied plaintiff's OPRA request in writing,
    stating "[t]he requested settlement agreement for Steve Bonanni
    has not been executed yet."2           That same day, Galloway's township
    solicitor asked defense counsel if the Bonanni "settlement [has]
    been completely finalized, including the tax deduction issue?"
    Defense counsel responded that he was out of his office, but had
    not "received anything as of today."
    On November 24, 2014, Galloway's defense counsel forwarded
    the reissued corrected settlement check to Bonanni's attorney. In
    addition, Galloway's defense counsel advised he would file the
    first of two separate stipulations of dismissal with the court.
    The stipulation, which was dated October 30, 2014, dismissed the
    case   as   to   the   mayor   only.     Galloway's   defense   counsel   and
    Bonanni's attorney had agreed the stipulation of dismissal as to
    Galloway would be filed later.
    On December 22, 2014, complainant served a second OPRA request
    stating "[s]ubject to immediate release[,] please provide the
    2
    As noted, the resolution required that the records custodian,
    who also served as the acting township clerk, attest to the mayor's
    signature on the settlement agreement. The records custodian was
    aware she had not attested to the mayor's signature on a settlement
    agreement and therefore reasonably understood the agreement
    required by the resolution had "not been signed yet."
    5                           A-2809-15T4
    Steve Bonanni settlement agreement."       On December 29, 2014, the
    records custodian responded in writing, stating "Steve Bonanni's
    settlement agreement has not been executed yet."
    On December 30, 2014, the township solicitor asked Galloway's
    defense counsel about the status of the Bonanni litigation and
    whether it could be considered "final and subject to OPRA release."
    Defense counsel responded the following day, advising he had just
    provided a copy of the "closing documents" to the township manager,
    he was waiting to file the stipulation of dismissal as to Galloway,
    and the settlement was final "as far as [he was] concerned."
    Defense counsel faxed copies of the release and stipulations of
    dismissal to the township manager and explained that although the
    documents had been previously signed, they were not approved by
    the Township until "much later."
    On   January   1,   2015,   complainant   wrote   to   the   township
    solicitor advising that he was informed a check was issued to
    Bonanni and inquiring how the Township could issue a check if
    there was no executed settlement agreement.3           The next day, the
    records custodian received the Release, and provided a copy to
    complainant.    The records custodian delivered the Release to
    3
    In fact, a settlement check was issued to Bonanni in November
    2014 without there being a written settlement agreement between
    Galloway and Bonanni.
    6                              A-2809-15T4
    plaintiff within seven business days of the records custodian's
    receipt of complainant's December 22, 2014 OPRA request.
    Three days after receiving the Release, complainant filed a
    GRC complaint alleging the records custodian unlawfully denied
    access to the Release in response to his November 20, 2014 OPRA
    request.   Complainant     asserted        the   November    4,   2014    release
    predated the OPRA request, the records custodian knowingly and
    willfully violated OPRA by failing to provide it, and the records
    custodian was subject to a civil penalty under N.J.S.A. 47:1A-11.
    Complainant later amended the complaint, adding Galloway's defense
    counsel and township solicitor and alleging they participated in
    the unlawful denial of access to the Release.
    On January 15, 2015, defense counsel filed the October 30,
    2014 stipulation of dismissal as to Galloway with the court.                     On
    January 26, 2015, defense counsel advised Galloway that the Bonanni
    litigation had ended.
    On January 29, 2015, complainant filed a second denial of
    access complaint with the GRC. The complaint reasserted the claims
    in the plaintiff's initial complaint.            The complaint also alleged
    Galloway's   records      custodian,       defense    counsel     and    township
    solicitor knowingly and willfully violated OPRA and should pay a
    civil   penalty   under   N.J.S.A.     47:1A-11      for    wrongfully   denying
    immediate access to the Release in response to the December 22,
    7                                  A-2809-15T4
    2014 request.       Complainant further alleged the solicitor should
    be disqualified from representing Galloway in the GRC proceeding.
    The GRC consolidated plaintiff's complaints and received
    statements of information from the parties, and its executive
    director issued written findings and recommendations.                  Citing the
    GRC decisions in Paff v. City of Union, GRC Complaint No. 2012-
    262 (Aug. 27, 2013) and Kohn v. Twp. of Livingston, GRC Complaint
    No. 2012-328 (Aug. 27, 2013), the executive director reasoned that
    Galloway    did   not    have     an   obligation     to   produce    the    record
    complainant requested on November 20, 2014, until the Bonanni
    settlement    was finalized.           The executive director found that on
    November 20, 2014, the settlement of the Bonanni litigation was
    not final because Galloway "had not finalized and executed a
    settlement    agreement"        with     Bonanni     as    required    under     the
    resolution.
