June 25, 2007
MICHAEL D'ANTONIO, PLAINTIFF-APPELLANT/ CROSS-RESPONDENT,
TERENCE MAYTIN AND GAIL MAYTIN, DEFENDANTS-RESPONDENTS/CROSS-APPELLANTS.
On appeal from Superior Court of New Jersey, Law Division, Bergen County, Docket No. L-006208-05.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued May 22, 2007
Before Judges Payne and Graves.
Plaintiff Michael D'Antonio, a general contractor for more than three decades, appeals from an order entered on April 17, 2006, granting summary judgment in favor of defendants Terence Maytin and Gail Maytin, and a subsequent order dated June 19, 2006, denying his motion for reconsideration and awarding counsel fees and costs to defendants pursuant to the frivolous litigation statute, N.J.S.A. 2A:15-59.1. On their cross-appeal, defendants argue they are entitled to damages under the Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 to -166, and "[a]lthough no specific cases have been found, and it was not argued below, it would be logical [based on the CFA] to treble the legal fees." We affirm the orders under appeal except for the amount of counsel fees and costs, which we remand to the trial court for further consideration.
During the Spring of 2005, plaintiff had extensive discussions with defendants regarding a major addition to their home. Prior to those discussions, plaintiff had completed some basic repairs and several smaller home-improvement projects for defendants. Defendants initially budgeted approximately $200,000 for their new addition, but they anticipated that the actual cost "could easily rise to $300,000."
In his four-page written estimate, dated July 2, 2005, plaintiff stated he was pleased to submit the estimate "in a line fashion, this means that each item is priced for you to choose what you would like to keep or remove." Plaintiff acknowledged, however, that some of the necessary costs to complete the project were not included in the estimate: "[c]ertain items are purposely left out due to customer not having a final selection or a price to control the final price of the estimate." Although plaintiff's estimate was incomplete, the total cost for the items that were included in the estimate was slightly more than $308,000. Upon receipt of plaintiff's written estimate, it was clear to defendants the proposal was not only open-ended, but also more than they planned to spend. Consequently, they informed plaintiff they were not going to hire him to build the addition.
In a letter dated July 25, 2005, plaintiff acknowledged that defendants were "not proceeding with the job"; nevertheless, plaintiff requested a payment of $2,500 from defendants for the time he spent "advising and working with" them. Plaintiff's letter, which makes no mention of either a written or oral contract between the parties, reads as follows:
Dear Mr. & Mrs. Maytin:
It has been two weeks since I spoke with you. I must reason that since you have not called me, that you are not proceeding with the job.
The cost for the estimate is free however, I have spent over 37 hours in advising and working with you to design and redesign the plans, which are still not correct. I have spent several hours in meeting with the architect and phone conversations. I have driven with Mrs. Maytin to physically choose building materials for the project. I have even signed a document for your insurance company to aid in the insurance process of this job.
I must get paid for the time that I have spent in working for you. I will consider my usual 3-4 hours as the normal estimating time and that would leave 33 hours at the rate of $3,300.00 for the work, however due to you being a repeat customer I will reduce this bill to $2,500.00.
Please advise, if you do this job the above amount will be deducted from the cost of the job.
Finally, you should consider just putting a Kitchen addition to the front only, this would enhance the house from its present state and would aid in any future sale.
