Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Official citation and/or docket number and footnotes (if any) for this case available with purchase.

Learn more about what you receive with purchase of this case.

Byrnes v. Billion BMW


September 9, 2008


On appeal from the Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-4466-03.

Per curiam.


Argued January 16, 2008

Before Judges Axelrad, Sapp-Peterson and Messano.

Defendant Dependable Auto Shippers, Inc. (DAS) appeals from the July 28, 2006, order entering judgment, after a jury trial, in favor of plaintiff James Byrnes in the amount of $93,000, and dismissing all claims and cross-claims against co-defendant Billion BMW, Inc. (Billion). Plaintiff cross-appeals from those portions of the order dismissing his claims against Billion, as well as the September 8, 2006, order that denied his request for counsel fees. We have considered the arguments raised by the parties in light of the record and applicable legal standards. We reverse and remand the matter for further proceedings consistent with this opinion.


We recite the relevant facts from the trial testimony. On October 20, 2002, plaintiff purchased a 2003 BMW 750 Li for $82,476.17 from Billion, a car dealership based in Sioux Falls, South Dakota. After shopping for the car at local dealerships, plaintiff searched the internet to locate the specific car and options that he desired at a better price, and subsequently had a series of phone conversations with Billion's salesman prior to the purchase. Plaintiff paid $30,000 of the purchase price in cash, and financed the balance by securing a bank loan, amortized by monthly payments of $1,066 over sixty months, beginning in November 2002. Plaintiff testified that as of the trial, in April 2006, he had continued to make his monthly payments on the car loan and approximately $19,200 remained as a balance on the loan.

Billion contracted with DAS, a shipper of high-end automobiles, to transport the car from DAS's agent's facility in Omaha, Nebraska, to DAS's facility in Linden, New Jersey, where plaintiff was to take delivery. On October 29, 2002, Billion transported the car to Omaha, and on November 11, 2002, a DAS truck picked it up for transport to New Jersey. Upon taking custody of the car, DAS issued a bill of lading that limited its liability to $250 unless "valuation coverage" was purchased. Plaintiff had purchased insurance for the car, and it is undisputed that neither Billion nor plaintiff purchased "valuation coverage" from DAS.

The car arrived at the DAS yard in Linden on November 14, 2002. Company policy required that DAS personnel inspect any delivered vehicle and make a notation of any damages. DAS's risk manager, Vernon Allison, testified that the company had no records of any post-shipment damage to plaintiff's new car.

Two days later, plaintiff arrived to pick up the car and observed that it was covered in "mud all over the place," and had marks and multiple dents on its body. The vehicle's armrests were up, cup holders were out, and the cellular phone that was included in the purchase price was stolen. Plaintiff crossed his name off the bill of lading he previously signed upon arrival at the DAS facility, marked "refused" on it, and, pursuant to advice he received from Billion's salesman, Jeff Boe, left to report the incident to the police. He returned two hours later with a police officer who prepared a report documenting plaintiff's complaints about the condition of the car.

Noticing a dirt track at the back of the DAS facility, that the mud on the car appeared similar to that of the dirt track, and the nervous demeanor of the DAS employees responsible for giving him the car, plaintiff surmised that DAS's employees had taken the car for a joyride on the track. A DAS employee, documenting the damage to the car, informed plaintiff that the bill of lading limited DAS's liability.

Plaintiff told Boe that he was rejecting the car because of the damage. Plaintiff testified that Boe told him that Billion would have the car examined by an auto-body repair shop, and, if plaintiff did not want the car after it was repaired, Billion would send him a brand new one. Billion arranged for Garden State Auto Body (GSAB) to remove the car from the DAS yard and repair it. GSAB's written estimate confirmed damage to the rear bumper, trunk lid, and rear quarter panel, a missing taillight, and the need for various cleaning and painting. Additionally, the odometer of the car now registered fourteen miles, seven more than when Billion delivered it to DAS.*fn1 On January 6, 2003, Billion paid GSAB's repair bill of $2388.67.

