                        NOT FOR PUBLICATION WITHOUT THE
                      APPROVAL OF THE APPELLATE DIVISION
     This opinion shall not "constitute precedent or be binding upon any court."
      Although it is posted on the internet, this opinion is binding only on the
         parties in the case and its use in other cases is limited. R.1:36-3.



                                       SUPERIOR COURT OF NEW JERSEY
                                       APPELLATE DIVISION
                                       DOCKET NO. A-5064-11T2

JONG S. HONG,

        Plaintiff-Respondent,

and

DANIEL KIM,

        Plaintiff,

v.

SOON H. KIM and
YEO PYEONG YUN,

        Defendants-Appellants.


              Submitted March 22, 2017 – Decided August 17, 2017

              Before Judges Alvarez, Accurso, and Lisa.

              On appeal from the Superior Court of New
              Jersey, Law Division, Bergen County, Docket
              No. L-8580-09.

              Kimm Law Firm, attorneys             for appellants
              (Michael S. Kimm, Sung H.            Jang, and Adam
              Garcia, on the briefs).

              Sukjin Henry Cho, attorney for respondent.
PER CURIAM

       This appeal, filed on June 11, 2012, was stayed for years as

a result of plaintiff Jong Sul Hong and defendant Soon Hee Kim

filing consecutive bankruptcy petitions.                       Soon Hee's1 bankruptcy

discharged     the   $270,000       judgment          that    Hong     obtained   after      a

fourteen-day bench trial.             We therefore do not reach the issues

Soon Hee raises on appeal with regard to the judgment, as they are

moot, and address only her argument, and that of her husband and

co-defendant     Yeo    Pyeong       Yun, 2 that         their       counterclaims       were

improperly dismissed.              We agree, and remand for trial on Soon

Hee's counterclaim for malicious prosecution, both Soon Hee and

Yun's    counterclaim        for    breach       of    fiduciary       duty,   and     Yun's

counterclaim for $75,000.            The cause of action based on an alleged

violation of the Fair Debt Collection Act, 15 U.S.C.A. § 1692a and

§ 1692e, however, is not reinstated.

       Every   witness       except      Hong    required        the    services      of    an

interpreter.     The halts and interruptions natural to such a trial

were     exacerbated         by    the    judge's            frequent     interjections,

interruptions, and commentary.                  Instead of aiding in clarifying

the    testimony,      the    trial      judge's       questioning        added    to      the


1
    We refer to Soon Hee Kim in this fashion to avoid confusion.
2
  We will refer to Yeo Pyeong Yun as Yun to avoid confusion, and
refer to Soon Hee and Yun collectively as defendants.

                                             2                                       A-5064-11T2
confusion.   This confusion was not alleviated by the judge's 104-

page written opinion.

     Hong, Soon Hee, and Yun were involved in lending circles,

known as "kehs," rooted in Korean culture.   Members of a keh pool

their funds, and pay out principal and interest on a rotating

basis. 3   Kehs date back to farming villages in Korea in the

sixteenth century.    Lan Cao, Looking at Communities and Markets,

74 Notre Dame L. Rev. 841, 874-84 (1999).

     From the trial testimony, we discern that Hong managed at

least two kehs, one formed in 2006, the other in 2008, in which

Soon Hee participated.     As the administrator of the kehs, Hong

paid no interest, and she claimed not to have kept any of the

interest paid into them.   At times, however, members would be paid

the keh purse and relend the money to her.     Although records of

the kehs were demanded during discovery, none were produced. Hong

testified that she kept records for the 2006 keh in a notebook,

which she lost.      Some Xeroxed pages, allegedly from this lost

notebook, were introduced at trial. Hong also claimed records


3
  For example, in a twelve-month keh with twelve positions,
requiring a $500 monthly principal payment, a monthly purse of
$6000 is taken in the order designated by the keh manager. By the
end of the twelve-month period, each position would have taken a
$6000 pot while each member would have paid a minimum of $6000
into the keh for each position, plus interest.      The positions
would be paid or receive more or less interest for the duration
of the keh depending on their place in the rotation order.

                                 3                          A-5064-11T2
regarding the 2008 keh were in the possession of an attorney no

longer involved in the case.

