IN THE THE MATTER OF PATRICK BOYLE VERSUS CAROL HUFF CAN WE PLEASE HAVE
APPEARANCES OF COUNSEL. (APPEARANCES TENDERED.) SDMRRJS WELCOME COUNSEL.
MR. GOTTILLA, PLEASE. CRAIG D. GOTTILLA: CHIEF JUSTICE IF I
MAY RESERVE THREE MINUTES FOR REBUTTAL IF NECESSARY SFLFRMENTS THAT'S FINE.
CRAIG D. GOTTILLA: ALSO, I HAD REQUESTED AN OPENING STATEMENT. THE COURT:
PLEASE. CRAIG D. GOTTILLA: THE MATTER THAT BRINGS US BEFORE THE COURT TODAY
PROVIDES AN TUPT FOR THIS COURT TO ADD ANOTHER DECISION TO THE RAM MONTHS, MAN TILL LA
AND AS SAR RACK LINE OF CASES BY REAFFIRMING THAT THE WORD INDEMNIFY IS A LEGAL TERM OF
ART WITH AN INHERENT MEANING AND THAT TO EXPAND THE MEANING OF THAT WORD IN A CONTRACT
REQUIRES EXPRESS AND UNEQUIVOCAL LANGUAGE OF AN INTENT TO DO SO. SO WHAT HAVE
NEW JERSEY COURTS TOLD US IS THE MEANING OF INDEMNIFICATION? JUDGE FISHER,
ONE OF NEW JERSEY'S MOST ESTEEMED APPELLATE JURISTS AN A JUDGE WHO SENT TEMPORARILY ON
THAT BENCH TOLD US EXACTLY WHAT INDEMNIFICATION MEANS, THERE, JUST FISH BORROWED A LINE
FROM A FEDERAL DISTRICT COURT JUDGE SAYING, IT IS AXIOMATIC THAT AN INDEMNIFICATION AGREEMENT
MUST BE BASED ON THE INDEMNITIES CLAIMED TO RETAIN RECOVERY FROM THE INDEMNITOR FOR
LIABILITY INCURRED TO A THIRD PARTY. JUDGE FISHER DID NOT COME UP WITH A THAT
HAND STANDARD OR THAT TESTIFY NISHGS ON HIS OWN. THE APPELLATE DIVISION, DEFINED
THAT PREVIOUSLY IN THE (CASE CITED) WHERE IT NOTED UNDER THE CONTRACT OF INDEMNITY, THE
PROMISE SORE ATTEMPTS TO PROTECT THE PROMISE SEE AGAINST LOSS OR LIENLT TO A THIRD PERSON.
SO HOW DOES CASE CITE, CASE CITE, (CASE CITED), WELL, IN THOSE THREE CASES
THIS COURT WAS NOT TASKED IN DETERMINING WHETHER THE ISSUE THAT IS BEFORE YOU NOW, WHETHER
AN INDEMNIFICATION AGREEMENT INCLUDES FIRST PARTY CLAIMED. INSTEAD, IT WAS LOOKING AT
WHETHER IN AN INDEMNIFICATION AGREEMENT, THE INDEMNITY IS ENTITLED TO INDEMNIFICATION
FOR THEIR OWN BLANK. STARTING WITH RAM MONTHS, THE COURT FELD THAT IN LESS
THERE IS AN EXPRESS UNEQUIVOCAL TERM IN A STANDARD INDEMNIFICATION AGREEMENT, EXTENDING
INDEMNIFICATION TO COVER INDEMNITY TEASE ON NEGLIGENCE, THAT INDEMNITY IS NOT COVERED.
AT THE CORE OF THIS HOLDING WAS THE COURT'S RECOGNITION OF THE COMMON LAW
STANDARD, THE COMMON LAW RULE THAT ORDINARILY A PARTY WHO IS AT FAULT MAY NOT OBTAIN IN
DEMNIFICATION FOR ITS OWN ACTS, BUT AS AN EXCEPTION TO THAT COMMON LAW RULE, PARTIES
MAY, IF THEY SO DESIRE CONTRACT AROUND THAT AND ALLOW A PARTY WHO HAS BEEN SUED OR FACES
LIABILITY FOR ACTING ON THE DIN DEM KNIT TORE'S BEHALF TO OBJECT TAEN INDEMNITY FROM THE
INDEMNITOR. IT USUALLY ARISES IN SPECIAL SITUATIONS. WHEN THIS
COURT REVISITED THAT SAME ISSUE IN MAN TILL LA IT DETERMINED THAT THE INDEMNIFICATION
HAS A PRESUMPTION BASED ON THE MONDAY LAW THAT AN INDEMNITY WHO HAS DEFENDED AGAINST
ALLEGATIONS OF ITS OWN CONDUCT MAY NOT COVER DEFENSE COSTS. LASTLY IN ASS
RACK, THE COURT REITERATED BOTH RAM MOES AN MAN TILL LA THAT TO EXPAND THE ADDITIONAL SCOPE
OF INDEMNIFICATION AN AGREEMENT MUST INCLUDE EXPRESS AN SPECIFIC LANGUAGES.
THE COURTS BELOW, DESPITE RECOGNIZING THAT BOTH INVESTOR SAVINGS AND IN FOOIG BAUM, THAT
AN DUT TO INDEMNIFY IS TRIGGERED WHEN AN INDEMNITY IS FOUND LIABLE TO A THIRD PARTY,
THE APPELLATE DIVISION LIKE THE TRIAL COURT SIMPLY IGNORED THE WORD INDEMNIFY IN THE KONLD
DOE ASSOCIATION'S BYLAWS. INSTEAD THE LOWER COURTS BOTH SKIPPED THE WORD IN
DEMNITY AN CONSTRUED IT LIKE A SIMPLE FEE SHIFTING IN A CONTRACT, WHICH REQUIRED THE IN
DEMNITOR HERE OCEAN CLUB CONDOMINIUM ASSOCIATION TO INDEMNIFY MR. BOYLE FOR ANY COSTS INCURRED
IN BRINGING -- IN BRINGING A FIRST PARTY SUIT AGAINST THE SOESH YAG, NOT IN DEFENDING
A SUIT BROUGHT BY A THIRD PARTY. THUS RATHER THAN FOLLOWING THE COURT'S HOLDINGS
IN RAM, MAN AND ASS RACK, BY LOOKING FOR WORDS THAT UNEQUIVOCALLY EXPRESS AN INTENT TO
EXPAND THE INHERENT TRADITIONAL SCOPE OF INDEMNITY TO FIRST PARTY CLAIMS THE LOWER
COURTS LOOKED INSTEAD AT THE WORDS THAT LIMITED IN DEAF NICK IF I CAN INDICATION TO THIRD PARTY
CLAIMS AS JUDGE FISHER AND THE APPELLATE DIVISION HAD PREVIOUSLY SAID WAS THE AXIOMATIC
PURPOSE. THE APPELLATE DIVISION WENT 180 FWRES IN THE OPPOSITE DIRECTION, THEY
INFERRED FERS PARTY CLAIMS WERE COVERED BASED ON THE ABSENCE OF LANGUAGE EXCLUDING THEM
RATHER THAN FOLLOWING THIS COURT'S PRIOR INSTRUCTIONS TO EXPAND IN DEM NIF IF I CAN
INDICATIONS OR FORP ONLY THROUGH EXPRESS UNEQUIVOCAL LANGUAGE. THE
APPELLATE DIVISION ALSO DID THIS DESPITE RECOGNIZING THEMSELVES IN THEIR OWN OPINION
BELOW THAT OTHER JURISDICTIONS THAT HAVE LOOKED AT THIS ISSUE HAVE TYPICALLY FOUND THAT
THEY -- AND DEFERRED -- I'M SORRY, DECLINED TO INFER FIRST PARTY INDEMNIFICATION WAS
COVERED UNLESS THE CONTRACTUAL LANGUAGE EXPRESSLY REFERS TO EX SURPRISE SITLY CONTEMPLATES
SUCH CIRCUMSTANCES. JUSTICE PATTERSON: THE APPELLATE DIVISION WAS CITING
YOUR LANGUAGE, SAID THAT IT'S VERY BROAD, IT COVERS ANY ACTION, SUIT OR PROCEEDING IN
WHICH THE TRUSTEE IS A PARTY BY REASON OF THEIR POSITION AS TRUSTEE AND VIEWED IT AS A
CASE BY CASE ANALYSIS LANGUAGE OF THE PROVISION. WHY IS THAT ENOUGH ENOUGH
TO COVER THIS CLAIM CLOP NOT ENOUGH CLOP. CRAIG D. GOTTILLA: BECAUSE THE
WORD INDEMNIFY HAS AN INHERENT MEETING. THE PARTIES USE THE WORD INDEMNIFY, IT IMPLICIT
LY STANDS FOR THE PROPOSITION THAT THE INDEMNITOR IS PROTECTING THE INDEMNITY FEE FOR
THIRD PARTY LIEBLTH, NOT FIRST PARTY. ADMITTEDLY THIS COURT AS BOTH THE APPELLATE
DIVISION AND AND THIRD CIRCUIT IN TRAVELLERS NOTED AS HOT REACHED THIS SPECIFIC ISSUE.
BASED ON THE WAY THIS COURT HAS TREATED INTERPRETATION OF INDEMNITY PROVISIONS IN THE
PAST, IT HAS ALWAYS STARTED WITH THE GENERAL CORE COMMON LAW PRINCIPLE OF INDEMNITY AN
THEN ALLOWED AN EXPANSION OF THAT ONLY THROUGH EXPRESS UNEQUIVOCAL LANGUAGE AN THAT'S
WHAT WAS OVERLOOKED BY THE COURTS BELOW HERE. INSTEAD OF LOOKING FOR WORDS
EXPANDING INDEMNITY, THEY LOOKED FOR WORDS RESTRICTING IT. JUSTICE
PATTERSON: IT SAYS THE ASSOCIATION SHALL INDEMNIFY EVERY TRUSTEE AND THERE IS
LANGUAGE, AGAINST ALL LOSS, COSTS EXPENSES, INCLUDING COUNSEL FEES, REASONABLY INCURRED
BY HIM IN CONNECTION WITH WITH ANY ACTION SUIT. THE WORD INDEMNIFY IS THERE.
WHAT IS MISSING. GT GOT WHAT IS MISSING IS ANY LANGUAGE SAYING YOU SHOULD
VIEW THE WORD AS INDEMNIFY AS SOMETHING OTHER THAN IT'S CORE AXIOMATIC MEANING OF BEING
TRIGGERED ONLY WHEN THERE IS A THIRD PARTY CLAIM AGAINST THE INDEMNITY. JUSTICE
PATTERSON: SO NO MATTER WHAT FOLLOWS THE WORD INDEMNIFY NO MATTER HOW BROAD THE LANGUAGE
IS, THE FACT THAT THE WORD INDEMNIFY IS THERE MEANS THAT LANGUAGE IS MORE NARROWLY
CONSTRUED. CRAIG D. GOTTILLA: YES, YOU START WITH THE WORD INDEMNIFY AN THE
CLAUSES THAT FOLLOW IT MODIFY WHAT THE INDEMNIFICATION WAS FOR. IF IF
THE WORD INDEMNIFY WAS NOT THERE, IF IT STARTED OFF WITH THE CLAUSE THE ASSOCIATION WILL
REIMBURSE ITS TRUSTEES FOR ANY COSTS, EXPENSES CAUSED OR INCURRED IN ANY ACTION, SUIT
THAT THEY ARE A PARTY TO, THEN I WOULD AGREE. IF IT STARTED OFF THAT WAY, BUT WHEN YOU
HAVE THE WORD INDEMNIFY IT MEANS SOMETHING. ATTORNEYS KNOW IT MEANS SOMETHING. L THE
APPELLATE DIVISION IN JONS V VONS CASE SAID IT'S A LEGAL TERM OF ART. PARTIES, PARTICULARLY
ATTORNEYS LOOKING AND CONSTRUING THAT LANGUAGE UNDERSTAND WHAT INDEMNITY MEANS AND ITS
CORE MEANING DOES NOT EXTEND TO FIRST PARTY CLAIMS IN THE SAME WAY A FEE SHIFTING
PROVISION WOULD. EVEN IF YOU COMPARE THE INDEMNITY CLAUSE IN THE FIRST SAVINGS
CASE, THAT CLAUSE, ITSELF, IS VERY SIMILAR TO THE LANGUAGE IN THE ASSOCIATIONS INDEMNIFICATION
PROVISION. IT'S VERY BROAD, VERY OPEN-ENDED AND SAYS THAT IN THAT PARTICULAR MATTER THAT
THE INDEMNITOR WILL UNCONDITIONALLY INDEMNIFY DEFENDANT HOLD HARMLESS THE INDEMNITY FROM
AND AGAINST ANY SUITS CLAIMS OR DEMANDS ON ACCOUNT OF ANY MATTER OR CONSEQUENCE ARISING
OUT OF THE LOAN. THAT IS THE SAME CONCEPT OF THE INDEMNIFICATION PROVISION
IN THE BYLAWS WHICH INDEMNIFIES TRUSTEES AN FORMER TRUSTEES FOR AND AGAINST ALL LOSS,
COST AN EXPENSES INCLUDING COUNSEL FEES, REASONABLY INCURRED BY HIM OR HER HAVING BEEN
A TRUSTEE OR OFFICER. SO, IN ONE INSTANCE, INVESTOR SAVINGS, WE HAVE A BROAD
INDEMNIFICATION PROVISION THAT SAYS ALL THE INDEMNITOR WILL INDEMNIFY FOR ANY LOSS OF
WHAT -- VERY BROADLY JUST LIKE IN THE CONDO ASSOCIATION, BYLAWS, WILL INDEMNIFY THE IN
DEMNITY FOR ANY LOSS ARISING OUT OF OUR SPECIAL AGREEMENT. WHEREAS IN THE
ASSOCIATION'S BYLAWS THEY'RE AGREEING TO INDEMNIFY FOR ANY LOSS, COSTS OR EXPENSES THAT
ARISE OUT OF YOU HAVING BEEN A TRUSTEE OR FORMER TRUSTEE. THE SAME LANGUAGE. IN
INVESTOR SAVINGS THE APPELLATE DIVISION FOUND THAT PROVISION, THAT TYPE OF INDEMNITY
PROVISION CAN ONLY BE TRIGGERED BY A THIRD PARTY CLAIM. THE COURT EXPRESSLY
STATED AT PAGE 159 OF ITS OPINION THAT, QUOTE, IT IS ONLY WHEN THE INDEMNITY IS FOUND
LIABLE TO A THIRD PARTY THAT THE INDEMNIFICATION AGREEMENT MAY BE TRIGGERED.