After defendants declined to pay plaintiff the sum he requested, plaintiff filed a complaint and jury demand alleging the parties had entered into an oral contract for the construction of the addition "on or about May 3, 2005." According to plaintiff, defendants stated "you have the job, whatever the price is that's what it is." In their answer, defendants denied making the statement plaintiff attributed to them, and in their counterclaim they asserted plaintiff was in violation of the Consumer Fraud Act because N.J.A.C. 13:45A- 16.2(a)(12) requires that all "home improvement contracts for a purchase price in excess of $500.00, and all changes in the terms and conditions thereof shall be in writing." In addition, defendants notified plaintiff in their answer and counterclaim that they would seek the imposition of sanctions pursuant to R. 1:4-8 and N.J.S.A. 2A:15-59.1, if plaintiff failed to file a voluntary dismissal of his complaint within twenty-eight days. Defendants' answer and counterclaim also requested a written statement of damages, and, in response, plaintiff stated:
Plaintiff asserts that the industry standard for estimates of this size is 6% of the total price of the contract. Due to the
[d]efendant[s] not being able to make a final selection, [p]laintiff must use the last chosen item in the computation for a total value. The total value used is $450,000 and 6% of that number is $27,000.00. Plaintiff made a reliance on the verbal word of both [d]efendants and the seven year history of working for the
[d]efendants and having heard seven years of defendants wanting to expand and hearing about how well the income has been received and the company bonuses that were expected and the cash deposit that was received. Plaintiff accepted the work scope as outlined in the plans submitted by [the architect]. Plaintiff, because of
[d]efendants withdrawal has been damaged by the time expended, the experience, knowledge and technique afforded to the architect, the meetings with subcontractors, the withdrawal of [p]laintiff's advertisement and as a final result no immediate income for the busiest time period of a contractor's season. Plaintiff asserts that all contracts are calculated for a 30% return. In this case a total expected return is $150,000.00 including the cost to estimate this project.
Defendants' summary judgment motion was heard on April 12, 2006. Following oral argument, the court stated:
In the instant matter plaintiff contends that he had an enforceable oral agreement with defendants for the construction of both a shed and an addition onto their home, upon which he relied by, one, continually revising defendants' addition plans over a period of months, and two, not advertising for other projects. This oral agreement, according to plaintiff, included a provision that the price of the shed project was conditioned on whether plaintiff was awarded the addition project. As further proof of the oral agreement plaintiff seems to suggest that the shed and addition projects were part of one large project, pointing to the simultaneous tree removal, which pertained to both project sites. Plaintiff also argues that he had a written agreement with the defendants embodied in, one, the June 29th letter drafted to the defendants' insurance company, which plaintiff signed on behalf of his construction company, and two, the July 2nd, 2005 estimate he provided to defendants which constituted "a meeting of the minds" up to that point.
In this case, viewing all the evidence in the light most favorable to the plaintiff, the non-movant in this case and on this motion, the [c]court finds that plaintiff's purported oral agreement is not enforceable. This is so because as previously discussed, the clear and unequivocal terms of the Consumer Fraud Act and specifically the subsequent Consumer Regulations N.J.A.C. 13:45[A]-16.2(a)[,] preclude enforcement of oral agreements. The citation mentioned by plaintiff in oral argument I find is not material or relevant to the issues presented in this litigation or in this motion. Thus, plaintiff's purported conditional agreement as to the price of the shed is unenforceable because it was not in writing.
Likewise, I find plaintiff is not entitled to payment for the 33 hours spent on creating an estimate for the defendants, as he asserts in his July 25th, 2005 letter, because, again, these alleged terms, specifically that only the first three or four hours of the estimate or work was free were not previously embodied in a writing. Once again, to be clear, I'm not sure that I'm offended by a concept that a contractor in anticipating, given his experience, the effort that's going to be expended in this work will simply tell the plaintiff that, "I will give you an estimate that will be free, with limited terms, that I will give you a certain estimate with certain general terms, takes me three or [four hours] of work. Beyond that time, which would be documented to you, I will charge a certain specific rate for my hourly work performed and I will keep you advised as to what my bill is." Again, such a provision is not on its face offensive to this [c]court or in violation of public policy, as long as the understanding is clearly set forth in the writing, to protect the consumer, which is necessary according to the legislation and rules I have cited.
In this case before me, even assuming that oral agreement existed between the parties, plaintiff has not demonstrated to this [c]court that the defendants actively attempted to defraud him or to use the Act as some sort of a sword against him. And, I point out that I say, assuming there is an oral contract, because I am not specifically finding that an oral contract did exist. I do not have to find whether or not [an] oral contract exists in the context of this decision because I am viewing the facts in the light most favorable to the plaintiff. In other words, I can assume for purposes of this motion only and under summary judgment standard that an oral contract existed.
