This opinion is based on the application of the doctrine of res judicata to a subsequent action for the summary dispossession of a tenant by the same landlord. I have found no other opinion holding that this doctrine may be applied to a second summary dispossess action.
This case relates to a two-family home in Orange, New Jersey. Plaintiff bought this property at an auction conducted by the City of Orange in December 1987. At that time, defendant had been the sole tenant (since 1976) pursuant to a month-to-month tenancy at a monthly rent of $350 for the entire property, notwithstanding that it was a two-family building.
By a notice dated May 1988 plaintiff gave defendant a notice of increase to $800. Defendant did not pay that increase and plaintiff sought her eviction in a summary dispossess action. On August 19, 1988, the day the action had been scheduled for trial, it was settled, the settlement calling for defendant to pay the increased rent of $800. Both parties were represented by their own counsel in coming to that agreement.
By notice dated February 16, 1989, to be effective April 1, 1989, the landlord sought another increase in rent, this time to $1350.
Defendant did not pay that increase either, and again plaintiff sought her eviction in a summary dispossess action based upon the nonpayment of that new rent. When the case came to trial, both April and May 1989 rents were past due. The trial of the summary dispossess action was held in the Special Civil Part of the Law Division. Both parties were represented by the same counsel who participated in the settlement agreement signed in August 1988. The issue presented to the court was whether the increase to $1350 was enforceable by the landlord. As stated by the court in announcing its decision, "The real question facing the court simply given the increase is whether the increase is unconscionable." The court determined that the increase was not shown to have been unconscionable and found the two months' rent of $2700 due and owing. Based on that adjudication, defendant paid the rent and the complaint was dismissed.
Defendant continued to pay that rent through September 1991; however, commencing October 1991 she failed to pay her rent. Plaintiff therefore again commenced a summary dispossession action. The matter came before me for trial after the entry of a default judgment (which was vacated), the action being transferred to the Law Division and a counterclaim being filed based on the allegedly unconscionable rent. During those procedural steps and the pendency of the action, defendant was required to pay $700 per month, on account and without prejudice. Defendant was also permitted to raise the defense of breach of the implied covenant of habitability (commonly called a " Marini " defense).
A preliminary determination in this action was that this property, being fewer than three units, was exempt from the Orange rent control ordinance.
The next threshold issue was whether the prior determination by the court, that the rent set at $1350 was binding on the parties
in this action by virtue of the doctrine of res judicata or whether defendant could relitigate that issue in this action. I find that the doctrine is applicable and does bind the parties as to that issue.
The earliest reported case to discuss res judicata as a consequence of a summary dispossession action in New Jersey is McWilliams v. King and Phillips, 32 N.J.L. 21 (Sup.Ct.1866). That action was by a tenant against his former landlord and a constable, essentially for what we now call a wrongful eviction. (In that case the form of ancient pleading was entitled an "action in trespass, quare clausum fregit.") The action was dismissed as to the constable "to protect the officers who are required, in discharge of their duty, to act upon the Disposition of those questions by the jury." The court continued, as to the landlord, saying:
But neither the landlord nor the tenant stand upon a similar footing. As to them, the statute regulating the trial has established a different rule, for it is expressly declared that the landlord shall remain liable in an action of trespass for any unlawful proceedings under the act. I think the intention was to establish a procedure of a provisional and summary nature, by which, for the time, it should be settled as between the landlord and tenant, who should have the immediate possession of the premises in dispute. It does not seem to me at all probable that the legislature designed, by a prompt proceeding before a Justice of the peace, which is subject neither to appeal nor review by certiorari, to adJudge definitively the right of possession to houses and lands, no matter how difficult or abstruse the questions of law involved, or how valuable the interest at stake might be. My Conclusion is that the decision before the Justice [of ...