On appeal from Superior Court of New Jersey, Law Division, Special Civil Part, Middlesex County, Docket No. DC-9718-00.
Gail Chester argued the cause for appellant (Middlesex County Legal Services Corp., attorneys; Ms. Chester, of counsel and on the brief). Carey A. Aquilina attorney for respondent (Hayt, Hayt & Landau, attorneys; Ms. Aquilina and F. John Caldwell, Jr., of counsel and on the brief).
Before Judges Havey, Coburn and Weissbard.
The opinion of the court was delivered by: Havey, P.J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Defendant Gilberto Arce appeals from an order for summary judgment in favor of plaintiff Ford Motor Credit Company (FMC) awarding it $5,905.96 plus costs, representing a deficiency owed by defendant under a retail installment contract executed by him to finance the purchase of a used car. The sole issue is whether FMC's suit is barred by the four-year statute of limitations under Article 2 of the Uniform Commercial Code, N.J.S.A. 12A:2-725 (§ 2-725). Following the Supreme Court's holding in Assocs. Discount Corp. v. Palmer, 47 N.J. 183 (1966), we conclude that the action is barred and accordingly reverse.
The central facts are undisputed. On January 31, 1994, defendant purchased a 1988 Dodge van from Liccardi Motors Inc. for a price of $7,928.70. As part payment, defendant executed a retail installment contract financing a total of $7,750.59. The agreement provided for thirty-five monthly payments of $333.04. The agreement was assigned to FMC.
At some point defendant defaulted on the payments due under the contract and, on March 21, 1995, he voluntarily surrendered the vehicle to FMC. FMC sold the vehicle at public auction for $3,195.
On September 29, 2000, approximately five and one-half years after defendant defaulted, FMC filed an action seeking to recover the deficiency owed under the retail installment contract. FMC moved for summary judgment. Defendant cross-moved for summary judgment and requested oral argument, claiming that FMC's suit was barred by the four-year statute of limitations under § 2-725. Without a hearing and without making any findings, the trial court granted summary judgment to FMC.
Before addressing the substantive issue before us, we find it necessary to comment on the trial court's failure to make any findings in this case or place on the record any reasons whatsoever supporting the grant of summary judgment in favor of FMC. The obligation to do so is clear. Rule 4:46-2(c) directs that, in deciding a summary judgment, "[t]he court shall find the facts and state its conclusions in accordance with R. 1:7-4." A trial court "is obliged to set forth factual findings and correlate them to legal conclusions. Those findings and conclusions must then be measured against the standards set forth in Brill v. Guardian Life Insurance Co. of America, 142 N.J. 520, 540, 666 A.2d 146 (1995)." Great Atlantic & Pacific Tea Co., Inc. v. Checchio, 335 N.J. Super. 495, 498 (App. Div. 2000). As we stated in Great Atlantic & Pacific Tea Co., supra, "neither the parties nor we are well-served by an opinion devoid of analysis or citation to even a single case." Ibid.
Article 2 of the Uniform Commercial Code (U.C.C.) applies to "transactions in goods." N.J.S.A. 12A:2-102. Article 2's statute of limitations, § 2-725(1), provides that "[a]n action for breach of any contract for [the] sale [of goods] must be commenced within four years after the cause of action has accrued." A cause of action accrues "when the breach occurs . . . ." § 2-725(2).*fn1
FMC apparently persuaded the trial court that its action to recover the deficiency owed under the retail installment contract was governed by N.J.S.A. 2A:14-1, which provides for a six-year statute of limitations in breach of contract cases. FMC's position is articulated in its appellate brief as follows:
This is not an action based upon the sale of goods. This is an action based upon the deficiency on a retail installment contract (Defendant borrowed money from Plaintiff, a lender). It is simply not an action for the balance of the price of goods or damages for economic loss due to the sale of goods. Further, Defendant's deficiency due under the retail installment contract is unrelated to the sale of the vehicle itself. Rather, the deficiency is due to Defendant's failure to make payments on the contract.
However, our Supreme Court in Palmer, supra, 47 N.J. at 187, addressed the precise issue before us. In that case, defendant had purchased a vehicle and financed it by executing a "Bailment Lease Security Agreement." Id. at 185. The Court held that plaintiff's suit to recover a deficiency after breach was barred under § 2-725 because a deficiency suit is essentially an action to recover monies due for the sale of goods. Id. at 187. The Court rejected the concurring judge's view that such an action is not governed by § 2-725 because it is ...