Fact is, in this case both parties have certified that they were not previously aware of the Act's requirements that home improvement contracts must be in writing to be enforceable. That lack of knowledge is not a defense to the plaintiff contractor.
As a second matter plaintiff has not presented sufficient proofs of any written agreement satisfying the strict requirements of N.J.S.A. 13:45[A]-16.2(a). Specifically, neither the proposed June 29th, 2005 letter nor the July 2nd, 2005 estimate is signed by both parties. Moreover, as to the June 29th letter plaintiff does not allege it was ever sent to defendants' insurance company. Even if it had been sent, the June 29th letter does not in any way resemble a contract as it is defined in the statutes, and certainly in the home improvement regulation, as it does not include even a single required term as set forth in N.J.A.C. 13:45[A]-16.2(a), such as for example a description of the work to be done, a total contract price, and the time period for completion of the work.
In sum, since there are no genuine issues of material facts as to the existence of an enforceable contract between the parties the Court grants defendants' summary judgment motion.
On appeal, plaintiff contends the trial court improperly entered summary judgment against him and, therefore, his motion for reconsideration should have been granted. We disagree. Summary judgment jurisprudence in New Jersey is very clear. In deciding a motion for summary judgment, the trial judge must determine whether there exists a genuine issue with respect to a material fact challenged. Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995). In doing so, the judge must consider the competent evidential materials presented in the light most favorable to the opposing party. Ibid. If there is sufficient evidence to permit a rational factfinder to resolve the disputed issue in favor of the opposing party, the motion must be denied. Ibid. In this case, the motion judge determined there were no genuine factual disputes and that ruling is fully supported by the record. We therefore affirm substantially for the reasons stated by the trial court in its comprehensive oral decision on April 12, 2006.
The frivolous litigation statute generally allows an award of counsel fees to a prevailing party (defendants) if the non-prevailing party (plaintiff) asserts a claim "in bad faith, solely for the purpose of harassment, delay or malicious injury," N.J.S.A. 2A:15-59.1(b)(1), or if "[t]he non-prevailing party knew or should have known, that the complaint . . . was without any reasonable basis in law or equity . . . ." N.J.S.A. 2A:15-59.1(b)(2). On May 12, 2006, following oral argument, the trial court concluded an award of counsel fees to defendants was appropriate because plaintiff's complaint failed to state a cause of action that had a reasonable basis in law or equity:
[D]efendants argue that they're entitled to attorney's fees because plaintiff knew or should have known that his lawsuit was frivolous. In this regard . . . upon receipt of defendants' notice and demand plaintiff could have sought the advice of counsel as to the implication . . . that, one, in their answer counterclaim they noticed plaintiff that his lawsuit was frivolous and demanded that he withdraw it because any of his purported agreements would not be enforceable under the CFA, which required among other things a signed writing.
Two, upon receipt of defendants' notice and demand plaintiff could have sought the advice of counsel as to the implications of the CFA on his complaint, but did not. Three, plaintiff is an experienced contractor who should have know[n] that the CFA requires a signed writing. And, four, in plaintiff's opposition to the summary judgment motion he boasted about his success in a prior CFA case against Bergen Jaguar, in which another [j]udge participated and thus plaintiff is or should be familiar with the CFA's requirements.
This Court finds that plaintiff was or should have been aware of the terms and provisions of the Consumer Fraud Act. This Court's finding is supported by the following facts. One, the Court is aware from information contained in the file and through other litigation referenced by the plaintiff himself and generated by the plaintiff, and referenced here again this morning, that although Mr. D'Antonio is not an attorney he is an experienced litigator. In some ways, I find that his utilization of the court system to pursue and protect his rights is admirable. However, his rights as a pro se attorney are not greater or lesser than any other party. Although, in certain circumstances procedural rules are relaxed for pro se litigants, in small claims court for example, substantive law is to be applied consistently whether an individual proceeds pro se or through an attorney. The pro se litigant is charged with the responsibility to know the law and must bear consequences for legal and strategic decisions just like an attorney would. See Rule 1:4-8, which makes no distinction between attorneys and pro se litigants in regard to the filing of frivolous pleadings. See also Gibraltar Factors [Corp.] v. Slapo, 41 N.J. Super. 381 (App. Div. 1956). Quoting, "It is elementary that all persons are preclusively presumed to know the law of the land and any ignorance thereof excuses no one."