      The monthly 2006 keh payment amount was $1500, and the monthly

interest was $300.    Due to the number of the participants in the

keh, a total of $2.4 million in purses were paid.          The 2008 keh

required monthly payments of $2500, from each of forty positions,

and interest of $500 on a pot totaling $100,000.         The total purse

came to $4 million.    Soon Hee held multiple positions in both the

2006 and 2008 kehs.       Yun had four positions in the 2006 keh, and

none in the 2008 keh.

      We need not repeat in detail the at-times garbled history of

payments, checks, and other financial transactions, in addition

to the kehs, between Hong and Soon Hee including loans in both

directions, and Soon Hee's unexplained payment to at least one of

Hong's relatives.     Suffice it to say that Soon Hee gave certain

blank and undated checks to Hong, who in turn gave them to Kim,

because Hong owed him money.       Kim never participated in any keh

managed by Hong, but had lent her various sums totaling $205,000.

From the written documents introduced during the trial, we assume

few   written   records    were   generated   as   a   result   of     these

transactions.

      Kim did not know that Hong had been holding Soon Hee's checks,

and did not know when they were delivered to Hong.          He deposited

                                    4                                A-5064-11T2
them because Hong advised him that it was "okay" to do so.           Kim

claimed that he warned Soon Hee that he was going to deposit the

checks, and "there wasn't any response by her."          On August 11,

2009, while together, Hong and Kim deposited the five checks.        Kim

filled in the dates; all were dishonored.

     After    the   checks   were   dishonored,   Hong   contacted   her

attorney.     It is not clear from the record if counsel was aware

of the history between the parties, either with regard to the kehs

Hong managed, or the fact the checks were initially issued with

the dates and payee in blank. Soon Hee testified the checks were

not to be deposited without her explicit consent.

     Hong's attorney wrote to Soon Hee, putting her on notice that

the issuance of the checks was a third-degree crime, and that if

Soon Hee did not forward certified or bank checks in the amounts

of $120,000 and $166,582 within ten days, the matter would be

referred to the Bergen County Prosecutor.     Hong, while testifying,

seemed to acknowledge that the letter was inaccurate because Soon

Hee had not filled in the dates on the checks.

     On September 21, 2009, Hong and Kim filed a civil complaint

against Soon Hee and Yun, alleging that Soon Hee sought "a short-

term, interest free loan in the amount of $300,000" from both

plaintiffs.    The complaint states:



                                    5                           A-5064-11T2
              6.   Based on the request by [d]efendant
         [Soon Hee], [p]laintiffs did then loan to
         [Soon Hee] the total sum of $287,040.00, of
         which $150,540.00 came from monies then
         possessed by . . . Hong, $120,000 came from
         monies then possessed by . . . Kim, and
         $16,500.00 came in the form of "cash advances"
         on credit cards maintained by . . . Hong.

              7.   Under the terms of the parties'
         agreement, the $287,040.00 which [d]efendant
         [Soon Hee] borrowed from . . . Hong and from
         . . . Kim was to be repaid in full within
         thirty (30) days of the date thereof. Based
         on the very short term of the loan and the
         long standing relationship of the parties, the
         parties agreed that the loan would not accrue
         interest, fees, or other charges during that
         thirty day term.

    Additionally,   the   complaint   stated   that   "[w]ithout   the

knowledge, consent, or permission of the [p]laintiffs," Soon Hee

used the money to purchase a retail store, and that she refused

to pay back the loan under the original terms of the agreement.

    According to the complaint, on an unspecified date, the

parties renegotiated the loan terms. Soon Hee was to pay the

principal in a lump sum within two years, and to pay $5400 per

month in interest until that time.      Soon Hee paid the interest

from September 2007 until February 2009, when she asked for and

received an additional $10,000 loan under the same terms.

    The complaint also alleged:       "[a]s evidence of defendants'

indebtedness to Plaintiffs on the said loan, on or about August

11, 2009, defendant [Soon Hee] wrote a series of checks to the

                                6                             A-5064-11T2
[p]laintiffs[.]"    The dishonored checks were described as follows:

check number 1474 "was made payable to . . . Kim in the amount of

$60,000"; check number 1475 "was made payable to          . . . Kim in the

amount of $60,000"; check number 1487 "was made payable to . . .

