NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

PER CURIAM.

By leave granted, plaintiff Pashman Stein P.C. appeals from the July 2, 2013 order of the Chancery Division denying its application for an injunction compelling defendant Nostrum Laboratories, Inc. to continue paying legal fees to plaintiff in connection with plaintiff's representation of its client, John Lomans. Plaintiff also challenges the portion of the order transferring the case to the Law Division for trial and disposition of all issues. We are constrained to reverse and remand because the material facts underlying the parties' respective claims were sharply disputed and, therefore, an evidentiary hearing was required to resolve the contested issues.

I.

Lomans is a scientist, who has been working for a number of years on developing a generic equivalent for a female hormone replacement therapy drug. In 2004, Lomans and another individual formed APR, LLC (APR) to continue working on this drug product. Lomans transferred "all of [his] intellectual property rights in [his] process for formulating the [p]roduct" to APR.

In July 2011, APR sold most of its assets to Dr. Reddy's Laboratories New York (Dr. Reddy's), a pharmaceutical company. Lomans signed a non-compete covenant with Dr. Reddy's and agreed to begin working with that company to develop the generic drug. In 2012, however, the relationship between Lomans, his partner, and APR soured and they filed legal actions in the Law Division against each other. Lomans also began having difficulties in his business relationship with Dr. Reddy's.

Lomans certified that, in the summer of 2012, he started working on a new process to develop the generic drug. Around this time, he met with defendant's president, who expressed an interest in assisting Lomans on this project. Lomans alleges that defendant's president put him in touch with an attorney for advice on how he could get out of his agreement with Dr. Reddy's. Lomans stated he paid the attorney $24,000 to attempt to negotiate a release with Dr. Reddy's, but the attorney was unsuccessful. The attorney then began to negotiate a business deal on Lomans' behalf with defendant. Lomans asserted the attorney later revealed he served on defendant's board of directors and, therefore, would not be able to represent him any longer.

Lomans claimed that defendant's president and its general counsel then advised him that he could terminate his agreement with Dr. Reddy's if Lomans could show that Dr. Reddy's breached the contract first. If this occurred, Lomans would be able to begin working with defendant on the development of the generic drug. Defendant's representatives helped Lomans draft the termination letter he sent to Dr. Reddy's. Lomans and defendant also entered into a Consulting Agreement under which defendant agreed to pay Lomans a consulting fee for his work developing the drug product. Under a separate Development and License Agreement, defendant agreed to fund Lomans' research and development work and, if the product ever came on the market, to pay him royalties. In return, Lomans agreed to give defendant the intellectual property rights to the work he produced during the course of the agreement. All of these agreements were executed on either January 28 or 29, 2013.

Lomans also alleged that defendant agreed to fund the ongoing litigation he was involved in with APR and his former partner. On January 29, 2013, Lomans and defendant signed a retainer agreement drafted by plaintiff, under which plaintiff would provide legal representation to Lomans in the litigation involving APR and his former partner, with the understanding that defendant would pay for the legal fees and costs incurred by Lomans.

In order to place this agreement, and the legal issues raised by it, in their proper perspective, it is necessary to briefly summarize our Supreme Court's 2009 decision in In re State Grand Jury Investigation, 200 N.J. 481 (2009) (Grand Jury).

In Grand Jury, an employer agreed to provide and pay for counsel for its employees who had been called to testify before a grand jury investigating the employer. Grand Jury, supra, 200 N.J. at 485. The issue faced by the Court was whether an attorney could accept such an arrangement consistent with the Rules of Professional Conduct. Ibid. The Court held that "a lawyer may represent a client but accept payment, directly or indirectly, from a third party provided . . . six conditions [are] satisfied." Id. at 495. The six conditions are:

The Court's ruling was not limited to criminal matters involving employees providing testimony against employers before a grand jury. Id. at 485. The Court noted that its holding applied "[r]egardless of the setting — whether administrative, criminal or civil, either as part of an investigation, during grand jury proceedings, or before, during and after trial[.]" Ibid.

Returning to the present case, the retainer agreement prepared by plaintiff did not reference the Grand Jury decision. The retainer agreement stated that "Lomans has retained [plaintiff] to represent him in these matters and to memorialize that [defendant] has agreed to pay [plaintiff's] legal fees and disbursements." The agreement then refers to RPC 1.8(f) and states that this Rule

The agreement goes on to state that "[b]y executing this retainer agreement, [Lomans] and [defendant] both agree to each of the above stated conditions."