JUSTICE WAINER APTER: WHAT ABOUT THE DICTIONARY DEFINITION IN BLACKS LAW? CRAIG
D. GOTTILLA: YOUR HONOR, IT'S A BLACK LAW DICTIONARY DEFINITION. IN NEW JERSEY WE HAVE
THE APPELLATE DIVISION TWICE TELLING US WHAT WE SHOULD LOOK AT THE TERM INDEMNIFICATION
TO MEAN AND THAT DEFINITION HAS AN OR TO IT. THE ARGUMENT WE'RE MAKING IS THERE IS A
SPECIFIC MEANING AND THAT SPECIFIC MEANING CAN BE REFINED, CAN BE EXPANDED, BUT IF YOU
LOOK AT INDEMNIFICATION IN THIS PARTICULAR SITUATION, AND ONE OF THE CASES, I BELIEVE
THE APPELLATE DIVISION RELIED UPON IN FINDING -- THERE IS A SECOND ISSUE THAT I HAVEN'T
ADDRESSED YET IS THE FEES UPON FEES ISSUE WHERE THE APPELLATE DIVISION AFFIRMED A LAER
COURT HERE, ALLOWED FOR AN ALLOWANCE OF FEES TO ENFORCE THE INDEMNITY OBLIGATION ITSELF
SO IN THE SER PA MATTER THAT THE APPELLATE DIVISION RELIED ON SAID, THE APPELLATE
DIVISION SAID THOSE FEES CAN BE RECOVERED. THAT ILLUSTRATES WHY FIRST PARTY INDEMNIFICATION
DOESN'T WORK IN A CASE LIKE THIS. IF WE'RE GOING TO LOOK AT JUST THIS CASE.
IN CERTAIN PERSONS PA, THERE WAS A THIRD PARTY CLAIM ASSERTED AGAINST A GENERAL
CONTRACTOR AN PROPERTY OWNER, BECAUSE THE INJURED PLAINTIFF WAS AN EMPLOYEE, WORKERS'
COMP. APPLIED SO HE COULD NOT SUE HIS EMPLOYER. HE DID SUE THE PROPERTY OWNER IN THIS
CASE NEW JERSEY TRANSIT AN SETTLED FOR 1.5 MILLION DOLLAR. NEW JERSEY TRANSIT AS
INDEMNITY UNDER A CONSTRUCTION CONTRACT SOUGHT INDEMNIFICATION FROM THE GENERAL CONTRACTOR.
HOWEVER, THERE WAS AN ALLOCATION OF FAULT IN THAT MATTER SO NEW JERSEY TRANSIT
WAS FOUND TO BE 15 PERCENT LIABLE. THEY HAD AN ALLOCATION OF FAULT FOR 15 PERCENT SO
THE APPELLATE DIVISION IN S E R P A, APPLYING THE HOLDING IN MAN TILL LA THAT YOU CANNOT
GET INDEMNIFICATION FOR YOUR COUNSEL FEES DEFENDING YOUR OWN NET CLAIMS FOR YOUR OWN
NEGLIGENCE FOUND ANY FEES UP TO THAT POINT WHERE THEY SETTLED AND AN ALLOCATION WAS MADE,
OFF THE TABLE, YOU CANNOT RECOVER. JUSTICE PATTERSON: THERE IS A CONFLICT
BETWEEN JOHNSON & JOHNSON AN SERIOUS PA IS THERE NOT FOT GOT THERE IS POT.
JUSTICE PATTERSON: IN SERIOUS IT FOUND THAT NEW JERSEY TRANSIT WAS ENTITLED TO COUNSEL
FEES FOR ENFORCEMENT OF THE INDEMNIFICATION PROCEEDING AND IT DIDN'T SEEM TO BE TIED IN
WITH THE FACTS THAT YOU'RE TALKING ABOUT INCLUDING THE ALLOCATION. CRAIG
D. GOTTILLA: WELL, IN S E R P A YOUR HONOR, THEY WERE NOT -- THE COURT HELD, THE APPELLATE
DIVISION HELD THAT THE GENERAL CONTRACT -- NEW JERSEY TRANSIT, THE INDEMNITY DID NOT GET
TO RECOVER ANY OF THE LEGAL FEES. JUSTICE PATTERSON: YES. CRAIG
D. GOTTILLA: FOR DEFENDING UP UNTIL THE MOMENT OF SETTLEMENT. AND ONLY GOT THEM, WAS
ONLY ENTITLED TO THOSE FEES FOR THE ACTION TO IN FORCE THE EVEN DEM KNIT TEE OBLIGATION
ITSELF A SPRT ISSUE GOT. JUSTICE PATTERSON: THE LANGUAGE WOULD SUGGEST IF
WE WERE TO UPHOLD THAT LANGUAGE IT WOULD COVER THIS CASE. CRAIG D. GOTTILLA:
IF WE APPLY THAT SAME HOLDING HERE AND YOU SAY WELL, YOU'RE NOT ENTITLED TO ATTORNEY'S
FEES FOR DEFENDING ANY CLAIMS AGAINST YOU FOR YOUR OWN NEGLIGENCE, WELL, THAT'S WHAT
PLAINTIFF PATH BOYLE SAID HIS ENTIRE ACTION WAS BASED ON. HE SAID SO IN HIS OPPOSITION
TO OUR POSITION THAT HE HAS TWO CATEGORIES OF ATTORNEY'S FEES, ONE, DEFENDING HIMSELF
AS A TRUSTEE, DEFENDING HIS STATUS AS A TRUSTEE, NOW HE'S DEFENDING HIMSELF THROUGH AN
AFFIRMATIVE ACTION BUT THAT'S WHAT HE IS CLAIMING HIS ACTIONS WERE DEFENDING HIMSELF FROM
CLAIMS FROM THE ASSOCIATION, SO UNDER S E R P A, IF WE LOOK AT IT HE IS DEFENDING HIMSELF
FOR CLAIMS THAT HE EVEN GAEJED IN MISCONDUCT UNDER S E R P A, HE DOESN'T GET THE FEES
FOR THAT PART OF THE SUIT BUT WOULD ONLY BE ENTITLED TO THEM FOR THE ACTION TO ENFORCE
THE INDEMNITY OBLIGATION ITSELF. JUSTICE PATTERSON: IF YOU LOOK AT THE
SECOND ISSUE YOU RAISED IN ISOLATION, S E R P A IS SUPPORT I HAVE OF BOYLE'S POSITION.
CRAIG D. GOTTILLA: IT IS. JUST THE GENERAL CONCEPT THAT THERE IS NO BRIGHT
LINE RULE IN NEW JERSEY, JUST AS THERE IS NO BRIGHT LINE RULE IN NEW JERSEY THAT SAYS
YOU CAN'T HAVE THIRD PARTY INDEMNIFICATION, THERE IS NO BRIGHT LINE RULE THAT SAYS AN
INDEMNITY AGREEMENT YOU AUTOMATICALLY GET OR DON'T GET YOUR FEES FOR ENFORCING IT.
JUSTICE SOLOMON: WE DON'T GET THERE IF THERE IS NO OBLIGATION TO INDEMNIFY.
CRAIG D. GOTTILLA: THAT'S CORRECT. IF THERE IS NO OBLIGATION TO INDEMNIFY YOU DON'T
GET TO THAT ISSUE THE FEES UPON FEES OR THE THIRD ISSUE THAT WE SOUGHT PETITION FOR WHICH IS
THE ADD R AGREEMENT. JUSTICE SOLOMON: AND THERE IS A SENTENCE AT THE
BEGINNING OF ARTICLE 6 THAT TALKS ABOUT THE TRUSTEES SHALL NOT BE LIABLE TO THE UNIT
DON'T NORSS WHAT WHAT IS THE RELEVANCE OF THAT? CRAIG D. GOTTILLA: IN THE
CONTEXT OF THE A CONDOMINIUM ASSOCIATION, MR. BOYLE IS A VOLUNTEER, THE OTHER BOARD MEMBERS
ARE VOLUNTEERS, THEY ARE VOLUME TIRING THEIR TIME. THEY'RE NOT GETTING PAID AND FRANKLY
AS YOU CAN GATHER FROM THIS SUIT IT IS A THANKLESS JOB. IT CAN BE FULL OF CONTENTION.
JUSTICE PATTERSON: THAT MAY BE AN UNDERSTATEMENT. CRAIG D.
GOTTILLA: IT COULD BE AN UNDERSTATEMENT. SO THE INDEMNIFICATION LANGUAGE,
TO MAKE CLEAR, THEY'RE SHIELDED O OWN TRUSTEES ARE SHIELDED UNDER THE BUSINESS JUDGMENT
RULE AND THIS PROVISION FROM BEING SUED BY THE OWNERS THEM JENNIFER SELLITTI ON BEHALF OF
FOR SIMPLE NEGLIGENCE, WILLFUL, MISCONDUCT, THERE IS NO CARVE OUT FOR GROSS NEGLIGENCE
OR BAD FAITH SO THERE IS STILL POTENTIAL THAT IF A TRUSTEE ENGAGES IN IN TEPGS NATURAL
CONDUCT, SELF DEALING AND UNFORTUNATELY, THAT DOES HAPPEN SOMETIMES. JUSTICE
SOLOMON: BUT IT SPECIFICALLY SAYS THAT YOU'RE NOT LIABLE IF YOU MAKE A MISTAKE OF JUDGMENT
AN THE TENANT SUES YOU. CRAIG D. GOTTILLA: CORRECT. JUSTICE
SOLOMON: YOU'RE NOT RESPONSIBLE, WE'RE RESPONSIBLE. CRAIG D. GOTTILLA:
RIGHT. JUSTICE SOLOMON: IS IT YOUR CONTENTION THAT THAT IN ANY WAY RELATES
TO THE OBLIGATIONS OF THE ASSOCIATION UNDER THE INDEMNIFICATION AGREEMENT.
CRAIG D. GOTTILLA: NO, I WOULD NOT VIEW THAT AS AN INDEMNIFICATION OBLIGATION. INSTEAD,
IT IS A WAIVER OF CLAIMS BY THE ASSOCIATION AGAINST THE TRUSTEES. WE WILL NOT -- IT'S
ALMOST SIMILAR TO A HOLD HARMLESS AGREEMENT THAT THEY WILL NOT ASSERT A CLAIM. YOU CANNOT
BE HELD NEGLIGENCE. JUSTICE PIERRE-LOUIS: READING ARTICLE # 6 IN CONTEXT
THAT FIRST SENTENCE IS THEN FOLLOWED IMMEDIATELY THEREAFTER BY THE INDEMNIFICATION PROVISION
THAT DISCUSSES SITUATIONS IN WHICH A TRUSTEE MIGHT BE SUED OTHER -- YOU KNOW, ASIDE FROM
THE INSTANCES IN THAT FIRST SENTENCE. CRAIG D. GOTTILLA: EXACTLY.
JUSTICE PIERRE-LOUIS: SHOULD WE BE READING THE ENTIRE ARTICLE AN PARAGRAPH IN CONTEXT
TO GAIN AN UNDERSTANDING OF WHAT THE INTENT WAS IN DRAFTING THESE BYLAWS THAT, YOU KNOW,
THE ARTICLE INITIALLY SAYS YOU WILL NOT BE SUED FOR A MISTAKE OR ANY OTHER -- OR BAD
FAITH, YOU KNOW, WHERE YOU SHOULD NOT BE LIABLE AN THEN IMMEDIATELY THEREAFTER, THE ASSOCIATION
WILL INDEMNIFY FOR ANY LOSS INCURRED WHICH, YOU KNOW -- TO WHICH A TRUSTEE MAY BE A PARTY
BY REASON OF HIM OR HER BEING A TRUSTEE OR OFFICER OF THE ASSOCIATION.
CRAIG D. GOTTILLA: ABSOLUTELY. YOU SHOULD ALWAYS READ THE CONTRACT IN CONSTRUCTION IN
CONTEXT WITH THE ENTIRE AGREEMENT AND IF YOU ARE GOING TO DO THIS THAT HERE THERE IS LANGUAGE
THAT FOLLOWS THE INDEMNIFICATION PROVISION THAT ALSO STRESSES AND LENDS TO THE CONCLUSION
THAT THIS IS FOR THIRD PARTY -- INTENDED FOR THIRD PARTY CLAIMS; NAMELY, THERE IS A
PROVISION THAT SAYS AND THIS IS THE EXCLUSION THAT WE TALK ABOUT FOR THE A D R ISSUE THAT
THE TRUSTEES ARE NOT ENTITLED TO EVEN DEM NIF IF I CAN INDICATION IF HE OR SHE IS FINALLY
AJUDGED IN SUCH ACTION, SUIT OR PROCEEDING TO BE LIABLE FOR WILLFUL MISCONDUCT OR BAD
FAITH. THAT PRESUMES THAT THE TRUSTEE IS BEING INDEMNIFIED OR IS FACING A LAWSUIT FOR
SOME TYPE OF MISCONDUCT AN IN THE EVENT THEY ARE FOUND LIABLE FOR WILLFUL MISCONDUCT,
BAD FAITH THEY ARE NOT ENTITLED TO INDEMNIFICATION UNDER THE BYLAWS AN THE
SENTENCE THAT FOLLOWS THAT AND I'M NOT SURE HOW ENFORCE SABL THIS WOULD BE AN I HAVEN'T
LOOKED AT IT, BUT IT MENTIONS IN THE EVENT OF A SETTLEMENT, INDEMNIFICATION IS ONLY OWED
IF THE ATTORNEY FOR THE ASSOCIATION DECIDES THAT THE TRUSTEE DID NOT ENGAGE IN WILLFUL
MISCONDUCT OR BAD FAITH SO NENS IN ESSENCE, YOU WOULD BE SAYING IN A CASE LIKE THIS WHERE
YOU HAVE A FIRST PARTY DISPUTE, MR. BOYLE SUS THE ASSOCIATION, AS IN MOST CASES, MOST
CASES ARE SETTLED THERE IS A CONSENT ORDER ENTERED THAT TERMINATED THE ACTIONS TO REMOVE
MR. BOYLE. AS A RESULT OF THAT SETTLEMENT, STRICTLY CONSTRUING THAT PROVISION PUTS THE
DECISION IN THE HANDS OF THE ATTORNEY REPRESENTING THE ASSOCIATION TO DECIDE
WHETHER HE GETS INDEMNIFICATION AT ALL. L THAT DOESN'T MAKE SENSE IN THE FIRST PARTY
CONTEXT. IN THE THIRD PARTY CONTEXT IT MIGHT BE IT MIGHT. THERE IS A JUDGMENT CALL CALL
THAT CAN BE MADE, THE ATTORNEY REPRESENTING THE ASSOCIATION LOOKS AT THE CLAIM, LOOKS
AT THE JUDGMENT, LOOKS AT HOW THE COURT RULED OR THE JURY VERDICT COMES BACK, CEASE IT'S
NEGLIGENCE, IT WAS INTENTIONAL NEGLIGENCE, THEN THE ATTORNEY CAN MAKE THAT DECISION.