Hong in the amount of $50,000"; check number 1488 "was made payable

to . . . Hong in the amount of $50,000"; and check number 1489

"was made payable to . . . Hong in the amount of $66,582.00."

     At trial, Hong admitted that many of the allegations in the

complaint,   reiterated   in    her       interrogatory   responses,       were

incorrect.   For   example,   she   conceded     that   Soon   Hee   had   not

transferred her interest in the business or other real estate

solely to render herself judgment proof; that plaintiffs sought

repayment of more than just a single loan; that there was never

an agreement to repay the loan within thirty days; that Kim had

never loaned Soon Hee any money; and that Hong did not make the

loans from her own funds.4

     Extensive testimony was elicited from Hong with regard to her

management of the kehs. She acknowledged that she had "difficulty"

with them.    Hong had comingled the money from the two kehs by


4
  Kim also acknowledged that "everything [was] wrong" in the
allegations in the complaint. He never lent Soon Hee or Yun money
directly, nor had he received any checks from Soon Hee. In
addition, "almost all" of the original answers he had provided to
interrogatories through his former counsel were "incorrect."


                                      7                               A-5064-11T2
using funds from one to meet the obligations of the other.       She

agreed that one person from the 2006 keh had not been paid,

although she insisted that Yun had "received everything in full,"

but had nothing in writing to establish that.

     From 2008 to 2009, Hong claimed she was approximately $800,000

to $900,000 in debt, including the $300,000 Soon Hee allegedly

owed her.      However, she kept no notes and had no writing to

evidence the debts, and was unsure whether the debts were cash

debts.

     During Soon Hee's testimony as a hostile witness in Hong's

case, she denied borrowing "even a single dollar" from Hong. She

claimed that she had participated in seven or eight of Hong's

kehs, and that for more than ten years they had been passing money

back and forth without maintaining records.     At times Soon Hee

received money from Hong, which Hong had borrowed from others, and

Soon Hee loaned money from her keh purses to third parties through

Hong. All of the transactions, Soon Hee claimed, were supposed to

be recorded in Hong's lost notebook.

     Soon Hee said that it was impossible to separate the funds

generated through the kehs from the loans.      Although she owed

$10,000 on the 2008 keh, she in turn was owed money from the 2006

keh, and Yun continued to be owed $75,000 from that keh to be paid

through her.    She had lent Hong money at no interest, which had

                                 8                          A-5064-11T2
not been repaid.      Soon Hee agreed she had signed all five checks

in blank and had written out other checks payable to plaintiff's

aunts.

     Soon Hee claimed it was Hong's practice in managing the kehs

to hold personal checks in escrow and not use them until the draws

were replenished.       When Hong's last keh was breaking up, Hong

needed the checks to show to others in addition to having financial

needs herself.    Soon Hee had agreed that when the keh accountings

were completed, she and Hong would do the necessary calculations

to determine precisely what was owed to whom.              Because Soon Hee

trusted Hong, she wrote the checks in Hong's presence, to be held

in escrow pending further keh transactions.           Hong allowed Soon Hee

to charge heavily on her credit cards.

     Soon Hee said that only Hong knew the identity of all the

members    of   the   keh.   She    also      testified    that   Hong     would

occasionally take two positions in her own keh, pay no interest,

and then lend money privately to other keh members.

     The    precise     nature     of       the   multi-faceted    financial

relationship between the parties was unclear.             Hong tape-recorded

some conversations with Soon Hee, and the transcriptions, prepared

by an acquaintance, were proffered and accepted as evidence.

During those conversations, Hong appeared to agree that at least



                                        9                                A-5064-11T2
some of the checks Soon Hee gave her represented Soon Hee's

obligations as a participant in the kehs.

     Yun testified that he did not participate in the 2005 or 2008

kehs, but he had four spots in the 2006 keh:     August and September

2007, and March and April 2009.    Yun received his payments through

Soon Hee and otherwise "didn't get involved."          His purse was

$127,000, but he did not know if it had been paid in cash or

checks; he believed that he was still owed $10,000, although it

was unclear from which keh year.       He testified that, at the time

of trial, he had not received the $75,600 he was owed from the

March and April 2009 purses in the 2006 keh.

     From March to August 2009, Yun "tried very hard to settle the

money problems" between his wife and Hong but was unable to do so.