The retainer agreement does not advise either defendant or Lomans about condition six of the Grand Jury decision, which requires the third-party to seek leave of court in order to be relieved of its obligation to continue to pay for the client's legal fees. Instead, the agreement states, "You may, of course, terminate [plaintiff's] representation at any time for any reason."

Defendant paid plaintiff a $20,000 retainer and agreed to pay a supplemental retainer if the initial retainer balance fell below $5,000. The retainer agreement set forth information concerning the hourly rates of the attorneys who would be working on the case, but did not provide a monthly budget of projected costs. Defendant asserts that the lead attorney plaintiff assigned to the case told it that the monthly legal fees would be approximately $20,000. This attorney denied that any such representation was ever made. Instead, the attorney alleged he told defendant's representatives that the monthly budget would be in the range of $30,000 to $60,000.

Plaintiff, defendant, and Lomans also executed a Joint Defense and Common Interest Agreement at the same time the retainer agreement was signed. This agreement has not been provided to us. According to defendant's general counsel, this agreement "memorialized the existing understandings among counsel and their clients with respect to certain actions, proceedings and intellectual property matters that they have and would continue to exchange" and provided that privileged material between the parties would be protected. The "actions, proceedings and intellectual property matters" covered by this Agreement are not apparent from the record.

On February 5, 2013, plaintiff sent defendant its first invoice for legal fees. This $19,470 invoice covered the work plaintiff performed to obtain and review the case file. Contrary to the fourth condition set forth in Grand Jury, this invoice was not redacted.1 Grand Jury, supra, 200 N.J. at 496. At some point during this period, Lomans filed a counterclaim in his lawsuit against APR and a third-party complaint against Dr. Reddy's. That company then filed a counterclaim against Lomans.

The lead attorney plaintiff assigned to represent Lomans certified that, in the first two months of plaintiff's representation of Lomans, defendant's general counsel "was the principal driver of [defendant's] litigation costs." The attorney stated that "[d]uring that time period [the general counsel] was intimately involved in developing and pushing litigation efforts and strategy, on a day to day basis." Plaintiff's decision to permit defendant to participate in these strategy sessions appears inconsistent with Grand Jury's prohibition against communications between the lawyer handling the matter and the third-party payer. Grand Jury, supra, 200 N.J. at 496. Defendant repeatedly denied plaintiff's assertion that it attempted to direct or dictate the litigation strategy plaintiff should follow in its representation of Lomans.

On March 25, 2013, plaintiff sent an invoice to defendant for approximately $92,000. Defendant immediately raised a concern that the charges were well in excess of the $20,000 monthly budget it believed had been established for the litigation costs. Plaintiff characterized the billing as an "outlier." On April 19, 2013, plaintiff sent the next invoice to defendant. The parties do not agree on the amount of the invoice. Plaintiff asserts it was for approximately $50,000 and defendant states the invoice was for $62,261.60. At that time, defendant's general counsel sent an email to plaintiff stating that "there will not likely be any significant respite from the litigation costs unless we successfully pursue settlement."

The relationship between plaintiff and defendant rapidly deteriorated over the next ten days, as the parties exchanged a series of increasingly caustic emails. Defendant balked at the fees plaintiff was charging it for representing Lomans and stated that the bills would not be paid unless plaintiff developed "a clear end game" for the resolution of Lomans' litigation with his former partner, APR, and Dr. Reddy's. Plaintiff asserted that the emails demonstrated defendant's intention to take over or interfere with its efforts to represent Lomans. Defendant contended the correspondence merely showed its continued concern with plaintiff's high fees.

On April 25, 2013, plaintiff sent defendant's general counsel a copy of the Grand Jury decision and encouraged him to read it. By the next day, plaintiff had decided not to cooperate any longer with defendant on litigation strategy. Defendant alleged that plaintiff's action violated the terms of the parties' Joint Defense and Common Interest Agreement.

