author: Botter, J. A. D. Fritz, J. A. D.

text:
    TRAVELERS INDEMNITY COMPANY, PLAINTIFF-APPELLANT, v. SUSAN MONGIOVI AND LOSS ADJUSTMENT CORP., INC., LEATHERBY INSURANCE CO. AND RUPERTA CASTRO, DEFENDANTS-RESPONDENTS.
    Superior Court of New Jersey Appellate Division
    Argued December 17, 1974
    Decided June 3, 1975.

      Before Judges Matthews, Fritz and Botter.

      Mr. Daniel J. Keenan argued the cause for appellant.

      Mr. Benjamin L. Bendit argued the cause for respondent Susan Mongiovi (Messrs. Bendil, Weinstock & Sharbaugh, attorneys).

      Mr. Leonard M. Goodman argued the cause for Respondents Loss Adjustment Corp., Inc. and Leatherby Insurance Co. (Messrs. Goodman & Lustgarien, attorneys).
   The opinion of the court was delivered by

Botter, J. A. D.

This is an appeal from the refusal of the trial judge to stay arbitration demanded by Susan Mongiovi of her insurer, Travelers Indemnity Company (Travelers), under an uninsured motorists endorsement (see N. J. S. A. 17:28-1.1) to her automobile insurance policy.

For the purposes of this action the following facts are not disputed. Mongiovi was sitting in her parked car on June 5, 1972 when it was struck by an automobile owned by Ruperta Castro and operated by Regustian C. Mendez. The Castro auto was insured by Leatherby Insurance Co. (Leatherby).

Mongiovi sued Castro for damages and her attorneys sent a copy of the summons and complaint to Leatherby. Thereafter Leatherby notified Castro that it was “expressly disclaiming all coverage under your policy 524326, because of your lack of cooperation.” A copy of said disclaimer letter was sent to Mongiovi’s attorneys, who, in turn, sent the letter to Travelers and informed Travelers that: “Since there has been a disclaimer, we are making claim under the Uninsured Motorist provisions of the Travelers Policy.”

Travelers apparently resisted Mongiovi’s claim, and Mongiovi’s attorneys demanded arbitration by the American Arbitration Association. In response, Travelers filed the complaint in this action and, on October 5, 1973, obtained an order to show cause why the arbitration hearing should not be stayed. The complaint asserts that the Castro vehicle was not an “uninsured” vehicle at the time of the accident; that Leatherby cannot disclaim if it was not prejudiced by the lack of cooperation: that the coverage afforded to Mongiovi under her insurance policy must be judicially determined as a condition precedent to arbitration (see Visselli v. American Fidelity Co., 155 Conn. 622, 237 A. 2d 561 (Sup. Ct. Err. 1967)), and that arbitration, pursuant to the endorsement, applies only to a dispute as to (a) the liability of the owner or operator of the Castro vehicle and/or (b) the amount of damages, if any. The complaint sought a stay of the arbitration, a determination of the “validity of the attempted disclaimer,” a determination of Mongiovi’s right to arbitration, and such other relief as may be appropriate.

The trial judge ruled that Mongiovi was entitled to pursue her claim for damages against Travelers. Accordingly, he refused to stay the arbitration proceeding. Implicit in this determination is the holding that the Castro vehicle was an “uninsured” vehicle within the meaning of the uninsured motorists endorsement issued by Travelers to Mongiovi. It is from the order denying the stay of arbitration that Travelers has appealed, although the issue of Leatherby’s right to disclaim has not been resolved in the lower court.

The trial judge found that the right of Mongiovi to assert her claim for damages against Travelers in arbitration required a determination of whether “the notice of disclaimer rendered the Castro car uninsured.” The trial judge applied the literal language of the policy endorsement and concluded that the uninsured motorists coverage could be invoked by Mongiovi since the endorsement defined an uninsured highway vehicle to include a vehicle insured by a company which “denies coverage” under its policy.

Since the Castro carrier denied coverage, “arbitration is available” to Mongiovi, the trial judge held. Also rejected was the contention of Travelers that Leatherby’s right to disclaim must be adjudicated before Mongiovi can proceed with her claim against Travelers.

In our view, the disclaimer by Leatherby makes the Castro vehicle an “uninsured” vehicle within the meaning of the Travelers uninsured motorists endorsement. Therefore, Mongiovi can demand payment under that coverage without first concluding her claim against the driver of the Castro vehicle, and without Leatherby’s right to disclaim having first been adjudicated.

The insurance coverage afforded by the policy endorsement is defined therein as follows:

I. UNINSURED MOTORISTS COVERAGE

(Damages for Bodily Injury and Property Damage Caused by Uninsured Highway Vehicles)
The company will pay all sums which the insured or his legal representative shall be legally entitled to recover as damages from the owner or operator of an uninsured highway vehicle because of bodily injury or property damage, caused by accident and arising out of the ownership, maintenance or use of such uninsured highway vehicle; provided, for the purposes of this coverage, determination as to whether the insured or such representative is legally entitled to recover such damages, and if so the amount thereof, shall be made by agreement between the insured or such representative and the company or, if they fail to agree, by arbitration.
No judgment against any person or organization alleged to be legally responsible for the bodily injury or property damage shall be conclusive, as between the insured and the company, of the issues of liability of such person or organization or of the amount of damages to which the insured is legally entitled unless such judgment is entered pursuant to an action prosecuted by the insured with the written consent of the company.

Exclusions

This insurance does not apply:
(a) to bodily injury or property damage with respect to which the insured, his legal representatives or any person entitled to payment under this insurance shall, without written consent of the company, make any settlement with any person or organization who may be legally liable therefor; * *■ *"

An “uninsured highway vehicle” is defined as follows:

(a) a highway vehicle with respect to the ownership, maintenance or use of which there is, in at least the amounts specified by the financial responsibility law of the state in which the insured highway vehicle is principally garaged, no bodily injury and property damage liability bond or insurance policy applicable at the time of the accident with respect to any person or organization legally responsible for the use of such vehicle, or with respect to which there is a bodily injury and property damage liability bond or insurance policy applicable at the time of the accident hut the company loriting the same denies coverage thereunder or is or becomes insolvent; or * * * but the term “uninsured highway vehicle” shall not include: (1) an insured highway vehicle, * * *. (Emphasis added.)

The literal language of the policy, as the trial court found, makes the Castro vehicle an “uninsured” vehicle for the purposes of the endorsement, since Castro’s insurance company “denies coverage” under its policy. It is asserted, however, that the definition is ambiguous, since, by other terms, it excludes “an insured highway vehicle.” Travelers contends that if it is determined that Leatherby had no right to disclaim, the Castro vehicle would remain an “insured” vehicle, and thus it would not be an “uninsured” vehicle.

Admitting some ambiguity, the first answer is to say that such ambiguity should be interpreted in favor of the insured and against the insurance company which drafted the policy endorsement. Butler v. Bonner & Barnewall, Inc., 56 N. J. 567, 576 (1970); Allen v. Metropolitan Life Ins. Co., 44 N. J. 294, 305 (1965). However, it is not necessary to rely solely on this principle. The terms of this endorsement, when carefully analyzed, confirm that the result reached was probably intended by the draftsman, whatever laymen may have understood the endorsement to mean.

To start with, the literal terms are satisfied notwithstanding the apparent ambiguity. We know that Castro’s insurance company “denies coverage” under the “insurance policy applicable at the time of the accident.” We do not know whether the disclaimer will be legally effective; therefore, we do not know whether the Castro vehicle is or is not an “insured” vehicle with respect to this accident. For the purposes of this endorsement, then, it is clear that an uninsured vehicle includes a vehicle with an insurance policy at the time of the accident issued by a company which later “denies coverage thereunder.” Such a vehicle cannot also be deemed an “insured” vehicle, since by previous definition it has been labeled an “uninsured” vehicle for the purposes of the policy.

There is other language which supports this conclusion. Clause I, “Uninsured Motorists Coverage,” first quoted above, provides that no judgment obtained by the insured against “any person or organization” liable to the insured for damages “shall be conclusive, as between the insured and the company [Travelers]” as to liability or damages “unless such judgment is entered pursuant to an action prosecuted by the insured with the written consent of the company.” (Emphasis supplied.) Coverage is also excluded for personal injuries or property damage claims if the insured “without the written consent of the company” makes “any settlement” with the persons “legally liable therefor.” These provisions prohibiting suit or settlement without consent of the insurer are said to be aimed at protecting the insurer “against multiple lawsuits in which its interests may be adversely affected without its being given adequate representation * * Annotation, “Uninsured Motorist Endorsement : validity and enforceability of provision for binding arbitration, and waiver thereof,” 24 A. L. R. 3d 1325, 1328 (1969). It is inconsistent to say that Mongiovi may not assert a claim under the Travelers uninsured motorists endorsement unless she has first litigated the validity of Leatherby’s disclaimer, but that Mongiovi may not sue Castro or Leatherby without Travelers’ written consent. Cf. Poray v. Royal Globe Ins. Co., 90 N. J. Super. 454, 461 (Law Div. 1966); Visselli v. American Fidelity Co., supra. In fact, retention of control over claims against others confirms the intent of the policy to permit both payment under the policy and the pursuit of claims against such persons who may be liable, notwithstanding the apparent lack of insurance coverage on another vehicle involved in the accident.

Thus the policy scheme allows Mongiovi to proceed against Travelers on the endorsement when Castro’s insurer has disclaimed. Central Mut. Ins. Co. v. Espina, 208 So. 2d 144 (Ela. App. 1968); St. Paul Mercury Ins. Co. v. American Arbitration Ass’n, 425 Pa. 548, 229 A. 2d 858 (Sup. Ct. 1967). Travelers retains control over Mongiovi’s claims against Castro and her insurer, and Travelers will acquire Mongiovi’s rights to said claims by subrogation upon payment of Mongiovi’s damages. Id. To the extent that Kearny v. Chemical Leaman Lines Co., Inc., 122 N. J. Super. 438 (Law Div. 1973) holds otherwise, it is disapproved.

We agree with the contention of Travelers that the only issues subject to the endorsement’s arbitration clause are liability (of the Castro vehicle) and damages (recoverable by Mongiovi). Visselli v. American Fidelity Co., supra; Hartford Accident & Indemn. Co. v. Travelers Ins. Co., 25 Conn. Sup. 414, 206 A. 2d 847 (Super. Ct. 1964). Leatherby’s right to disclaim is not an issue for arbitration between Mongiovi and Travelers, but was properly made a subject of the within action. Having determined that Mongiovi may assert her claim under the uninsured motorists endorsement, arbitration can proceed, if needed, should Travelers and Mongiovi fail to agree on Mongiovi’s right to damages and the amount thereof.