Plaintiff was unsatisfied with the repairs, however, and Boe authorized additional repairs at an estimated cost of $1014.47. A few weeks after the second round of repairs were complete, plaintiff returned to GSAB to inspect the car. Plaintiff testified that the owner of GSAB, Peter Ciccone, told him that the car needed further work, and that Billion had authorized only some of the work in "piecemeal" fashion. However, when Ciccone testified, he indicated that there were no further problems with the car after the second round of repairs, and that plaintiff did not advise him of any further work he believed needed to be done.

At this point, plaintiff called Billion to advise that he was still refusing to accept the car. Boe had left Billion's employ, so plaintiff spoke to Billion's vice-president, David Billion, who advised that Billion would not discount the car or give plaintiff a new one. Billion testified that if indeed Boe had ever made such a representation to plaintiff, he was unaware of it, and Boe was not authorized to do so. Despite refusing to accept the car or sell it, plaintiff continued making the monthly payments on his car loan because he believed he needed to protect his credit rating.

Plaintiff retained counsel, but negotiations to resolve the dispute were not fruitful. Plaintiff testified that after the second round of repairs, he was not going to accept the car; however, apparently through counsel, and in an attempt to resolve the dispute, plaintiff demanded that Billion pay the additional repair costs and provide him a credit of $8000, an amount ostensibly related to plaintiff's costs in renting a luxury replacement car.

David Billion apparently sought assurance that plaintiff would accept the car before making payment for the second round of repairs, acknowledging that he told plaintiff to pick up the car and then Billion would pay the outstanding balance. He refused to pay the $8000 demand, which he likened in his testimony to "extortion" by plaintiff. After trying to resolve the dispute by seeking contribution from DAS, David Billion ultimately told plaintiff he could pick up the car, or do whatever he liked with it, but that Billion was not paying the $8000, was not taking the car back, and was not providing a new car. David Billion testified that the value of the car as repaired was in the "low 70's [thousands] wholesale" and that it would have sold retail "in the 78[']s [thousands]."*fn2

As of May 2003, the balance for the second round of repairs still remained unpaid and GSAB notified Billion and plaintiff that it would begin assessing a daily storage fee for the vehicle. On June 2, 2004, GSAB again reminded Billion of the unpaid balance and accruing storage fees and also sent plaintiff a similar reminder on August 27, 2004. On June 7, 2005, GSAB filed with New Jersey's Motor Vehicle Commission its notice of intention to sell the BMW as an abandoned vehicle, serving same on plaintiff and Billion. With no response from the parties, Ciccone testified that he eventually sold the car for "$20,000 some [] dollars" to cover his repair costs and storage fees.

In the interim, on September 29, 2003, plaintiff filed a complaint against Billion and DAS asserting claims of breach of contract, negligence, legal fraud, spoliation of evidence, breach of express and implied warranties, violation of the Consumer Fraud Act, N.J.S.A. 56:8-1 through -20 (the CFA), and breach of the implied covenant of good faith and fair dealing. In its answer, DAS asserted affirmative defenses that included an allegation that plaintiff had failed to mitigate damages and that his claim for damages was limited by the bill of lading and by statute. DAS also cross-claimed against Billion, seeking indemnity and contribution, and Billion's answer asserted similar cross-claims against DAS.

On September 22, 2004, two weeks after the discovery period ended, DAS moved for summary judgment arguing: (1) that plaintiff could not establish a prima facie case that its employees had damaged the car; or (2) alternatively, that its liability was limited to $250 pursuant to the terms of the bill of lading, or to the amount of plaintiff's "actual damages" under the Carmack Amendment (the Amendment), 49 U.S.C.A. § 14706. Plaintiff also moved for partial summary judgment against Billion. On November 10, 2004, the motion judge denied both applications, and DAS's motion for reconsideration was similarly denied on March 15, 2005.