He attempted to negotiate a resolution of the problem between Hong

and Soon Hee, but they were not able to agree on a price.            He

fired Hong, who had worked in his store, after only two months.

He found her claim that Soon Hee owed her $600,000, and repeated

requests for a $100,000 loan, troublesome.

     On September 23, 2009, plaintiffs filed criminal charges

against Soon Hee with the Fort Lee police. At trial, Hong said she

went to the police after she heard nothing from Soon Hee in

response to her attorney's demand letter. She said: "It was my



                                  10                          A-5064-11T2
knowledge that once the checks were deposited and was bounced,

returned, that . . . the criminal complaint may be filed."

     Hong showed the checks to the police, who did not ask any

questions about them. She did not tell them that it was her and

Kim, not Soon Hee, who dated the checks and wrote the payee names,

or that the money for the loans had come from others. Plaintiff

said she "told the story" to her attorney and that he wrote

documents she referred to as affidavits.

     Hong's affidavit stated that "2 years and few months ago" she

had loaned Soon Hee "around $300,000" in a "short term loan"; that

Soon Hee "gave me 5 checks for the money I have given it to her;"

that Soon Hee "refused" to pay back the money; that her attorney

had sent out a letter and received no response; and that she had

deposited three of the checks on August 11, 2009, and they were

returned.

     In a handwritten affidavit, Kim stated that he had "received

2 checks at $60,000 each," that he deposited them on August 11,

2009, and the checks were returned for insufficient funds. He

stated that a letter had been sent to Soon Hee on September 1

asking her "to make the checks good but no response."

     Kim's affidavit did not identify who gave him the checks.      He

testified at trial that the police never asked how he came into



                               11                            A-5064-11T2
possession of the checks or whether he had filled in the date and

payee, and he never told the police that he had done so.

     After filing the charges, Hong spoke to someone at the

prosecutor's office and went to the Superior Court about the case

more than five times without telling anyone that the information

in the affidavit was incorrect.           When asked if she was concerned

about the accuracy of her statement to the police, Hong responded:

"I did it with just the purpose of getting the money."

     Kim said he had filed the criminal complaint only to ensure

that he received his money; he did not want anyone to go to jail.

If Soon Hee had called him to "make the resolution to make the

check good," he would have withdrawn it.

     Detective Philip Ross of the Fort Lee Police Department

arrested Soon Hee on November 19, 2009, on five charges of the

indictable offense of passing bad checks in violation of N.J.S.A.

2C:21-5B.    She surrendered in police headquarters at 9:40 a.m. on

November 19, 2009, with her attorney.         Soon Hee was fingerprinted,

screened    as   a   prisoner,   pat-searched,   photographed,   and   held

pending arraignment.      She was released after arraignment at 12:30

p.m. that day.        Her passport was seized as a condition of her

release.

     Ross said the arrests were based on the affidavits, copies

of the returned checks, and the complaints filed by Hong and Kim.

                                     12                           A-5064-11T2
Ross was unaware that the checks had been given to plaintiff in

March 2009, or that when delivered, they were undated. If he had

known, he would not have taken any police action. The criminal

complaint against Soon Hee was administratively dismissed on July

15, 2010, eight months after her arrest.

     When the matter was being processed through the criminal

court, Soon Hee "was really panicking[.]"     She paid an attorney

$5000 and filed an ethics complaint against Hong's attorneys who

had sent the demand letters and filed the civil complaint.    In her

written statement to the ethics committee, Soon Hee stated as

follows:

           In April 2009, all five checks were give[n]
           by me to Ms. Jongsul Hong and she and I agreed
           that she will hold those checks until I repay
           her loan. Ms. Hong loaned money to me, which
           is current, for which those checks were to be
           held by her, and never to be cashed or
           deposited or given to any third-party.

                Ms. Hong and I have had [a] personal loan
           relationship since three years ago and I give
           her interest monthly. The check was not to
           be used by anyone and it was not my payment
           for anything. It was only "to hold."

                . . . .

                I never issued those checks to "Daniel
           Kim" and the check[s] were blank and they were
           not supposed to be deposited. Everyone knew
           that I did not have the funds and so even the
           dates were not written in.