We affirm. Since the action below has not been concluded in all respects, the matter is remanded to the trial court.

Fritz, J. A. D.

(dissenting). I am satisfied that the majority, like the trial judge, has by-passed the real issue presented on this appeal and, in the course of this journey, undertaken unnecessarily to decide too much. Accordingly, I respectfully dissent from their conclusion that arbitration can proceed (as they say “if needed”) and refrain from an expression of view, as presently unnecessary and undesirable in a summary proceeding, as to whether a disclaimer always constitutes a vehicle “uninsured”. The inevitability of this latter conclusion in the view of the majority, regardless of the bona fides of the disclaiming insurance company and the factual milieu of a given case, is apparent: their determination in this regard sprang from the policy words uninfluenced by the facts here. While the logic of the contract construction is persuasive, I am not prepared to concur in this situation where I feel this far-reaching pronouncement is unnecessary.

The real remedy that was sought below was a stay of arbitration. The insured or uninsured status of the Castro vehicle has no relevance whatsoever unless it is a stepping stone to the ultimate determination of that primary issue. But the trial judge focused on a primal determination of the insured-uninsured status of Castro, and then concluded, as he put it, that “logically * * * arbitration is available.” In this I think he was mistaken, for if this rule is sound, arbitration would be available in any case of an uninsured vehicle, whether by sound or unsound disclaimer or otherwise. Clearly such was not the intention of the parties with respect to the arbitration clause, a fact acknowledged by the majority in the penultimate paragraph of its opinion where it says:

We agree with the contention of Travelers that the only issues subject to the endorsement’s arbitration clause are liability (of the Oastro vehicle) and damages (recoverable by Mongiovi). * * * Leatherby’s right to disclaim is not an issue for arbitration between Mongiovi and Travelers, but was properly made a subject of the within action. Having determined that Mongiovi may assert her claim under the uninsured motorists endorsement, arbitration can proceed, if needed, should Travelers and Mongiovi fail to agree on Mongiovi’s right to damages and the amount thereof.

Indeed, that conclusion expresses my view as to the purpose of the arbitration clause and the reason I believe arbitration is not here available. This despite the fact that arbitration is a favored remedy, Keppler v. Terhune, 88 N. J. Super. 455 (App. Div. 1965), and doubts are to be resolved in favor of arbitration, Standard Oil, etc., Union v. Esso Research, etc., Co., 38 N. J. Super. 106 (App. Div. 1955), dec. on pet. for reh. 38 N. J. Super. 293 (App. Div. 1955), for the right to arbitration does not attach to a eon-tract except by express agreement between the parties and then only within the perimeters of that agreement. Keppler v. Terhune, supra, 88 N. J. Super, at 462. The parties are said to “have a right to stand upon the precise terms of their contract.” Goerke Kirch Co. v. Goerke Kirch Holding Co., 118 N. J. Eq. 1, 4 (E. & A. 1935).

In the uninsured motorist endorsement with which we are concerned, the arbitration clause in its entirety reads:

G. Arbitration.
If any person making claim hereunder and the company do not agree that such person is legally entitled to recover damages from the owner or operator of an uninsured highway vehicle because of bodily injury or property damage to the insured, or do not agree as to the amount of payment which may be owing under this insurance, then, upon written demand of either, the matter or matters upon which such person and the company do not agree shall be settled by arbitration, which shall be conducted in accordance with the rules of the American Arbitration Association unless other means of conducting the arbitration are agreed to between the insured and the company, and judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction thereof. Such person and the company each agree to consider itself bound and to be bound by any award made by the arbitrators pursuant to this insurance.

It is to be seen from the plain language of this section that before arbitration is available, there must be a disagreement between Travelers and Mongiovi either as to (1) whether Mongiovi “is legally entitled to recover damages from the owner or operator of an uninsured highway vehicle” (emphasis supplied), or as to (2) the “amount which may be owing under this insurance.” It is to be noted that irrespective of the rights of Travelers and Mongiovi, either vis-á-vis or with respect to Castro or Leatherby, the arbitration clause is framed in terms of the liability of the owner or operator of the uninsured vehicle and not in terms of the responsibility of another carrier to indemnify that liability. The terms of the arbitration clause before us are succinct and concise and the agreement between the parties is clear. We overstep if we "intrude” to rewrite "the language [the parties] employed in reducing their understanding to writing.” Standard Oil, etc., Union, supra, 38 N. J. Super, at 114.

In the matter before us there is no disagreement at all between Travelers and Mongiovi as to the entitlement of the latter to recover damages from Castro. Not only does neither assert such a disagreement but Mongiovi’s action against Castro speaks of her conviction in this regard and Travelers’ announced concern for its subrogation right bespeaks its position. While it seems unlikely that there could be disagreement on the “amount of payment” which may be owing until such tima as that is fixed, presumably by a trial of Mongiovi’s suit against Castro, such a defense to payment by Travelers under its uninsured motorist clause has not been raised and thus will not serve to invoke the arbitration clause. It is to be seen, therefore, that regardless of whether Castro is deemed to be insured or uninsured, the arbitration clause does not in these circumstances require submission to arbitration. This conclusion has been reached in a majority of other jurisdictions which have considered the problem. See, for instance, Visselli v. American Fidelity Co., 155 Conn. 622, 237 A. 2d 561 (Sup. Ct. Err. 1967); Western Casualty & Surety Co. v. Strange, 3 Mich. App. 733, 143 N. W. 2d 572 (Ct. App. 1966); Flood v. Country Mutual Ins. Co., 41 Ill. 2d 91, 242 N. E. 2d 149 (Sup. Ct. 1968); Murtaugh v. American States Ins. Co., 25 Ohio O. 2d 106, 187 N. E. 2d 518 (Ct. App. 1963); In Matter of Rosenbaum, 11 N. Y. 2d 310, 229 N. Y. S. 2d 375, 183 N. E. 2d 667 (Ct. App. 1962); Motor Vehicle Accident Indem. Corp. v. Linder, 17 App. Div. 2d 610, 230 N. Y. S. 2d 372 (App. Div. 1962). But see, In re Zurich Ins. Co., 14 App. Div. 2d 669, 219 N. Y. S. 2d 748 (App. Div. 1961), decided prior to Rosenbaum, supra.

As is pointed out in Annotation, “What Issues Are Ar-bitrable Under Arbitration Provision of Uninsured Motorist Insurance,” 29 A. L. R. 3d 328 (1970) where the cases are collected, "a few jurisdictions” have held to the contrary. See, for instance, Great American Ins. Co. v. American Arbitra tion Ass’n, 436 Pa. 370, 260 A. 2d 769 (Sup. Ct. 1970). I believe this minority position represents unwarranted judicial intrusion in the contract relationship between the parties, unjustified by the expressed but improbable position that an arbitrator will decide the issue more promptly and more justly than a court. See Motor Vehicle Accident Indemnification v. Malone, 16 N. Y. 2d 1027, 265 N. Y. S. 2d 906, 213 N. E. 2d 316 (Ct. App. 1965).

I am further persuaded that arbitration is unavailable by syllogistic logic: since the arbitration clause appears in the uninsured motorist endorsement, arbitration is not available if Castro is deemed insured. If he is deemed uninsured, there is nothing to arbitrate since, as the majority recognizes, only the issues of liability and the extent of damages may be subjected to arbitration. I have come full circle: Castro’s status, insured or not, is irrelevant to arbitration.

Finally, as a matter of mutual intent between the contracting parties, it seems to me most unlikely that Mongiovi, when contracting with Travelers, intended that arbitrators should decide the vitality of a.n insurance contract between two strangers (to Mongiovi and Travelers) neither of which strangers was a party to the Mongiovi contract and neither of which could be bound by the arbitration.

The advantages of a denial of arbitration are clear. All parties can be brought together in one civil action adequately framed and processed, and all parties will be bound by the totally dispositive result. This expediency, coupled with justice, was the brilliant target of that referred to not so long ago as the “new Pules.”

N. J. Manu. Ins. Co. v. Haran, 128 N. J. Super. 265 (App. Div. 1974), has been brought to our attention. The problem there considered is different from the one facing us.

I would reverse the order below and enjoin arbitration. In doing this, I would decide nothing else with respect to relative rights and duties between or among the insurance companies, their agents, or the individual parties and I would enter such judgment without prejudice to the pursuit of any of these rights by any party in any appropriate forum excepting arbitration.

      Travelers did not move for leave to appeal. R. 2:2-4. It is doubtful that Travelers may appeal as of right, as from a final judgment (R. 2:2-3; Keppler v. Terhune, 88 N. J. Super. 455, 461 (App. Div. 1965) ; Stiles v. Hammond, 21 N. J. Super. 237, 239 (App. Div. 1952)) without at least having moved for entry of a final judgment on the claims adjudicated by the court pursuant to R. 4 :42-2. See Applestein v. United Board & Carton Corp., 35 N. J. 343, 350-352 (1961). Nevertheless, because of the time already consumed in this litigation, we have decided to deal with the issue on the merits. We also shun, for the same reason, the question of the propriety of using a summary action procedure (R. 4:67-1) rather than a declaratory judgment action to bring this issue before the court.


source: Caselaw Access Project

author: Per Curiam.

license: Public Domain

text:
    SEMI METALS, INC. AND GENERAL INSTRUMENT CORP, PLAINTIFFS-RESPONDENTS AND CROSS-APPELLANTS, v. PINTER BROTHERS, DEFENDANT-APPELLANT AND CROSS-RESPONDENT, AND EASTERN FREIGHT WAYS, INC., DEFENDANT.
    Superior Court of New Jersey Appellate Division
    Argued May 13, 1975
    Decided July 10, 1975.

      Before Judges Halpebn, Crahay and Wood.

      Mr. Stanley P. Fishman argued the cause for appellant, Pinter Brothers (Messrs. Feuerstein, Sachs & Maitlin, attorneys).

      Mr. Clifford J. Sheeham, argued the cause for respondent, Semi Metals, Inc. and General Instrument Corp. (Messrs. Hueston, Hueston & Sheehan, attorneys).

      Mr. Herbert M. Guston argued the cause for defendant, Eastern Freight Ways, Inc. (Messrs. Guston & Beiss, attorneys) .
   Per Curiam.