DAS sought the same relief immediately before trial by way of a motion in limine that was also denied, and trial commenced over three days from April 11 to April 13, 2006. During an extensive charge conference following completion of the testimony, DAS and Billion agreed that if plaintiff prevailed, the judge should determine any allocation of damages between the two. The defendants also agreed that their respective claims for indemnification and contribution should be decided post-trial by the judge. Plaintiff reserved a right to seek counsel fees from the court if he prevailed.

In responding to specific interrogatories posed on the verdict sheet, the jury returned a verdict in favor of plaintiff and found both Billion and DAS had breached their contracts. The jury also found that Billion's subsequent repairs of the car "cure[d] any defect." It further found the car had been damaged while in DAS's custody, that DAS's employees took the car for a joyride, and that DAS was grossly negligent in its custody and care of the vehicle. Finally, the jury determined the car's January 2003 post-repair value to be $75,000, that plaintiff had mitigated his damages, and awarded plaintiff $93,000 in damages.*fn3

Following trial, plaintiff moved for the entry of judgment jointly and severally against Billion and DAS, as well as counsel fees. DAS moved to limit the amount of any judgment against it, arguing that even if its liability were not limited by the bill of lading or the Amendment, it could not be responsible for any damages exceeding the difference between the purchase price of the car and the estimated market value after repairs. DAS noted that after Billion moved the car to GSAB, DAS no longer had control over the vehicle. Billion cross-moved to fix the form of judgment, arguing that the risk of loss passed to plaintiff at the time of delivery to DAS's Linden facility, or alternatively, after it cured any defects by completing the second repairs in January 2003. It contended that the jury's verdict required dismissal of all claims against it.

Relying on the jury's answers to specific interrogatories, the judge agreed that any further risk of loss passed to plaintiff after Billion had affected a cure through repairs, and he entered a judgment of no cause of action against Billion.

Because the jury had found DAS "grossly negligent," and plaintiff had mitigated his damages, the judge refused to set aside or reduce the $93,000 verdict against DAS. The judge reserved ruling on plaintiff's motion for counsel fees and sought further briefing. On July 28, 2006, he entered an order granting plaintiff judgment in the amount of $93,000 against DAS, and entering a judgment of no cause of action against Billion.

On September 8, 2006, the judge denied plaintiff's request for counsel fees and costs. Later that day, plaintiff filed a motion for reconsideration. On September 27, 2006, DAS filed its appeal and plaintiff cross-appealed. On October 6, 2006, the judge dismissed plaintiff's motion for reconsideration, concluding he lacked jurisdiction because the appellate processes had been invoked.


DAS argues: 1) that its pre-trial motions for summary judgment should have been granted; 2) that the trial judge erred in excluding certain photographic evidence; and 3) that the judgment amount must be set aside because a) plaintiff is limited to recovery of his "actual damages" under the Amendment; b) because plaintiff had a duty to accept the vehicle after it was repaired; and c) because the parties had otherwise agreed to limit DAS's damages to those that occurred while the car was in its possession. Plaintiff counters that the pre-trial motions were properly denied, that the evidence was properly excluded, and that the judgment amount was proper and was not subject to any agreement of limitation between plaintiff and defendants.

In his cross-appeal, plaintiff argues the trial judge improperly denied his motion for counsel fees because they were specifically provided for by the bill of lading. He also argues that the judge committed error by dismissing his CFA claim against Billion, and in finding no cause of action against Billion based upon the jury interrogatories. Billion counters by arguing that plaintiff's CFA claim was properly dismissed, that the judge properly entered no cause of action in favor of Billion based upon the jury's findings, and that any agreement it reached with DAS during the litigation did not serve to indemnify DAS for plaintiff's judgment.


We initially dispense with DAS's arguments regarding the denial of its pre-trial motions and the judge's evidence ruling finding them to be of insufficient merit to warrant extensive discussion in this opinion. R. 2:11-3(e)(1)(E). We add these brief comments.