                                13                           A-5064-11T2
     The trial judge rejected defendant's contention that Hong's

role as a keh organizer and loan facilitator imposed a fiduciary

duty upon her.   He instead found that Soon Hee owed $270,000 to

Hong, in addition to $16,582 for the use of Hong's credit card.

He further found that Hong was "gullible and naïve," had borrowed

money "from various third parties" at Soon Hee's request, and then

loaned a minimum of $270,000 to Soon Hee to "put the loan money

into an account so defendant could obtain a loan," believing the

money would be returned.   He added:

          [t]he Court still has some difficulty which
          does leave questions of credibility that the
          plaintiff was only seeking to collect $270,000
          representing the balance of the loan of
          $310,000 since $40,000 has been repaid though
          no records have been presented by the
          plaintiff as to this payment of $40,000 where
          the Court had previously indicated that these
          payments would have corroborated the agreement
          between the parties that this was a loan and
          it was to be repaid and even possibly address
          the issue of interest. (Do the pleadings and
          subsequent arguments of the defendant claiming
          loan sharking acknowledge that they were
          paying interest yet it was usurious was their
          argument though little testimony involved on
          the issue of interest on the loan except to
          say it was the same interest as the keh being
          2% a month though there was no testimony as
          to how many payments were made.)

     The judge observed that the checks Soon Hee had signed were

"critical" to his determination.    If, as Soon Hee had testified,

"this is just the same as writing an IOU on a piece of paper and


                               14                          A-5064-11T2
is worthless," then "[w]hy write this indebtedness on your checking

account?"   He said:    "[i]t would appear to be acknowledged by all

the parties that giving a personal check to a lender is an

acknowledgement of the debt being common practice.             The Court

questions what are you supposed to do with these checks if not

cash them or negotiate them."        Furthermore, Soon Hee acknowledged

the debt in letters she wrote to the Bergen County Ethics Committee

regarding Hong's attorneys.

     As well as rejecting the notion that Hong had a fiduciary

duty, the court also dismissed defendants' counterclaim regarding

violations of the Fair Debt Collection Practices Act.          The judge

concluded that Hong was not a debt collector as defined by that

legislation:   "a person who regularly collects or attempts to

collect directly or indirectly debts owed or due or asserted to

be owed or due another."      The court said that "plaintiffs are not

vicariously liable for their prior counsel['s] letter to the

defendant and any allegations with regards to ethics violations

have already been dismissed by the Ethics Committee."

     Furthermore,      the   court   dismissed   defendants'   claim    of

malicious prosecution because they had failed to prove that Hong's

complaint to the police department "was done with malice."             The

fact that Hong acted on the advice of counsel "show[ed] good faith

and is a valid affirmative defense."        The judge opined that there

                                     15                          A-5064-11T2
were   no    damages   other    than   attorney   fees   because,      although

defendant "was briefly detained at the Fort Lee Police Department,"

and had her passport confiscated, "she never testified that this

caused her any inconvenience let alone any emotional distress."

       Finally, the court said:

              There was no counterclaim for any monies that
              the plaintiff [] Hong may owe the defendants
              [], there being no claim for a set off against
              the indebtedness found to be owed by the [Soon
              Hee] to the plaintiff [] Hong, therefore the
              Court will not nor can it consider any claims
              of the defendant which it may have referenced
              as set offs throughout this opinion.

                                       I.

       In an appeal from a bench trial, "[t]he scope of appellate

review of a trial court's fact-finding function is limited."

Seidman v. Clifton Sav. Bank, S.L.A., 205 N.J. 150, 169 (2011)

(quoting Cesare v. Cesare, 154 N.J. 394, 411 (1998)).              The factual

findings and legal conclusions of the trial judge are not disturbed

unless      the   reviewing    court   is   "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."          In re Trust Created by Agreement Dated

Dec. 20, 1961, ex rel Johnson, 194 N.J. 276, 284 (2008) (quoting

Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474,

484 (1974)).        We owe no deference, however, to a trial court's


                                       16                               A-5064-11T2
interpretation of the law and the legal consequences that flow

from established facts.      Gallenthin Realty Dev., Inc. v. Borough

of Paulsboro, 191 N.J. 344, 358 (2007); Manalapan Realty, L.P. v.

Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995).