On May 1, 2013, plaintiff filed an order to show cause in the Chancery Division seeking an order compelling defendant to pay the outstanding legal fees and to continue to fund Lomans' litigation costs. Under Grand Jury, the person being represented by the attorney has the right to institute a summary action for the relief plaintiff sought on its own behalf. Grand Jury, supra, 200 N.J. at 497. After defendant noted that plaintiff might not have standing to litigate the issue on a summary basis, plaintiff added Lomans as a party-plaintiff in its amended verified complaint. Defendant sought an order permitting it to cease paying for Lomans' litigation costs as permitted by Grand Jury. Id. at 496.

Plaintiff's primary contention was that defendant had no good faith basis for terminating its agreement to pay for Lomans' counsel fees. Pointing to condition six of the Grand Jury decision, plaintiff asserted that defendant had refused to continue to pay the fees because plaintiff and Lomans were "pursu[ing] a course of conduct deemed in the client's best interests but disadvantageous to the third-party payer. . . ." Grand Jury, supra, 200 N.J. at 497. Plaintiff further alleged that defendant's concern about the amount of the fees was merely a pretext for its efforts to control the litigation. Defendant strongly contested plaintiff's factual assertions, and alleged plaintiff was misinterpreting the correspondence exchanged by the parties.

The parties did not request, and the judge did not conduct, an evidentiary hearing to resolve the parties' competing factual contentions. Instead, the judge reviewed the certifications and exhibits submitted by the parties. On July 2, 2013, the judge denied plaintiff's request for an injunction requiring defendant to continue to pay the counsel fees plaintiff was charging Lomans. He also granted defendant's motion to cease its obligation to pay the fees as of the date of the order.

In a brief written opinion, the judge cited to the Grand Jury decision, but did not make any findings concerning whether all six of the conditions established in the decision had been met. The judge instead focused on condition six, and stated that defendant had "the burden to show that the termination [of its agreement to pay fees] was based on a legitimate purpose and not to control or interfere with [plaintiff's] representation of Lomans." The judge found that defendant had voluntarily agreed to pay for Lomans' attorney's fees; defendant and plaintiff had "no apparent conflict[,]" at least at the time the retainer agreement was executed; and the retainer agreement permitted defendant to terminate the arrangement "at any time for any reason." Without further analysis of the parties' competing factual allegations, the judge found that defendant's "rationale, [that] the attorney fees greatly exceeded what they had anticipated, is a sufficient reason to terminate the agreement."

Therefore, the judge terminated defendant's obligation to pay Lomans' fees as of July 2, 2013, the date of the order. The judge also transferred the matter to the Law Division for further proceedings.

Plaintiff thereafter filed a motion for leave to appeal. We denied this motion and plaintiff filed a similar motion with the Supreme Court. The Court granted plaintiff's motion for leave to appeal and remanded the case to us for consideration on the merits.

Shortly before oral argument, plaintiff filed a motion to supplement the record with a certification prepared by the lead attorney representing Lomans. Although defendant opposed this motion, it also relied upon recent developments occurring in the case in the presentation of its arguments. We therefore grant plaintiff's motion to supplement the record.2

Briefly, plaintiff's supplemental certification states that, following the July 2, 2013 order, the fee litigation continued in the Law Division. Although the judge ruled that defendant no longer was required to pay Lomans' legal fees, plaintiff states it continued to provide representation to Lomans in his action against his former partner, APR and Dr. Reddy's.

Plaintiff further alleges that, prior to a recent mediation session, defendant and Lomans entered into an agreement under which Lomans agreed to dismiss any claims he had against defendant in the Law Division fee action and in this appeal. On September 5, 2014, Lomans filed a stipulation of dismissal with this court and he is no longer a party to this appeal.3

Plaintiff contends that defendant's action in resolving its disagreement with Lomans further evidences that defendant's true motive all along was to control the litigation efforts plaintiff undertook on Lomans' behalf. In its reply papers, defendant sharply disputes plaintiff's factual contentions.

On appeal, plaintiff argues the judge erred in finding that defendant had good cause for terminating its agreement to pay Lomans' legal fees and costs. Plaintiff also argues that the judge should have continued to handle the matter in the Chancery Division as a summary action rather than transferring the case to the Law Division for resolution as a dispute over counsel fees.

II.

