On appeal from Superior Court of New Jersey, Chancery Division, Morris County, Docket No. C-38-02.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges A. A. Rodríguez, Sabatino and Lyons.
Plaintiffs, Judith A. Mobilio and Francis E. Mann, wife and husband, filed a verified complaint alleging that defendants, Kenneth and Patricia Schwartz, also husband and wife, anticipatorily breached a contract to sell their home to plaintiffs when the Schwartzes cancelled the contract because plaintiffs insisted that they replace French doors in the family room. Plaintiffs sought specific performance, or alternatively, damages. Plaintiffs also sued the real estate brokers, defendants, Mary Troup ("Troup") and Leslie Polsen ("Polsen"), and Troup's and Polsen's employer, Weichert Realtors ("Weichert"), alleging defamation by Troup and professional negligence by Troup, Polsen and Weichert. Plaintiffs appeal an order dismissing all of the counts in plaintiffs' suit against all defendants with prejudice. We affirm.
The following factual and procedural history is relevant to our consideration of the issues advanced on appeal. In the latter part of 2001, the Schwartzes put their house on the market. Around the same time, plaintiffs were looking to buy a house. In November 2001, plaintiffs retained Troup to help them find a house. Notably, plaintiff Mobilio had a license to sell real estate through Weichert Realtors, but she had never used it, as she worked as an insurance salesperson for Weichert. Mobilio testified that when she first met Troup she told Troup that she held a real estate license, but Troup denied that.
Shortly after plaintiffs retained Troup, Troup told them about an open house that the Schwartzes had scheduled. Plaintiffs were interested and decided to attend. At the open house, the showing agent gave plaintiffs a sales brochure that described the house and listed its features. Of importance to this appeal was a statement in the brochure that the French doors in the family room were "new to be installed." Plaintiffs testified that they understood that to mean that the Schwartzes would replace the French doors with new ones, regardless of the sale price. Though plaintiffs did not know it at the time, in October 2001 Patricia Schwartz had ordered new French doors worth $3,341 and was awaiting their arrival.
Plaintiffs liked the Schwartzes' house and decided to make an offer. The Schwartzes' asking price was $659,000. In the beginning of December 2001, plaintiffs offered $615,000, but the Schwartzes rejected their offer. The two continued to negotiate a price and ultimately agreed on $633,500 as the price to be listed in the contract.
At that price, however, the Schwartzes did not want to make any financial concessions or improvements to the house, and so notified Polsen, their agent. Specifically, they told her that they would not replace the French doors, and they asked her to make that "very clear" to plaintiffs. Polsen said that she would, but then only told Troup that "this [$633,500] was it, and don't expect any monetary concession from the Schwartzes because this is lower than they were anticipating having to go." Troup said that she relayed that to Mobilio, but Mobilio said that she did not. Notably, at that time Troup knew nothing about the French doors because she did not attend the open house with plaintiffs, and plaintiffs never mentioned the doors to her or showed her the sales brochure.
On about December 11, 2002, Troup drafted a contract with a purchase price of $633,500 and forwarded it to Polsen. Contrary to the requirements of N.J.S.A. 45:15-17(q), the contract did not disclose Mobilio's real estate license. That statute authorizes the New Jersey Real Estate Commission to discipline any real estate agent who is guilty of "[p]urchasing any property unless he [or she] first discloses to the seller in the contract of sale his status as a real estate broker, broker-salesperson or salesperson."
When the Schwartzes reviewed the contract, they again raised the issue of the French doors. They asked Polsen whether the doors had been excluded from the contract, and she said that they were not an issue because plaintiffs did not specifically mention them in the contract. The Schwartzes accepted Polsen's responses, primarily because plaintiffs wrote into the contract that the Schwartzes' refrigerator was included in the sale, and the refrigerator "was a fraction of the price of the doors." Because they did not want to make any financial concessions, the Schwartzes crossed-out the provision that the sale included the refrigerator and forwarded the contract to plaintiffs.
That night, Troup reviewed the change with plaintiffs and contacted Polsen, who was at the Schwartzes' house. According to the Schwartzes, Troup told Polsen that Mobilio "threw a fit" over the refrigerator and demanded that it be included in the sale. Polsen responded that the Schwartzes would not make any financial concessions at that sale price and thus would not include the refrigerator in the sale. Troup said that she relayed that to plaintiffs, but Mobilio said that she did not.
Patricia Schwartz then offered to sell the refrigerator to plaintiffs for $750, but plaintiffs refused to pay for it. Polsen asked plaintiffs if they would pay $250 if she and Troup agreed to each contribute $250 of their commissions to make up the difference in price, but plaintiffs again refused. Polsen then offered to contribute $500 of her commission if Troup would contribute $250 and Troup agreed.
Polsen testified that if she and Troup had known about Mobilio's real estate license they would not have offered to pay for the refrigerator. She also said that the dispute over the refrigerator made her "uneasy" because "they [plaintiffs] were . . . going to walk away over $250 . . . And in my experience that wasn't sitting right. That's an expensive house. $250. I had never seen anybody do that before."
Troup testified that during the dispute about the refrigerator, Mobilio gave her some "very surpris[ing]" information. Mobilio said that with the aid of "Steve Gordon," "a high level executive at Weichert," Mobilio was having a background check performed on the Schwartzes, and the information she obtained "would give her negotiating leverage in the transaction." Troup did not respond to Mobilio's telling her that, as she "was very surprised," but she did call Polsen to share the information with her. Notably, Steve Gordon was Mobilio's manager, and he lived down the street from the Schwartzes.
Polsen testified that when Troup told her about the background check, Troup did not give details but said that Mobilio "knew all about Ken Schwartz." "Later," said Polsen, Troup told her that "a senior executive in Weichert insurance," who lived in "a subdivision where the Schwartzes lived," told plaintiffs that "Ken Schwartz went out in the insurance business in the late spring and early summer of 2001 . . . and that he was in financial peril because of 9/11 . . . . There was also some comment that was made about him [Ken Schwartz] not paying for the [his] Corvette." Polsen did not share that information with the Schwartzes, explaining that "[i]t was more than I thought it was going to be."
Thereafter, on December 17 and 18, 2001, plaintiffs and the Schwartzes signed a contract to sell the Schwartzes' house to plaintiffs for $633,500. On December 19 and 20, the parties' attorneys made minor changes to the contract and on December 24, 2001 they finalized it. Patricia Schwartz then canceled the order on the French doors, and plaintiffs applied for a mortgage.
Shortly thereafter, testified Troup, Mobilio told her that Mobilio had a real estate license and that she wanted to collect a referral fee from Troup. Weichert had a policy that any employee who holds a real estate license and buys a home through Weichert Realtors is entitled to a referral fee in the amount of twenty-five percent of the agent's commission on the sale. In this case Troup's portion of the six-percent commission was two and one-half percent of the selling price. Troup said that she asked Mobilio why Mobilio did not disclose her license earlier, and Mobilio explained that other Weichert brokers had been reluctant to work with her when she told them that she had a real estate license. Believing that Mobilio had acted unfairly by withholding her status as a real estate agent, Troup sought guidance from her manager, Michael Penyak, on whether she had to give Mobilio the referral fee. She also complained to Polsen. Penyak, however, said that Troup had to honor Mobilio's ...