BUT IN A THIRD PARTY, YOU'RE PUTTING IT IN THE HANDS OF THE ASSOCIATION, EVERY
CLAIM WOULD SETTLE RIGHT AWAY. IN THIS CASE THEY SETTLED THE ATTORNEY OR CORPORATE COUNSEL
FOR THE ASSOCIATION MAKES THAT DECISION. JUSTICE SOLOMON: TAKING IT BACK
TO THE ORIGINAL ARGUMENT, I THOUGHT OR MAYBE I MISHEARD THAT YOUR CONTENTION WAS SIMPLY
THAT THIS AGREEMENT SHOULD BE COULD BE STRUED AGAINST THE INDEMNITY BECAUSE THERE IS
NOT EXPRESS LANGUAGE ALLOWING FOR THIS KIND OF A CLAIM AND I THINK YOUR ARGUMENT WAS THAT'S
WHAT NEW JERSEY GENERALLY PROVIDES, THE INDEMNIFICATION AGREEMENT, UNLESS IT'S
UNAMBIGUOUSLY ALLOWS FOR THIS KIND OF A CLAIM IS TO BE CONSTRUED COMBENS THE INDEMNITY
AN IN FAVOR OF THE INDEMNITOR. CRAIG D. GOTTILLA: THAT IS THE CORE -- THAT
IS THE ARGUMENT, THAT IS THE POSITION. JUSTICE SOLOMON: IF THAT'S OUR CONCLUSION
THAT'S KIND OF THE END OF THE DISCUSSION. CRAIG D. GOTTILLA: THAT WOULD BE
THE END OF THE CASE, YOUR HONOR. CHIEF JUSTICE RABNER: CAN I ASK YOU A
QUESTION ABOUT THE A D R ISSUE. CRAIG D. GOTTILLA: SURE. CHIEF
JUSTICE RABNER: IS THERE A DIFFERENCE BETWEEN WILLFUL MISCONDUCT OR BAD FAITH ON THE ONE
HAND AND A BREACH THAT THAT ADVERSELY AFFECTS THE ASSOCIATION ON THE OTHER? CAN
YOU GIVE US AN EXAMPLE? CRAIG D. GOTTILLA: SURE. WE'RE TALKING ABOUT THE
DIFFERENCE BETWEEN THE SPECIFIC LANGUAGE IN THE INDEMNIFICATION PROVISION VERSUS THE RAD
BURN AMENDMENT STANDARD FOR WHICH WE WERE GOING TO ARBITRATE. SO YOU COULD
HAVE AN INSTANCE OF WILLFUL MISCONDUCT WHERE A TRUSTEE EM BAZ SELLS MONEY, THAT'S AN
EZ Z ONE, THAT'S GOING TO BE WILLFUL MISCONDUCT, BAD FAITH YOU ARE EM BEZ LINK MONEY FROM
YOUR NEIGHBORS. A GOOD CAUSE FOR BEING UNABLE TO SERVE ON THE BOARD COULD BE
INSTANCES LIKE WE HAVE HERE WHERE THE OTHER MEMBERS OF THE BOARD OF TRUSTEES ASSERTED
THAT MR. BOYLE WAS HARASSING THEM, THREATENING THEM, WAS UNABLE TO WORK ALONG WITH THEM
ON THE BOARD. IT WAS NOT FUNCTIONING WITH HIM AS A MEMBER OF IT SO THAT MIGHT NOT BE
WILLFUL MISCONDUCT; THAT COULD BE IN GOOD FAITH. THE COURT: SO I WASN'T
ASKING FOR A DISTINCTION BETWEEN THOSE TWO. L I WAS ASKING YOU TO COMPARE THOSE TWO,
IF YOU CAN, TO THE LANGUAGE IN THE STATUTE. EACH OF THE EXAMPLES YOU JUST
GAVE WOULD ALSO CONSTITUTE A BREACH THAT ADVERSELY AFFECTED THE BLANK OF THE
ASSOCIATION. IS THERE LIFE FWEEN THE STATUTE AN THE LANGUAGE IN ARTICLE 6.
CRAIG D. GOTTILLA: IN SPECIFIC EXAMPLES THERE IS AN ARTICLE 6.
THE COURT: I SEE THE LANGUAGE IS DIFFERENT. I AM TRYING TO FIND OUT IF IT HAS A PRACTICAL
DIFFERENCE AN ASKING IF YOU COULD GIVE US AN EXAMPLE WHERE ONE BLANK MIGHT VIOLATE ARTICLE
6, BUT NOT THE A D R, ARE THEY ALL ENCOMPASSING ONE THE OTHER AND, IF SO, HELP -- TELL
ME WHY THEY ARE NOT BECAUSE I THINK THAT'S YOUR POSITION. CRAIG D. GOTTILLA:
IT IS. ONE OF THE DIFFICULTIES IS BECAUSE IT IS A BRAND-NEW REGULATION. THERE
IS NO GUIDANCE AT THIS POINT POINT AS TO WHAT THE STANDARD IS UNDER THE NEW RAD BURN.
CHIEF JUSTICE RABNER: YOU REFERRED I REFERRED TO IT AS A STATUTE, YOU'RE
CORRECT, IT'S A REGULATION. CRAIG D. GOTTILLA: IT IS THE REGULATION THAT
SAYS IT WAS AN EXCEPTION. SO UNDER THE BYLAWS, THIS WAS A NEWLY ENACTED PATHWAY TO ALLOW
FOR THE REMOVAL OF A BOARD MEMBER OTHER THAN GOING THROUGH A UNIT ON A VOTE.
IT NOW ALLOWS THE CITYING BOARD OF TRUSTEES THEMSELVES TO VOTE TO REMOVE A BOARD MEMBER
FOR GOOD CAUSE DIRECTLY IMPACTING THE MEMBER'S ABILITY TO SERVE. PERHAPS, AN EXAMPLE
OF THAT WOULD BE IF THE MEMBER NO LONGER LIVES FULL TIME AT A LOCATION, IF THERE IS PLENTY
OF SNOW BIRDS IN NEW JERSEY, SOMEONE LIVES IN FLORIDA HALF THE YEAR AND UP IN NEW JERSEY
THE OTHER HALF, IF THEY ARE NOT COMPUTER SAVVY CAN'T PARTICIPATE IN MEETINGS OR ARE
UNAVAILABLE, THAT WOULD BE ONE EXAMPLE OF BEING UNABLE OF GOOD CAUSE -- DIRECTLY IMPACTING
THEIR ABILITY TO SERVE. YOU MAY HAVE OTHER INSTANCES WHERE A MEMBER ISN'T UP TO DATE
ON THEIR FEES OR A MEMBER MAY BE -- AGAIN, THE EXAMPLE OF I HAD PROVIDED IT, THERE BEING
DISAGREEABLE TO THE EXTENT AT A MEETING WHERE THE BOARD CANNOT FUNCTION WHERE SOMEONE
REFUSES TO PARTICIPATE OR CONTINUALLY INTERRUPTS OR FRUS STRAITS THE WORK OF THE BOARD,
IN THAT INSTANCE THAT WOULD ALSO BE GOOD CAUSE. IT MAY NOT AMOUNT TO WILLFUL MISCONDUCT
OR BAD FAITH IT COULD JUST BE THAT PERSON'S PERSONALITY, THEIR STYLE, IT COULD BE THE
WAY THEY THINK BUSINESS SHOULD BE CONDUCTED AND THAT WOULD FRUSTRATE THE ABILITY AND THE
BOARD HAS TO FUNCTION TO SERVE AND TO FULFILL FIDUCIARY OBJECTIONS TO THE SEVERAL
OBLIGATIONS TO THE SEVERAL HUNDRED MEMBERS OF THE ASSOCIATION. OBLIGATIONS.
I THINK WE'VE MOVED ON TO THE A D R, JUST A FEW MORE POINTS ON THAT AND THEN
I MAY ADDRESS A HOUP HOUPING ITEM HOUSEKEEPING ITEM OR TWO BEFORE ACCEDING TO MY COLLEAGUE
HERE. IN A D R, CERTAINLY, NEW JERSEY ENCOURAGES ALTERNATIVE DISPUTE
RESOLUTION, BUT IT DOESN'T FORCE PARTIES TO ARBITRATE OR MEDIATE ISSUES UNLESS THEY VOLU
NTARILY AGREE TO DO IT. SO THE TWO CRITICAL DOCUMENTS HERE ARE THE ARBITRATION
AGREEMENT, WHICH IDENTIFIES A SINGLE, SOLE, ISSUE, IT MAKES NO REFERENCE TO THE
INDEMNIFICATION CLAIM. THERE IS A SEPARATE CLAIM IN THE COMPLAINT, CONTRACTUAL,
INDEMNIFICATION, NO REFERENCE TO IT. IT SAYS ONE ISSUE IS GOING TO BE SUBMITTED AN THAT IS
WHETHER REMOVAL IS MRO UNDER THE NEW RAD BURN AMENDMENT, NEW REGULATION, WHEN THAT DID
NOT GO FORWARD AND, AGAIN, THIS IS THE REASONS FOR IT AN THE TIMING OF IT, THE ASSOCIATION
BACKED OUT JUST BEFORE THE NEXT ANNUAL REGULARLY SCHEDULED ELECTION TO ALLOW THE DEMO
CRATIC PROCESS TO WORK OUT. THE UNIT OWNERS RATIFIED THE ASSOCIATION'S ACTIONS TO REMOVE
MR. BOYLE BY VOTING HIM DEAD LAST IN THAT ELECTION. THERE WAS NO NEED TO
PROCEED WITH AN ARBITRATION ON THAT ISSUE BECAUSE THE UNIT OWNERS WERE ABLE TO VOTE. THE
ASSOCIATION, THE BOARD WAS WILLING TO TAKE THAT GAMBLE IF MR. BOYLE WAS REEE LEBTD RE
ELECT LEKTD THEN THE CASE WAS OVER AS TO ANY ACTIONS HE TOOK BEFOREHAND OR ANY EFFORTS
TO REMOVE HIM. WHEN YOU LOOK AT THE CONSENT ORDER ABANDONING THE ARBITRATION,
IT SPECIFICALLY REFERENCES THAT THE PARTIES ARE ONLY RESOLVINGING THE CLAIM THAT WAS BEING
SMID TO A D R AND THEY RESERVE ALL RIGHTS AN EVERY OTHER CLAIM, ESPECIALLY MR. BOYLE'S
CLAIM TO SEEK INDEMNIFICATION SO THERE WAS ABSOLUTELY NO WAIVER. THERE IS NOTHING IN
THE ARBITRATION AGREEMENT, NOTHING IN THE CONSENT ORDER THAT SAYS WE UNDERSTAND THAT THIS
ARBITRATION IS FWOEG TO DECIDE EVERYTHING AND IF WE BACK OUT OF IT, WE'RE CONSENTING TO
THE INDEMNIFICATION AGREEMENT APPLIES. THERE IS NO LANGUAGE LIKE THAT. NOW,
OUR COURTS ARE CLEAR AND THEY HAVE REPEATEDLY HELD, YOU CAN'T FORCE A PARTY TO ARBITRATE
ISSUES THEY DON'T VOLUNTARILY FWRAE TO ARBITRATE. ONE ISSUE I WOULD LIKE TO
BRING UP AND IT IS SOMETHING THAT HAPPENED AT THE APPELLATE DIVISION, IT HAPPENED FWEN
HERE, IN THE PAPERS, THE PLAINTIFF REFERS TO THE FABT THAT THE ASSOCIATION HAS AN INSURANCE
COMPANY AND THEY MAKE THE UNSUPPORTED STATEMENT. THERE IS NO REFERENCE TO IT IN THE RECORD
THAT THE ASSOCIATION IS BEING FULLY DEFENDED AND IS BEING PAID -- IT'S ATTORNEY'S FEES
ARE BEING PAID WITHOUT FAIL FOR THIS MATTER AND YET THERE IS NOTHING IN THE MATTER THAT
DESCRIBES THE CONDITIONS UNDER WHICH THE ASSOCIATION IS BEING PROVIDED A DEFENSE.
THERE IS NO REFERENCE TO WHETHER THERE IS A RESERVATION OF RIGHTS LETTER, ANY EXCLUSION
ARY LANGUAGE THAT MAY APPLY. JUSTICE PATTERSON: LET ME STEP BACK FOR A SECOND
TO YOUR COMMENT ABOUT THE CONTRACTS. CRAIG D. GOTTILLA: SURE.