In its complaint seeking money damages plaintiff Semi Metals, Ine. (Semi Metals), a subsidiary of General Instrument Corp. (General), alleged delivery of two cartons of germanium metal to defendant Pinter Brothers (Pinter) for shipment, under a uniform straight bill of lading, to the Sylvania Electric Company in Pennsylvania. Defendant Eastern Freight Ways, Inc. (Eastern) was to be the connecting carrier in the transmittal. Plaintiff contended that the metal was thereafter “lost, stolen or converted.” (A second count in the complaint, grounded in the same factual allegations, asserted a bailment of the metal and loss through negligence.)

It was stipulated that the full value of the goods was $19,280. Defendants included in their answers as a separate defense that plaintiff’s damages, if any, were limited by the terms of the bill of lading under which the germanium was shipped.

Following a trial without a jury the trial Judge entered Judgment in favor of plaintiff in the sum of $19,280 without interest against Pinter. Eastern had a Judgment of dismissal. The trial Judge’s reasons were reported. Semi Metals, Inc. v. Pinter Bros., 126 N. J. Super. 124 (Law Div. 1973). Pinter appeals, asserting essentially that

I. Since the trial court found as a fact that plaintiff had committed an “intentional misdescription” of the contents of the shipment, recovery was barred.
II. Even if plaintiff is entitled to recover, appellants’ liability is limited by tariffs filed with the Interstate Commerce Commission.
III. If there is any liability owing to plaintiff, responsibility therefor should be borne by co-defendant Eastern.

Semi Metals cross-appeals, asking that the Judgment be modified to include interest.

We are satisfied that, as between defendants Pinter and Eastern, the trial Judge on this record correctly held that Pinter was the liable carrier, and we affirm that holding essentially for the reasons given by the trial court, 136 N. J. Super, at 138. However, we perceive that the trial judge erred in the quantum of damages assessed and reverse on that score. It may be illuminative to enlarge on the factual recitation set out below.

Two cartons of germanium scrap weighing 335 pounds were received by Pinter from Semi Metals on August 17, 1970. Germanium is a semi-precious metal used in the manufacture of electronic equipment. In August 1970 it had a value of between $330 and $360 a kilogram. (In view of the stipulation we calculate the value to be slightly in excess of $85 a pound.)

The two cartons were picked up by a truck driver employed by Pinter at Semi Metals’ plant and placed on one of its trucks, and thereafter have not been accounted for.

Semi Metals prepared the bill of lading for the transmittal of the germanium and it chose to describe the shipment as “3 ctns. Electronic Material”. That labeling was twice referred to by the trial court as an intentional mis-description. The propriety of that finding is patent in light of the record.

Semi Metals’ purchasing agent, David Shapiro, testified that he purchased the involved germanium in August 1970 from a company in Denmark at a favorable price and shortly thereafter sold and shipped it collect to Sylvania in Pennsylvania without realizing a profit, expecting to buy it back within 30-60 days at a higher price. The record is not entirely clear as to the nature of this transaction, the stated reason ultimately being, “To reduce any inventory.”

On direct examination Shapiro testified that the materials were shipped “collect” pursuant to instructions from Syl-vania, and for this reason no value of the goods was stated in the bill of lading. Shapiro, who was in charge of plaintiff’s shipping operations, prepared the bill of lading. He testified that Semi Metals had insurance covering the full value of the shipment against any loss.

Shapiro did not tell Pinter’s truck driver what the two cartons contained or that the shipment “was worth a lot of money.” On direct examination Shapiro first stated that there was no reason why he didn’t employ the word “germanium” rather than “electronic equipment,” asserting that “I always put down ‘electronic equipment.’ ” When asked if there was a value on shipped goods based upon tariffs, Shapiro claimed not to know.

Significantly, however, Shapiro stated that it was plaintiff’s company policy not to put values on shipments of materials and that one of the reasons therefor was the avoidance of higher freight charges. The record makes clear that value was of little moment to plaintiff since it had purchased insurance against loss. The record reflects this during Shapiro’s examination:

Q. Isn’t one of the reasons why [no value is put on shipment] because there would be a higher freight charge?
A. I would say yes to that.
Q. Isn’t it a fact the reason you don’t put it on there is to keep your freight charges low?
* * * * * -r * **
A. Is the question to keep the rate low?
Q. Right.
A. Yes.
Q. Isn’t that the reason you purchased insurance, to protect yourself in that manner?
A. Yes.

Indeed, scrap gold, said Shapiro, would have been shipped in like manner and we presume for the same reasons.

As the trial judge noted, the liability of common carriers for the loss of shipped goods and limitations on that liability are found in 49 U. S. CV. A. § 30(11). That legislation makes common carriers generally liable for the full actual loss to goods in transit on a through bill of lading notwithstanding attempted limitations on liability for full actual loss to the property. However —-

* * * That the provisions hereof respecting liability for full actual loss * * * shall not apply * * * to property, except ordinary livestock, received for transportation concerning which the carrier shall have been or shall be expressly authorized or required by order of the Interstate Commerce Commission to establish and maintain rates dependent upon the value declared in writing by the shipper or agreed upon in writing as the released value of the property, in which case such declaration or agreement shall have no other effect than to limit liability and recovery to an amount not exceeding the value so declared or released, * * * and any tariff schedule which may be filed with the commission pursuant to such order shall contain specific reference thereto and may establish rates varying with the value so declared and agreed upon; and the commission is empowered to make such order in cases where rates dependent upon and varying with declared or agreed values would, in its opinion, be just and reasonable under the circumstances and conditions surrounding the transportation. * * * [49 U. S. C. A. § 20(11)]

Ordinarily the metal involved in this case would be clearly within the cited exception, there being at the time of loss a filed tariff governing them. However, as noted, there was no declared value on the bill of lading. The trial judge observed that

The rights and liabilities of the parties are governed by the acts of Congress, the bill of lading and the tariffs duly filed with the Interstate Commerce Commission. The bill of lading and tariff have the force of statute and they cannot be varied under any pretext. The carrier cannot lawfully depart from them. [126 N. J. Super. at 131]

We add only that neither may a shipper. Time-D. C., Inc. v. Tappins, Inc., 126 N. J. Super. 179 (Cty. Ct. 1973), aff’d 132 N. J. Super. 5 (App. Div. 1975).

The record supports a finding that at the time of this transaction there was duly filed with the Interstate Commerce Commission, pursuant to 49 U. S. C. A. 317(a), tariffs governing freight traffic — National Freight Classification A-ll (effective June 11, 1970). Among its many provisions it includes an item for scrap metals N. O. I. (Not Otherwise Indicated). Different rates are authorized for released value of (1) up to 40 cents a pound, (2) between 40 cents and $1 a pound and (3) between $1 and $5 a pound. The tariff further prescribed:

Note •— The released value must be entered on shipping order and bill of lading in the following form:
‘The agreed or declared value of the property is hereby specifically stated by the shipper to he not exceeding - per pound.’
(Shipper’s Signature)

and

If the shipper declines or fails to declare the value or agree to a released value in writing the shipment will not be accepted, charges will initially be assessed on basis of the class for the highest valuation provided. Upon proof of the lower actual value, freight charges will be adjusted to the basis of the class or rate applicable in connection with such actual value. In no instance will carriers’ liability exceed the highest value for which classes are provided.

The tariff contemplated for scrap metals a maximum released value of not more than $5 a pound unless otherwise declared. We cannot conceive that the carrier here would have accepted the germanium and transported it if alerted by the shipper to a value greatly in excess of $5 a pound. (Interestingly, in view of Shapiro’s testimony, we note that another item in the tariff provides that gold articles are “not taken” under the Motor Freight Classification Tariff.)

Thus, in light of plaintiff shipper’s position that it deliberately labeled the metals “electronic materials” (the tariff has no such classification) to enjoy reduced freight charges (at no risk to it in view of its insurance coverage), we do not perceive that the exceptional loss should he borne by the carrier. The misdescription was intentional and had the clear capacity to mislead. Herring v. Alabama Great Southern Railroad Co., 236 Ala. 618, 184 So. 180 (Sup. Ct. 1938), cert. den. 306 U. S. 644, 59 S. Ct. 583, 83 L. Ed. 1044 (1939); cf., Allied Van Lines, Inc. v. Smith, 28 Colo. App. 85, 470 P. 2d 926 (App. Ct. 1970). Compare New York City R. Co. v. Goldberg, 250 U. S. 85, 39 S. Ct. 402, 63 L. Ed. 857 (1919). See also, Annotation, “Shipper’s misdescription of goods as affecting carrier’s liability for loss or damage”, 1 A. L. R. 3d 736 (1965). We need not and do not pass upon —- as Pinter asks us to —■ whether plaintiff’s conduct constituted a breach of the penal provisions of 49 U. S. C. A. § 10(3).

It appears that the trial court placed reliance for its holding on Caten v. Salt City Movers & Storage Co., Inc., 149 F. 2d 428, 432 (2 Cir. 1945); Thomas Electronic, Inc. v. H. W. Taynton, Inc., 277 F. Supp. 639 (M. D. Pa. 1967); Loeb v. Friedman’s Express, Inc., 187 Misc. 89, 65 N. Y. S. 2d 450 (Sup. Ct. 1946), aff’d 271 App. Div. 973, 66 N. Y. S. 2d 634 (App. Div. 1946), aff’d 296 N. Y. 1029, 73 N. E. 2d 906 (Ct. App. 1947), cert. den. 331 U. S. 851, 67 S. Ct. 1743, 91 L. Ed. 1859 (1947) and Paramount Dress Co. v. Kirby & Kirby, 167 Pa. Super. 524, 76 A. 2d 432 (Super. Ct. 1950). We do not view those authorities as operative on this record. In none of them do we see a finding of intentional misdescription of the goods involved, with an eye by the shipper to thereby pay reduced freight charges. It simply does not conform with plain principles of justice to permit a shipper to enjoy reduced freight rates by an intentional act and reap the benefits of that contract when there is no loss but disclaim the shipping agreement where there is one. Adams Express Co. v. Croninger, 226 U. S. 491, 33 S. Ct. 148, 57 L. Ed. 314 (1913). In a word, on this record plaintiff was estopped from invoking the holding of Caten and its progeny.

Lastly, we see no warrant in this record for disturbing the trial court’s denial of interest.

Accordingly, the judgment under review is modified granting judgment to plaintiff against defendant Pinter in the sum of $1,135 ($5 a pound as limited by the tariff), without interest.

