Reconsideration of New Jersey Interlocutory Orders and the Limitations of the “Interests of Justice” Standard of Review
Introduction
Under New Jersey law, the standard for reconsideration of an interlocutory order is more liberal than the standard required for reconsideration of a final order. Reconsideration of a final order requires that the order was “palpably incorrect” or “irrational.” Reconsideration of an interlocutory order, on the other hand, may be granted under the more liberal “interests of justice” standard. However, practitioners seeking reconsideration of an interlocutory order in New Jersey state courts should not interpret this liberal standard as boundaryless or granting carte blanche to assert frivolous, vexatious, or repetitious arguments when seeking reconsideration of an interlocutory order.
Two Standards for Reconsideration
The New Jersey Court Rules lay out these separate reconsideration standards. On the one hand, Rule 4:49-2, which governs motions for reconsideration of a judgment or final order, requires that such motions “shall state . . . the matters or controlling decisions that counsel believes the court has overlooked or as to which it has erred . . . .” N.J. Ct. R. R. 4:49-2. Courts have further explained that this rigorous standard requires the order under review to have been a “‘palpably incorrect,’ ‘irrational” decision. Lawson v. Dewar, 468 N.J. Super. 128, 134, 256 A.3d 388, 392 (App. Div. 2021).
Interlocutory orders,1 on the other hand, are governed by Rule 4:42-2(b), which allows that interlocutory orders “shall be subject to revision at any time before the entry of final judgment in the sound discretion of the court in the interest of justice.” N.J. Ct. R. 4:42-2(b) (emphasis added). The Appellate Division has explained this to mean that “until the suit ends, a trial court ‘has complete power over its interlocutory orders and may revise them when it would be consonant with the interests of justice to do so.’” Lawson, 468 N.J. Super. at 134 (quoting Ford v. Weisman, 188 N.J. Super. 614, 619, 458 A.2d 142 (App. Div. 1983)). The rationale is that reconsideration motions — at least ones that “argue in good faith a prior mistake, a change in circumstances, or the court’s misappreciation of what was previously argued — present the court with an opportunity to either reinforce and better explain why the prior order was appropriate or correct a prior erroneous order.” Id. at 136.
Courts Confuse the Standards
However, New Jersey courts have sometimes misapplied the “palpably incorrect” final order standard to interlocutory orders. For example, in Selective Auto Ins. Co. of New Jersey v. Cascarino, the defendant sought severance of the claims and, if successful, reconsideration of the court’s order extending discovery. No. CPM-L-297-18, 2019 WL 11749209, at *6 (N.J.Super.L. June 11, 2019). Although the court noted correctly that it “may reconsider its interlocutory orders at any time, until final judgment,” the court nevertheless incorrectly applied Rule 4:49-2, instead of Rule 4:42-2(b), to reconsideration of the discovery order. In denying reconsideration, the court stated that the movant “failed to meet the burden for reconsideration imposed under R. 4:49-2” because it did not show that “the Court ha[d] expressed its decision based upon a palpably incorrect or irrational basis.” Id. See also Twp. of Mahwah v. Merrill, No. A-0600-14T4, 2015 WL 5309436, at *3 (N.J. Super. Ct. App. Div. Sept. 10, 2015) (The trial court erred in deciding that reconsideration of a motion to file a responsive pleading out of time “was governed by Rule 4:49–2, which addresses reconsideration of final orders, as opposed to Rule 4:42–2, which addresses reconsideration of interlocutory orders.”).
One court even rejected the distinction between the standards for final and interlocutory orders, effectively disregarding Rule 4:42-2(b)’s “liberal” standard. In denying plaintiffs’ reconsideration motion of an interlocutory order pursuant to Rule 4:42-2 and instead invoking the “palpably incorrect or irrational basis” standard, the court opined: “To the extent that plaintiffs argue that the decisional standards for reconsideration are different for an interlocutory order (R. 4:42-2) versus a final order (R. 4:49-2), I reject that argument as illogical and counterproductive to the necessarily watchful judicial posture that judges must take when presented with any type of do-over.”2 Horizon Healthcare Services, Inc. v. MD-X Solutions, Inc., No. BER-L-8463-08, 2009 WL 833333 (N.J.Super.L. Mar. 13, 2009).
Lawson Clarifies That the Standard for Reconsideration of Interlocutory Orders is More Liberal Than That for Final Orders or Judgments
In response to these errors by some courts, in 2021, the Appellate Division affirmed and clarified the difference between the statutory standards. In Lawson v. Dewar, the court explained that the standard for reconsideration of interlocutory orders “does not require a showing that the challenged order was ‘palpably incorrect,’ ‘irrational,’ or based on a misapprehension or overlooking of significant material presented on the earlier application.” 468 N.J. Super. at 134. There, the court reversed an erroneous application of the stricter “palpably incorrect” standard to an interlocutory order concerning discovery. Lawson made clear that “[u]ntil entry of final judgment, only ‘sound discretion’ and the ‘interest of justice’ guides the trial court. . . .” Id.