JUSTICE PATTERSON: THE PLAINTIFF SAYS YOUR INDEMNIFICATION PROVISION 4 IS NOT THE SAME
AS THE STANDARD PROVISION THAT APPEARS IN THE NEW JERSEY CONDOMINIUM AN COMMUNITY ASSOCIATION
LAW. IS THAT A TRUE STATEMENT? IF IT IS, DOES THAT IMPACT YOUR
POSITION? CRAIG D. GOTTILLA: IT IS SPLITTING HAIRS. ONE PROVISION, I BELIEVE,
SAYS IT'S NET LOSS VERSUS LOSS. WHETHER THAT MAKES -- THAT DOES NOT MAKE A DIFFERENCE
AS TO THE INDEMNITY OBLIGATION ITSELF. WHETHER IT IS LOSS OR NET LOSS, WE ARE STILL TALKING
ABOUT WHAT IS THE LOSS THAT HAS OCCURRED. JUSTICE PATTERSON: IS THAT THE
ONLY DISTINCTION OR IS THERE MORE TO IT. CRAIG D. GOTTILLA: I BELIEVE IT
MAY BE GROSS NEGLIGENCE VERSUS WILLFUL MISCONDUCT. I THINK THE CULPABILITY, THE
EXCEPTIONINGS FOR CULPABILITY, THERE MAY HAVE BEEN A SLIGHT DISTINCTION. IT MIGHT NOT
BE BAD FAITH IT MIGHT BE GROSS NEGLIGENCE AN WILLFUL MISCONDUCT IN ONE VERSUS -- I'LL
FIND IT, YOUR HONOR -- WHEN I COME BACK ON REBUTTAL, THE EXACT ADDITION STINKS
DISTINCTION, BUT THEY ARE MINOR DISTINCTIONS THAT DON'T CHANGE THE FUNCTION. IT IS THE
SAME INDEMNITY OBLIGATION JUST ONE IS A DIFFERENT EXCEPTION THAT IS EXCLUDED FROM THE
CONTEXT OF THE INDEMNITY. THE OTHER, THE LAST ITEM I WOULD LIKE TO ADDRESS
WHILE WE'RE HERE IS REALLY A HOUSE TASH DASH THIS IS PURELY A HOUSEKEEPING ITEM. WHILE
OUR PETITION WAS PENDING BEFORE THE COURT, THE -- I THINK THE VERY SAME DAY WE FILED OUR
NOTICE OF PETITION, THE PLAINTIFF FILED A MOTION TO AMEND THE JUDGMENT AT THE TRIAL LEVEL
OVER OUR OBJECTION AND CONTRARY TO RULE 291 -- I THINK IT IS 291, THE TRIAL COURT, NONE
THELESS CONSIDERED THE MOTION WHILE OUR PETITION WAS PENDING AND GRANTED A MOTION TO AMEND
THE JUDGMENT, ENTERED A NEW JUDGMENT ON APRIL 3RD, 2023 AND IT WAS ONLY AFTER THIS COURT
GRANTED THE PETITION FOR CERTIFICATION THAT THE TRIAL COURT SEEDED JURISDICTION TO THIS
COURT SO DEPENDING ON HOW THE COURT RULES TODAY AND I CAN SUPPLEMENT THE RECORD IF NECESSARY
TO INCLUDE THAT NEW JUDGMENT WE CAN ADD THAT TO THE RECORD. JUSTICE PATTERSON:
WHAT DID IT CHANGE? CRAIG D. GOTTILLA: IT REDUCED THE FINAL JUDGMENT FROM
$560 SOME ORDER THOUSAND DOLLARS TO $394,000, ONE OF THE THINGS THAT THE APPELLATE DIVISION
DID IS THEY DETERMINED THAT FOR ONE COUNT IN THE COMPLAINT, THE RIF VIT ACTIVE SUIT COMPLAINT
WAS NOT SUBJECT TO THE INDEMNITY PROVISION BECAUSE THAT WAS NOT A CLAIM THAT HAD TO BE
BROUGHT AS A TRUSTEE, BUT WAS BROUGHT SPECIFICALLY AS A UNIT OWNER. SO,
WHEN WE WENT BACK TO THE TRIAL COURT, I FEEL ODD BRINGING IT UP BECAUSE IT BENEFITED MY
CLIENT, IT DID REDUCE THE AMOUNT OF THE JUDGMENT ON REMAND, BUT AT THE SAME TIME TO MAKE
SURE THE RECORD IS CLEAR AND WHATEVER THIS COURT'S RULING IS IN TERMS OF ADJUSTING,
AFFIRMING OR REVERSING, IT SHOULD BE TIED TO THAT JUDGMENT. THE COURT: THE
CLERK OF THE COURT WILL CONTACT YOU AFTER ARGUMENT, IF NEED BE. THANK YOU.
MR. POLICE OFFICER. CHIEF JUSTICE RABNER: MR. POLLACK. BARRY J.
POLLACK: MAY IT PLEASE THE COURT. IN ANSWER TO ONE OF THE ISSUES THE COURT RAISED IN
THE MRAENT THES ARMTH IT IS A CASE BY CASE ANALYSIS AND AS THIS COURT SAID IN KIEFFER
VS. BEST HAVE I R CONTRACTUAL INDEMNITEE PROVISION IS THE SAME AS DON TRUEING ANY
OTHER PART AVENUE CONTRACT. IT IS TO DETERMINE THE INTENT OF THE PARTIES. THE JUDGE TASK
IS SIMPLY INTERPRETATIVE, IT IS NOT TO REWRITE THE CONTRACT FOR THE PARTIES BETTER THAN
OR DIFFERENT THAN THE ONE THEY WROTE FOR THEMSELVES, THUS WE SHOULD GIVE THE
CONTRACTUAL TERMS THEIR PLAIN AND ORDINARY MEAN IF AN INDEMNITEE MEANING IS UNAMBIGUOUS
THEN THE WORDS PRESUMABLY REFREKT THE PARTIES' EX SPAKT TAGSS. IT IS THEREFORE
ONLY IF THE MEETING OF INDEN IN THE THE COURT THEN APPLIES THE RULE THAT A PROVISION
IS STRICTLY CONSTRUED AGAINST THE INDEMNITY. BECAUSE THE BYLAWS IN THIS CASE ARE UNAM
BIGUOUS, THE COURT SHOULD ENFORCE THE CONTRACT AS WRITTEN. THERE IS NO NEED TO FALL BACK
ON A PRESUMPTION OF STRICT CONSTRUCTION TO RESOLVE AN AMBIGUITY WHEN NONE EXISTS.
COURTS APPLY NEW JERSEY LAW HAVE HELD INDEMNITEE CONTRACTS THAT UNAMBIGUOUSLY ALLOW
FOR 1ST PART INDEMNIFICATION SHOULD BE EN FORTSED AS WRITTEN. THIS COURT IN LIT TON INDUSTRIES
VERSUS I M O INDUSTRIES ENFORCED AN INDEMNITEE PROVISION IN A CONTRACT TO COVER FIRST
PARTY CLAIMS. TO DETERMINE WET AN INDEMNITEE CLAUSE IS UNAMBIGUOUS AS WITH ANY EXERCISE
IN CONTRACT INTERPRETATION, THE STARTING POINT IS THE COMMON MEANING OF THE WORDS. AND
THIS IS WHERE I PART COMPANY WITH MY COLLEAGUE. INDEMNIFY DOES HAVE A COMMON
MEANING. IT MEANS TO COMPENSATE FOR LOSSES. THERE IS NOTHING ABOUT THE TERM THAT
RESFRIKTS IT TO COMPENSATION 0 THIRD PARTY LOSSES. INDEED MY COLLEAGUE CONCEDED IF THE
WORD REIMBURSED HAD BEEN USED, THEN MR. BOYLE PREVAILS. OF BUT THE WORD INDEMNIFY IS
SYNONYMOUS WITH REIMBURSE. MIRIAM WEBSTER'S DICTION SHEAR TO SECURE AGAINST HURT, LOSS
OR DAMAGE. TO MAKE COMPENSATION FOR INCURRED HURT, LOSS AR OR DAMAGE. AS
ALREADY BEEN POINTED OUT BLACK LAW'S DICTION IN OTHER WORDS INDEMNIFY TO MEAN REIMBURSE
ANOTHER FOR A LOSS SUFFERED BECAUSE OF A THIRD PARTY'S OR ONE'S OWN ACT OR DEFAULT.
THE PLAIN UNAMBIGUOUS MEANING OF INDEMNIFY IS NOT TO REIMBURSE FOR LOSSES
CAUSE THE BY A THIRD PARTY, BUT MERELY TO COMPENSATE. A NUMBER OF COURTS
APPLYING NEW JERSEY LAW HAVE REACHED THE SAME CONCLUSION. IN THE THIRD CIRCUIT'S DECISION
IN TRAVELERS INDEMNITEE VERSUS DAY MON INDEMNIFY JEN LOGICAL ENJOYS BROAD DEFINITION AND
INDEED KRIETDED THE BLACK'S LAW DICTIONARY DEFINITION. IT ALSO NOTED NEW JERSEY'S
RESPECT FOR THE ABILITY OF PARTIES TO CONTRACT FREELY AND HELD THEREFORE THERE IS NO BAR
ON FIRST PARTY CLAIMS AS A MATTER OF LAW, SOMETHING AGAIN I BELIEVE MY COLLEAGUE
CONCEDED. NF MED EX MANUFACTURING VERSUS MAN SON, 2008 WEST LAW 877870, A
DISTRICT OF NEW JERSEY CASE AP EMPLOYING NEW JERSEY LAW, OF THE COURT HELD THAT BECAUSE
THE INDEMNIFICATION CLAUSE AT ISSUE THERE DID NOT DISTINGUISH BETWEEN DIRECT AND THIRD
PARTY, IT THEREFORE CLEARLY AND UNMANY BIG WUSLY COVERED BOTH. IN FIRST JERSEY NATIONAL
BANG VERSUS PETROLEUM A THIRD CERTIFICATE CASE FROM 1983 SAID UNDER NEW JERSEY LAW A
BROAD THE WORDED INDEMNIFICATION CLAUSE NEED NOT ALSO RECITE THE SPECIFIC SORTS OF LOSS
WITHIN ITS COVERAGE, THE INDEMNIFICATION CLAUSE AGAIN IN THAT CASE WAS FOUND TO UNAMBIGUOUSLY
COVER FIRST PARTY LOSSES. SO STANDING ALONE THE PLAIN MEANING OF IN.COM
IF I MEANS TO REIMBURSE FOR LOSSES, WHETHER RESULTING FROM A FIRST PARTY OR A THIRD
PARTY. OF BUT ALS NOTED IN THE ARLG MENT IT DOES NOT STAND AL LOEVEN IN THE BYLAWS HERE.
ANY POSSIBLE AMBIGUITY A TO WET THE BYLAWS INTENT TO RESTRICT THE WORE INDEMNIFY TO INCLUDE
ONLY ONE TYPE OF INDEMNIFICATION, THIRD PARTY INDEMNIFICATION, IS CLARIFIED UNAMBIGUOUSLY.
THE OESHGS SHALL INDEMNIFY AGAINST ALL LOSSES REASONABLY INCURRED IN CONNECTION WITH
ANY ACTION. THE OHM EXCEPTION IS THE EXCEPTION OF FOR WILLFUL MISCONDUCT
OR BAD FAITH. AND THE FACT THAT THE DRAFTERS KNEW HOW TO WRITE AN EXCEPTION AND DID EXCEPT
CERTAIN CLAIMS, WILL WUL MISCONDUCT AND BAD FAITH SHTHS BUT DID NOT EXEMPT NIRS PARTY
CLAIMS IS FURTHER EVIDENCE THAT THE INTENT OF USING THE WORD ALL WAS BECAUSE IT MEANT
ALL. VEN INCLUDED 3RD PARD CLAIM. JUSTICE PATTERSON: YOU MENTIONED KIEFFER,
AND KIEFFER TELLS US THAT INDEMNITY, INDEMNIFICATION PROVISIONS ARE STRICTLY
CONSTRUED AGAINST THE INDEMNITY. DID THE APPELLATE DIVISION NOL RULE AND
IF SO, PLEASE INDICATE WHERE IN THE OPINION WE CAN FIND THAT. (INDEMNITEE).
BARRY J. POLLACK: WELL, KIEFFER, WELL, FIRST OF ALL, THE RULE IS STRICTLY CONSTRUED IF
THERE IS A AN AMBIGUITY, THE PARTY ARE FREE TO CONTRACT AS THEY WISH. IN THAT
CASE, THERE WAS AN AMBIGUITY BUT IT'S NOT AN AMBIGUITY ABOUT WHETHER FIRST PAERD CLAIMS
ARE KUFRTD, THE AMBIGUITY IN KIEFFER WAS THAT THERE WAS, THERE WERE ACTUALLY 2 DIFFERENT
INDEMNIFICATION PRO RIGSS THERE, ONE BETWEEN BEST BUY AND A COMPANY CALLED A I C AND THEN
ANOTHER BETWEEN A I C AND A SUBCONTRACTOR CALLED ALL CLEANING. AND THE TWO INDEM KATHS
PROVISIONS WERE NOT MERE IMAGES OF EACH OTHER. THE LATTER DID NOT ONLY INCLUDE FEES ARISING
OUT OF NEGLIGENCE. IN THE UNDERLYING SUIT THERE, HAD BEEN A DETERMINATION THAT NUVEN
OF THE DEFENDANTS WERE NEGLIGENT. SO THE ISSUE WAS WHETHER THERE WAS INDEMNIFICATION
FOR FEES FOR DEFENDING A NEGLIGENCE ACTION WHEN THERE WAS NO FINDING OF NEGLIGENCE, WHETHER
THAT FIT WITHIN OR RISING OUT OF NEGLIGENCE. AND THE COURT FOUND THAT WAS AMBIGUOUS AND
THAT'S WHERE IT STEPPED IN WITH THE PRESUMPTION. 359 PAT SO DO WE TERP FROM THE TIME
THE APPELLATE DIVISION DECISION TO STAND FOR THE PROPOSITION THAT THIS PROVISION IS CRYSTAL
CLEAR? I DON'T SEE THAT, BUT TELL ME -- BARRY J. POLLACK: NO, OVM THE APPELLATE
DIVISION IN THAT CASE WAS NOT ADDRESSING. JUSTICE PATTERSON: THIS CASE,
YOU'RE SAYING KIEFFER ONLY, THAT KIEFFER PRESUMPTION ONLY APPLIES IF THERE'S AN
AMBIGUITY AND THERE'S NONE HERE. BARRY J. POLLACK: IN KIEFFER THERE WAS
AN AMBIGUITY BT THE AMBIGUITY -- JUSTICE PATTERSON: YOU'RE SAYING THIS IS
A CRYSTAL CLEAR PROVISION THERE'S NO WAY REASON AL MINDS COULD DIFFER ABOUT?