                                        II.

     The issue of whether a duty should be imposed is a question

of law.    It requires evaluation of the parties' relationship, the

nature of the risk involved, and the related public interest.

Frederick v. Smith, 416 N.J. Super. 594, 599 (App. Div. 2010),

certif. denied, 205 N.J. 317 (2011).                No deference is owed to the

trial court's legal conclusion on the issue.                Ibid.

     A fiduciary relationship arises "when one person is under a

duty to act for or give advice for the benefit of another on

matters    within   the   scope    of    their       relationship."       F.G.    v.

MacDonell, 150 N.J. 550, 563 (1997).                It occurs when the parties'

relationship involves a level of trust and confidence and one

party is in a dominant or superior position.                Ibid.

     The   trial    court   here   said       that     it   found   no   fiduciary

relationship    existed      between          the     parties   because      their

relationship involved "a straightforward loan between [] Hong to

[Soon Hee]." (Da2271).       Debtor-creditor relationships generally

are not considered to be fiduciary because of their essentially



                                        17                                 A-5064-11T2
adversarial nature.        N.J. Econ. Dev. Auth. v. Pavonia Rest., 319

N.J. Super. 435, 446 (App. Div. 1998).

       But    the    court's      finding       that     the     matter     involved      a

straightforward loan was not supported by the evidence.                          This was

the basis for the judge's dismissal of defendants' counterclaim

that   Hong    had     breached    a   fiduciary         duty.   There     was   nothing

straightforward         about     Hong's        constantly       shifting      testimony

regarding the circumstances of the loans. She herself acknowledged

a long-term financial relationship with Soon Hee and her management

of the kehs in which Soon Hee and Yun were participants.                               The

judge's      factual     findings      were      thus     inconsistent         with    the

reasonably credible evidence in the record, and were the sole

support for his legal conclusion that the parties had a simple

lender-borrower        relationship     and       that    therefore       no   fiduciary

relationship existed.

       In addition, it was undisputed that Hong served as Soon Hee

and her husband's intermediary for hundreds of thousands of dollars

in keh money that she collected, paid out to them in purses, and

loaned for profit to others.               In her role as the keh organizer,

Hong collected and distributed enormous sums of money.                                 She

admittedly profited from the no-interest loans she received in

that capacity and then re-lent to others with interest.



                                           18                                     A-5064-11T2
     Soon Hee and Yun, and the other keh participants had to trust

that Hong would distribute their money in accordance with the

rules of the particular keh.   Hong alone knew the identity of the

dozens of keh participants, the order in which payouts were to be

made, and funds distributed to the participants —— as well as to

any individuals who were making loans separately from keh payments.

     Hong may well have owed defendants the duty of loyalty and

the duty to exercise reasonable skill and care that are encompassed

within a fiduciary's obligations.    See F.G. v. MacDonell, supra,

150 N.J. at 564.    The state of the record, however, permits no

definitive conclusion on this point.      These duties include a

fiduciary obligation to maintain records regarding distribution

of keh funds.

     Despite Hong's testimony to the contrary, her statements in

the April 2, 2009 telephone recordings she moved into evidence

demonstrated that at least some of the obligations represented by

the five checks were incurred as a regular part of the keh

transactions.    Despite this evidence, Hong did not explain why

some of the check amounts coincided with Soon Hee's portion of the

keh purses.     The judge did not address these questions in his

decision.

     Soon Hee testified repeatedly that the records for the 2008

keh, and Hong's lost notebook containing the record of all of the

                                19                          A-5064-11T2
loan transactions, would support her contention that the loan

transactions went both ways, and that Hong also owed her money.

The    only    evidence    to     the    contrary   was    Hong's     self-serving

insistence at trial that the loans were entirely separate from the

keh.        In fact, it was not until December 2010, months after

defendants made the discovery request regarding Hong's financial

records, that Hong first claimed she had lost the notebook that

contained records of her loan transactions.

       The discovery violations were not remedied or resolved before

trial.       Soon Hee and Yun may have been entitled to invoke the

spoliation inference, a remedy for a litigant who becomes aware

during litigation that evidence has been destroyed or concealed.