DAS contends its motion for summary judgment on liability should have been granted because plaintiff failed to raise sufficient proof to demonstrate DAS's employees were responsible for the damage to the car. Relying upon Housel v. Theodorididis, 314 N.J. Super. 597 (App. Div. 1998), and Gonzalez v. Ideal Title Importing Co., 371 N.J. Super. 349 (App. Div. 2004), aff'd, 184 N.J. 415 (2005), DAS contends that plaintiff failed to oppose its statement of material facts in support of the summary judgment motion and supplied no information based upon personal knowledge that DAS's employees had damaged the car.

The motion judge properly determined that a genuine dispute of material fact precluding summary judgment existed based upon plaintiff's opposition to the motion, which included documentation of his loan agreement with the bank binding him to make payments for the car, the damage report and appraisal prepared by GSAB, the bill of lading marked with plaintiff's refusal to accept the car because of the damage, and a certification that plaintiff believed DAS's employees caused the damage.*fn4 We find that the information supplied in opposition to the motion, together with the reasonable inferences to be drawn, could have led to the conclusion that the car was damaged while in DAS's control.

Both cases DAS cites are readily distinguishable. In Housel, the non-moving party presented no opposition disputing the moving party's statement of material facts. Housel, supra, 314 N.J. Super. at 602-04. In Gonzalez, the opposition contradicting the moving party's factual assertions was not based upon any personal knowledge. Gonzalez, supra, 371 N.J. Super. at 358. As we noted, plaintiff's opposition, though circumstantial in nature, clearly led to the reasonable conclusion that DAS's employees damaged the car and was based upon his own personal knowledge of the events.*fn5

In the alternative, DAS argued it was entitled to partial summary judgment on damages, contending that any recovery by plaintiff was limited to $250 as set forth in its bill of lading. However, DAS acknowledges in its brief that the limitation would not apply if the carrier was "grossly negligent or intentionally reckless in its care and custody of the" car, citing American Cyanamid Co. v. New Penn Motor Express, 979 F.2d 310, 315-16 (3d Cir. 1992). Therefore, it seems to us that the judge properly denied the motion for partial summary judgment as to damages based upon the rather sparse motion record occasioned by the lack of any significant discovery by the parties.*fn6 For these reasons, we find no error in the denial of DAS's motion for reconsideration of these issues.

We discuss the issues DAS raises regarding the denial of its motion for partial summary judgment limiting plaintiff's claim to "actual" damages in greater detail below, and in the context of the trial testimony.

As to the alleged error regarding the trial judge's refusal to permit DAS to introduce photographic evidence that there was no dirt track at the rear of its Linden facility, we conclude the judge's decision was not a mistaken exercise of discretion, or, alternatively, if it was error, it was harmless. The issue arose during a break in Allison's testimony when DAS sought to introduce photographs of the Linden facility taken in 2006. We gather from the record the photos demonstrated there was no dirt track in the rear of the facility and were intended to rebut plaintiff's testimony that the mud on the new vehicle came from the dirt track that "looked like it was" at the rear of the DAS's yard.

However, it was undisputed that DAS never furnished the photographs during discovery, or even at the onset of trial. The trial judge, recognizing that DAS was on notice from "day one" that plaintiff alleged there was mud on the car, that DAS employees had driven the car, and that plaintiff had specifically demanded production of all photographs DAS intended to use, denied DAS's request and excluded the photographs. Under these specific circumstances, we cannot conclude that the trial judge mistakenly exercised his broad discretion regarding the admission of evidence. Benevenga v. Digregorio, 325 N.J. Super. 27, 32 (App. Div. 1999), certif. denied, 163 N.J. 79 (2000). Furthermore, Allison, who was a long-term employee of DAS and fully familiar with its operations and facilities, was permitted to testify that the entire DAS facility in Linden was covered in asphalt and that there was no dirt track. Therefore, any error in not permitting the photographs taken three years after the events was harmless.


