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Porter and Ripa Associates Inc. v. 200 Madison Avenue Real Estate Group

Decided: April 24, 1978.

PORTER AND RIPA ASSOCIATES, INC., A CORPORATION OF THE STATE OF NEW JERSEY, PLAINTIFF,
v.
200 MADISON AVENUE REAL ESTATE GROUP, A LIMITED PARTNERSHIP, LOUIS C. RIPA, GENERAL PARTNER, DEFENDANT



Polow, J.s.c.

Polow

Plaintiff Porter and Ripa Associates, Inc. (PAR), an architectural and engineering firm, as tenant under a 15-year lease dated July 24, 1970, occupied premises in Morris Township owned by defendant 200 Madison Avenue Real Estate Group (200 Madison). Article I of this lease has been amended to increase the monthly rent, but otherwise the lease remains in its original form. Article X provides, in pertinent part, as follows:

In the event of the nonpayment of said rent, or any installment thereof, at the times and in the manner above provided * * * the landlord or its agents shall have the right to and may enter the Demised Premises * * * without being liable for any prosecution or damages therefore. * * * Such re-entry by the landlord shall not operate to release the Tenant from any rent to be paid or covenants to be performed hereunder during the full term of this lease. * * * In any such event the landlord shall have the right, as agent of the tenant, to take possession of any furniture, fixtures or other personal property of the tenant found in or about the Demised Premises and sell the same at public or private sale and to apply the proceeds thereof to the payment of any monies becoming due under this lease * * *.

Article XXII of the lease provides:

In case of violation by the Tenant of any of the covenants, agreements, terms and conditions of this lease, and upon failure to discontinue such violation within ten (10) days after written notice thereof given to the Tenant, this lease shall thenceforth, at the option of the Landlord, become null and void, and the Landlord may re-enter without further notice or demand * * *.

At the time of execution of this lease in 1970 distress procedure similar to that provided by the lease in Article X was generally assumed to be available to landlords with or without such contract language, pursuant to N.J.S.A. 2A:33-1 et seq. Notice was not required before re-entry and seizure under our distress statute when this lease was executed.

It is established by appropriate sworn documentation on these cross-applications that the landlord resorted to what its counsel describes in his brief as "Self-Help Possession," that is, the landlord took possession of all PAR's property in the demised premises and locked the tenant out on January 9, 1978 because of nonpayment of two months rent -- those installments due on December 1, 1977 and January 1, 1978. Although there had been discussions about the rent due and demands made for payment, no notice of re-entry nor of the intent to take possession of the tenant's property was given. PAR then initiated this action for recovery of its property, damages, punitive damages and termination of the lease on the ground that the landlord "wrongfully and illegally" seized the premises.

Defendant landlord now moves for summary judgment in its favor asserting that its acts were all taken in strict compliance with what it calls the "clear and unambiguous" language of Article X of the leasing agreement. Plaintiff PAR moves for partial summary judgment in its favor, declaring that seizure of its property without notice violates the specific terms of the lease as well as constitutional due process requirements.

To support its due process argument PAR relies substantially on the rationale of Judge Greenberg's decision in Van Ness Industries v. Claremont Painting , 129 N.J. Super. 507 (Ch. Div. 1974), which holds that

Defendant 200 Madison argues that Article X of the lease makes no reference to notice and thus "clearly and unambiguously" authorizes physical repossession and seizure without notice upon nonpayment of rent. Furthermore, it says the Van Ness requirement of prior notice should not be applied here because by executing the instant lease "clearly" providing for "self-help" without notice, PAR has waived any right to notice if it otherwise exists. And, in any event asserts the lessor, this court is not bound to follow the law sent forth by a court of coordinate jurisdiction. Van Ness , the landlord maintains, should not be followed because it was based on inapplicable authority and there is no such constitutional right to notice with regard to premises leased solely for nonresidential use. Finally, defendant maintains that due process requirements are inapplicable to the present case because there is a total absence of any state involvement in the lockout and seizure of property by defendant.

I am satisfied that the constitutional right to due process by way of notice is subject to waiver, as the landlord asserts. Indeed, the United States Supreme Court observed in National Equipment Rental, Ltd. v. Szukhent , 375 U.S. 311, ...


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