Alan Schorr’s Employment Case of The Week ending December 6, 2013

In re Estate of DeFrank, __ N.J. Super. ___, 2013 WL 6036597 (Published, decided November 15, 2013)

This week’’s Case of the Week is a published Appellate Division decision that many employment practitioners may have missed or overlooked because it is not an employment case. However, the holding and reasoning of this Court is completely applicable to employment discrimination and retaliation cases, and therefore should be carefully read and used by plaintiff employment practitioners in defending against summary judgment.

In In re Estate of DeFrank, the issue involved whether a decedent intended that certain joint bank accounts should be included in her estate. Essentially, two sisters were named in the decedent mother’s Will to each receive half of her estate. But about $250,000 (16% of the estate) consisted of joint bank accounts with one of the daughters. The plaintiff daughter claimed that the joint accounts should be considered part of the estate, because that was the mother’s intent in the Will. The defendant daughter argued that the creation of the joint account was evidence that the mother did not intend a totally equal split, but rather intended that the defendant daughter keep the joint accounts and split the remainder. Both parties had evidence supporting their respective positions.

Both parties filed for summary judgment. The motion judge denied the plaintiff’s motion for summary judgment and granted defendant’s motion for summary judgment, holding that the Multiple–Party Deposit Account Act (MPDA) governed the dispute and that the joint accounts pass outside the estate. The plaintiff appealed, arguing that she had presented clear and convincing evidence that it was not her mother’s intention to create a right of survivorship in the accounts. The Appellate Division reversed, holding that summary judgment was inappropriate because the resolution of the case involves state of mind and intent. The Court’s analysis, though rarely seen in discrimination and retaliation, is completely appropriate for application in employment cases:

It is ordinarily improper to grant summary judgment when a party’s state of mind, intent, motive or credibility is in issue. Mayo, Lynch & Assocs., Inc. v. Pollack, 351 N.J.Super. 486, 500, 799 A.2d 12 (App.Div.2002); G & W, Inc. v. Bor. of E. Rutherford, 280 N.J.Super. 507, 514, 656 A.2d 11 (App.Div.1995); Valley Nat’l Bank v. P.A.Y. Check Cashing, 378 N.J.Super. 406, 421, 875 A.2d 1056 (Law Div.2004), aff’d o.b., 378 N.J.Super. 234, 875 A.2d 953 (App.Div.2005); Pressler, Current N.J. Court Rules, comment on 2.3.4 on R. 4:46–2 (2014). In Shebar v. Sanyo Bus. Sys. Corp., 111 N.J. 276, 290–92, 544 A.2d 377 (1988), the Court reversed a summary judgment order when the issue was whether plaintiff had waived his claims; the Court reasoned that whether plaintiff intended a waiver was a genuine fact issue. In G & W, supra, 280 N.J.Super. at 514, 656 A.2d 11, an anti-trust case, we said that summary judgment was not appropriate because motive and intent were in issue. In Duerlein v. N.J. Auto. Full Ins. Underwriting Ass’n, 261 N.J.Super. 634, 642, 619 A.2d 664 (App.Div.1993), an insurance case, this court concluded that the trial judge erred in “summarily conclud[ing] that [the defendant-insurance company] was guilty of bad faith.”


Indeed, “[t]he cases are legion that caution against the use of summary judgment to decide a case that turns on the intent and credibility of the parties.” McBarron v. Kipling Woods, L.L.C., 365 N.J.Super. 114, 117, 838 A.2d 490 (App.Div.2004). In Judson v. Peoples Bank & Trust Co., 17 N.J. 67, 76, 110 A.2d 24 (1954), the Court set a high standard for summary judgment where intent is involved, noting

Where, as here, the opposing party charges the moving party with willful fraud and must probe the conscience of the moving party (or its officers, when, as here, a corporation) to prove his case, or in any case where the subjective elements of willfulness, intent or good faith of the moving party are material to the claim or defense of the opposing party, a conclusion from papers alone that palpably there exists no genuine issue of material fact will ordinarily be very difficult to sustain.


[ Ibid.].


Thus, it is clear that questions of a party’s state of mind, knowledge, intent or motive should not generally be decided on a summary judgment motion. Garden St. Bldgs. v. First Fid. Bank, 305 N.J.Super. 510, 527, 702 A.2d 1315 (App.Div.1997), certif. denied, 153 N.J. 50, 707 A.2d 153 (1998).

This published Appellate Division decision can be used by employment practitioners as precedent that, where intent or motive is an issue, summary judgment can never be granted. This is especially relevant in many discrimination and wrongful termination cases where the employer has stated a reason for its action and the plaintiff has the burden of proving pretext. By definition, “pretext” means “a purpose or motive alleged or an appearance assumed in order to cloak the real intention or state of affairs.” See Webster’s Online Dictionary. Virtually every argument involving pretext requires the Court to address issues of motive and intent. Therefore, an argument can be well-supported that so long as a plaintiff establishes a prima facie case of discrimination or retaliation, summary judgment must be inappropriate because the question of whether the employer’s reason is legitimate or whether it is pretextual requires a determination of motive and/or intent.

Plaintiffs’ Counsel: Eileen W. Siegeltuch, Hinkle, Fingles & Prior, P.C.

Defendants’ Counsel: Jonas Singer, Wells & Singer, LLC.

Trial Judge: Mary C. Jacobson, Mercer County Chancery Division.

Appellate Judges: Hon. Michael A. Guadagno, Hon. Jonathan N. Harris, Hon. Anthony J. Parrillo (Opinion by Parillo).