We consider the issues DAS raises regarding the jury's award of damages in the amount of $93,000 in light of the jury's specific interrogatory answers, and the judge's subsequent conclusion that based upon those answers, Billion was not liable to plaintiff for any damages. In essence, urging various legal theories, DAS contends that, at worst, it cannot be legally liable to plaintiff for any award of damages that exceeds the actual diminution of the BMW's value caused as a result of its employees' gross negligence.

During the post-trial motion to settle the form of judgment, DAS's counsel moved to set aside the jury verdict and limit plaintiff's damages to the difference between the purchase price of the car, and $75,000, the value of the car after repairs, as found by the jury. The judge denied the motion, finding that the jury relieved Billion of liability because it had decided that Billion cured any defect by repair, while at the same time finding that plaintiff was entitled to a full measure of his damages because he properly mitigated damages.

In support of its appeal of that denial, DAS raises three specific arguments under the general rubric that the judgment fails to "comport with [] applicable law." First, DAS contends that the Amendment limits plaintiff's recovery to his "actual damages," in this case the diminution in the value of the BMW after it was repaired. Second, and as a corollary to its first argument, DAS contends that plaintiff had a duty under the Amendment to accept the car after it was repaired a second time.

Third, DAS maintains that the judgment somehow does not comport with the parties' earlier agreement. Because we agree that plaintiff's damages against DAS are limited to "actual damages," we need not consider the balance of defendant's arguments.

"The Carmack Amendment to the Interstate Commerce Act, 49 U.S.C.A. § 14706, established a national uniform policy governing the liability of interstate carriers for loss or damage to property entrusted to them." Industrial Risk Ins. v. United Parcel Service, 328 N.J. Super. 584, 590 (App. Div. 2000). We have noted that

To establish a prima facie case of liability under the Amendment, a shipper must prove the following three elements: (1) delivery of the goods to the initial carrier in good condition, (2) damage of the goods before delivery to their final destination, and (3) the amount of damages. After a plaintiff establishes a prima facie case of liability against the carrier, the carrier has the burden of proving that it was not negligent and that the loss was caused by an act of God, act of public enemy, act of shipper, act of public authority, or the inherent nature or vice of the goods. [Id. at 591 (citation omitted).]

The rights and obligations conferred by the Amendment upon shippers, like Billion, apply to consignees, like plaintiff, as well. See S & H Hardware & Supply Co. v. Yellow Transp., Inc., 432 F.3d 550 (3d. Cir. 2005). Plaintiff concedes that his claim against DAS is strictly governed by the Amendment.

A carrier may limit its liability for goods lost or damaged in transit to a sum certain. Industrial Risk, supra, 328 N.J. Super. at 591. DAS included such a limitation of liability in the amount of $250.00 in its bill of lading. DAS concedes, however, that this limitation does not apply since the jury determined it was grossly negligent, a position we accept for purposes of this appeal.

But, even if the limitation of liability is inapplicable, DAS argues that plaintiff's damages against it were limited to "the actual loss or injury to the property caused by" its gross negligence. 49 U.S.C.A. § 14706(a)(1). It continues that the upper limit of possible damages that it could be liable for in this case should be the car's reduction in market value and the repair costs, because that is the measure of "actual loss" occasioned by its gross negligence. Camar Corp. v. Preston Trucking Co., 221 F.3d 271, 277 (1st Cir. 2000).

The 'ordinary measure of damages' in Carmack Amendment cases is meant to put the [consignee] back in the position it would have been in had the carrier properly performed . . . . 'The ordinary measure of damages in cases of this sort is the difference between the market value of the property in the condition in which it should have arrived at the place of destination and its market value in the condition in which, by reason of the fault of the carrier, it did arrive.'