BARRY J. POLLACK: IN OUR CASE. JUSTICE PATTERSON: YES. BARRY
J. POLLACK: YES, YOUR HONOR. BECAUSE INDEMNIFY BY DEFINITION INCLUDES BOTH FIRST PARTY
CLAIMS. JUSTICE SOLOMON: YOU STARTED OUT BY SAYING YOU HAVE TO READ THIS
SENTENCE UNDER ARTICLE VI OF THE BYLAWS IN CONTEXT, CORRECT? BARRY J.
POLLACK: CORRECT. 0. JUSTICE SOLOMON: AND IN CONTEXT DOESN'T THE
SPECIFICALLY REFR TO TRUSTEES SHALL NOT BE LIABLE TO THE UNIT OWNERS? BARRY J.
POLLACK: SO IN. JUSTICE SOLOMON: DOESN'T THAT AT LEAST CREATE AN AMBIGUITY?
BARRY J. POLLACK: NO, YOUR HONOR, I WOULD SAY POL. JUSTICE
SOLOMON: THE' THE VERY FIRST SENTENCE EXPLAINING WHAT THE EXPOSURE IS. BARRY J.
POLLACK: I WOULD SAY THAT SUPPORTS MY READING OF THE CONTRACT AS A WHOLE. BECAUSE THE
INTENT OF THIS WHOLE PARAGRAPH INCLUDING THAT FIRST SENTENCE IS TO INCUR RIDGE VOLUNTEER.
(WHEREUPON, AN OFF-THE-RECORD DISCUSSION TOOK PLACE.) ENCOURAGE VOLUNTEER
SIR VS ON A VOLUNTEER BOARD. JUSTICE SOLOMON: WE'LL PROTECT YOU WHEN THE
UNIT OWNERS SUES. BARRY J. POLLACK: AND WE WILL MAKE YOU WHOLE IF YOU FACE
LITIGATION ARISING OUT OF YOUR SERVICE. THE GOALS OF BOTH PROVISIONS ARE
IDENTICAL, THERE'S TO ENCOURAGE SERVICE ON A VOLUNTEER BOARD BY MAKING SURE THAT IECHL
NOT GOING TO BE OUT OF POCKET SHTHS IECHL NOT GOING 0 TO HAVE 0 PAY FOR THE PRIVILEGE
OF VOLUNTEERING. JUSTICE SOLOMON: THAT'S HOW YOU READ THOETS TWO SEPARATE
SENTENCES, SEPARATE CLAUSES AS ONE? BARRY J. POLLACK: SEPARATE CLAUSES
BOTH IN THE SAME PARK, BOTH INVINCING THE SAME INTENT. JUSTICE SOLOMON:
YOU'RE SAYING THAT'S UNAMBIGUOUS? POL PL I'M SAYING INDEMNIFY SHALL INDEMNIFY ALL LOSSES
IN ANY OBJECTION IS UNAMBIGUOUS AND I'M SAYING THAT'S THAT FIRST SENTENCE --
JUSTICE SOLOMON: EVEN AFTER THE FIRST SENTENCE, THE LEAD SENTENCE OF THIS ARTICLE EXPLAINS
THAT YOU ARE BEING PROTECTED AGAINST SUITS BY UNIT OWNERS AGAINST YOU AS A TRUSTEE.
BARRY J. POLLACK: WELL, THAT'S NOT THE ONLY THING YOU'RE BEING PROTECTED
AGAINST. WHAT THIS PARAGRAPH IS ABOUT IS WHAT YOU'RE BEING PROTECTED AGAINST. I THINK
WHAT YOU'RE PROTECTED AGAINST IN SENTENCE ONE IS DIFFERENT FROM WHAT YOU'RE PROTECTED
AGAINST IN SENTENCE TWO, THE COMMON THEME IS PROTECTION, THAT WE'RE GIVING YOU OF BROAD
PROTECTION, THE BROADEST POSSIBLE PROTECTION FOR YOUR SERVICES OF VOLUNTEER BOARD MEMBER.
JUSTICE SOLOMON: DOES IT EVER EXPRESS, I UNDERSTAND THAT'S YOUR
CONSTRUCTION, THIS PARAGRAPH. DOES IT EVER EXPRESSLY SAY YOU'RE GOING TO BE INDEMNIFIED
AS TO FIRST PARTY CLAIMS? BARRY J. POLLACK: NO. THE WORDS FIRST PARTY
CLAIMS ARE NOT USED. JUSTICE SOLOMON: OR WORDS TO THEFKT.
BARRY J. POLLACK: BECAUSE THEY'RE NOT NEED. ONCE YOU SAY INDEMNIFY AND YOU SAY AL, IT
NETTER RL INCLUDES FIRST PART CLAIMS. I AGREE WITH YOUR HONOR, ONE COULD HAVE USED THAT
PHRASE, BUT THE QUESTION BEFORE THIS COURT IS NOT COULD WE REDRAVT THIS CONTRACT SO IT'S
CLEARER, IT'S SOM SOL I GET THAT, I'M ASKING WHETHER THAT FIRST SENTENCE, ESSENTIALLY
UNDERMINES YOUR ARGUMENT. BARRY J. POLLACK: I DON'T THINK SO. I THINK
IT INVINCES THE EXACT SAME INTENT AND YOU'RE SUPPOSED TO DETERMINE THE INTENT AS THE
CONTRACT AS A BHOEL AND WHAT I'M SAYING THE INTENT OF THE BROAD INDEMNIFICATION AT ISSUE
IS TO PROVIDE BROAD PROTECTION. JUSTICE WAINER APTER: LET ME READ THIGHS
TWO SENTENCES AS YOU ARE SAYING THE SAME THING, IT STILL SEEMS LIKE THAT HURTS YOUR ARC
MENT RATHER THAN HELPS IT BECAUSE IT SEALS LIKE IT'S SAY, A, YOU WILL NOT BE LIABLE FOR
ANY MISS HE TAKE OF JUDGMENT, NEGLIGENCE OR ON THE WISE EX SET WILLFUL CONTACT OR BAD
FAITH, AND, B, WE WILL ALSO INDEMNIFY YOU IN ANY CASE WHERE YOU ARE SUED BY A UNIT OWNER
FOR NEGLIGENCE, MISS TAKS OF JUDGMENT, ETCETERA, EXCEPT FOR THIS BAD FAITH KTS IF YOU'RE
READING THEM TO SAY THE SAME THING IT SEEMS LIKE THE IT HURTS YOUR ARGUMENT BECAUSE IT'S
ASSUMING THAT IT IS THE SAME TYPE OF SUIT BY A UNIT OWNER THAT WAS REFERENCED IN THE FIRST
SENTENCE. BARRY J. POLLACK: NO, BUT IT DOESN'T REPEAT UNIT OWNER, IT SAID,
INSTEAD IT SAYS ANY CASE. SO IT CLEARLY BROADENS IT. JUST REPEATING THE SAME SENTENCE
IT WOULD WOULDN'T HAVE TO REPEAT THE WILLFUL MISCONDUCT LANGUAGE. IT'S TWO ALBEIT RELATED
CONCEPTS. WHEN YOU READ IT, YOU READ IN THE ASSOCIATION SHALL IVEN DEM IF I EVERY TRUSTEE
FOR A SUIT BY A UNIT OWNER, BUT, OF COURSE, IT DOESN'T SAY THAT. IT SAYS ANY SUIT.
JUSTICE WAINER APTER: ANY ACTION, SULT OR PROCEEDING TO WHICH HE MAY BE A
PARTY BY REASON OF THIS BEING OR HAVING DEN A TRUSTEE. BUT THE FIRST SENTENCE MAKES IT
SEEM LIKE THEIR ASSUMPTION IS THAT THOSE ARE SUITS BY UNIT OWNER. BARRY J.
POLLACK: I THINK THAT IS SIMPLY ONE CATEGORY OF SUIT. THERE'S THE BUSINESS JUDGMENT
RULE AND THEN THERE'S A BROAD INDEMNIFICATION LANGUAGE. TO ME THE REASON THAT THEY'RE
IN THE SAME ARTICLE IS BECAUSE THEY'RE BOTH PROVIDING PROTECTIONS TO TRUSTEES TO
ENCOURAGE VOLUNTEER TRUSTEES TO SERVE. JUSTICE WAINER APTER: THE FIRST SENTENCE,
THOUGH, IS NOT ACTUALLY PROI VIEDING ANY INDEMNIFICATION, IT STS' SAYING YOU SHOULDN'T
BE LIABLE BUT IT'S IN THE SAYS WE HAVE TO PAY ANYTHING, RIGHT? BARRY J.
POLLACK: YOU'RE M WE'RE NOT GOING TO HOLD YOU LIABLE EN THEN FURTHERMORE, WE'RE GOING
TO INDEMNIFY YOU IF THERE ARE ANY SUITS. JUSTICE NORIEGA: DOESN'T YOUR
CONTENTION ALLOW FOR THE POSSIBILITY THAT AT EVERY ELECTION FOR THE ASSOCIATION AVENUE
LOSING PARTY MAY SUSTAIN A LAWSUIT WHICH WILL BE COVERED BY THE ASSOCIATION?
BARRY J. POLLACK: THERE IS A POSSIBILITY OF A LAWSUIT, CERTAINLY. THE QUESTION IS DOES
THAT MEAN THAT THE TRUSTEE WHO BRINGS THAT LAWSUIT IS GOING TO BE INDEMNIFIED IN EVERY
INSTANCE, ABSOLUTELY NOT. JUSTICE NORIEGA: IN THAT YOUR READING IF YOU'RE
A TRUSTEE AND TLAR CHALLENGES THE VALIDITY OF THE ELECT AS THEIR BEING OUT OF THEED AS
A TRUSTEE, ACCORDING TO YOUR ROADING OF THE R ASSOCIATION WOULD HAVE TO INDEMNIFY THEM?
BARRY J. POLLACK: NO, YOUR HONOR, I THINK THAT'S VERY COMPARABLE TO IN THE
PETITION, THE SORT OF PARADE OF HORRIBLES THAT WAS SET FORTH IN THE PETITIONER'S BRIEF
AT PAGE 11. UNDER THE APPELLATE COURT INTERPRETATION TRUSTEES WHO FILED SUITS
AGAINST THEIR ASSOCIATIONS TO COULDN'T TEST MAJORITY ACTION SOCIAL SECURITY THINGS AS
TRIVIAL AS TO WHERE TO HOLD A HOLIDAY PARTY OR A SIGNAL CAPTAIN AS A PROCEEDING AS PROCEED
ING WITH CAPITAL IMPROVEMENT PROJECT ARE ENTITLED TO FEES REGARDLESS OF OUTCOME. THAT'S
NOT OUR PROVISION AT ALL. OUR POSITION AT ALL. FIRST OF ALL, THE PROVISION SPEAKS ONLY
ABOUT FEES REASONABLY INCURRED. NO COURT WOULD FIND THAT A TRUSTEE HAS REASONABLY INCURRED
FEES BY BRIPGING A SUIT OVER WHERE TO HOLD A HOLIDAY PARTY. AND EVEN IF THE PROVISION
ITSELF DIDN'T CABINET OPENLY TO REASONABLY INCURRED FEE THE, NEW JERSEY LAW DOES.
THAT IMPORTANT GUARDRAIL EXISTS IN NEW JERSEY LAW WHEN THERE IS ANY FEE PETITION.
