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Just New Homes, Inc. v. Sun Management

February 5, 2008

JUST NEW HOMES, INC. AND D. RICHARD TONGE, PLAINTIFFS-APPELLANTS/ CROSS-RESPONDENTS,
v.
SUN MANAGEMENT, INC., D/B/A SUNRISE COMMUNITIES, DEFENDANT-RESPONDENT/CROSS-APPELLANT, AND NVR INC. D/B/A RYAN HOMES; REGAL HOMES; SGS COMMUNITIES; PAPARONE HOMES OF NEW JERSEY, INC.; AND CENTEX HOMES, LLC., DEFENDANTS.



On appeal from Superior Court of New Jersey, Law Division, Middlesex County, L-9313-03.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued October 23, 2007

Before Judges Coburn, Grall and Chambers.

Plaintiffs, Just New Homes, Inc. (JNH) and D. Richard Tonge, appeal from an order dated December 13, 2005, imposing monetary sanctions in the sum of $13,750, for filing a frivolous lawsuit. Defendant, Sun Management, Inc., d/b/a Sunrise Communities (SM), has filed a cross-appeal from the denial of its request for a permanent injunction to have its name removed from plaintiff's website. In light of the number of other cases brought by plaintiff under similar theories to the ones in this case which terminated adversely to plaintiff, we affirm the award of monetary sanctions. Based on the record below, we also affirm the granting of summary judgment dismissing the counterclaim for a permanent injunction.

I.

Plaintiff Tonge is a real estate broker and principal of JNH. JNH has an internet website containing information on new residential construction projects in numerous areas in the country, including areas in New York, New Jersey, Pennsylvania, Florida and Texas. Potential purchases of new homes may register as clients of JNH, authorizing JNH to serve as their agent entitled to a commission. By sorting through the information on the website, the potential buyers may identify new home construction projects of interest to them. The website advises the potential buyers that they will receive a "Cash-Back Bonus" of one percent of the base price of the home if the sale goes through. In order to receive the bonus, the potential purchaser must print out a Bonus Coupon and Registration Certificate and present the latter to the sales office of the builder. The potential purchaser is instructed to tell the builder's sales officer that JNH is their real estate agent. The cash-back bonus is payable from the commission JNH seeks from the builder. The website further advises that if the commission JNH receives on the sale is less than one and one-half percent of the base price, the buyer will receive only one-half of the commission received by JNH. This means that if JNH does not receive any commission, the buyer will not receive any cash-back bonus, although the website does not explicitly advise the prospective purchasers of this fact.

The builder in this case, SM, will pay a flat referral fee of $2,000 to a broker provided three criteria are met: (1) the broker personally accompanies the prospective buyer to the sales office; (2) the prospective buyer had not earlier registered with the builder or visited the sales office; and (3) the buyer subsequently purchases a house. This practice is typical of many new residential construction builders.

Plaintiff Tonge maintains that he is unable to accompany the prospective buyers to the sales offices and sign registration forms as their broker because he suffers from progressive osteoarthritis, a chronic disease. As a result, when one of his clients seeks to visit a site, he requests, as a reasonable accommodation, acceptance of a faxed registration in lieu of an in person visit. SM denies these requests. Also, as the trial judge noted, due to the extensive geographical area covered by JNH's website, it is unlikely a single person with no disability could accompany clients to all of these sites anyway.

On December 22, 2003, plaintiffs filed this lawsuit against SM and five other new home builders who had failed to provide the requested accommodation. With respect to all defendants, the complaint alleged violations of the New Jersey Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to -49, and tortious interference with contractual relations. The claims against the other defendants have been dismissed and are not part of this appeal.

In February 2004, defendant filed a counterclaim seeking, among other relief, a permanent injunction enjoining plaintiffs from representing to clients that they may receive a rebate or discount if they purchase a home from defendant.

II.

This was not the first suit plaintiffs filed against a builder in New Jersey for failure to provide an accommodation under these circumstances. In December 2001, plaintiffs filed a similar pro se action in the Special Civil Part in Camden County against RJP Builders (RJP), alleging that RJP failed to provide Tonge with a reasonable accommodation and failed to pay plaintiffs a commission when they referred a buyer to RJP. After the trial was held on March 5, 2002, the trial court found that plaintiffs were entitled to the referral fee of $500 which RJP provided to brokers who did not come to the premises, but plaintiffs were not entitled to further monies under a breach of contract theory. The trial court specifically found that plaintiffs had not set forth a viable discrimination claim under the LAD.

In December 2001, plaintiffs filed another pro se suit against RJP, in the Special Civil Part, Gloucester County, seeking commissions on a sale involving other purchasers under similar circumstances. Plaintiffs argued that they were entitled to a commission based on real estate broker commission law and argued that RJP's practices violated the LAD as well as the Americans With Disabilities Act. That case ended with summary judgment being granted for RJP. While RJP was awarded counsel fees by the trial court under Rule 1:4-8, on the basis that ...


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