[Am. Nat'l Fire Ins. Co. v. Yellow Freight Sys., 325 F.3d 924, 931-32 (7th Cir. 2003)(quoting Gulf, Colorado & Santa Fe Ry. Co. v. Texas Packing Co., 244 U.S. 31, 37, 61 L.Ed. 970, 37 S.Ct. 487 (1917)).]

However, as plaintiff counters, decisional law construing the Amendment "incorporates common law principles for calculation of damages," and "[u]nder particular circumstances, replacement cost can be a legitimate measure of [] Amendment damages." Nat'l Hispanics Circus, Inc., v. Rex Trucking, Inc., 414 F.3d 546, 552 (5th Cir. 2005). Additionally, "an injured party may recover damages for delay, non-speculative lost profits, and all reasonably foreseeable consequential damages" occasioned by the carrier's negligence. Mach Mold Inc. v. Clover Assocs., 383 F. Supp. 2d 1015, 1032 (N.D. Ill. 2005).

We agree with DAS that the critical inquiry is whether plaintiff's claim for damages--all costs associated with the purchase and financing of the car--is a claim for foreseeable damages proximately caused by DAS's gross negligence. We conclude it is not, and that DAS was entitled, as a matter of law, to have its damages capped at an amount equal to the costs of repairs and the diminution in the market value of the car after the repairs.

In other circumstances, discussing the measure of damages attributable to a damaged automobile, we have held that "'[t]he general primary rule is that, in the absence of the total destruction of an automobile the measure of damages is the difference in its value immediately before and after the injury.'" Premier XXI Claims Management v. Rigstad, 381 N.J. Super. 281, 283 (App. Div. 2005)(quoting Jones v. Lahn, 1 N.J. 358, 362 (1949))(emphasis added). However, "when the cost to repair a vehicle is proven, but there exists additional proof showing that even with the repair, the vehicle has depreciated, plaintiff is entitled to the reasonable cost of repair plus the depreciation, if any." Premier XXI Claims Management, supra, 381 N.J. Super. at 284.

In this case, there was no proof that the car was destroyed or otherwise worthless; rather, the only proof was to the contrary, i.e., that the value of the car after the repairs were made was at least $72,000 wholesale. The jury found as a fact that the car was worth $75,000 after it was repaired.

Indeed, it was plaintiff's position throughout the trial that the amount of damage to the vehicle was inconsequential because he was entitled to reject the delivery of an imperfect car as non-conforming and rescind the contract with Billion under the applicable provisions of the Uniform Commercial Code, N.J.S.A. 12A:1-101 to 12A:10-106 (the UCC). During the extensive charge conference, plaintiff's counsel recognized that his remedies against DAS were limited, as noted by the following colloquy with the judge:

Counsel: Now if the jury accepts the testimony that it was delivered to DAS in Linden perfectly and then the DAS people joyride the vehicle and damage it, then can I seek rescission damages against DAS?

Judge: The answer is no.

Counsel: So, that's the problem. I'm left with diminution of value and I've totally lost remedies against Billion. So it would seem like I can win against either . . . get one or the other, but my remedies are different depending on how that's played out.

At various points throughout the trial, the judge agreed that plaintiff's recovery against DAS was indeed limited.

This essential distinction as to the remedies available to plaintiff vis-à-vis each defendant was not explained to the jury, nor adequately considered by the judge after he dismissed Billion from the case. Plaintiff may have had the right under the UCC to the tender of a perfect car as to Billion, see Ramirez v. Autosport, 88 N.J. 277, 290 (1982), but his remedy against DAS was strictly proscribed by the Amendment and the common law principles as to damages that flowed therefrom.