IN ASSESSING THE FEE PETITION THE COURT LOOKS BOTH AT WHETHER THE PARTY SEEKING THE FEES
WAS THE PREVAILING PARTY, AND ALSO THE PROPORTIONALITY OF THE FEES TO THE RELIEF
OBTAINED. NOW, OF COURSE, HERE MR. BOYLE WAS THE PREVAILING PARTY SO IN THIS CASE WE'RE
NOT DEALING WITH THE SITUATION WHERE THERE IS A FRIF LUTS LAWSUIT, THERE WAS A MERITORIOUS
LAWSUIT. CHIEF JUSTICE RABNER: READING THE LANGUAGE OF ARTICLE VI, WE TALKED
ABOUT THE FIRST 2 SENTENCES, DOES THE THIRD SENTENCE RELATING TO SETTLEMENTS APPLY TO
BOTH THIRD PARTY AND FIRST PARTY ACTIONS? BARRY J. POLLACK: YES, I THINK
THAT IT DOES. NOW, HERE, FIRST OF ALL, LET ME CLARIFY THERE WAS NOT A SETTLEMENT. THE
CONSENT ORDER SETTLED CERTAIN FACTUAL ISSUES, THE CASE WHAT A JUMPED FULLY ON THE MERITS
OF THE SUM RYE JUDGMENT. CHIEF JUSTICE RABNER: THE LANGUAGE OF IT AND YOUR
COLLEAGUE HATS POINTED OUT THAT IT DOESN'T SEEM TO MAKE SENSE THAT THE ATTORNEY FOR ONE
SIDE WOULD HAVE THE SOLE AUTHORITY TO MAKE A DETERMINATION AS TO WHETHER THE OTHER IN
A FIRST PARTY AKDZ ENGAGED IN BAD FAITH OR WILLFUL MISCONDUCT. DO YOU DISAGREE WITH
THAT? POL PL I DO. SO THE SECOND SENTENCE. BARRY J. POLLACK: THE SECOND
SENTENCE IS TALK ABOUT A CASE LIKE THIS ONE WHERE THERE'S AN ADJUDICATION ON THE MERITS
AND HERE THERE WAS AN ADJUDICATION OF THE MERITS WITHOUT A FIND OF BAN FAITH. IF A CASE
SETTLESES THEN NECESSARILY THERE WILL NOT HAVE BEEN A AN ADD SKEWED OCCASION AS TO WHETHER
OR NOT THE SUIT OR PROCEEDING RESULTED FROM THE WILLFUL MISCONDUCT OR BAD FAITH OF THIS
PARTY SEEKING INDEMNIFICATION. SO, YES, WHERE THERE HASN'T BEEN A JUDICIAL DETERMINATION,
IT DEFERS TO A COUNSEL TO COUNCIL TO MAKE THE ASSOCIATION. JUSTICE
PIERRE-LOUIS: COUNSEL FOR THE ASSOCIATION. R. BARRY J. POLLACK: AT THE
DRAFTED BY THE ASSOCIATION WHICH IS ANOTHER POINT, YOUR HONOR, THE BYLAWS SERNL ARE
DRAFTED BY THE ASSOCIATION IF THEY WANTED TO CONFINE IT TO FIRST -- JUSTICE
PIERRE-LOUIS: DOES THAT MAKE SENSE TO APPLY THAT PARTICULAR, THAT PARTICULAR CLAUSE THE
INTENT WOULD HAVE BEEN FOR THAT TO APPLY TO A FIRST PARTY CLAIMS? SO IN A SITUATION LIKE
THIS IF THERE HAD BEEN A SETTLEMENT, COUNSEL FOR THE ASSOCIATION WOULD DETERMINE IF YOUR
CLIENT HAD ACTED IN BAD FAITH OR WAS GIMENT TEE OF WILLFUL MISCONDUCT TO DECIDE WHETHER
INDEMNIFICATION WOULD OCCUR. DOES THAT MAKE SENSE FOR THIS PARTICULAR CLAUSE TO APPLY
TO FIRST PARTY CLAIMS? BARRY J. POLLACK: DOES IT MAKE. JUSTICE
PIERRE-LOUIS: IT MAY SEEM LIKE IT DOES. MONTHLY PL IT'S CERTAIN THE NOT THE WAY I WOULD
DRAUFT DRAFT IT, YOU WERE, BUT DOES THE MAKE SENSE IN THE SENSE OF WHAT THE CLAN APLAIN
LANGUAGE IS, YES THAT, IS THE PLAIN LANGUAGE, THE TWO SENTENCES MIRROR EACH OTHER. IN THE
ONE WE HAVE ANSWERED ADJUDICATION, IF THERE'S AN ADJUDICATION OF BAD FAITH AND THE OTHER
THERE IS NO ADJUDICATION. SO IT HAS TO COME UP WITH SOME MECHANISM FOR DETERMINING WHETHER
OR NOT THAT BAD FAITH EXCEPTION ACH APPLIES AND THE MECHANISM THAT IT CHOOSES WHICH I AGREE
WITH YOU, I DON'T AGREE WITH IT, BUT THE MECHANISM THAT IT CHOOSES IS THAT THE
ASSOCIATION LAWYER WILL MAKE THAT DETERMINE NATHS AND THE PARTIES ARE FREE TO CONTRACT
AS THEY WISH, THE FACT THAT YOU AND I WOULD WRITE THE. JUSTICE PATTERSON:
THE BIG INCENTIVE FOR SETTLE THE FOR SOMEONE IN YOUR CLIEN'S POSITION IF IT'S ULTIMATELY
IF IT DOES APPLY FO A FIRST PARTY CLAIM AND ULTIMATELY THE ASSOCIATION IS GOING TO MAG
THE DETERMINATION AS TO WHETHER THERE WAS WILLFUL MISCONDUCT. BARRY J. POLLACK:
PRESUMABLY, IF #3450I CLIENT WERE GOING TO SETTLE, WE WOULD WORK THAT INTO THE SETTLE
MANY. THERE WOULD HAVE TO BE AN AGREEMENT IN THE SETTLEMENT JUST LIKE THERE WAS IN THE,
THERE WAS NO ADJUDICATION OF BAD FAITH, WE WOULD WRITE INTO THE SETTLEMENT IF THERE WAS
NO BAD FAITH AND THE ASSOCIATION WERE NOT WILLING TO DO THAT, THERE WOULDN'T HAVE BEEN
A SETTLEMENT. SO I AGREE WITH YOU IT DOES COME INTO PLAY IN TERMS OF HOW A SETTLEMENT
NEGOTIATIONS ARE GOING TO BE CONDUCTED. CHIEF JUSTICE RABNER: THAT'S ASSUMING
THE ENTIRETY OF ARTICLE VI APPLIES TO FIRST PARTY CLAIMS. BARRY J. POLLACK:
CORRECT. IT'S A UM SOOING THAT ALL MEANS ALL, ALL INDEMNIFICATION, THEN INDEMNIFICATION
MEANS BOTH. JUSTICE PIERRE-LOUIS: COUNSEL, IN LOOKING CLOSER AT THAT THIRD
SENTENCE, IT DOESN'T NECESSARILY MIRROR THE SECOND SENTENCE OF COMPLETELY BECAUSE IN THE
SETTLEMENT SENTENCE, THE OF PHRASE USED WITH REGARD TO OF THE TRUSTEES' PARTICIPATION
IN THE LAWSUIT OR ANY MATTER SPECIFICALLY RELATES TO WILLFUL MISCONDUCT OR BAD FAITH IN THE
PERFORMANCE OF HIS DUTY AS SUCH TRUSTEE OR OFFICER IN RELATION TO THE MATTER INVOLVED.
THAT LANGUAGE DOES NOT SEEM TO RELATE TO A FIRST PARTY CLAIM. AND THAT LANG
RIDGE OF THE TRUSTEES' PERFORMANCE OF HIS DUTIES DOESN'T SEEM, DOESN'T APPEAR IN THE FIRST
OR SECOND SENTENCE. YOU'RE SAY THOSE TWO, SECOND AND THIRD SENTENCES MIRRORED EACH OTHER,
AETS A BIT DIFFERENT. BARRY J. POLLACK: I AGREE WITH YOU THE LANGUAGE IS
THE DIFFERENT BUT THE ABSOLUTELY DOES APPLY TO FIRST PARTY CLAIM, WE HAVE A FIRST PARTY
CLAIM HERE AND PLAINLY THE ASSOCIATION HAS TRIED TO INVOKE THE BAD FAITH EXEMPTION SO
BAD FAITH EX CEMENT SHUP CAN APPLY REEL EQUALLY FO A FIRST PARTY CLAIM OR A THIRD PARTY
CLAIM. TO ME IT DOESN'T TELL ME THAT WE'RE CONFINING OURSELVES TO ONE OR THE OTHER.
P AGAIN THE DOES GO BACK TO WHAT THE WORD INDEMNIFICATION MEANS RGS FN I COULD JUST
RETURN TO THAT FOR A MOMENT, BECAUSE MY COLLEAGUE -- JUSTICE PIERRE-LOUIS:
SO THIS SUIT RELATES TO THE PERFORMANCE OF HIS DUTIES Z AS A TRUST TIE FOR THE ASSOCIATION.
AS OPPOSED TO BEING SUED BY UNIT OWNER. BARRY J. POLLACK: WELL, FREKTS,
FOR EXAMPLE THE KWETHS WAS ASKED BY THE CHIEF JUSTICE AS TO WHETHER THERE'S DAYLIGHT
BETWEEN THE RAD FORTD STAND DASHED AND THE STANDARD HERE. OF BOTH OF GET TO WHETHER OR
NOT IN PERFORMING MR. BOYLE'S DUTY HE WAS ACTING CONTRARY TO THE INTERESTS OF THE ASSOCIATION,
IN BAD FAITH. SO I THINK THAT THESE CLAUSES APPLY PERFECTLY TO THIS CASE WHICH DECHL
STRAITS THAT THEY CAN VEN DO APPLY TO FIRST PARTY CLAIMS. AND IF I MAY JUST RETURN TO
THAT FOR A MOMENT BECAUSE I DON'T WANT TO LEAVE THE MISS IMPRESSION THAT I THINK MY COLLEAGUE
SUGGESTED THAT COURTS GENERALLY RECOGNIZE THAT SOMEHOW INDEMNIFY MEANS ONLY THIRD PARTY
CLAIMS, THAT'S ABSOLUTELY NOT THE CASE. I MENTIONED THE MED EX MANUFACTURING
VERSUS MON SON CASE. THAT CASE SITES A NUMBER OF COURTS, IT CITES AN 8TH CIRCUIT CASE,
LIT TON MICROWAVE COOKING VERSUS LEF TON 15 F 3RD 7 NIERNTHS AN 8 NL CIRCUIT CASE APPLYING
MINNESOTA LAWING AND RELYING ON WEBSTER'S DICTIONARY DEFINITION OF INDEMNIFY RGS ONLY
A STRAINED READING TO PRODUCE A THIRD PARTY SUIT REQUIREMENT ON A AN INDEMNITEE CLAUSE.
IT ALSO REFERS TO A 9TH CERTIFICATE CASE, YANG MING MARINE TRANSPORTATION VERSE OKAY MOAT
TOE TRADE DERTS RS 2 FINE 103RD 1086 A 20019TH CIRCUIT CASE RELYING ON BLACK'S LAW
DICTIONARY DEFINITION OF INDEMNIFY, THE PLAIN AND UNAM BIG RUSS MEANING OF INDEMNIFY IS
NOT TO COULD COMPENSATE TOWER LOSSES CAUSED BY THIRD PARTIES BUT MERELY TO COMPENSATE.
IT ALSO REFERS TO A SOUTHERN DISTRICT OF OHIO CASE, PATEL MEMORIAL INSTITUTE VERT NAS
GO PIPE LIEVEN SIR VSS 56 F 2ND SHTHS F. SUPP 2D 944, #23450E7B 99-CASE WHICH HE RELIES
ON 6TH CIRCUIT LAW AND ALSO HIGHER LAW. WHICH IS THE SAME AND SAYS THE TERM INDEMNIFY
HATS NOT TRADITIONALLY BEEN HELD TO HELD ONLY TO THIRD PARTY SITUATIONS, CITES BLACK'S
LAW DICTIONARY, IT SAYS INDEM IF THE VOFRS THE SHIFLTH OF LAUTSS RATHER THAN ANY REQUIREMENT
THAT THIRD PARTY LOSSES BE SLOFLD. PARAGRAPH. JUSTICE PATTERSON: WOULD YOU
AGREE IN GENERAL USE AND WHERE IT APPEAR IN OUR STATUTES OCCASIONAL THE WORD INDEMNITEE
IS ABOUT THIRD PARTY CLAIMS? BARRY J. POLLACK: IT OFTEN IS ABOUT THIRD
PARTY, BUT THE POINT IS THE WORD ITSELF -- JUSTICE PATTERSON: USUALLY RATHER THAN
OFTEN. BARRY J. POLLACK: I'LL GIVE YOU USUALLY. I TIFF YOU TYPICALLY, I'LL
DPIF YOU COMMONLY. THE WORD DEFINITELY ENCOMPASSES BOTH. I CITED A 4TH, DAN RIVER
VERTSZ P Y A MONARCH, 1994 WEST LAW 510462. THE DETERMINE INDEM TAGS VEN CLUDZ A FREEMENT
TO HOLD OTHER HARMLESS FROM THE LEGAL COULDN'T VENS OF AN ACT OF ONE OF THE PARTIES TO THE
AGREEMENT. T THERE IS NO REQUIREMENT THAT THE ACTION BE BROUGHT BY A THIRD PERSON.
I'D MS REFER YOU TO DISTRICT COURT OF NEW JERSEY CASE SPENCER SAVINGS BANK
VERSUS BAPG K OF AMERICA, 2018 WEST LAW 683, 7972, THIS ONE IS APPLYING CALIFORNIA LAW,
AND IT SAYS THERE'S NO REASON TO READ A LIMITATION TO THIRD PARTY CLAIMS INTO A
CLAUSE REQUIRING A PARTY TO EN DEM IF I THE OTHER. AND HERE AGAIN INDEMNIFY
DOES NOT STAND ALONE. IT'S MODIFIED BY ALL, IN ANY, IT'S IN A CONTRACT THAT IS ENCOURAGING
SERVICE ON A NONPROFIT BOARD. IT IS WRITTEN BY THE ASSOCIATION, THE ASSOCIATION #23450U
HOW TO PROTECT ITS TREFT AND WRITE THE INDEMNIFICATION MORE NARROWLY IF IT CHOSE TO
AND IT DOESN'T INCLUDE ANY OF THE LANGUAGE THAT IS SOMETIMES USED TO INDICATE AN INTENT
ONLY TO APPLY THE TO THIRD PARTY CLAIMS. THERE'S NOTHING THAT TALKS ABOUT ASSUMING THE
DEFENSE. THERE'S NOTHING THAT TALKS ABOUT A DUTY TO DEFEND. THERE IS NOTHING THAT SUGGESTS
THAT WE'RE TALKING ABOUT THIRD PARTY CLAIMS. MANY VT CASES MY COLLEAGUE RELIES OVEN
WHERE THEY SAY IN THOSE CASES, AGAIN IT'S A CASE BY CASE ANALYSIS, THE PROVISION WAS TALKING
ONLY ABOUT THIRD PARTY INDEMNIFICATION, USED THOETS TERMS MENT HERE NOT OECHLY ARE.
