Specifies nonprevailing party in proceeding or judgment deemed frivolous by judge may include municipality or municipal corporation.

This bill amends New Jersey law to clarify that municipalities and municipal corporations can be held liable for legal costs and attorney fees if a judge deems their lawsuit frivolous. It specifies that "nonprevailing party" includes local governments when their complaint, counterclaim, or defense is found to have been filed in bad faith, solely to harass or delay, or without a reasonable legal basis. The law requires judges to make this determination during proceedings or at judgment, allowing the winning party to recover expenses. This change follows a recent New Jersey Supreme Court ruling confirming municipalities are subject to such sanctions.