      Included on the uniform straight bill of lading was: “NOTE — where the rate is dependent on value, shippers are required to state specifically in writing the agreed or declared value of the property.” Semi Metals here gave no value.

      While ordinarily not relevant, we note here that plaintiff was fully reimbursed for the loss sustained, and the action below was brought by General’s insurance carrier (in Semi Metals’ name) under subrogation rights.


author: Morgan, J. A. D.

text:
    STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT, v. TROY POINTER, DEFENDANT-APPELLANT.
    Superior Court of New Jersey Appellate Division
    Argued May 19, 1975
    Decided July 11, 1975.

      Before Judges Michels, Morgan and Milmed.
    Mr. Theodore V. Fishman, First Assistant Deputy Public Defender, argued the cause for appellant (Mr. Stanley C. Van Ness, Public Defender, attorney).

      Mr. Joseph J. Rodgers, Deputy Attorney General, argued the cause for respondent (Mr. William F. Hyland, Attorney General of New Jersejq attorney).
   The opinion of the court was delivered by

Morgan, J. A. D.

The essential issue to be determined on this appeal is whether the fruits of a search conducted pursuant to an alleged “oral search warrant” must be suppressed. Subsumed thereunder are the further issues of whether the warrant in the present case was an oral one and, if so, whether in contemplation of state and federal constitutional and procedural law, an “oral search warrant” is the legal equivalent of a written one.

The facts which generate these questions are simple and free from dispute. On March 30, 1973 Detectives Robert Puller and Joseph Kownacki of the Trenton Police Department applied to a judge of the Superior Court of New Jersey for issuance of a search warrant. The need for the warrant had become apparent within a brief period of time before their appearance, and they lacked the usual prepared affidavits setting forth the facts supporting their application. Instead, they gave sworn oral testimony in the presence of the judge, which was stenographically recorded, later transcribed, and is part of the record on this appeal. R. 3:5-3; R. 3 :5-6.

That testimony disclosed that Puller and Kownacki had just arrested defendant and one Herman Lester for possession of narcotics. At the time of the arrest, defendant was found in possession of a large amount of money in addition to the narcotics found on his person, and a key to Room 1223 of a particular Holiday Inn. The officers retained the narcotics, but perceiving the key to be of no particular significance at the time, permitted defendant to return it to his pocket with his other belongings.

Contemporaneously with the arrest of defendant and Lester, one Jerome “Eyes” Smith was arrested. Smith offered to aid the officers if he would be given a ££break.” He then informed the officers that defendant had “dope” in one of the hotels, but refused to elaborate further. On a “strip search” of defendant at police headquarters following his arrest Fuller observed that the key he had previously seen was missing. On inquiry as to its whereabouts defendant denied ownership of the key, but told the officer that it was in the police van which had transported defendant to police headquarters. The key was discovered in a well in the rear of the truck where the prisoners had been sitting.

The detectives testified that they then contacted a Robert Bradley, manager of the Holiday Inn, who informed them that Room 1223 was registered to one Troy Pointer, although under an assumed name. Pictures of defendant were taken to Bradley, who then identified defendant as the person to whom the room was registered. Bradley was told to double lock the door to that room and have a public officer posted in front of it. There was no noise from inside the room.

It was on the basis of this sworn testimony that the judge authorized a search of Room 1223 in this Holiday Inn, together with anyone found therein, advising the detectives that a written warrant reflecting his oral authority would be issued within a few days. In fact, the warrant was issued approximately five days after the search, dated March 30, 1973, nunc pro tunc. The same judge who provided the oral authorization for the search sat on defendant’s motion to suppress the evidence uncovered in the search, over defendant’s objections, and denied the motion. Defendant was later tried and convicted of possession of heroin (count 1) and possession of heroin with intent to distribute (count 3). Count 2 had been dismissed. Defendant was sentenced to the New Jersey State Prison for a term of not less than 6 nor more than 12 years on count 3, and not less than 3 years or more than 5 years on count 1. Both sentences were to be served concurrently.

Preliminarily, we conclude that the testimony given by the officers in support of their application for issuance of a search warrant sufficiently established probable cause for its issuance. Smith’s tip, that defendant possessed heroin in an unidentified motel room, standing alone would not have justified issuance of the warrant, although the circumstances in which it was given could have been found by the issuing judge to be suggestive of some reliability. Smith was not an unknown informer. His identity was known and he was giving the tip as a quid pro quo for a desired “break” from law enforcement officials. Had the tip' proven valueless, Smith’s attempt at lenient treatment would have failed. This factor was an important consideration in the evaluation of Smith’s credibility and the reliability of the information, however sketchy, that he imparted. Beyond this, however, the evidence received as a whole provided a “substantial basis” for the court’s finding of probable cause. United States v. Harris, 403 U. S. 573, 579-581, 91 S. Ct. 2075, 2079-2081, 29 L. Ed. 2d 723, 731-733 (1971). In addition to Smith’s information, the judge was informed that defendant had just been arrested with narcotics in his possession; he was also found with a large amount of cash and a mote] room key; he first disclaimed ownership of the key, a fact shown to be false by later investigation of the testifying officers, and attempted to hastily rid himself of it by discarding it in the police van; the motel room identified by the key was in fact rented by him, although under a false name, a fact which corroborated, in part, the “tip” given by Smith. Based upon all of this information, the judge correctly found that probable cause for searching the motel room existed. State v. Perry, 59 N. J. 383, 388 (1971); State v. Mercurio, 113 N. J. Super. 113 (App. Div. 1970), aff’d o. b. 57 N. J. 367 (1971).

Defendant next contends that the failure of the judge to issue the customary form of warrant prior to the search impaired his Eourth Amendment right to protection against unreasonable searches and seizures. He takes the position that the search was conducted pursuant to oral authority of a judge, was therefore constitutionally defective and any evidence uncovered therein must, accordingly, be suppressed.

The vice inherent in this argument is that the warrant authorizing the search in this case was not an oral but a written one, albeit not in the customary form. The judge’s authorization to search was memorialized, in tangible and written form, on the stenographer’s tape, as was the testimony given in support of its issuance. The tape was dated; it memorialized judge’s finding of probable cause and authorization to search, specified the persons and places to be searched and what it was to be seized. The stenographer’s tape, a “writing” in every sense of the word, therefore, contained the necessary essentials for a valid search warrant, and the failure of the judge to transpose this written authority into the usual form of warrant does not result in having his written warrant deemed an oral one. Although this written warrant was not particularly suitable for serving or filing, these circumstances did not and could not have converted the written warrant into an oral one.

Minor deficiencies in the form of the warrant or with the manner of its use have not resulted in illegal searches with the necessary consequent suppression of the fruits thereof. Failure to file the affidavit and warrant with the office of the county clerk did not require suppression of the evidence uncovered in the search, the requirement for filing being regarded as merely directory. State v. Harris, 98 N. J. Super. 502 (App. Div.), certif. den. 51 N. J. 396 (1968). Error in describing the premises to be searched did not invalidate the warrant when, from other circumstances, the identity of the premises was made clear. State v. Daniels, 46 N. J. 428 (1966). Failure to deliver a copy of the warrant to the party whose premises are being searched until the following day was held not to render the search "unreasonable” in terms of the Fourth Amendment. United States v. McKenzie, 446 F. 2d 949 (6 Cir. 1971). The fact that an existing warrant is not in the possession of the searching officers at the time of the search does not render the search unlawful requiring the suppression of its results. State v. Johnson, 16 Ohio Misc. 278, 240 N. E. 2d 574 (Ohio C. P. 1968) (warrant produced 10 to 15 minutes after search); United States v. Woodring, 444 F. 2d 749 (9 Cir. 1971) (warrant produced before search ended). The fact that the warrant in this case was not signed does not render the search constitutionally infirm where neither the judge nor the searching officers were aware of this deficiency. Sternberg v. Superior Court of County of Solano, 41 Cal. App. 3d 281, 115 Cal. Rptr. 893, 894 (D. Ct. App. 1974).

While the requirement that a search warrant be in writing is implicit in the Fourth Amendment and its counterpart in the New Jersey Constitution (1947), Art. I. § 7, although not expressly set forth therein, the warrant in the present case complies with that requirement. The form of the warrant might have caused a problem had the officers met with a contemporaneous challenge to their authority to search at the motel. It is with respect to such contingencies that possession by the officers of the customary form of warrant at the time of the search is desirable and required by the rules of court requiring service of the warrant on the person whose premises are to be searched. B. 3:5-5. Failure to make the service or leave a copy at the place searched, particularly when not demanded or when the authority to search goes unchallenged, will not, however, invalidate the search if the other prerequisites to a proper search have been met. United States v. McKenzie, supra.

In the specific and unique circumstances of this case we conclude that the search was a lawful one and that none of defendant’s Fourth Amendment rights were impaired thereby.

There is not even an intimation that the officer who applied for the warrant was playing fast and loose with the court or desired to obtain a general warrant under the guise of a specific warrant. The police were not guilty of any subterfuge. The police observed the mandate which required them to apply to a judicial officer whose independent judgment stands between the police and the public. [State v. Daniels, supra at 46 N. J. 437-438]

A proper finding of probable cause was made by a judicial officer on the basis of sworn testimony preserved for later review in trial court and appellate proceedings. The premises to be searched was described and the search did not exceed the bounds thereof. A warrant, in customary form, issued within days thereafter. In State v. Romeo, 43 N. J. 188 (1964), cert. den. 379 U. S. 970, 85 S. Ct. 668, 13 L. Ed. 2d 563 (1965), the court observed:

The fundamental requirement of the Fourth Amendment is reasonableness. Granting requisite adherence to the basic essentials of that concept assuring proper recognition of the individual liberties sought to be safeguarded thereby, the validity of law enforcement conduct should not be judicially tested by post facto technicalities and formalisms of no vital importance.

Defendant has no just cause for complaint and the motion to suppress the evidence was properly denied.

We do not, however, wish to be understood as condoning the procedure adopted in this case. Departures from normal practice in the issuance of search warrants should be assiduously avoided as productive only of time consuming and costly proceedings thereafter not to mention risk of undermining an otherwise valid conviction. The short amount of time necessary for the judge to have issued a warrant in customary form or to have drafted, even by hand, a basic, bare-bones warrant containing the essentials required by the rules of court would have obviated the later proceedings caused by the failure to take those few minutes. Search warrants must be in writing and every effort should be made to have such warrants conform to the requirements set forth in our rules of court. Laxity in the compliance with these procedures is disapproved.