Rosenblit v. Zimmerman, 166 N.J. 391, 401-02 (2001). The inference

serves to level the playing field by allowing a factfinder to

presume that the lost or concealed evidence would have been

unfavorable to the spoliator.            Ibid.   When the issues were raised,

the judge did "not concur with defendants analysis/arguments that

by    not    providing    books    and    records   of    these   kehs   that    the

aforementioned claims made by the defendant concerning monies owed

to them by the plaintiff must be true."             Nor did the trial judge's

decision      mention    Hong's    assertion     that    the   2008   keh   records

allegedly remained in the possession of Hong's other attorney.



                                          20                                A-5064-11T2
       In addition, without support in the record, the court found

that defendants also had the notebook.                  Soon Hee had merely

testified that she had seen Hong's notebook on multiple occasions.

Thus defendants are correct that the trial court erred when it

rejected out of hand their claim that Hong was in a fiduciary

relationship with them, and when he did not draw an adverse

inference from Hong's failure to produce documents that were

critical to the parties' claims.              The judge's conclusions were not

supported    by   the        record.      Accordingly,       we    reinstate     the

counterclaim and remand the matter for a new trial on that issue.

Should defendants wish to do so, they have the right to file a new

motion pretrial regarding spoliation. Our decision on these issues

results from the judge's reconstruction of the record, and is not

intended to dictate the outcome.

                                         III.

       In his decision on the parties' cross-motions for summary

judgment, another judge dismissed Yun's counterclaim for breach

of fiduciary duty.       That judge mistakenly believed that only Yun

had asserted such a claim.            In fact, both he and Soon Hee asserted

the    counterclaim     in    their    original    answer.        The   judge   also

mistakenly found that Yun had not been a member of any keh, and

that if he had participated, it was only "indirectly" through Soon

Hee.

                                         21                                 A-5064-11T2
     To the extent that defendants' breach of fiduciary duty

counterclaim was deemed dismissed by that pretrial judge's order,

it is hereby reversed.     Yun was a member of the 2006 keh.            The

remand for a retrial on the extent of Hong's fiduciary duty is on

the counterclaim made by both defendants.

                                  IV.

     Yun also contends that he is entitled to damages for Hong's

mismanagement of the 2006 keh in the amount he paid into the keh,

$75,000.   We reverse the dismissal of this claim, because the

trial court's decision incorrectly stated no counterclaim had been

made:

           What about providing evidence of what the
           defendant[s] paid into the keh with their
           books and records? Wasn't Yun's participation
           in this keh through [Soon Hee], did she
           receive those monies, where did she deposit
           her keh monies, where are her records as to
           what she paid into the keh on Yun's behalf?

     Nevertheless,   in   the   last    sentence   of   the   "Conclusion"

section of his decision, the judge said:

           There was no counterclaim for any monies that
           the plaintiff [] Hong may owe the defendants
           Soon [Hee] or [] Yun, there being no claim for
           a set off against the indebtedness found to
           be owed by the defendant Soon [Hee] to the
           plaintiff [] Hong, therefore the Court will
           not nor can it consider claims of the
           defendant which it may have referenced as set
           offs throughout this opinion.



                                  22                               A-5064-11T2
     Under   the   conflicting      evidence   presented    at   trial,   the

$75,000 claim could be viewed as part of the loan and repayment

agreement    between   Hong   and   Soon   Hee,   or   as   an   independent

transaction between Hong and Yun.          However, Yun is entitled to a

disposition of the claim on remand, as his claim for $75,000 has

not been decided in a fashion which comports with the record.

                                     V.

     We agree that the Fair Debt Collection Act claims should have

been dismissed.    That cause of action would only be appropriate

if Hong had been a debt collector within the meaning of the

statute, which she was not.

     The Act is intended "to eliminate abusive debt collection

practices by debt collectors."       15 U.S.C.A. § 1692(e).       It defines

"debt collector" as

            any person who uses any instrumentality of
            interstate commerce or the mails in any
            business the principal purpose of which is the
            collection of any debts, or who regularly
            collects or attempts to collect, directly or
            indirectly, debts owed or due or asserted to
            be owed or due another. Notwithstanding the
            exclusion provided by clause (F) of the last
            sentence of this paragraph, the term includes
            any creditor who, in the process of collecting
            his own debts, uses any name other than his
            own which would indicate that a third person
            is collecting or attempting to collect such
            debts.

