CINDY JOHNSON, ETC. VS. FRANK MCCLELLAN, ESQ. VS. AARON J. FREIWALD, ESQ. (L-2366-19, MIDDLESEX COUNTY AND STATEWIDE)

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NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NO. A-2683-19 CINDY JOHNSON, Administratrix Ad Prosequendum and Administratrix of the estate of TONY JOHNSON, Plaintiff-Respondent, APPROVED FOR PUBLICATION July 19, 2021 v. APPELLATE DIVISION FRANK MCCLELLAN, ESQ., Defendant/Third-Party Plaintiff-Appellant, v. AARON J. FREIWALD, ESQ., and FREIWALD LAW, P.C., f/k/a LAYSER & FREIWALD, P.C., Third Party Defendants. ______________________________ Argued October 19, 2020 – Decided July 19, 2021 Before Judges Messano, Hoffman, and Smith. On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-2366- 19. John L. Slimm argued the cause for appellant (McElroy Deutsch Mulvaney & Carpenter, LLP, and Marshall Dennehey Warner Coleman & Goggin, attorneys; John L. Slimm, of counsel and on the briefs; Daniel A. Malet, on the briefs). William L. Gold argued the cause for respondent (Bendit Weinstock, PA, attorneys; William L. Gold, on the brief). The opinion of the court was delivered by HOFFMAN, J.A.D. Plaintiff Cindy Johnson, in her capacity as administrator of her late husband's estate, brought a civil action against defendant Frank McClellan, under N.J.S.A. 2C:21-22a, for damages resulting from defendant's alleged unauthorized practice of law regarding his involvement in plaintiff's prior medical malpractice suit. Plaintiff also sought disgorgement of a referral fee she claimed defendant received improperly. Plaintiff moved for summary judgment, which the motion court granted. On February 28, 2020, the motion court entered an Amended Order for Final Judgment, awarding plaintiff a total of $308,181.68, with $52,145.42 representing the "[r]eturn of [i]mproper [r]eferral [f]ee [s]um [o]rdered disgorged," and $256,036.26 representing treble damages and attorney's fees, under N.J.S.A. 2C:21-22a. This appeal followed. Because disgorgement is a remedy, not a cause of action, and because we find no evidence that plaintiff A-2683-19 2 sustained an "ascertainable loss," a required element for a cause of action under N.J.S.A. 2C:21-22a, we reverse. I. On December 28, 2008, plaintiff's husband went into cardiac arrest and died, while hospitalized in Hamilton. The autopsy report identified a "bilateral pulmonary thromboembolism" as one of the causes of his death. Seeking to bring a medical malpractice suit for her husband's death, plaintiff contacted defendant, on the recommendation of a friend, about possible legal representation. Because defendant, a law school professor and Pennsylvania attorney, was not licensed to practice law in New Jersey, he referred plaintiff to Thomas Ashley, a New Jersey-licensed attorney. Defendant recounted that he "had a discussion with [plaintiff] . . . when [he] referred her to Tom Ashley . . . that Tom would have a fee agreement with her, and it would be a contingent fee . . . ." According to plaintiff, at "the end of May or beginning of June . . . 2009[,]" she met with Ashley and defendant in Ashley's office; "a couple months later," she received a Legal Services Agreement "from the Law Offices of Tom Ashley," signed by Ashley. After reading the agreement, she "made notes," and then signed the agreement. Plaintiff stated she never …

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