On appeal from the Superior Court of New Jersey, Law Division, Monmouth County.
The opinion of the court was delivered by: Wefing, J.A.D.
Approved for Publication June 7, 2000
Before Judges STERN, KESTIN and WEFING. The opinion of the Court was delivered by WEFING, J.A.D.
Defendants Red Bank Volvo, Inc., Peter Comito and Michael Jeffers (Red Bank Volvo) appeal from a judgment entered against them for $3,073.68 following a bench trial on plaintiff's complaint for violation of the Consumer Fraud Act, N.J.S.A. 56:8-2. Although we have concluded, after a careful review of the entire record, that plaintiff established a consumer fraud violation, we are satisfied that plaintiff, who has appeared pro se throughout this matter, failed to prove he had experienced an "ascertainable loss." N.J.S.A. 56:8-19. We thus reverse the judgment.
On February 20, 1999, plaintiff went to Red Bank Volvo in response to an ad for the dealership that had appeared in the Asbury Park Press the preceding day. The ad stated, in capital letters, "NOW AT RED BANK VOLVO JUST SIGN AND DRIVE." It also said that no money down or security deposit was required, no bank fees would be assessed and that no payment was required the first month. Plaintiff selected a 1999 Volvo S-70 and signed the necessary papers to lease the vehicle for thirty-nine months at $318.60 per month, with a limit of twelve thousand miles a year. Motor vehicle and document fees totaled $210, which plaintiff put on his credit card.
Included among the papers plaintiff executed was a credit application. Plaintiff listed an annual salary of $26,000 at a position he had held for six months. The credit application included a certification that plaintiff had no outstanding judgments against him.
The following day, February 21, 1999, Red Bank Volvo told plaintiff he had not qualified for its leasing program; a credit check disclosed the existence of several outstanding judgments that plaintiff had failed to disclose on the credit application.
Five days later, plaintiff filed his complaint, alleging that Red Bank Volvo had violated the Consumer Fraud Act when it failed to disclose in its ad that its "Sign and Drive" lease program was only available to creditworthy customers.
At trial, plaintiff admitted he had been a lawyer but said he signed the credit application without reading it. He said that several weeks thereafter, his own car broke down and he had to have it towed and repaired and, in addition, rent a replacement vehicle while his was out of commission. He also testified that Red Bank Volvo told him that absent the "Sign and Drive" program he would be charged $495 in bank fees.
The trial court concluded that the ad in question was an affirmative misrepresentation and constituted a consumer fraud because it did not state that participation in the "Sign and Drive" program was contingent upon passing a credit check. The trial court computed damages in the following way. It added the $210 charge plaintiff had put on his credit card during his initial visit, the expenses he incurred when his car broke down and $495 that plaintiff testified he understood he would incur in bank fees in a different leasing program, for a total of $1,024.59. It then trebled that and entered judgment for $3,073.68.*fn1
Consumer fraud violations can be divided, broadly, into three categories: affirmative acts, knowing omissions and regulatory violations. Cox v. Sears Roebuck & Co., 138 N.J. 2, 17, 647 A.2d 454 (1994). If a plaintiff demonstrates that a defendant committed a consumer fraud that is an affirmative act, "intent is not an essential element." Ibid. If, however, the alleged consumer fraud is the result of a defendant's omission, "plaintiff must show that the defendant acted with knowledge, and intent is an essential element of the fraud." Id. at 18, 647 A.2d 454. In the final category, regulatory violations, "intent is not an element of the unlawful practice, and the regulations impose strict liability for such violations." Ibid.
As we view this matter, it is unnecessary for us to determine whether we agree with the trial court's conclusion that defendants' failure to include in the ad a statement that the "Sign and Drive" program was subject to a credit check can be considered an affirmative misrepresentation as opposed to a knowing omission, for we are satisfied that it does, indeed, constitute a violation of N.J.A.C. 13:45A-26A.7(a)4. This regulation declares unlawful
[t]he failure to state all disclaimers, qualifiers, or limitations that in fact limit, condition, or negate a purported unconditional offer . . . clearly and conspicuously, next to the offer and not in a footnote identified by an asterisk.Because Red Bank Volvo's ad did not comply with ...