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U.S. ELECTRICAL SERVICES, INC. v. ELECTRICAL SOLUTIONS GROUP, INC., A-2970-13T3. (2015)

Court: Superior Court of New Jersey Number: innjco20150312249 Visitors: 3
Filed: Mar. 12, 2015
Latest Update: Mar. 12, 2015
Summary: NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION PER CURIAM . Defendants, Electrical Services Group, Inc. and Scott Diamond, appeal from a post-judgment discovery order entered on January 31, 2014, which compelled the deposition testimony of defendant Diamond's spouse, Elsa Diamond, regarding her knowledge of his assets. We affirm. Plaintiff filed suit against defendants over a contract dispute and recovered a judgment for $125,378.25 plus costs, interest and attorneys' fe
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NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Defendants, Electrical Services Group, Inc. and Scott Diamond, appeal from a post-judgment discovery order entered on January 31, 2014, which compelled the deposition testimony of defendant Diamond's spouse, Elsa Diamond, regarding her knowledge of his assets. We affirm.

Plaintiff filed suit against defendants over a contract dispute and recovered a judgment for $125,378.25 plus costs, interest and attorneys' fees pursuant to an order dated September 12, 2013. By subsequent order dated September 27, 2013, plaintiff recovered a supplemental judgment for attorneys' fees in the amount of $39,415.45. On December 9, 2013, plaintiff filed a verified petition for discovery, asserting that Diamond was the sole shareholder of Electrical Solutions Group, Inc., as well as two other companies in New York and Pennsylvania, but "ha[d] failed to identify any personal assets of more than de minimus value, and ha[d] failed to disclose any personal income." Plaintiff sought an order compelling Ms. Diamond to appear and testify concerning her husband's property and assets which may be subject to execution to satisfy the judgment. The trial court granted plaintiff's application and entered the order on December 19, 2013.

Defendants moved to vacate the order of discovery, arguing that any testimony from Ms. Diamond was subject to the marital communications privilege, codified at N.J.S.A. 2A:84A-22. Defendants maintained that any information Ms. Diamond may have possessed relating to Diamond's personal finances or business activities was communicated to her in confidence, and that Diamond denied consent to disclose such information. The court denied the motion, and on January 31, 2014, entered an order stating, "Ms. Diamond should be able to testify regarding her first[-]hand knowledge and observations of facts and occurrences." Defendants appealed.

Defendants argue that the court erred in requiring Ms. Diamond to testify because her testimony would be subject to the marital communication privilege. The applicable standard that guides our review of a trial court's legal conclusions is well-settled. "A trial court's interpretation of the law and the legal consequences that flow from established facts are not entitled to any special deference." Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995).

As a general proposition, privileges are to be narrowly construed. State v. Szemple, 135 N.J. 406, 413 (1994) (citing United States v. Nixon, 418 U.S. 683, 710, 94 S.Ct. 3090, 3108, 41 L. Ed. 2d 1039, 1065 (1974); State v. Schreiber, 122 N.J. 579, 582-83 (1991)), superseded by N.J.S.A. 2A:84A-23 (regarding cleric-penitent privilege).

N.J.S.A. 2A:84A-22 states:

No person shall disclose any communication made in confidence between such person and his or her spouse unless both shall consent to the disclosure or unless the communication is relevant to an issue in an action between them or in a criminal action or proceeding in which either spouse consents to the disclosure, or in a criminal action or proceeding. ...

The three criteria that must be met for the marital communications privilege to apply are: 1) there is a communication, 2) the communication is made in confidence, and 3) the communication is between spouses. N.J.S.A. 2A:84A-22. The marital communications privilege "`stems from the strong public policy of encouraging free and uninhibited communication between spouses, and, consequently, of protecting the sanctity and tranquility of marriage.'" State v. Terry, 218 N.J. 224, 233 (2014) (quoting Szemple, supra, 135 N.J. at 414). Because it "`has as its only effect the suppression of relevant evidence, its scope should be confined as narrowly as is consistent with the reasonable protection of marital communications.'" Id. at 239 (quoting Szemple, supra, 135 N.J. at 415).

Here, defendants argue that the act of bringing personal and business financial records into the marital home where Ms. Diamond may have seen them is necessarily a confidential communication between spouses. We disagree.

"The privilege protects communications between spouses, not conduct or occurrences; thus, testimony of one spouse about another spouse's acts is not privileged." Andrews v. Holloway, 256 F.R.D. 136, 147 (D.N.J. 2009) (citing United States v.

Parker, 834 F.2d 408, 411 (4th Cir. 1987); United States v. Robinson, 763 F.2d 778 (6th Cir. 1985) (wife's testimony concerning her discovery of her husband's business documents not privileged); United States v. Lofton, 957 F.2d 476 (7th Cir. 1992) (wife's testimony regarding husband's receipt of a package in home not privileged); United States v. Espino, 317 F.3d 788 (8th Cir. 2003)). We conclude that one spouse's storage of such documents in the marital home and the other spouse's observation of those documents, without more, does not constitute a confidential communication between them.

First, the contents of such documents are not privileged just because both parties have seen them. Observation of one spouse's actions is not automatically communication between the spouses.

Second, many personal and business financial records are generated by or submitted to third parties outside the marital home. These records are not confidential communications between spouses in the first instance, though communications regarding them could be, provided the right proofs. Additionally, assuming particular documents are initially confidential, placement in the home where another member of the household or a guest could discover them does not guarantee continued confidentiality. A party asserting the privilege must show that such documents remained confidential within the marital home for the privilege to apply.

Third, the simple act of leaving documents in the home does not necessarily encourage communications between spouses or protect marriages. Without convincing evidence that application of the privilege in a particular case will protect and further the interests it is designed for, there is no reason for a court to recognize the privilege.

Because we find that the mere act of leaving personal and business records in the marital home is not a confidential communication, the privilege does not apply to a spouse's discovery of those documents or the contents thereof. Our determination is consistent with the judicial practice of construing the marital communications privilege narrowly. See Terry, supra, 218 N.J. at 239. Furthermore, the trial court appropriately limited the scope of Ms. Diamond's testimony to first-hand knowledge and observations of facts and occurrences, which provides reasonable protection of confidential marital communications.

Affirmed.

Source:  Leagle

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