Two, based on plaintiff's own admissions he has had prior knowledge of the requirements of the Consumer Fraud Act. For example, in opposing defendants' summary judgment motion and request for attorney's fees plaintiff argued that the defendants were not entitled to attorney's fees because they could not show a[n] "ascertainable loss" as required under the CFA. . . .
Three, in addition to being a knowledgeable litigant the facts demonstrate that plaintiff is also an experienced and knowledgeable businessman and contractor.
See plaintiff's reply to defendants' summary judgment motion dated March 27, 2006, at Page 5 in which he alleges that he has 35 years of experience in the contracting business. The Court finds that plaintiff therefore knew or should have known the fundamental requirements of the CFA as it relates to residential construction and renovation. One of the cornerstones of that remedial legislation is . . . the requirement of a written contract signed by all parties with the specific terms as set forth in the legislation.
In sum, this Court finds that no reasonable person could find . . . the alleged oral agreement or the scant documents relied upon [by] plaintiff could ever meet the writing requirement under the CFA. For these reasons the Court finds that plaintiff knew or should have known that his complaint was frivolous, and thus defendants are entitled to attorney's fees pursuant to Rule 1:4-8 and/or N.J.S.A. 2A:15-59.1. Based on this decision there is no need for me to reach a determination as to whether plaintiff also acted in bad faith or with intention to harass in continuing this litigation with defendants. This Court notes, however, that it is extremely troubled by defense counsel's description of plaintiff's behavior during such settlement negotiations. And, I note that plaintiff does not specifically deny all of counsel's allegations in this regard.
The Court is reserving on the amount of said fees based upon my review, my more specific review of when those fees were generated in the context of my ruling. And, I will set forth the opinion in the near future.
The frivolous litigation statute provides that a prevailing party may be awarded "all reasonable litigation costs and reasonable attorney fees." N.J.S.A. 2A:15-59.1(a)(1) (emphasis added). Prior to an award of counsel fees and costs, a prevailing party must submit a detailed affidavit to the court setting forth:
The nature of the services rendered, the responsibility assumed, the results obtained, the amount of time spent by the attorney, any particular novelty or difficulty, the time spent and services rendered by secretaries and staff, other factors pertinent to the evaluation of the services rendered, the amount of the allowance applied for, an itemization of the disbursements for which reimbursement is sought, and any other factors relevant in evaluating fees and costs[.]
On March 24, 2006, defendants requested $16,812.50 in attorney's fees and $1,223.76 in costs and filing fees, and, in a subsequent certification dated April 20, 2006, defendants sought to be reimbursed for additional legal fees and disbursements. The order entered on June 19, 2006, awarded counsel fees in the amount of $12,562.50 and costs in the amount of $930.26.
We are in substantial agreement with the trial court's rationale for awarding counsel fees and costs to defendants, and we have no doubt that the court carefully reviewed all of the submissions from both parties. We also recognize "fee determinations by trial courts will be disturbed only on the rarest of occasions, and then only because of a clear abuse of discretion." Rendine v. Pantzer, 141 N.J. 292, 317 (1995). Nevertheless, the trial court's analysis regarding counsel fees and costs is not part of the record, and we have been unable to determine whether the trial court properly calculated the amount of fees and costs awarded in this case. Thus, we are constrained to remand this issue for further consideration and findings by the trial court.
After reviewing plaintiff's remaining contentions in light of the record and the applicable law, we conclude that his arguments are without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).
We affirm the appeal and cross-appeal, except for the amount of counsel fees and costs awarded to defendants. This issue is remanded to the trial court for reconsideration and findings of facts and conclusions of law consistent with R. 1:7- 4. We do not retain jurisdiction.
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