JUSTICE WAINER APTER: WHAT ABOUT THE BROAD LANGUAGE QUOTE BY YOUR ADVERSARY FROM
IVEN INVESTORS SAVING BANG, AN IP DCHL OCCASION AGREEMENT MUST BE BASED ON INDEM CLEEMS
TO INDEM FOR INCURRED TO A THIRD PARTY. OF PAGE 159. BARRY J. POLLACK:
A COUPLE OF POINTS ABOUT THAT, YOUR HONOR. FIRST OF ALL, IT IS AN APPELLATE
DIVISION DECISION, IT'S NOT A DECISION OF THIS COURT. SECONDLY, IT IS INCLUDE THE VERY
LIMITING LANGUAGE THAT IS ABSENT HERE. IN THE ININVESTIGATOR'S SAVINGS BACK CLAUSE IT
TALKS BO DEFENDING AND HOLING HAR LESS, IT MAKS NO SENSE TO STAY I'M GOING TO DEFEND NEW
A CASE AGAINST ME. AND SO THAT DEFENSE AND THINGS LIKE ASSUMING THE DEFENSE, NOETSDZ
PRO VIG, YOU HAVE TO NOTIFY ME OF A CLAIM, THOSE ARE ALL WAYS TO INDICATE WE'RE ONLY TALKING
ABOUT THIRD-PARTY CLAIMS, THOSE WERE AM BY GU ARE THE IF HAD YOU ALL ON THE OTHER HAND
BUT SEEMINGLY LIMITING TERMS ON THE OTHER HAND. HERE WE HAVE NONE OF THOSE
LIMITS TEFRMENTS THE OPENLY MOD FIRES TO INDEMNIFY WHICH INCLUDE AND DOES INCLUDE BOTH
ARE ANY AND ALL. SO THE MODIFICATION IS ONLY TO SHOW US THAT THEY INTEND INDEMNIFY IN THE
BROUGHT ABROADEST SENSE OF THE WORD. CHIEF JUSTICE RABNER: THE AMERICAN
RULE YOU BEAR YOUR OWN COSTS IN A LAWSUIT AND THAT APPLIES FO FIRST PARTY CLAIMS OF COURSE
AND IS THE GENERAL RULE MUCH THE ARGUMENT YOU'RE ADVANCING IF YOUR INTERPRETATION OF ARTICLE
VI CUTS THE OTHER WAY. DOES THE AMERICAN RULE AND THE JEVEN RUL PHILOSOPHY
THAT APPLIES TO LIT TAGS CAUTION IN FAVOR OF MORE EXPRESS LANGUAGE? BARRY J.
POLLACK: TWOVR POINTS. ONE, THIS COURT HAS ACKNOWLEDGED REPEATEDLY THAT THE AMERICAN
RULE ENCOMPASSES THE IDEA THAT IT CAN BE CLAFRJED BY CONTRACT. OF THIS COURT SAID THAT
IN PACK CARD BAMBERGER. CHIEF JUSTICE RABNER: CLEAR CONTRACTS.
BARRY J. POLLACK: CORRECT. CORRECT. AND, YOUR HONOR, THAT'S PRE VICELY MY POINT.
THIS IS A CLEAR CONTRACT. I UNDERSTAND IT COULD HAVE BEEN WRITTEN DIFFERENTLY, BUT IT IS
A CLEAR CONTRACT. IT USES THE WORE INDEMNIFY WHICH -- JUSTICE PATTERSON:
ANY CONTRACT CAN BE WRITTEN DIFFERENTLY BUT THIS ARE YOU SAYING. BARRY J.
POLLACK: UNAMBIGUOUS. JUSTICE PATTERSON: THIS COULD HAVE BEEN WRITTEN MORE
CLEAR OFLY. BARRY J. POLLACK: I DON'T THINK THE STANDARD IS YOU HAVE TO
WRITE THE CLEAR OF THE CONTRACT EVER. THE STAMPED TARRED IS IS THE PLAIN MEANING THE
WORDS ONLY GIVE RISE TO 1 REASONABLE INTERPRETATION AND HERE THE ANSWER IS YES.
JUSTICE SOLOMON: IN CONTEXT. BARRY J. POLLACK: IN CONTEXT, YES,
AND HERE THE ANSWER IS YES, IT IS UNAMBIGUOUS, EITHER FIRST PARTY OR THIRD PARTY AND THN
I SAY ANY AND ALL, AND IT'S IN THE CONTEXT OF ENCOURAGING NONPROFIT SERVICE, YES, I BO
SAY THE COMMON MEANING OF THOSE WORDS LEADS TO AN UN578 BIG WUS INTERPRETATION.
JUSTICE PATTERSON: IF YOU LOCK AT THE AMERICAN RULE CASES, IT YOU CAN AT As ABOUT
CONTRACTUAL EXCEPTIONS TO THE AMERICAN RULE, WHAT IS CITED IN THOSE CASES Z IS VERY CLEAR
LANGUAGE ABOUT ATTORNEYS FEES, ABOUT AWARD, ETCETERA. THAT IS RESPECTFULLY I THINK IS
NOT QUITE WHAT WE HAVE HERE IN TERMS OF CLARITY. BARRY J. POLLACK: WELL,
I THINK WE DO HAVE VERY CLEAR TERMS. WE SAY ANY AND ALL AND IT DOES SPECIFICALLY INCLUDE
ATTORNEYS FEES AND IT SAYS ALL, NOT JUST NET LOSS THAT'S USED IN THE ASSOCIATION FORM,
IT GOES BROADER THAN THAT, IT SAYS ALL LOSS, COSTS AND EXPENSES INCLUDING COUNSEL FEES.
SO I TAKE IT AS VERY BROAD AND VERY CLEAR. AND THE, YOU KNOW, IN TERMS
OF THE ASSOCIATION FORM, OF COURSE, ASSOCIATION IS FREE TO CHANGE THAT FORM. THE WHOLE
POINT IS THAT PARTIES ARE FREE TO CONTRACT. SO TO THE EXTENT THERE MIGHT BE AS CLEARER
WAY TO SAY IT, PARTIES CAN SAY IT MORE CLEARLY. BUT THITS CONTRACT, WHEN IT WAS WRITTEN,
USED TERMS THAT HAVE A PLAIN AND UNAMBIGUOUS MEANING AND IT GAVE A VERY BROAD LEVEL OF
PROTECTION TO THE SERVICE OF VOLUNTEER BOARD MEMBERS. IF I COULD JUST BR
IEFLY TOUCH ON THE OTHER COUPLE OF ISSUES, THE FEES ON FEES AND THE ISSUE ABOUT WHETHER
THART A NEED TO REMATCHED FOR ANY FURTHER LITIGATION ON WILLFUL CONDUCT OR BAD FAITH.
ON THE FEES ON FEES, AS IT WAS POINTED OUT SERPA VERY CLEARLY SAID, AS ALL
THESE CASES SAY, NEW JERSEY RESPECTS, FREELY CONTRACT AND YOU CAN FREELY CONTRACT FOR
FIRST PARTY INDEM KATHS, YOU CAN FREELY CONTRACT FOR FEES ON FEES. AND IN
SERPA, THE LANGUAGE WAS FOUND TO BE CLEAR AN UNAMBIGUOUS. THE SAME IS TRUE HERE. AGAIN,
THE ASSOCIATION SHALL INDEMNIFY AGAINST ALL LOSSES INCLUDING COUNSEL'S FEES, REASONABLY
INCURRED BY HIM IN CONNECTION WITH ANY AKDZ, SULT OR PROCEEDING TO WHICH HE MIGHT BE A PARTY
BECAUSE OF HIS SIR VS TO THE ASSOCIATION. THERE'S BEEN NO DEHE BAIT THAT THIS SUIT FELL
INTO THAT CATEGORY. AND THIS NOT A CASE WHERE HE BRIPGS A SEPARATE FREE
STANDING ACTION FOR INDEMNIFICATION MUCH THE CLAIM FOR INDEMNIFICATION IS PART OF THE VERY
SUIT OR ACTION THAT HE BRINGS ARISING OUT OF THE SERVICE FOR THE ASSOCIATION. SO
GEVENS ALL LOSSES, COSTS AND EXPENSES INCLUDING COUNSEL'S FEES, INCURRED IN CONNECTION
WITH ANY ACTION OR SUIT. THESE WERE IF Is IVEN CURD IN A CLAIM IN THIS VERY SUIT.
AND THEN ON THE LAST ISSUE OF WET THERE'S A NEED TO REMAND FOR FURTHER
LITIGATION AS TO WHETHER THE EXCEPTION APPLIES AND RESPECTFULLY THERE IS NOT, CHIEF JUSTICE
ASKED A VERY GOOD QUESTION, AS A PRACTICAL MATTER, YOU KNOW, IS IT POSSIBLE THAT ONE
COULD ACT AGAINST THE INTEREST OF THE ASSOCIATION AS RADBURN USES IT BUT NOT A WAY THAT
IS WILLFUL MISCONDUCT AS THE INDEMNIFICATION CLAUSE USES IT AND, YOU KNOW, COUNSEL CAME
UP WITH SOME EXAMPLES THE SNOW BIRD, OBVIOUSLY THAT'S NOT THITS CASE. WHETHER OR NOT
THEORETICALLY THERE COULD BE SUCH A CASE, THERE WASN'T HERE. HERE THE DEFENDANTS, I'M
SORRY, HERE THE ASSOCIATION SOUGHT TO REMOVE MR. BOYLE BASED ON OF HIS CONDUCT AS A BOARD
MEMBER;. AS THE TRIAL COURT PUT IT, THE REASONS GIVEN IN THE RESOLUTION SEEKING
HIS REMOVAL WERE ASSAULT, BULLYING SHTHS VOTER IMPROPRIETIES AND INDEM INTIMIDATION.
WHETHER OR NOT BEING A SNOW BIRD MIGHT INTERFERE WITH YOUR SERVICE BUT NOT BE IN BAD FAITH
CLEARLY ASSAULT, BULLILY, VOTER IMPROPRIETY VEN INTIMIDATION, IF THEY ACTUALLY HATCH,
WOULD BE IN BAD FAITH. MANY LONG A THE COURT BELOW THE TRIAL COURT NOTED AND THE APPELLATE
DIVISION AGREED, THE ISSUES BETWEEN THE DIFFERENT CLAIMS WERE INEX STRIK BLEE INTERTWINED.
ON THESE PARTICULAR FACTS NO, THERE IS NO DAYLIGHT BETWEEN THE TWO. AND IMPORTANTLY
THE TRIAL COURT NOTED BEFORE ENTERING THE CONSENT ORDER IN WHICH THE DEFENDANT'S AGREED
TO FOREVER ABANDON RELINQUISH, SEEK AND FOREGO ANY RIGHT TO PURSUE ANY PROCEEDING, MEETING
OR ANY D R TO REMOVE THE PLAINTIFF FROM THE BOARD BASED ON ANY ACT OR OMISSION OF THE
PLAINTIFF, THE TRIAL COURT NOETEDDED BEFORE ENTERING IT THAT DOING SO AS FAR AS HE WAS
CONCERNED WOULD RESOLVE THE FACTUAL DEVELOPMENT OF THE ISSUE OF BAD FAITH. AND THERE WAS
NO OBJECTION FROM THE ASSOCIATION THE. JUSTICE WAINER APTER: I'M SORRY WHERE
SPECIFICALLY DID THE TRIAL COURT DO THAT? I WAS FOLLOWING YOU WHERE YOU WERE QUOTING
THE LANGUAGE FROM THE TRIAL COURT BUT I DIDN'T SEE ANYTHING ABOUT BAD FAITH IN IT.
BARRY J. POLLACK: IF YOU WOULD LOOK AT THE JANUARY 13TH, 2022, 2022 ORDER AT PAICHS
11 THROUGH 13, PAGES 11 THROUGH 13, THE TRIAL COURT NOTES HE MADE CLEAR HE BELIEVED THE
DEFENDANTS WERE RELIPG WISHING THEIR RIGHT TO, AND THE DEFENDANTS DID NOT OBJECT.
JUSTICE WAINER APTER: THAT'S IN THE IN THE JULY 27TH, 2021, ORDER THAT YOU WERE
ORIGINALLY QUOTING FROM, RIGHT? BARRY J. POLLACK: CORRECT. THAT IS THE
COURT LATER REFERRING BACK TO THE TRANSCRIPT OF THE PROCEEDING PRIOR TO THE ENTRY OF THE
COULDN'T SEN ORDER, WHERE T THE TRIAL COURT -- SO LET ME BACK UP, YOU WERE. THE
ORDER I'M REFERRING TO IS ORDER DENYING A #340EGS FOR RECONSIDERATION. AND IN THE ORDER
DENYING THE MOTION FOR RECONSIDERATION, THE TRIAL COURT REFERS BACK TO THE TRANSCRIPT
OF THE PROCEEDING AT WHICH THE PRECEDED THE ENTRY OF THE CONSENT ORDER AND NOTES IT WAS
VERY CLEAR THAT THE TRIAL COURT BELIEVED THAT ENTER LONG THE CONSENT ORDER THAT ISSUE,
THE WILLFUL MISCONDUCT ISSUE, WAS NOT RIPE FOR SUMMARY JUDGMENT. AND THERE WAS NO OBJECTION
FROM THE ASSOCIATION. THE ASSOCIATION THEN AFTER HAVING BEEN TOLD THAT VOLUNTARILY EP
TERD THE CONSENT ORDER. AND THEN AVENUE THAT, THE TRIAL JUDGE EVEN TERD SUMMARY JUDGMENT
FINDING THAT THERE HAD BEEN NO FINDING OF WILLFUL MISCONDUCT OR BAD FAITH. SO THERE
IS NO NEED FOR THE ASSOCIATION TO GET A SECOND BITE AT THAT APPLE. CHIEF
JUSTICE RABNER: COUNSEL SUGGESTED THAT, MY WORD, NOT HIS, THAT YOU COULD BE CAN TANK RUSS
BUT ACT IN GOOD FAITH AND THAT MIGHT BE A BREECH UNDER THE REGULATION, BUT THAT THAT WOULD
NOT BE COVERED UNDER THE BYLAWS, I TAKE YOU DON'T BYE THAT. BARRY J. POLLACK:
I'M NOT SPEAKING TO WHETHER OR NOT THEORETICALLY THAT MIGHT BE TRUE, I'M SAYING BASED
ON THAT THE FACTS OF THIS CASE THE TRIAL COURT PLAINLY DID NOT BELIEVE ALL WE WERE TALKING
ABOUT WAS GOOD FAITH CAN TANK RUSS. WE WERE TALK ABOUT ALLEGATION OF INTIM DPAGS DAGS,
IF TRUE AND IF PROOF IN THE TRIAL COURT'S MIND WOULD HAVE CONSTITUTED BAD FAITH AND WILLFUL
MISCONDUCT, AND THAT THE ASSOCIATION THREW IN THE TOWEL ON THAT. THEY HAD THE OPPORTUNITY
TO LITIGATE THAT AND CHOSE NOT TO. CHIEF JUSTICE RABNER: THANK YOU. MR.