    The executive director explained that although the records
    custodian    later      learned    the    Release    was    the   only   document
    memorializing the settlement, she had not seen the Release prior
    to the November 20, 2014 OPRA request.              In addition, the executive
    director    found    the   records       custodian    reasonably      believed     no
    settlement had been reached because she had not been asked to
    attest to the mayor's signature on a settlement agreement as
    required by the resolution. The executive director also determined
    8                                 A-2809-15T4
    that the settlement agreement was not final on November 20, 2014,
    because the first stipulation of dismissal was not filed until
    weeks later on December 8, 2014.          The executive director concluded
    the records custodian did not unlawfully deny access to the Release
    on November 20, 2014, because "the evidence supports that the
    Township had not yet executed and finalized settlement at that
    time."
    The executive director also addressed complainant's denial
    of access complaint based on the production of the Release in
    response to his December 22, 2014 OPRA request.              He determined
    that because only Bonanni signed the release, it was unclear
    whether the document "actually served as the official settlement
    agreement at the time of disclosure."            He also noted that there
    were conditions precedent to the final settlement of the matter,
    including   the   filing   of   the   stipulation    of   dismissal    as    to
    Galloway, that were not satisfied when the December 22, 2014
    request was made.
    The executive director found it unnecessary to determine if
    the Release was exempt from disclosure under OPRA because, despite
    the records custodian's denial of access on December 22, 2014, she
    provided the release within seven business days of the request and
    therefore did not violate OPRA.              The executive director also
    9                               A-2809-15T4
    recommended rejection of complainant's claims against Galloway's
    defense counsel and township solicitor.
    The    GRC   adopted   the   executive    director's   findings   and
    recommendations.    In its final agency decision, the GRC determined
    the records custodian did not deny access to the release on
    November 20, 2014, because the evidence showed Galloway had not
    executed and finalized the settlement at that time.              The GRC
    further concluded that there was no denial of access to the Release
    in response to complainant's December 22, 2014 request because the
    document was provided within seven business days.            This appeal
    followed.
    II.
    Our standard of review of a decision by the GRC "is governed
    by the same standards as review of a decision by any other state
    agency."    Fisher v. Div. of Law, 
    400 N.J. Super. 61
    , 70 (App. Div.
    2008).   "A reviewing court will not overturn an agency's decision
    unless it violates express or implied legislative policies, is
    based on factual findings that are not supported by substantial
    credible evidence, or is arbitrary, capricious or unreasonable."
    
    Ibid.
     "[U]nder our deferential standard of review, we give weight
    to the GRC's interpretation of OPRA."         McGee v. Twp. of E. Amwell,
    
    416 N.J. Super. 602
    , 616 (App. Div. 2010).          "We do not, however,
    simply rubber stamp the agency's decision."           Paff v. N.J. Dep't
    10                            A-2809-15T4
    of Labor, 
    392 N.J. Super. 334
    , 340 (App. Div. 2007) (citation
    omitted); E.g., Paff v. N.J. Dep't of Labor, 
    379 N.J. Super. 346
    ,
    358 (App. Div. 2005).          "Our standard of review is plenary with
    respect to" an interpretation of OPRA.              Asbury Park Press v. Cty.
    of Monmouth, 
    406 N.J. Super. 1
    , 6 (App. Div. 2009), aff'd, 
    201 N.J. 5
     (2010).
    We begin by noting that the parties do not dispute that
    settlement      agreements    are   government       records    and     subject       to
    disclosure under OPRA.        See Asbury Park Press v. Cty. of Monmouth,
    
    201 N.J. 5
    , 6 (2009) (finding settlement agreement resolving
    lawsuit between an employee and a county is a government record
    subject    to    disclosure    under      OPRA).      But    here,     the    Bonanni
    settlement agreement was an oral agreement between Galloway's
    defense counsel and Bonanni's attorney.                     They agreed to the
    settlement terms: Bonanni agreed to execute a release of all claims
    and dismissal of the lawsuit in exchange for a monetary payment.
    There was no written settlement agreement between Galloway and
    Bonanni setting forth those terms, even though the resolution
    required   a     written    agreement     signed    by   the    mayor,       with   his
    signature attested to by the acting township clerk.
    Although the Release was not a contract between Galloway and
    Bonanni    and    did   not   comport      with    the   requirements         of    the
    resolution,      Galloway     and   the    GRC     considered    the     Release       a
    11                                     A-2809-15T4
    government record encompassed within complainant's OPRA requests
    for production of the Bonanni "settlement agreement."   That is why
    on January 2, 2015, the records custodian, after being advised for
    the first time that the settlement was final, provided complainant
    with the Release in response to his request for the Bonanni
    "settlement agreement."