Post-Lawson Case Law Remains Confused
Since Lawson, courts have more frequently noted the correct distinction between the two reconsideration standards when determining which one applied. See, e.g., Sullins v. Lugo-Valez, No. HUD-L-374-20, 2023 WL 11795940, at *1-2 (N.J.Super.L. Jan. 06, 2023) (recognizing “the court’s order granting Plaintiff’s motion [which] . . . did not dispose of all the claims . . . is an interlocutory order” reviewed “pursuant to the standard set forth in Rule 4:42-2 and Lawson”); JPC Merger Sub LLC v. Tricon Enters., Inc., 474 N.J. Super. 145, 160, 286 A.3d 1186, 1195 (App. Div. 2022) (“Where the order sought to be reconsidered is interlocutory, as in this case, Rule 4:42-2 governs the motion.”).
However, practitioners should remain attentive because even since Lawson clarified the two standards, they are sometimes misapplied. See Pierre-Louis v. Princeton 370 LLC, No. A-1965-22, 2024 WL 4615589, at *6 (N.J. Super. Ct. App. Div. Oct. 30, 2024) (recognizing that the trial court’s reconsideration of its nonfinal summary judgment order should have been “guided by the more liberal standard using its ‘sound discretion’ and the ‘interest of justice’ provided in Rule 4:42-2”)(citing Lawson, 468 N.J. Super. at 134-35). See also Sadeeshkumar v. Venugopal, 478 N.J. Super. 25, 41, 310 A.3d 689, 699 (App. Div. 2024) (reversing order denying reconsideration motion where the motion court applied the non-interlocutory Rule 4:49-2 standard to an interlocutory order regarding a motion to amend.).
Even the More Liberal Standard Requires Good Cause
Moreover, practitioners are cautioned against abusing the liberal standard, which is not without limits. For example, practitioners should heed the Lawson court’s admonition that even motions for reconsideration of interlocutory orders must not be “frivolous, vexatious, or merely repetitious.” Lawson, 468 N.J. Super. at 136. Indeed, even under the “interests of justice” standard, “the court’s discretion should be exercised conservatively.” Poku v. Borough of Red Bank Block 81, Lot 20, No. 007567-2022, 2023 WL 5216296, at *3 (N.J. Tax Ct. Aug. 14, 2023). Accordingly, “the court’s exercise of discretion is not subject to wanton invocation or unfettered judicial response but must be ‘for good cause shown.’” Id.
While New Jersey courts have not defined “good cause” in this context, it is clear, at a minimum, that reconsideration motions that assert new legal theories or merely repeat the prior arguments, without, for example, raising a prior mistake, a change in circumstances or facts, or the court’s misappreciation of a previously argued issue, will likely fail. For example, in Atl. Fabrication & Coatings, Inc. v. ISM/Mestek, the court denied a reconsideration motion that failed to offer any pertinent new facts unavailable at the time of the interlocutory order. No. A-0500-19, 2021 WL 5264364, at *10 (N.J. Super. Ct. App. Div. Nov. 12, 2021) (“[T]he factual predicates of [Atlantic’s] new theory were available when [Atlantic] responded to [Mestek]’s motion for summary judgment.”) (alterations original). Similarly, in Wasilewski v. Accu Reference Medical Lab, LLC, the court denied a motion to reconsider an order denying a motion to amend a complaint where “the current 247-page application containing a 42-page ‘letter brief’ is a paradigm of the proverbial ‘second bite at the apple.’” No. UNN-L-003247-20, 2022 WL 22964007, at *3 (N.J.Super.L. Dec. 05, 2022).
Conclusion
In short, practitioners moving for reconsideration of interlocutory orders in New Jersey state courts are cautioned that the liberal “interests of justice” standard is not without limits and should not be abused. Good cause remains required. Furthermore, practitioners are wise to remain attentive to decisions denying motions to reconsider interlocutory orders because courts sometimes still mistakenly apply the harsher standard. Written by Yonatan Y. Jacobs and Robert C. Penn Jr..
1 This standard applies to “any order or form of decision which adjudicates fewer than all the claims as to all the parties.” N.J. Ct. R. 4:42-2(b).
2 The court further opined: “Applying a consistent methodology to all motions for reconsideration enhances predictability and serves to fortify our subservience to precedent. Accordingly, I expressly adopt the view — well understood, I believe, by a majority of the bench and bar — that the same modes of thought and methods of analysis apply to applications for reconsideration of both interlocutory and final orders.” Horizon Healthcare Services, Inc. v. MD-X Solutions, Inc., No. BER-L-8463-08, 2009 WL 833333 (N.J.Super.L. Mar. 13, 2009).