In Grand Jury, supra, the Supreme Court directed that questions concerning the propriety of a third-party continuing to pay for the representation of another be determined "via a summary action[.]" Grand Jury, supra, 200 N.J. at 497. Rule 4:67-1(a) prescribes the procedures the trial court must follow in a summary proceeding. Mag Entm't, LLC v. Div. of Alcoholic Beverage Control, 375 N.J.Super. 534, 550 (App. Div. 2005). Proceedings instituted under this Rule are commenced by the filing of an order to show cause supported by a verified complaint. R. 4:67-2(a). The court thereafter conducts an initial hearing and, "if satisfied with the sufficiency of the application, [it] shall order the defendant to show cause why final judgment should not be rendered for the relief sought." Ibid.

The court must try the case at the return date of the order to show cause "or on such short day as it fixes." R. 4:67-5.

Following the hearing, the judge must make detailed findings of fact and conclusions of law. Mag Entm't, supra, 375 N.J. Super. at 551 (citing Courier News v. Hunterdon County Prosecutor's Office, 358 N.J.Super. 373, 378-79 (App. Div. 2003)).

"[I]n a variety of contexts, courts have opined on the impermissibility of deciding contested issues of fact on the basis of conflicting affidavits or certifications alone." State v. Pyatt, 316 N.J.Super. 46, 50 (App. Div. 1998) (citations omitted), certif. denied, 158 N.J. 72 (1999). In particular, where the papers filed raise issues of fact or require credibility determinations, relief cannot be granted or denied absent a plenary hearing. Whitfield v. Whitfield, 315 N.J.Super. 1, 12 (App. Div. 1998).

On appeal, a judge's findings will generally "not be disturbed unless we are convinced that `they are so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence as to offend the interests of justice.'" Tractenberg, supra, 416 N.J. Super. at 365 (citations and internal quotation marks omitted). However, when the judge's determinations are made on a written record, they are not accorded the usual deference given when made following an evidentiary hearing, where the judge has the opportunity to develop a "feel of the case" and determine the credibility of witnesses. Dolson v. Anastasia, 55 N.J. 2, 7 (1969). Moreover, "[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).

Applying these principles here, we conclude that the current record does not permit us to resolve the issue of whether the trial judge erred in finding that defendant presented a sufficient reason for terminating its agreement to pay Lomans' legal fees within the intendment of Grand Jury, supra. As summarized above, virtually every material fact in this case is disputed by the parties. They do not agree on the circumstances leading up to defendant's agreement to pay for Lomans' litigation expenses in his lawsuit with his former partner, APR, and Dr. Reddy's. The record is also not clear as to the full nature of that agreement. While the retainer agreement is part of the record on appeal, the parties' Joint Defense and Common Interest Agreement is not. The parties also do not agree whether all six conditions established in the Grand Jury decision were met in this case.

There is a sharp dispute between the parties as to the representations, if any, plaintiff made to defendant concerning the monthly litigation costs defendant would be expected to pay. Finally, each party interprets their emails concerning the billing and litigation strategy differently.

Due to the widely divergent factual allegations presented by the parties, we conclude the judge should have conducted an evidentiary hearing prior to determining whether defendant presented sufficient reasons for terminating the retainer agreement under Grand Jury, supra. Such a hearing would have permitted the judge to hear the testimony of the key players involved in this dispute, including the attorneys assigned by plaintiff to represent Lomans, defendant's officials, and Lomans, and to make the credibility findings necessary to resolve the factual issues raised in their competing certifications. Following a hearing, the judge also would have been able to make detailed findings of fact on whether the parties' retainer agreement and subsequent relationship complied with the requirements established in Grand Jury, supra.

Because a hearing was required to resolve the factual issues underlying each party's request for relief, and because a hearing was not conducted, we vacate the July 2, 2013 order. We remand this matter to the Law Division for further proceedings, which may include a single trial or evidentiary hearing on all of the issues raised by the parties.

We reject plaintiff's contention that this matter should be returned to the Chancery Division or otherwise treated as a summary action by the Law Division. By filing a stipulation of dismissal in this appeal and in the Law Division fee litigation, Lomans has made it clear that he no longer wants plaintiff to represent him. Therefore, the exigencies that existed in the Grand Jury case, which prompted the Court to hold that the client may seek an injunction compelling the third-party to continue paying for needed representation in a summary action, are no longer present here. Grand Jury, supra, 200 N.J. at 497. Accordingly, all of the issues involved in this matter may appropriately be resolved in the Law Division.

Reversed and remanded. We do not retain jurisdiction.