            [15 U.S.C.A. § 1692a(6).]


                                     23                              A-5064-11T2
In addition to not coming within the definition, the conduct

complained of was engaged in by Hong's former attorneys.                 Neither

plaintiff can be held accountable for their actions.

                                       VI.

     We    do   not    agree    with   the   trial     court's    dismissal      of

defendants' counterclaim for malicious prosecution. The cause of

action    for   malicious      prosecution    provides   a   civil     remedy    to

plaintiffs who have been subjected to baseless criminal actions.

LoBiondo v. Schwartz, 199 N.J. 62, 90 (2009). To sustain a claim

for malicious prosecution, a plaintiff must prove the following

four elements: "(1) a criminal action was instituted by this

defendant against this plaintiff; (2) the action was motivated by

malice; (3) there was an absence of probable cause to prosecute;

and (4) the action was terminated favorably to the plaintiff."

Ibid.

     It    is   a   complete     defense     to   an   action    for   malicious

prosecution that the complainant acted on the advice of counsel

that probable cause existed. Id. at 106; Weinstein v. Klitch, 106

N.J.L. 408, 409 (E. & A. 1929). Notwithstanding a malicious motive,

the showing that the complainant properly relied on the advice of

counsel    erases     the   "absence   of    probable    cause"    element      and

precludes recovery. LoBiondo, supra, 199 N.J. at 106.



                                       24                                 A-5064-11T2
     However, that defense requires a showing that "all of the

material facts within [the complainant's] knowledge – that is

those which would justify or negative the making of the complaint

– are fully and truthfully stated to the attorney." Weinstein,

supra, 106 N.J.L. at 409. The complainant must demonstrate that

the attorney was provided with all of the facts necessary to make

an informed decision on the probable cause issue. LoBiondo, supra,

199 N.J. at 106. Where the evidence suggests that the material

parts of the information conveyed to the attorney were knowingly

false, it is up to a jury to decide whether probable cause was

absent. Weinstein, supra, 106 N.J.L. at 409.

     The   court   dismissed   defendant's   claim   for   malicious

prosecution because it found that plaintiffs had acted on the

advice of counsel, and that counsel was aware of the material

facts, because they had written collection letters.

     There is no support for these findings, however, because the

collection letters do not indicate that plaintiffs' attorneys were

aware that the checks had been provided to Hong months earlier,

were undated, and that at least two of them had been written with

no payee. To the contrary, the letters misstated that Soon Hee had

issued the checks on August 11, 2009.   Contrary to the attorneys'

assertion, Hong testified she had received checks months earlier

in March and April 2009.

                                25                           A-5064-11T2
     Thus the evidence does not support the court's finding that

plaintiffs established lack of malice because they relied on the

advice of counsel, and that counsel had been provided with all of

the material facts.     The court simply erred when it entered

judgment in plaintiffs' favor on defendants' counterclaim for

malicious prosecution. There were material issues of fact that

remained to be decided on that issue, and those issues of fact

arose from Hong's own testimony.

     Moreover, the court erred as to the proofs in the record when

it found that Soon Hee had no viable damage claim.     According to

the court, she was neither inconvenienced nor distressed by her

arrest, and incurred only $5000 in attorney fees.          A plaintiff

proving malicious prosecution is entitled to recover attorney fees

and is not required to establish a minimum amount. Seidel v.

Greenberg, 108 N.J. Super. 248, 271 (Law Div. 1969).   Furthermore,

Soon Hee testified that she was panicked by her arrest, especially

as   the   criminal   charges   proceeded.     She   was     arrested,

fingerprinted, photographed, searched, and compelled to appear in

court on several occasions.     Her ability to travel was restricted

because she was required to turn over her passport.         The court

improperly overlooked her testimony.      We therefore remand for a

new trial on this cause of action as well.



                                  26                           A-5064-11T2
    Affirmed in part; reversed in part and remanded for a new

trial on Soon Hee's counterclaim for malicious prosecution, both

Soon Hee and Yun's counterclaim for breach of fiduciary duty, and

Yun's counterclaim for $75,000.     We express no opinion on the

merits of the claims.

    Affirmed in part, reversed and remanded in part.




                               27                         A-5064-11T2