    Relying on its decisions in Paff, 
    supra,
     GRC Complaint No.
    2012-262, and Kohn, supra, GRC Complaint No. 2012-328, the GRC
    determined that the failure to provide the Release in response to
    the November 20, 2014 request did not violate OPRA because the
    settlement of the Bonanni litigation was not final at that time.
    In the executive director's findings and recommendations, which
    the GRC adopted, it states "the [GRC's] position on settlement
    agreements is that same are not finalized until all parties have
    executed the agreement."   We need not address the validity of the
    GRC's application of its decisions in Paff or Kohn4 because having
    4
    In Kohn, the GRC determined that a memorandum was not a government
    record subject to disclosure under N.J.S.A. 47:1A-1.1 because it
    contained "inter-agency or intra-agency advisory, consultative or
    deliberative material" concerning a settlement that had not been
    finalized. Kohn, supra, GRC Complaint No. 2012-328. In Paff, the
    GRC found there was no denial of access to a requested "settlement
    agreement" where the agreement did not exist at the time at the
    time of the OPRA request. Paff, 
    supra,
     GRC Complaint No. 2012-
    262. Here, the GRC did not make any factual findings supporting
    a determination that the Release contained "advisory, consultative
    or deliberative material." Instead, the GRC assumed the Release
    12                           A-2809-15T4
    reviewed the record, we are convinced the GRC's factual finding
    that the settlement agreement was not final on November 20, 2014,
    is not supported by substantial credible evidence.
    "An agreement to settle a lawsuit is a contract which, like
    all   contracts,   may   be   freely   entered   into,   and   which    a
    court .   .   . shall honor and enforce as it does other contracts."
    Pascarella v. Bruck, 
    190 N.J. Super. 118
    , 124-25 (App. Div.),
    certif. denied, 
    94 N.J. 600
     (1983); accord Cumberland Farms Inc.
    v. New Jersey Dept. of Envtl. Prot., 
    447 N.J. Super. 423
    , 438
    (App. Div. 2016), certif. denied, 
    229 N.J. 149
     (2017).          Parties
    to a settlement agreement "may orally, by informal memorandum, or
    by both agree upon all the essential terms of the contract, and
    effectively bind themselves thereon, if that is their intention,
    even though they contemplate the execution later of a formal
    document to memorialize their undertaking."        Pascarella, supra,
    
    190 N.J. Super. at 126
    .
    Here, all of the terms of the settlement were agreed to
    between the attorneys for the respective parties prior to November
    constituted such material based on its determination that a
    settlement agreement, or in this case a release, constitutes
    "advisory, consultative or deliberative material" until the
    settlement agreement is finalized. Because we conclude there is
    insufficient evidence supporting the GRC's determination that the
    settlement agreement was not final on November 20, 2014, it is
    unnecessary to address the validity of the GRC's assumption.
    13                            A-2809-15T4
    20, 2014.   In accordance with the agreement, prior to November 20,
    2014, the attorneys executed and exchanged the stipulations of
    dismissal, Bonanni signed and delivered the Release, and Galloway
    issued an initial and then corrected settlement check for its
    portion of the settlement amount due to Bonanni. There was no
    evidence that at any time after November 20, 2014, the attorneys
    negotiated or agreed to any additional settlement terms.           To the
    contrary,   the   evidence   established   that   Galloway   and   Bonanni
    entered into a binding and final agreement to settle the lawsuit
    prior to November 20, 2014.     See, e.g., Hagrish v. Olson, 
    254 N.J. Super. 133
    , 137 (App. Div. 1992) (finding acceptance of payment
    in exchange for an agreement not to pursue an appeal constituted
    a binding settlement agreement).
    We are mindful that the stipulations of dismissal were not
    filed and the settlement checks were not delivered until after
    November 20, 2014, but the settlement agreement was final and
    binding when plaintiff served its first OPRA request.         The filing
    of the stipulations and delivery of the checks were simply the
    fulfillment of a condition of a final settlement agreement that
    the attorneys, on behalf of their respective clients, reached in
    14                               A-2809-15T4
    late October or very early November 2014.5                 See, e.g., 
    ibid.
    ("Absent    unusual    circumstances,       the   courts     should   enforce
    executory agreements to settle litigation.").
    We are therefore convinced the GRC erred in concluding that
    Galloway was not obligated to provide the Release on November 20,
    2014 because the settlement agreement was not final.               The record
    lacks substantial credible evidence supporting the factual finding
    upon which the GRC's conclusion is based.              The parties do not
    dispute that the Release is a government record, N.J.S.A. 47:1A-
    1.1, and it was provided in fulfillment of one of the conditions
    of the settlement agreement.          Moreover, there is no evidence
    showing the Release was otherwise exempt from disclosure under
    OPRA when complainant first requested it on November 20, 2014.
