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Heim v. Wolpaw3/25/1994
[271 NJSuper Page 540] General Accident Insurance Company (appellant) appeals from an order amending a judgment plaintiffs obtained against defendants Ivan F. Wolpaw, Karanne Wolpaw, and Heath Wolpaw in a personal-injury negligence action. As originally entered on January 3, 1991, the judgment was stated to be "in the amount of $475,000.00 together with interest and costs to be taxed." The
amount of the judgment did not include a sum for prejudgment interest. On July 1, 1992, appellant moved for an order clarifying the judgment to confirm that the court did not intend to award plaintiffs prejudgment interest. On July 9, 1992, plaintiffs cross-moved, purportedly pursuant to R. 1:13-1, for an order to correct a "clerical mistake" in the judgment by amending it to include a sum for prejudgment interest.
The Judge who had conducted the trial heard both motions together and on August 21, 1992, entered an order denying appellant's motion and granting plaintiffs' motion. The order raised the amount of the judgment to $680,461.98, which included prejudgment and post-judgment interest, after crediting sums paid on account of the original judgment. The main issue on appeal is whether the trial court mistakenly exercised its discretion when it granted plaintiffs' motion. Preliminarily, plaintiffs question whether the trial court exceeded its authority by entertaining appellant's motion eighteen months after entry of the judgment.
Although not acknowledged by the parties, they were all relying on R. 4:50 for relief from the judgment. As the trial court stated during oral argument, there was no "clerical mistake" to be corrected under R. 1:13-1. The court acknowledged that it, not the clerk, had made the mistake by not making clear its intent to award prejudgment interest. The original judgment was facially ambiguous. It stated that "interest" was awarded. The reference appears to be to prejudgment interest because there is no need for a judgment to provide expressly for post-judgment interest, which attaches to a judgment " xcept as otherwise ordered by the court." R. 4:42-11(a). On the other hand, prejudgment interest is of no value unless it is computed and included in the judgment. By not including an amount for prejudgment interest the judgment did not enable plaintiffs to recover it by executing the judgment. Thus, for the judgment to serve its purpose of providing finality, plaintiffs and appellant needed recourse to R. 4:50 to clarify the court's intent.
Rule 4:50-2 provides that a motion to correct a "mistake" in a judgment pursuant to R. 4:50-1(a) must be made within one year. Resolving an ambiguity in a judgment, however, goes beyond correcting a mistake. Unless the ambiguity is resolved, the judgment in that respect has no meaning. Resolving an ambiguity is a "reason justifying relief" from the judgment other than correcting a mistake and is therefore cognizable under R. 4:50-1(f), the catch-all for extraordinary relief not otherwise specified in the rule. Relief for that reason may be sought within "a reasonable time." R. 4:50-2. Where, as here, the parties had been reading the ambiguity differently, it is reasonable to recognize that they needed time to realize the problem before they both sought relief. The matter was properly before the trial court.
As to the merits, the purpose for awarding prejudgment interest is not served by awarding it in this case. Appellant's homeowners' policy afforded Karanne Wolpaw and her young son Heath only $50,000 coverage. Soon after plaintiffs commenced this action, appellant deposited the full am
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