Defendant’s contention that the trial judge who issued the warrant should have disqualified himself, on defendant’s request, from determining the motion to suppress is without merit. State v. Smith, 113 N. J. Super. 120 (App. Div. 1971), certif. den. 59 N. J. 293 (1971). We have examined the record together with the presentenee report and have concluded that the sentences imposed were not manifestly excessive.

Affirmed.

      The necessity for a written, as distinguished from an oral, warrant is also apparent in our rules of court designed to implement the search and seizure provision of both the federal and state constitutions. See, e. g., R. 3:5-3 for the requirement that a warrant be “dated” and that it name and describe the person or place to be searched and specify the hours during which it may be executed. R. 3:5-5 requires the searching officer to give a copy of the warrant to the person whose premises are being, searched. This provision, too, imports the concept of a search warrant as being a written instrument.


text:
    OSWALD A. KRAUSE, DOROTHY M. KRAUSE, TIMOTHY TARDELL AND BARBARA TARDELL, PLAINTIFFS-APPELLANTS, v. WALLACE D. TAYLOR AND BARBARA TAYLOR, DEFENDANTS-RESPONDENTS.
    Superior Court of New Jersey Appellate Division
    Argued May 5, 1975
    Decided July 11, 1975.

      Before Judges Michels, Morgan and Milmed.

      Mr. Alfred A. Siss, Jr. argued the cause for appellants.

      Mr. Eugene G. Liss argued the cause for respondents (Messrs. Liss & Meisenbacher, attorneys; Mr. Raymond Mei-senbacher, on the brief).
   Per Curiam.

Plaintiffs-appellants Oswald A. and Dorothy M. Krause (hereinafter Krauses), purchased certain property in the Borough of West Paterson, County of Passaic, from David A. and Mae E. Tajdor, his wife, by deed dated .January 9, 1947. Defendants Wallace D. and Barbara Taylor are the grantors’ successors in title and, for convenience, both the grantors and their successors will be referred to herein as the “Taylors”. The property purchased by the Krauses, adjacent to land retained by the Taylors, was landlocked and the only access to a public road was afforded by use of an easement across the Taylors’ property, known as Taylor’s Way.

Prior to its purchase in 1947 the Krauses had leased the property in question from the Taylors for use as a nursery, and then, too, ingress and egress to the leased land was by means of Taylor’s Way. The 1947 deed refecting Krauses’ purchase of the land in question sought to preserve this access by incorporating therein the following provision:

The parties o' the second part, their heirs or assigns are hereby given the right of privilege of egress or ingress in, over and upon a certain private roadway running from New Street, which is also called Rifle Camp Road, through the property of the parlies of the first part and adjacent, to the property described in the within deed.

Following purchase, the laud continued to be used as a nursery but to an increasingly limited extent. Krauses’ intention to ultimately make use of the land as a homesite was known to the Taylors, and several years later the Krauses purchased a small adjacent parcel of property upon which they did build a home. Access to this home continued over Taylor’s Way.

By deed dated August 13, 1973 the Krauses conveyed a portion of the land they had purchased from the Taylors to plaintiffs Timothy and Barbara Tardell (hereinafter Tar-dells). The Tardell deed included a grant of the right to use the easement which the Krauses received from the Taylors. After obtaining title the Tardells began construction of a home on their newly purchased property, and construction was substantially underway when the Taylors blocked the easement so as to preclude vehicles associated with construction of the house from having access to the Tardell property. Although the blockades were removed soon after institution of the present suit, the judgment being appealed from permits the Taylors to prohibit the Tardells and other assignees of the- Krauses from using this easement. The Krauses and Tardells appeal.

In this action plaintiffs sought to obtain an order requiring the Taylors to remove any and all barricades or obstructions preventing use of the easement, permanently retraining the Taylors from obstructing the easement and declaring the rights of the parties as to the extent to which they were entitled to use of the easement. The trial judge denied the relief sought (except that he did require that the Krauses be permitted to continue use of the easement) on the following basis:

This Court is of the opinion that the subdivision of the property to Mr. Tardell, and the expected use by Mr. Tardell and his family, with the accompanying traffic that would be used on it, was not contemplated by the parties at the time the easement was granted and, could not be and, in this Court’s opinion, is not a reasonable exercise of the use of the easement, and I find it an unreasonable use and an enlargement of the easement across Taylor’s Lane.

An easement is an interest in the land of another affording a right to use the other’s land. 2 Thompson on Real Property, § 319 at 33 (1961); Leasehold Estates, Inc. v. Fulbro Holding Co., 47 N. J. Super. 534, 551 (App. Div. 1957), certif. granted 25 N. J. 538 (1958). The easement in question was created by express grant in the 1947 deed from the Taylors to the Krauses, although, in the absence thereof, its existence would have been generated by reason of necessity. 2 Thompson, op. cit., § 362 at 410-411; William Dahm Realty Corp. v. Cardel, 128 N. J. Eq. 222, 227 (Ch. 1940). Of significance to the present case is the distinction between general grants of easements of way and limited grants in which a limitation is imposed with respect to the authorized purposes for which the granted easement may be used. 2 Thompson, op. cit., § 386 at 556 et seq. Where the express grant contains a limitation of the use to or purpose for which a way is to be put, it will be enforced despite the fact that it may become necessary or convenient to use it for purposes other than those authorized. Leasehold Estates, Inc., supra, 47 N. J. Super, at 551; Man v. Vockroth, 94 N. J. Eq. 511 (E. & A. 1923). But “where no limitation is placed on the extent of the use of an easement of way, it is available as a general way for all purposes to which the dominant tract might be devoted.” Leasehold Estates, Inc., supra.

The easement granted the Krauses by the 1947 deed is, in one respect, limited in that the right of ingress and egress is confined to “a certain private roadway running from New Street * * * through the property” of the Taylors. By this limitation the Krauses are forbidden to use other portions of the Taylors’ property for purposes of access to their land. In all other respects, however, the grant of easement is unlimited in nature. The easement is appurtenant to the dominant estate, not to any portion thereof, and nothing appearing in the grant limits the purposes to which the dominant estate could be put as affecting or restricting the granted right of user for access purposes. Compare the more restricted grants of easements construed in Leasehold Estates, Inc., supra, 47 N. J. Super, at 554; Man v. Vockroth, supra, 94 N. J. Eq. at 512.

Except as limited by the terms of its creation or transfer and subject to an exception to be hereinafter discussed, a subsequent owner of a part of the dominant estate to which a right of way is appurtenant has the right to use such right of way to his particular part of the land, even though his subdivided parcel does not abut upon such way. Boylan v. Loy Corp., 128 N. J. Eq. 460, 464 (Ch. 1941), aff’d 130 N. J. Eq. 203 (E. & A. 1941); William Dahm Realty Corp. v. Cardel, supra; Diocese of Trenton v. Toman, 74 N. J. Eq. 702 (Ch. 1908); Cushman Virginia Corp. v. Barnes, 204 Va. 245, 129 S. E. 2d 633 (Sup. Ct. App. 1963); Cox v. Glenbrook Co., 78 Nev. 254, 371 P. 2d 647 (Sup. Ct. 1962) (easement by prescription); Crawford Realty Company v. Ostrow, 89 R. I. 12, 150 A. 2d 5, 9 (Sup. Ct. 1959); Crimmins v. Gould, 149 Cal. App. 2d 383, 308 P. 2d 786 (D. Ct. App. 1957) (appurtenant to certain subdivided lots but not to others). Cf. Camp Clearwater, Inc. v. Plock, 52 N. J. Super. 583, 594-595 (Ch. Div. 1958), aff'd 59 N. J. Super. 1 (App. Div. 1959); Fidelity Union Trust Co. v. Cochrane, 116 N. J. Eq. 190, 193 (Ch. 1934).

The Restatement, Property, § 488 states:

Except as limited by the terms of its transfer, or by the manner or terms of the creation of the easement appurtenant, those who succeed to the possession of each of the parts into which a dominant tenement may be subdivided thereby succeed to the privileges of use of the servient tenement authorized by the easement.

The Restatement, in § 488(b), goes on to explain:

The burden upon a servient tenement frequently will not be greatly increased by permitting an easement appurtenant to attach to each of the parts into which the dominant tenement may be subdivided. Though some increase in burden may result from the fact that the number of users is increased by the subdivision, the extent of the use is still measured by the needs of the land which constituted the dominant tenement. Moreover, dominant tenements are ordinarily divisible and their division is so common that it is assumed that the possibility of their division is contemplated in their creation. Hence, unless forbidden by the manner or terms of its creation, the benefit of an easement appurtenant accrues upon a subdivision of a dominant tenement to the benefit of each of the parts into which it is subdivided.

Some eases have recognized circumstances, frequently by way of dictum, involving enormous additional burdens on the servient estate resulting from subdividing the dominant estate or from a change in nature of use beyond which the above stated rule will not be applied. See Camp Clearwater v. Plock, supra, wherein, in dictum, the court observed that severance of the tract “into many parcels and to many owners” would not carry the easements (to use the lake for fishing, boating and swimming) to each of them. See also, Fidelity Union Trust Co. v. Cochrane, supra. In this case, however, no such exaggerated increase in burden is involved, and we have no occasion to decide whether such an exception to the general rule will be recognized in New Jersey. The proofs taken below clearly demonstrate that at the time the easement was created the dominant estate was being devoted to a commercial use, a nursery, and that trucks presumably carrying nursery stock and equipment to and from the subject premises used the right of way. Over the years the use to which the dominant estate has been put has changed from a commercial to a residential, single-family use of modest proportions, certainly not the kind of change sufficient to consider possible application of this exception.

Accordingly, we hold that the Tardells are entitled to use Taylor’s Way as a means of ingress to and egress from their property, but cannot utilize the easement for utility purposes falling outside the scope of the original easement grant.

Reversed.

      No cross-appeal has been taken from th'is part of the judgment.

      “* *■ * the law imposes a right-of-way by necessity across a portion of a tract which when severed from another portion cuts off access to the back tract.”


author: Kolovsky, P. J. A. D.

text:
    BARBETTA AGENCY, A CORPORATION OF NEW JERSEY, PLAINTIFF-RESPONDENT, v. EMIL SCIARAFFA, JR. AND MARIA SCIARAFFA, DEFENDANTS-APPELLANTS, AND JOHN V. DVORAK AND ANN DVORAK, DEFENDANTS-RESPONDENTS.
    Superior Court of New Jersey Appellate Division
    Argued June 10, 1975
    Decided July 11, 1975.

