On appeal from Superior Court of New Jersey, Law Division, Essex County.
Defendant Congruent Machine Co., Inc. appeals from an order for partial summary judgment dismissing the third-party complaint against Richard Hecht, an order for summary judgment dismissing a counterclaim against plaintiff and entering judgment in favor of plaintiff in the amount of $66,832.87 and costs, and an order for summary judgment dismissing the third-party complaint against third-party defendants Vincent LaMela, Harold Mison, Bill Osmun, Ted Carbone, Joseph Epstein, Martin Lipmann and Aaron Epstein.
The action was brought to recover a deficiency following defendant's default under what was termed a lease agreement. Defendant counterclaimed to recover damages allegedly sustained because the sale of the equipment involved was commercially unreasonable, and further counterclaimed and cross-claimed to recover damages because at the sale plaintiff and third-party defendants, including the auctioneer, conspired to form a bidding ring to preclude defendant and other persons from offering a fair and reasonable bid on the equipment.
Summary judgment was granted in favor of the auctioneer on the ground that there was no genuine issue as to any material fact challenged and no evidence that the auctioneer was part of the alleged bidding ring. We affirm that summary judgment substantially for the reasons set forth by the trial judge.
Summary judgment was granted in favor of plaintiff and the other third-party defendants on the ground that the affidavits submitted and the other papers before the court raised no issue as to an illegal conspiracy to frustrate bidding at the sale and no evidence that the sale was commercially unreasonable. We affirm the grants of summary judgment substantially for the reasons set forth by the trial judge, except as to the amount of the deficiency.
The agreements that form the basis of the action are security agreements rather than leases. N.J.S.A. 12A:1-201(37); Peco, Inc. v. Hartbauer Tool & Die Co. , 262 Or. 573, 500 P. 2d 708 (Sup.Ct.1972). The agreements provide in Paragraph 17 that in the event of default the secured party may:
(a) Proceed by appropriate court action or actions, . . . to recover damages for the breach of such covenants and terms hereof; or
(b) By notice in writing to the Lessee terminate this lease, . . . and take possession thereof and thenceforth hold, possess and enjoy the same free from any right of Lessee or its successors or assigns, . . . but Lessor shall nevertheless have a right to recover from Lessee any and all amounts including rents which, under the terms of this lease may be then due and be unpaid hereunder for use of said items of Equipment together with any damages in addition thereto which Lessor shall have sustained by reason of the breach of any covenant or covenants of this lease, together with attorney's fees, as hereinafter provided, and such expenses as shall be expended or incurred in the seizure of items of Equipment or in the enforcement of any right or privilege hereunder or in any consultation or action in such connection. Lessor may sell the Equipment with notice, or without notice where permitted by law, at private or public sale, at which Lessor may purchase without having the Equipment at the sale, and the proceeds thereof less expenses of retaking, repairing, reselling and reasonable attorney's fees will be credited upon unpaid rentals; . . . and any deficiency shall be paid by Lessee with interest. . . .
That paragraph further provided that in the event of default the secured party would be entitled to an amount equal to 20% of the sums due for legal fees and expenses.
Defendant contends that the only amount plaintiff could recover in the deficiency action was the amount of the "rents" due at the time plaintiff repossessed the equipment. Plaintiff, on the other ...