GOTILLA, BRIEF REBUTTAL? CRAIG D. GOTILLA: OF THANK YOU, YOUR HONOR. FIRST
I'D LIKE TO RESPOND TO JUSTICE PATTERSON'S QUESTIONS ABOUT THE DIFFERENCE BETWEEN
ARTICLE VI AND THE BYLAWS AND THE STANDARD FORM AGREEMENT THAT I'LL MOVE ON TO A COUPLE
OF POINTS. JUSTICES, AS I HAD INDICATED WHEN I WAS UP HERE BEFORE, I HAVE
HAD AN OPPORTUNITY TO LOOK AT THE BYLAWS AS WELL AS THE LANGUAGE IN THE STANDARD FORM
PROPOSED IN THE BOOK AND AS THE DIFRTSS AS I RECALL THE ARTICLE VI BYLAWS, THEY'RE LEAD
IN LANGUAGE THEY WILL INDEMNIFY FOR ALL LOSS, COSTS, SO FORTH WHERE AS THE STANDARD
AGREEMENT IS FOR THE AMOUNT WILL INDEMNIFY FOR THE AMOUNT OF NET LOSS AND ALSO THE EXCEPTIONS
TO THE INDEMNIFICATION AGREEMENT THAT ARE DIFFERENT IN ARTICLE VI OF THE BYLAWS, THERE
SAN EXCLUSION FOR INDEMNITEE FOR WILLFUL MISCONDUCT AND BAD FANL WHERE AS IN THE
STANDARD AGREEMENT, IT'S AN EXCEPTION FOR GROSS NEGLIGENCE AND WILLFUL MISCONDUCT. SO
THE DIFFERENCE IS ONE EXCLUDES FOR JUST GROSS NEGLIGENCE WHERE AS THE ON THE IS BAD FAITH,
THEY BOTH, CLUED FOR WILLFUL MISCONDUCT. JUSTICE PATTERSON: SO YOUR AGREEMENT
IS MORE EXPANSIVE IN THAT REGARD THAN THE STANDARD FORM OF AGREEMENT?
CRAIG D. GOTILLA: I WOULD PUT GROSS NEGLIGENCE SOMEWHERE BETWEEN WILLFUL MISCONDUCT
INTENTIONAL AKS AND. JUSTICE PATTERSON: ORDINARY 97. I THINK THERE'S LAW
SAYING THAT. CRAIG D. GOTILLA: THE OTHER, FIRST THING I WOULD LOIK TO FIND
OUT THE LANGUAGE OF ARTICLE VI IS THE ASSOCIATION DOES NOT DRAFT THE BYLAWS. THIS IS
NOT A SITUATION WHERE THE ASSOCIATION SILTHS DOWN AND DRAFTS THEM. THE BYLAWS ARE PART
OF THE MASTER DEED AND USUALLY ARE INCLUDED WITHIN THE PUB MRIK OFFERING STATEMENT THAT
THE DEVELOPER WHO BUILDS AND CONSTRUCTS THE CONDOMINIUM PUTS OUT. SO THIS IS.
JUSTICE PATTERSON: FOR BEFORE THE ASSOCIATION EXISTS. CRAIG D. GOTILLA:
BEFORE A SINGLE UNIT HAS BEEN SOLD. JUSTICE PATTERSON: SO YOU'RE ARGUING
NEW SHOULD BE CONSTRUED AGAINST THE DRAFTER BECAUSE IT'S NOT YOU. CRAIG D.
GOTILLA: PRECISELY MAT PAT OR YOUR CLIENT. CRAIG D. GOTILLA: PRECISELY.
AND A COUPLE OF OTHER IMPORTANT THINGS THAT I HEARD MY COLLEAGUE MENTION TO THE COURT.
FIRST OF ALL, HE AGREED WITH THE NOTION THAT ORDINARILY -- WELL, TYPICALLY, GENERALLY,
USUALLY, OFTEN, INDEMNIFICATION IMPLIES -- INDEMNIFICATION AP EMPLOYS TO THIRD PARTY
CLAIMS, NOT FIRST PARTY CLAIMS. UNDER THAT SCENARIO, AGAIN, IF YOU GO BACK TO HOW THIS
COURT TREATED HE WERE INTERPRETATION OF INDEMNIFICATION AGREEMENTS, IF YOU'RE GOING
TO START WITH A GENERAL IDEA OF WHAT INDEMNITEE MEANS, IN ORDER TO EXPAND THAT GENERAL
OFTEN FREQUENT USUAL MINING OF INDEMNITEE, THEN YOU NEED CLEAR, UNEQUIVOCAL LANGUAGE EX
SPREFRG AN INTENT TO DO SO JUST LIKE YOU DO IN THE OTHER SITUATION. JUSTICE
PATTERSON: DO YOU AND YOUR ADVERSARY AGREE ON THAT MOSTLY CONCEPT, MOSTLY BUT NOT ALWAYS
CONCEPT? CRAIG D. GOTILLA: WELL, I THINK. JUSTICE PATTERSON:
SPECIFICALLY THAT IN MOSTLY BUT NOT ALWAYS, INDEMNIFICATION IS USED, THE HE A TALKING
ABOUT A THIRD-PARTY CLAIM? CRAIG KRG I GO WITH WHAT JUDGE FISHER SAID IT'S AXIOMATIC,
AN INDEMNIFICATION, WHAT AN INDEMNIFICATION AGREEMENT MEANS, IN THE INVESTIGATOR
ININVESTIGATORS SAVINGS CASE, AXIOMATIC IS NOT USUALLY. JUSTICE PATTERSON:
IS THAT A CORRECT STACHLT OF THE LAW SGICH GIVEN THAT THERE ARE APPARENTLY ESPECIALLY
IN FEDERAL COURTS, GOING IN THE OTHER DIRECTION? CRAIG D. GOTILLA: IN NEW JERSEY
AT LEAST BELOW THE APPELLATE LEVEL. UNTIL THIS COURT MAKES A RULING, I THINK THAT IS
THE LAW, IF IT IS AK YO MATIC THAT INDEMNIFICATION IS A THIRD PARTY DEVICE, NOT
A FIRST PARTY. AND AS FOR THE NUMBER OF CASES, I'M FAMILIAR WITH THE FIRST
JERSEY CASE THAT COUNSEL HAD CITED, THE MED EX DISTRICT COURT CASE I'M NOT FAMILIAR WITH,
I DON'T BELIEVE THAT WAS CITED, HIENL IT'S AN UNPUSH BLISHD OPINION AS WELL AS THE UNPUSH
BLISHD DISTRICT COURT OPINIONS AND STATE COURT OPINIONS I HAVEN'T READ THOSE SO I CAN'T
COMMENT ON THOSE OF THE THE CERTIFICATE COURT CASES ALSO FIRST TIME I'M HEARING MOST OF
THOSE. I CAN'T COMMENT UNFORTUNATELY ON ANY OF THOSE. HOWEVER --
JUSTICE PATTERSON: ARE THOSE IN ANYBODY'S BRIEF, A COUPLE OF THOSE WERE UNFAMILIAR NAMES
TO ME. YAG CRAIG LIT TON CASE I BELIEVE WAS CITED IN PLAINTIFF TS APPELLATE BRIEF, FIRST
JERSEY WAS CITED I THINK BY BOTH PARTIES, THE HE HAD EX CASE AND REMAIN TER THE SIR HAVE IT
COURT CASES I DON'T BELIEVE WERE CITED ANYWHERE. JUSTICE PATTERSON: LIT
TON IS NOT IN THE RESPONSE TO PETITION BT I GUESS AETS A MRT DIVISION, CRAIG KRAG IT IS
IN THE APPELLATE DIVISION. JUSTICE SOLOMON: YOU SEEM TO BE SAYING THE
USUAL MEANING, THE TYPICAL MEANING OF INDEMNIFICATION IS A THIRD PARTY CLAIM,
CORRECT? CRAIG D. GOTILLA: YES. JUSTICE SOLOMON: IF THAT'S
THE USUAL MEANING OF THE BOARD INDECHL OCCASION, YOU OUGHT TO HAVE CLARIFYING LANGUAGE,
YOU OUGHT TO SPECIFICALLY SAY YOU'RE REFERRING TO FIRST PARTY CLAIMS. CRAIG D.
GOTILLA: EXACTLY, YOU WERE. JUSTICE SOLOMON: IS THAT HOW THE MA YOUR ARE THE
OF JURISDICTIONS GO? CRAIG D. GOTILLA: YOUR HONOR, I CAN'T SAY THE CIRCUIT
COURT CASES THAT WERE CITED AND I THINK I RECENTLY SAW THAT ANOTHER ATTORNEY WAS UP
BEFORE YOUR HONOR'S IN THE RECENT MAST CALL THE SCORE CARD SORT OF ARGUMENT. I CAN'T ADD
UP OFF THE TOP OF MY HEAD WHICH JURISDICTIONS SUCH AS THE WUNDZ I NOTED PREVIOUSLY FIND
AND AT THE APPELLATE DIVISION IN ITS OPINION BELOW NOTED ITSELF THAT MOST JURISDICTIONS
HAVE FOUND THAT YOU CANNOT EXPAND JURISDICTION -- INDEMNITEE TO THIRD -- SORRY, TO FIRST
PARTY CLAIMS ABSENT SPECIFIC LANGUAGE. THAT WAS THE APPELLATE DIVISION, THAT'S THE GENERAL
SITUATION, I DON'T KNOW THESE OTHER CASES. BUT WHAT I'D DID HEAR COUNSEL
ACKNOWLEDGE IS THAT THE WORD INDEMNITEE, JUST THAT WORD IN ISOLATION, THE BOARD INDEMNITEE
AND THE WHOLE REASON WE'RE HERE DPA IS THAT WORD IS SUSCEPTIBLE TO INTERPRETATION EITHER
MEANING FIRST PARTY OR THIRD PARTY CLAIMS. IF THE VERY WORD THAT WE'RE TALKING ABOUT
IS SUSCEPTIBLE TO THOSE ALL TEMP #2I6 INTERPRETATIONS, THEN UNDER KIEFFER, ANY
AMBIGUITY HAS TO BE CONSTRUED AGAINST INDEMNIFICATION. THAT'S WHAT THIS COURT
HASHGS AND IT'S A DISTINCTION OUR COURTS MADE BETWEEN CONTRACTS OF INDEMNITEE IN INSURANCE
POLICIES VERSUS PRIVATE CONTRACT. ANY AMBIGUITY IN A PRIVATE CONTRACTUAL CONTRACT, PRIVATE
INDEMNIFICATION CONTRACT SF CONSTRUED AGAINST THE INDEMNITEE. AND JUST LASTLY,
YOUR HONOR, THE FIRST JERSEY CASE WHICH WAS CITED BY BOTH PARTIES, BECAUSE IT DOES ALLOW
FOR INDEMNIFICATION OF FIRST PARTY CLAIMS, THAT'S A THIRD CIRCUIT DECISION, BUT OF
SIGNIFICANTLY SHTHS THAT OPINION INCLUDES ADDITIONAL VERBIAGE AT THE END OF THE
INDEMNITEE PROVISION THAT CLARIFIES THAT IT APPLIES TO CLAIMS ARISING DIRECTLY OR
INDIRECTLY FROM, OUT OF OR INCIDENT TO THIS AGREEMENT T. SO THAT LANGUAGE IS, IF YOU
HAVE A CLAIM ARISING OUT OF THIS GREECHLT AGREEMENT ITSELF WE'RE GOING TO INDEMNIFY YOU
FOR THAT. SO THAT CONVERTS THAT PROVISION, THAT'S PROVIDING AT LEAST SOME
INDICATION THAT THIS IS NOT A THIRD PARTY LIABILITY IN.COM OCCASION AGREEMENT, BUT IF
THERE'S AP INTRA PARTY INDEMNITEE VERSUS INDEMNITOR SUIT, WE'LL ALSO INDEMNIFY YOU FOR
THAT. AND THE FINAL, I KNOW I SAID THAT WAS THE LAST, BUT THE FIEM THING
IS A CONSENT ORDER A BAN DOORING THE ADR, THERE WAS NO DECISION ON THE MERITS ON THE WHETHER
THERE WAS WILLFUL MISCONDUCT OR BAD FAITH. THE WHOLE ADR PROCEDURE WAS SET UP AS AN AL
TERNATIVE TO THE ASSOCIATION HAVING A UNIT OWNER VOTE TO REMOVE MR. BOYLE. THE WAY THE
TRIAL COURT INTERPRETED THE RADBURN A AMENDMENTS, IF YOU WANT AS A BOARD TO REMOVE A
SITTING TRUSTEE RGS YOU CAN ONLY DO SO IF YOU GO TO ADR FIRST. THERE WAS NO ORDER REQUIRING
ADR UNLESS THE ASSOCIATION WANTED TO GO FORWARD WITH A VOTE OF ITS BOARD OF TRUSTEES TO
REMOVE MR. BOYLE. JUSTICE PATTERSON: YOU'RE SAYING THE OPENLY
RELEVANCE OF THAT PROVISION IS THAT THE REMEDY OF REMOVAL WAS TAKEN OFF THE TABLE BECAUSE
YOU OPTED FOR AN ELECTION. CRAIG D. GOTILLA: CORRECT. INSTEAD OF FIGHTING
IT OUT THROUGH AN ARBITRATION TO DECIDE WHETHER ACTIONS THAT HAD OCCURRED MONTHS EARLIER,
THE ASSOCIATION IN JULY OF 2021 AGREED AND A CONSENT ORDER WAS ENTERED AROUND THEN TO
ABANDON THE ADR TO LET THE UNIT OWNER DECIDE IN AUGUST, WHICH THEY DID, IN EFFECT YOU
HAD A TRUSTEE WHO SUCCESSFULLY GOT HIMSELF BACK ON TO A BOARD THROUGH TECHNICALITIES AND
PROCEDURAL ERRORS THAT THE ASSOCIATION COMMITTED UNDER A NEW REGULATION TEMPORARILY HAD
A VICTORY BUT THEP WAS VOTED OUT BY THE UNIT OWNERS. CHIEF JUSTICE RABNER:
THANK YOU COUNSEL TO BOTH COUNSEL, VERY FINE ARGUE THES. WE'LL TAUKT MATTER UNDER AED
A VICES R TAKE A VERY BRIEF RECESS