      Before Judges Kolovsky, Lynch and Allcorn.

      Mr. Michael D’Alessio, Jr. argued the cause for appellants (Messrs. Fielo & D’Alessio, attorneys; Mr. Michael E. Fielo on the brief).

      Mr. Francis M. Devito argued the cause for plaintiff-respondent (Messrs. Alongi & Devito, attorneys).
   The opinion of the court was delivered by

Kolovsky, P. J. A. D.

Defendants Dvorak were the owners of a tract of vacant land in Belleville, N. J. A writing dated December 10, 1970 (but apparently signed several days thereafter) was executed by the Dvoraks as sellers and defendants Sciaraffa as purchasers. By its terms the writing provided for the sale, for $69,000, of the land together with the sellers’ rights under a building permit which permitted the construction of a multiple dwelling of 21 units in accordance with plans on file with the building inspector of the Town of Belleville.

It is undisputed that plaintiff was the real estate broker whose efforts resulted in the execution of the writing.

The sale was never consummated because despite the fact that the writing embodied an acknowledgement by the sellers that they had received, “upon execution of this contract,” the deposit of $6900 called for by the writing — a deposit to be held in escrow by the sellers’ attorney — that deposit was never made. By letter dated January 6, 1971 the sellers’ attorney advised the purchasers’ attorney that, because the $6900 had not been received, “we deem the contract never to have come into existence and formally notify you that the seller considers neither party bound.”

Plaintiff instituted this action against both the sellers and the purchasers to recover its 10% commission, amounting to $6900. After a trial before the judge without a jury, the judge ruled that plaintiff was entitled to the commissions claimed; that- the failure to close title was not due to any default by the sellers Dvorak but rather to the default of the purchasers (Sciaraffas), and awarded plaintiff a judgment of $6900 against them. Only the Sciaraffas appeal.

Implicit in the trial judge’s ruling was a finding that, contrary to what the sellers’ attorney had written on January 6, 1971, a contract had come into existence. We shall assume at this point that that finding was correct and not infected by evidential rulings — to be discussed later — precluding the development of testimony essential to a determination of whether in fact a contract had come into existence.

If, in fact, a contract had come into existence, then the record adequately supports the judge’s further finding that the Sciaraffas, by not forwarding the $6900 deposit, had breached their contract with the sellers Dvorak, thus justifying the sellers’ termination of the contract.

But the judge erred in his conclusion that merely because the sellers were thus justified in terminating the contract by reason of the purchasers’ breach of contract, then, without more, under Ellsworth Dobbs, Inc. v. Johnson, 50 N. J. 528, 558 (1967), the purchasers are “liable to the plaintiff for breach of their implied obligation to complete the transaction.”

The trial judge misconceived the scope of the defenses available, under Ellsworth Dobbs, Inc. v. Johnson, supra, to an allegedly defaulting purchaser who is sued by a broker for the commissions he would have received from the seller if the sale had been completed. The judge erred in assuming that (1) merely because, as between a seller and purchaser, there has been a breach of contract by the purchaser, the purchaser is ipso facto liable for commissions to the broker involved, and (2) the purchaser’s defenses to an action by the broker are limited to those which would be available in an action bjr the seller against the defaulting purchaser.

Prom the latter assumption stems the judge’s failure to consider the Sciaraffas’ contention that their obligation to perform was conditioned on their ability to obtain mortgage financing. Were this an action by the sellers against the purchasers, that contention would not be available as a defense since the written contract did not embody a mortgage contingency clause. The parol evidence rule would bar any attempt, by oral testimony, to thus vary the items of the ■writing.

But this is not such an action. It is an action by a broker against a defaulting purchaser. Any right of plaintiff to recover commissions from defendants stems not from an express agreement by defendants to pay commissions — there was no such agreement — but rather from defendants’ implied obligation to plaintiff-broker to complete the purchase so that if they failed, without valid reasons, to complete the purchase, they would become liable to pay the commissions of which plaintiff was deprived. Ellsworth Dobbs, Inc. v. Johnson, supra at 561; cf. Annotation, “Buyer’s default — liability to broker,” 30 A. L. R. 3d 1395 (1970).

However, as Ellsworth Dobbs, Inc., supra, demonstrates, in such an action by a broker against a buyer for damages for the alleged violation of that implied obligation, the buyer is not precluded from asserting, and proving by oral testimony, defenses which might not be available in an action between the seller and buyer on the written contract because of the operation of the parol evidence rule.

In Ellsworth Dobbs, Inc., the buyer, larussi, was unable to perforin his contract with the seller Johnson because he could not obtain the necessary financing. The court recognized that such inability to obtain financing would not be a bar to an action by the seller against the buyer on the contract, but nevertheless ruled that such inability, the broker’s knowledge thereof and his express or implied agreement that performance was subject to a financing contingency, would be a defense to an action by the broker, Dobbs, against the buyer.

As the court said:

larussi claims that Dobbs’ representative, Fleming, was fully aware of Ms financial condition. This knowledge arose from the previous course of dealings between them, and more specifically from his financial inability to complete the first attempt to buy the Johnsons’ property. His testimony, and that of the Johnsons (which was unduly restricted at the trial), is to the effect that when the contract of sale, which is the subject of this suit, was executed, Fleming knew larussi’s performance depended upon his acquisition of financial backing before the closing; he knew also that the closing itself and his right to commission were so conditioned. On the other hand, Fleming denies knowledge that larussi’s performance of the contract was contingent upon securing financing. He denies also that he understood or agreed that his commission was subject to Iarussi’s success in obtaining financing before the closing date. This factual controversy can only be resolved by a jury.
* * * there is a jury question as to the nature of the relationship between Dobbs and Iarussi. A jury should also decide whether Dobbs (through Fleming) knew and agreed, expressly or impliedly, that performance was subject to the financing contingency and that commission would be earned only on satisfaction of that contingency. If the jury finds in favor of Iarussi on this issue, Dobbs is not entitled to recover. [50 A. J. at 561-562]

So, here, the terms of the 'written contract are not a bar to the assertion by defendants, as a defense to this action, that plaintiff-broker knew and agreed, expressly or impliedly, that defendants’ obligation to perform was contingent on their being able to arrange mortgage financing! That defense and the testimony offered relating thereto must be considered and evaluated.

The judgment under appeal must therefore be reversed and plaintiff’s action against the Sciaraffas remanded for a new trial. (Plaintiff did not appeal from the judgment dismissing its claim against the Dvoraks and, in any event, on the record here, there is no basis for imposing liability on the Dvoraks.)

At the retrial there should, among other things, be a full exploration of the issue of whether a contract had come into existence. At the original trial, an erroneous ruling barring any testimony from Mr. Solomon, who acted as Dvoraks’ attorney both during the contract negotiations and at the trial, prevented such exploration.

The significant negotiations involving the preparation, signing and delivery of the writing took place between Solomon, the attorney for the sellers, and Mr. Schwartz, the attorney for the purchasers. Their testimony was critical to the resolution of the issue of whether a contract had “come into existence,” an essential prerequisite to the right of plaintiff to recover commissions from anyone.

If the fact be that the signed writing was only conditionally delivered to the purchasers’ attorney, in effect in escrow, on the understanding that it was not to be deemed delivered until the deposit of $6900 was forwarded to purchasers’ attorney, then since more than a reasonable time had elapsed and still the $6900 had not been forwarded, the sellers were justified in their conclusion that a contract had not come into existence — this because there never was a completed delivery giving rise to a binding contract of sale. 1A Corbin on Contracts, §§ 250, 251, 589 (1963); Builders Fair v. Youmans, 39 N. J. Super. 183, 186 (App. Div. 1956); see also, Mangani v. Stadium Bowling Academy, 132 N. J. L. 299, 300 (Sup. Ct. 1944).

Despite the importance (a fact recognized in the trial judge’s letter opinion) of the testimony which only the two attorneys who negotiated the writing could give, the judge refused to permit Solomon to testify because he was also the sellers’ trial attorney.

The trial judge’s ruling was erroneous. While a trial attorney should not offer himself as a witness and his doing so may subject him to disciplinary proceedings, nevertheless the testimony is competent and the failure to permit the attorney to testify is reversible error. See White v. State Bd. of Tax App., 123 N. J. L. 350 (Sup. Ct. 1939), quoted with approval in Callen v. Gill, 7 N. J. 312, 317 (1951); see also, Pierce v. Yaccarino, 72 N. J. Super. 252, 261, 262 (App. Div. 1962).

At the retrial Solomon and Schwartz, the attorneys who handled the negotiations on behalf of their respective clients, should be called to testify.

Reversed and remanded for a new trial of plaintiff’s action against defendants Seiaraffa.

      Apparently much of the colloquy resulting in the ruling took place in chambers and was not recorded. We are, therefore, unable to determine what part that colloquy played in the Sciaraffas’ decision not to call Mr. Schwartz, the attorney who represented them during the negotiations but not at the trial, as a witness.


text:
    HENRY W. KURZ, ROBERT MORGAN, AND LYMAN L. THOMPSON, PLAINTIFFS-RESPONDENTS, v. LEONARD GENOVA, DEFENDANT-APPELLANT.
    Superior Court of New Jersey-Appellate Division
    Submitted November 4, 1974
    Decided July 22, 1975.
    Before Judges Collester, Lora and Handler.

      Messrs. Kaplowitz and Wise, attorneys for appellant (Mr. Steven Wise on the brief).

      Messrs. Pisano & Triarsi, attorneys for respondents (Mr. Alfonso L. Pisano on the brief).
   Per Curiam.

Defendant Leonard Genova appeals from a judgment of the Law Division which invalidated his election as the borough council representative of Roselle Park to a “joint meeting” comprised of municipalities, organized pursuant to N. J. S. A. 40:63-68 et seq., for the construction and maintenance of a sewage disposal system.

The facts are not in dispute. The municipal government of Roselle Park consists of the mayor and six members of the borough council. The borough, along with other municipalities, is a member of a joint meeting, alternatively referred to as the Joint Sewer Authority or Joint Sewer Commission. N. J. S. A. 40:63-69 defines a joint meeting as the meeting or assembly of members of the governing bodies of several municipalities having authority to make and enter into contracts for the construction jointly of the works or improvements authorized by N. J. S. A. 40:63-70 [sewage disposal systems]. N. J. S. A. 40:63-85 provides for the organization and election of officers of the joint meeting by the governing bodies of the various municipalities. N. J. S. A. 40:63 — 87 states in pertinent part that:

Each municipality through its body or board represented in such joint meeting, shall be entitled to one vote therein, on all motions, resolutions, appointments and all other proceedings taken in or by such joint meeting * * *. If only one member of such municipal body or board be present at the joint meeting, the vote of his municipality may be east by him. * * *

The participation of Roselle Park in the actions of the joint meeting is thus limited to members of the borough council. The council elects one of its members to represent the municipality at the joint meeting. The council representative is paid $2,200 a year by the joint meeting for his services.