    See N.J.S.A. 47:1A-1.1 (defining "government record" under OPRA
    and detailing exempt records).            We therefore reverse the GRC's
    determination that Galloway did not unlawfully deny access to the
    Release    in   response   to   complainant's     November   20,   2014   OPRA
    request.
    5
    We are convinced the final settlement agreement was reached in
    late October and early November 2014, because the stipulations are
    dated October 30, 2014, the Release is dated October 30, 2014, and
    was signed by Bonanni on November 4, 2014, and Galloway issued the
    initial check prior to November 11, 2014.
    15                               A-2809-15T4
    We    next    consider     complainant's      assertion     that     Galloway
    violated OPRA by denying lawful access to the Release in response
    to the December 22, 2014 request.                  It is undisputed that the
    records custodian provided the Release within seven business days
    of the request.         See N.J.S.A. 47:1A-5(i) (requiring response to
    request for government records "no later than seven business days"
    of a request "[u]nless a shorter time period is otherwise provided
    by   statute,       regulation,    or    executive    order").      Nevertheless,
    complainant     asserts       Galloway    unlawfully    denied     access    to   the
    Release because it is a "contract" to which he was entitled to
    "[i]mmediate access" under N.J.S.A. 47:1A-5(e).                  We disagree.
    "[C]ontracts . . . are ordinarily to be provided immediately"
    in response to an OPRA request, Mason v. City of Hoboken, 
    196 N.J. 51
    , 65 (2008) (citing N.J.S.A. 47:1A-5(e)).                 Because the statute
    does   not    define    the     term    "contract,"    we   give   the    term    its
    "generally accepted meaning, according to the approved usage of
    the language."        N.J.S.A. 1:1-1.      Contract is defined as a "legally
    enforceable agreement between two or more parties" or a "writing
    or document containing such an agreement." Webster's II New College
    Dictionary, 245 (1999).
    Here, as noted, the settlement agreement between Galloway and
    Bonanni was made orally between counsel, and was never incorporated
    into a formal written agreement.               The records custodian reasonably
    16                                 A-2809-15T4
    believed    no   settlement       agreement       had   been    made   because     the
    resolution    required      the    mayor's       signature     on    any   settlement
    agreement and the records custodian knew that had not yet occurred.
    In any event, although the Release did not include all of the
    settlement terms and did not conform to the requirements of the
    resolution, we are satisfied that on December 22, 2014, it was an
    enforceable      contract   that    was    subject      to     the   requirement     of
    immediate production under N.J.S.A. 47:1A-5(e).
    The Release created contractual rights between the parties.
    Under the Release, Bonanni agreed to dismiss his lawsuit and
    release all claims against Galloway in exchange for the monies he
    received.    And although Galloway did not execute the document, the
    Release     granted   Galloway       an        enforceable      contractual     right
    precluding Bonanni's assertion of any future claims.                        In other
    words, the Release was a contract between the parties even though
    it was signed only by Bonanni.                 See Domanske v. Rapid-American
    Corp., 
    330 N.J. Super. 241
    , 246 (App. Div. 2000) (finding "a
    release is merely a form of contract"). The Release was a contract
    that satisfied one of the conditions of the settlement agreement
    and was a government record encompassed by complainant's requests
    for the "settlement agreement."
    The GRC rejected complainant's claim he was unlawfully denied
    access in response to his December 22, 2014 request because it
    17                                  A-2809-15T4
    determined the Release was provided within seven days of the
    request.6   This finding was based on its determination that the
    settlement agreement was not final when the request was made.                  As
    noted, the record lacks substantial credible evidence supporting
    that conclusion.       To the contrary, the settlement was final and
    the Release constituted a contract to which Galloway should have
    provided immediate access N.J.S.A. 45:1A-5(e).               We reverse the
    GRC's determination to the contrary.
    Complainant also claims that the GRC erred by failing to
    determine   it   was    the   prevailing   party     and   was   entitled      to
    attorney's fees.       The GRC did not reach those issues and others,
    including   complainant's      claim     for   the   imposition    of     civil
    penalties, because it determined there were no OPRA violations.
    We will not address those claims in the first instance. The GRC
    shall address the claims on remand.
    Reversed and remanded for further proceedings.                We do not
    retain jurisdiction.
    6
    The executive director recommended that because the Release was
    properly produced within the seven-day period, the GRC should
    decline to determine if the Release was exempt from disclosure
    because the settlement agreement was not yet final in December 22,
    2014. Again, the record lacks sufficient credible evidence
    supporting any determination that the settlement agreement was not
    final on December 22, 2014.
    18                                  A-2809-15T4