At a meeting of the borough council defendant was nominated as the council representative to the joint meeting. In the election that followed defendant received three votes, including his own, and three councilmen voted against him. Pursuant to the council by-laws which required such an election to be by a majority vote, with the mayor voting in case of a tie, the mayor cast the deciding vote in favor of defendant.

Plaintiffs, the councilmen who voted against defendant, brought an action in lieu of prerogative writs to set aside the election. Following a hearing the trial judge held defendant could not vote for himself, enjoined defendant from serving as council representative to the joint meeting, and declared the position to be vacant. This appeal followed.

In ruling that defendant was disqualified from voting for himself the trial court relied on Hazlet Tp. Committee v. Morales, 119 N. J. Super. 29 (Law Div. 1972). In that ease the court held the appointment of a member of the township committee to membership on the township sewerage authority was void where at the time of the appointment the township committee member cast the deciding vote for his own appointment. The court ruled that although N. J. S. A. 40:14A-5 allowed a member of the governing body to be appointed by that governing body as a member of the sewerage authority, the appointment was invalid where the interested member voted for himself and his vote was essential to the appointment. The court stated that being in a position to appoint one’s self to a public office or position was clearly of that class of self-interest which disqualifies, and that a municipal official in such a situation is not likely to act purely out of undivided loyalty to the public.

Defendant contends the trial judge erred. He asserts that only members of the Roselle Park borough council are eligible for the position of council representative to the joint meeting and that he was not disqualified from voting for himself. He relies on Skarbnik v. Spina, 125 N. J. Super. 87 (Law Div. 1973), which was decided subsequent to Hazlet and the decision in the present case.

We are satisfied that Hazlet is clearly distinguishable from the instant ease. Hazlet involved an appointment to a municipal sewerage authority created under the Sewerage Authorities Law (N. J. S. A. 40-.14A-1 et seq.). N. J. S. A. 40:14A-5 permitted, rather than required, members of the governing body to be appointed by the governing body as-members of the sewerage authority. In the instant case membership in the borough council of Roselle Park was required to represent the municipality in a joint meeting.

Skarbnik v. Spina, supra, involved the election by the-municipal council of West Orange of a council representative to a joint meeting, organized as here, under the provisions of N. J. S. A. 40:63-68 et seq. The municipal council consisted of five members. At a meeting of the council Spina, one of the councilmen, was elected as council representative to the joint meeting by a vote of three to two, with Spina voting for himself. His election was subsequently challenged by one of the councilmen who voted against him. In upholding Spina’s election the court pointed out that under N. J. S. A. 40 :63-69, 40 :63-85 and 40 :63— 87 membership in the governing body was a prerequisite for participation in actions of the joint meeting. The court further noted that if Spina was disqualified from voting it would require for election the affirmative vote, not of the-majority, but of at least three of the four councilmen remaining. The court held that this requirement was not within the letter or spirit of the procedure adopted by the-council under its rules. The court also found no showing-that Spina was subject to any direct or indirect private interest at variance with the impartial performance of his public duty.

We agree with the rationale of Skarbnik v. Spina, supra. Here, the election of a borough council representative to the joint meeting, if Genova was disqualified, would require the affirmative vote of four of the five remaining councilmen. Moreover, since the council representative to the joint meeting merely represents the municipality in its transactions we can see no self-interest on the part of Genova which would disqualify him from voting.


author: ALLCORN, J. A. D.

text:
    STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT, v. JOHN TALBOT, III, DEFENDANT-APPELLANT.
    Superior Court of New Jersey Appellate Division
    Argued June 3, 1975
    Decided July 24, 1975.

      Before Judges Kolovsky, Lynch and Allcorn.

      Mr. Martin Newmark argued the cause for appellant (Messrs. Newmark & Newmark, attorneys).

      Mr. Marl Vaarsi, Deputy Attorney General, argued the cause for respondent (Mr. William, F. Hyland, Attorney General, attorney).
   The opinion of the court was delivered by

ALLCORN, J. A. D.

Defendant appeals his conviction for the offense of unlawful distribution of heroin, entered upon a jury verdict.

The making of the sale of heroin to an undercover State Police officer on February 19, 1973 is not denied by defendant. Eather, he contends that the sale was the result of entrapment by the police and their informant; that not only did the police informant induce the unwilling defendant to make the sale, but that the heroin defendant sold to the police had been supplied to defendant by the informant a few days earlier for the express purpose of entrapping defendant into making the sale (albeit unknown to the police); and that since such evidence was uncontroverted and inasmuch as the State presented no “proper proof” of defendant’s predisposition to sell narcotics, defendant had established entrapment as a matter of law and, consequently, the trial court erred in denying defendant’s motion for acquittal made at the close of the entire case.

It is undisputed that on February 14, 1973 Anthony Federici was arrested by the Wayne police on a narcotics charge. Federici having previously aided the Wayne police, Sergeant Weinmann sought to recruit Federici again as an informant in assisting the police to search out and to obtain evidence against persons known by Federici to be dealers in or distributors of narcotics. In return, Sergeant Weinmann undertook to inform the judge of Federici’s cooperation when he appeared for sentencing on the charge for which he had been arrested. Federici agreed and mentioned the names of several persons to Sergeant Weinmann, including that of defendant.

Thereafter, on February 19, 1973, Federici, Weinmann and State Police Detective Dalio met with Trooper Jack Cole, an undercover officer of the State Police, following which Cole and Federiei proceeded to defendant’s home in Smoke Rise, Kinnelon, in an unmarked police car. There they met defendant at or near a corral on the premises and, together, went into a barn or shed in or adjacent to the corral, where the sale of the heroin from the defendant to Trooper Cole took place, in the presence of Federiei.

Federiei, who did not testify for the State, was called as a witness by defendant. He testified on direct examination that following his arrest and his accommodation with Sergeant Weinmann on February 14, he sold “narcotics to John Talbot” sometime “between February 14 and February 19,” “with the intention of arranging for a sale back to the police.” On cross-examination Federiei was unable to fix the date of his sale to defendant any closer than “February 17 or 18”; he could not recall where the sale took place; he could not recall the quantity sold, and he could not state with ánjr certainty the amount paid to him by the defendant — in contrast to his complete recollection of the place, quantity, price and the details of the conversations on the occasion of the sale from defendant to the undercover trooper on February 19, only a day or two after Federici’s purported sale to defendant.

It was Federici’s further testimony that defendant’s name as a distributor was first suggested by him, not by the police; that the plan to sell heroin to defendant and to induce him in turn to sell some of it to the police was “completely [his] own idea,” and “[n]o police officer ever suggested” such procedure to him. Significantly, Federiei at no time testified that he informed any of the police officers concerned with this case of his plan prior to the sale to defendant or, subsequent thereto, of the fact or purpose of the sale by him to defendant. All of the police officers denied any knowledge and flatly rejected any such means as improper law enforcement procedure.

Defendant, who was 21 at the time of the trial in April 1974, testified on direct examination that he had been a user of heroin and marijuana for sometime prior to November 1972, when he stopped (Eederiei testified he had last sold heroin to defendant in December 1972 or January 1973, immediately prior to the February 1973 sale); that he previously had pleaded guilty to and been convicted of: breaking and entering in New Jersey in 1971; possession of eight ounces of marijuana and a quantity of barbiturates in New York, the offense having been committed in September 1972; possession of cocaine, barbiturates and seconal, possession of a hypodermic syringe and needle, and delivery of a barbiturate to a high school girl by injecting her with cocaine, committed in Ehode Island, in March, 1972.

Defendant also testified that Eederiei had telephoned him approximately Eebruary 17 or 18 and offered to sell him some heroin, which he refused; that Eederiei telephoned again the next day and, because Eederiei said he needed money and because defendant’s resolve weakened, he agreed to buy a “$30.00 piece” — even though that was all the money he had; that thereafter Eederiei drove to defendant’s home, where the transaction was consummated; that the following day Eederiei telephoned and said he wanted some heroin for a friend of his brother, just arrived “from out west,” but defendant declined to sell; that when, on the succeeding day (Eebruary 19), Eederiei telephoned again, defendant agreed to sell the balance of the heroin to Eederiei (defendant in the meantime having “snorted” some of it himself), because he “still didn’t really want to get involved [in shooting],” and so “decided I would get rid of it.” It is on the basis of this testimony of defendant and Eederiei that defendant claims that entrapment was established as a matter of law.

The defense of entrapment is grounded upon the proposition that the “function of law enforcement is the prevention of crime and the apprehension of criminals,” and “that function does not include the manufacturing of crime,” Sherman v. United States, 356 U. S. 369, 372, 78 S. Ct. 819, 820, 2 L. Ed. 2d 848 (1958). It “reflects a policy that the powers of government should not be used to entice otherwise innocent persons into the commission of crimes which they would not commit on their own.” State v. Dolce, 41 N. J. 422, 432 (1964).

The test enunciated by Dolce is that entrapment exists “when the criminal design originates with the police officials, and they implant in the mind of an innocent person the disposition to commit the offense and they induce its commission in order that they may prosecute. ... It occurs only when the criminal conduct was the product of the creative activity of law enforcement officials.” 41 N. J. at 430. In the application of this test the determinative factors are: (1) whether there was any inducement to commit the offense by the law enforcement officers and, if so, (2) whether there was any predisposition to commit the offense on the part of defendant. See, Annotation, “Modern Status of the Law Concerning Entrapment to Commit Narcotics Offense — Federal Cases,” 22 A. L. R. Fed. 731, 737-738 (1975); Annotation, “Modern Status of the Law Concerning Entrapment to Commit Narcotics Offense — State Cases,” 62 A. D. R. 3d 110, 113-116 (1975).

Otherwise stated, if the criminal intent originates with the law enforcement representatives and defendant is by them induced to commit the offense in order to prosecute him, defendant may not be convicted. On the other hand, if the criminal intent originates with defendant (i. e., he was predisposed) and the law enforcement representatives simply afford defendant the opportunity to commit the offense, there has been no entrapment.

In the present ease the entrapment defense has two facets: (1) a law enforcement representative in the person of the government informant supplied and sold heroin to the defendant with the intent that he sell some part or all of it to the undercover police officer, and (2) the government informant induced defendant, who was reluctant and not so predisposed, to sell the same heroin to the undercover police officer. It is the position of defendant that, inasmuch as the testimony of himself and Federici that the latter had furnished the heroin to defendant to sell to the undercover agent was “so uncontradicted” and the State’s proof of defendant’s predisposition “so insufficient,” entrapment had been established as a matter of law.

It is true that a number of cases have held that where the evidence is undisputed that an agent of the government furnished narcotics to an individual so that he may sell them to another government agent, and where there is no question of the credibility of the witnesses or their testimony, entrapment is established as a matter of law. United States v. Bueno, 447 F. 2d 903 (5 Cir. 1971), cert. den. 411 U. S. 949, 93 S. Ct. 1931, 36 L. Ed. 2d 411 (1973). Annotations, supra, 22 A. L. R. Fed. at 748-750 and 62 A. L. R. 3d at 141-145; see Sherman v. United States, 356 U. S. 369, 78 S. Ct. 819, 2 L. Ed. 2d 848 (1958); compare United States v. Russell, 411 U. S. 423, 93 S. Ct. 1637, 36 L. Ed. 2d 366 (1973). This rule has no application here, however, in view of the questionable credibility of the testimony of both defendant and the informant.

A mere reading of the testimony of defendant and of the informant on direct and cross-examination is alone sufficient to raise doubts as to the credibility of that testimony. The obvious self-interest of defendant, combined with the relationship between the two — defendant at the trial describing Federici as “a good friend of mine for many years” ■— further affect the believability of the testimony, particularly when it is observed that defendant and his “good friend,” the informant, were the only persons who would have any knowledge as to whether the informant in fact supplied defendant with heroin at the date asserted and whether the heroin sold by defendant to the undercover trooper in fact was the same as that allegedly supplied by the informant. As so aptly stated, “Where men of reason and fairness may entertain differing views as to the truth of testimony, whether it be uneontradicted, uneontroverted or even undisputed, evidence of such a character is for the jury.” Ferdinand v. Agricultural Ins. Co. of Watertown N. Y., 22 N. J. 482, 494 (1956).

Moreover, the testimony of defendant and the informant was not undisputed, uncontroverted or uneontradicted. Defendant himself, on his direct testimony, conceded that he had been a user of heroin and other drugs for some time, at least up to November 1972, while the informant admitted selling heroin to defendant for a substantial period, the last sale (before February 1973) having taken place in December 1972 or January 1973. Defendant further admitted driving Federici to New York on prior occasions so that Federici could purchase heroin. And Federici testified to having named defendant as a dealer or distributor of narcotics during his discussions with the Wayne police after having reached his accommodation with them. It was also conceded by defendant that he had pleaded guilty in New York to the possession of eight ounces of marijuana in September 1971, estimated by Trooper Cole to be enough to make 600 cigarettes and that he pleaded guilty in Ehode Island to delivering (injecting) a barbiturate to the high school girl in March 1972.

Tbo, there is the testimony of Trooper Cole that, on the occasion of the sale by defendant to Cole, defendant stated that he could supply Cole with “ounces of heroin”, and that during a conversation with the informant the latter told Cole that defendant had a supplier in the Hamburg area of Sussex County and “was capable of dealing in ounces” of heroin.

All of the foregoing controverted and affected the credibility of the testimony of defendant and Federici. In sum, we conclude that the question of entrapment (whether the State had proved beyond a reasonable donbt that defendant had not been entrapped) was clearly an issue for determination by the jury.

Defendant next attacks-the conviction by a number of challenges to the charge to the jury. We discern merit in only one: the instruction to the jury which charged, in effect, that there could be no entrapment unless Federici, in furnishing the heroin to defendant for sale to Cole, “was acting with the consent of the police and as their agent”. In so charging the trial judge effectively insulated the State against having to prove that there was no entrapment, whatever the evidence as to the nature and degree of the creative activity engaged in by the informant employed by the police which otherwise might constitute entrapment, if the jury was satisfied that the police had no prior knowledge and did not give prior consent to the creative activity of the informant.

The hypothesis is offensive to fundamental principles of the administration of justice. To induce an individual to commit a crime and to furnish him with the means and the opportunity to do so in order to prosecute him, is incompatible with the legitimate function and proper ends of law enforcement. The manufacture of crime, whether by the police or by an informant employed by the police, cannot be countenanced. However desirable and helpful the employment of an informant may be in the pursuit and discovery of criminal activity and evidence of crime, law enforcement authorities may not disavow him and disclaim responsibility for his actions when he entraps someone because they had no knowledge and did not approve of the entrapment. In short, “ [g] overnment cannot make such use of an informer and then claim disassociation through ignorance.” Sherman v. United States, 356 U. S. 369, 375, 78 S. Ct. 819, 822, 2 L. Ed. 2d 848 (1958); State v. Scrotsky, 39 N. J. 410 (1963).

As a consequence of the incorrect exposition to the jury of the law in this regard and the resultant Tna.nifp.Rt. prejudice to the defendant, the conviction must be reversed and the cause remanded for a new trial. Inasmuch as some of the additional issues raised on this appeal may well arise at the retrial, we will take the opportunity of passing on them for the benefit of the parties and the court.

We find no error in the rulings of the trial court in admitting the rebuttal testimony of Trooper Cole concerning the remarks of Eederici to him to the effect that defendant was capable of dealing in ounces of heroin, or in declining to allow defendant to show that his New York conviction was on appeal. Neither the hearsay nature of the Eederici statement nor the fact that it was made subsequent to the sale here in question bars its admission on the issue of predisposition. Annotation, “Admissibility of Evidence of Other Offenses in Rebuttal of Defense of Entrapment,” 61 A. L. R. 3d 293, §§ 7[a], [e]; Evid. R. 55; see State v. Wright, 66 N. J. 466 (1975), rev’g 132 N. J. Super. 130 (App. Div. 1974). In any event, the testimony was also properly admissible as a prior inconsistent statement for the purpose of impeaching the credibility of Eederici under Evid. R. 20. In view of Cole’s previous testimony that defendant had made the same claim to him, there was no prejudice in the refusal of the judge to give a limiting charge.

So far as concerns the New York conviction, the fact that defendant had there been convicted of “possession of narcotics” was initially brought to the attention of the judge and jury at the outset of the direct examination of defendant by his counsel. When, during cross-examination, the prosecutor adduced the details — that defendant had pleaded guilty to the possession of eight ounces of marijuana and a barbiturate in his automobile — defendant asserted that in spite of his guilty plea,- he was in fact innocent since he had no knowledge that the narcotics were in his automobile. At this juncture the State offered a certified copy of the New York conviction record, which was admitted into evidence without objection by defendant.

On redirect, counsel adduced from defendant that the New York conviction “is * * * before the Appellate Court of Now York”, and that “the determination of the trial court [denying a suppression motion] recently [has] been reversed and remanded for a new hearing.” The prosecutor’s motion to strike the testimony was granted inasmuch as it did not constitute the best evidence of such matters. Following the close of the testimony of defendant, counsel offered into evidence an uncertified copy of an opinion of the Appellate Division of the Supreme Court of New York reversing the order of the trial court denying a motion to suppress the evidence, and remanding the motion for a new hearing. The opinion was ruled inadmissible principally because of the absence of any foundation concerning this type of procedure under New York law and practice.

At the outset it should be noted that the appeal and reversal of the order denying suppression should have been developed by counsel for defendant simultaneously with the disclosure of the conviction. The withholding of this fact for subsequent disclosure hardly accords with the fairness and candor to the court and counsel, which is the obligation of every attorney.

Be this as it may, evidence as to the plea of guilty made by the defendant to the charge of illegal possession of narcotics was admissible on the issue of predisposition, without regard to whether the conviction was or was not reversed. The significant circumstance was the express acknowledgement by defendant of the knowing possession of narcotics evidenced by his plea of guilt to the charge — whatever the rule with regard to the effect of the pendency of an appeal of a conviction offered or received for the purpose of impeachment of credibility. Evid. R. 55 (Comment, § 55-3); Annotation, supra, 61 A. L. R. 3d 293, §§ 6, 7. At most, defendant was entitled to testify as to his lack of knowledge and his innocence as well as the factors motivating his plea, which he did. Parenthetically we observe that defendant made no objection to the introduction into evidence of the certified conviction record.

In any event, as noted by the State and not controverted by defendant, the New York conviction ultimately was affirmed by the Appellate Division of the Supreme Court of New York. Thus, even upon the exceedingly dubious assumption that the trial judge erred in permitting the evidence of the conviction to stand and in refusing to admit evidence of the reversal and remand of the order denying suppression, defendant patently suffered no prejudice whatever as a result. Compare State v. Blue, 129 N. J. Super. 8 (App. Div. 1974), certif. den. 66 N. J. 328 (1974).

We find no abuse of discretion by the trial judge in granting an exception to the sequestration order so as to permit Trooper Cole to remain in the courtroom during presentation of the case for defendant, following completion of the State’s direct case, in order to assist the prosecutor. State v. Hines, 109 N. J. Super. 298 (App. Div. 1970), certif. den. 56 N. J. 248 (1970), cert. den. 400 U. S. 867, 91 S. Ct. 108, 27 L. Ed. 2d 106 (1970). Similarly, the judge properly exercised his discretion in declining to address to the prospective jurors on voir dire a question concerning their willingness to follow the law with respect to entrapment. State v. Manley, 54 N. J. 259 (1969); State v. Kelly, 118 N. J. Super. 38 (App. Div. 1972), certif. den. 60 N. J. 350 (1972); United States v. Crawford, 444 F. 2d 1404 (10 Cir. 1971), cert. den. 404 U. S. 855, 92 S. Ct. 98, 30 L. Ed. 2d 95 (1971).

Our review of the remaining contentions satisfies us that they are completely without merit.

Accordingly, the judgment of conviction is reversed and the cause is remanded to the Law Division for a new trial.

      This, quite logically, without regard to the existence or nonexistence of predisposition. See United States v. Russell, 411 U. S. 423, 127, 93 S. Ct. 1637, 36 L. Ed. 2d 366 (1973). Compare State r. Redinger, 64 N. J. 41, 50 (1973).