After Billion removed the vehicle from DAS's facility to repair it, the car was never returned to DAS's control. It was unable to repair the vehicle itself, unable to sell it for its undisputed, significant market value, or otherwise limit plaintiff's recovery to the actual damages that then existed; at the same time, plaintiff's alleged damages were escalating. Instead, DAS became the unwitting "third man out" in the struggle between plaintiff and Billion to resolve their dispute. In short, the reasonably foreseeable damages proximately caused by DAS's gross negligence were limited to the diminution of the value of the car after it was repaired, and the costs of those repairs.*fn7

A jury verdict will not be set aside unless it clearly and convincingly appears that there was a miscarriage of justice under the law. R. 2:10-1; Dolson v. Anastasia, 55 N.J. 2, 7-8 (1969). Here, the jury should have been advised, as a matter of law, that in the event it found for plaintiff as against DAS, it was limited to an award of damages that could not exceed the difference between $75,000 and the purchase price of the car. For that reason, the judgment against DAS must be reversed.

Before we turn to plaintiff's cross-appeal, we would note that denial of DAS's summary judgment motion on this issue was proper. While DAS was entitled to a determination, pre-trial, that plaintiff's recovery under the Amendment was limited to "actual" damages, the exact parameters of the claim certainly could not have been fleshed-out on the scant motion record that then existed, and, at best would have resulted merely in an order declaring plaintiff's claim against DAS to be so limited, without more. In light of our ruling, we conclude that there was no error in the denial of DAS's summary judgment motion.


Plaintiff's cross-appeal argues that the judge's entry of no cause of action against Billion was error, as was his earlier dismissal of plaintiff's CFA claim. Plaintiff also contends that he was entitled to an award of counsel fees against DAS based upon the express language of the bill of lading.


Plaintiff's claim of error regarding the dismissal of his CFA claim is multi-faceted. He contends that Billion misrepresented that the car would be shipped to New Jersey in a closed container and it was not; that Billion reneged on its promise to supply plaintiff with a new car if he was unsatisfied with the repairs; that it failed to obtain his consent to the bill of lading's limitation of liability; and that it improperly demanded that plaintiff accept the car before paying for the second round of repairs. Individually or collectively, he contends that these events are sufficient to prove a violation of the CFA. He also argues that the trial judge misinterpreted existing law by concluding that a claim for breach of contract cannot also be a cognizable claim under the CFA. Since we agree with the trial judge's conclusion that these factual assertions, even if believed by the jury, do not set forth a claim under the CFA, we need not consider the last point plaintiff raises.

The CFA provides in relevant part:

The act, use or employment by any person of any unconscionable commercial practice, deception, fraud, false pretense, false promise, misrepresentation . . . in connection with the sale or advertisement of any merchandise or real estate, or with the subsequent performance of such person as aforesaid, whether or not any person has in fact been misled, deceived or damaged thereby, is declared to be an unlawful practice . . . . [N.J.S.A. 56:8-2.]

"The standard of conduct contemplated by the unconscionability clause is good faith, honesty in fact and observance of fair dealing . . . ." Kugler v. Romain, 58 N.J. 522, 544 (1971). A violation of the CFA can arise in three different settings. Gennari v. Weichart Co. Realtors, 148 N.J. 582, 605 (1997). An affirmative misrepresentation, even if unaccompanied by knowledge of its falsity or an intention to deceive, is sufficient. Ibid. (citing Strawn v. Canuso, 140 N.J. 43, 60 (1995)). An omission or failure to disclose a material fact, if accompanied by knowledge and intent, is sufficient to violate the CFA. Ibid. (citing Cox v. Sears Roebuck & Co., 138 N.J. 2, 18 (1994)). "[T]he third category of unlawful acts consists of violations of specific regulations promulgated under the [CFA]. In those instances, intent is not an element of the unlawful practice, and the regulations impose strict liability for such violations." Cox, supra, 138 N.J. at 18.

First, there was no evidence that whether the car was shipped in a closed container or not was in any way material to plaintiff's acceptance of the car; plaintiff repeatedly testified that he did not even know the circumstances regarding the shipment of the car. Second, any promise Billion's representatives made to plaintiff regarding replacing the car was a statement made while the parties were attempting to negotiate a resolution of the dispute, and was not made during either the formation or performance of the contract for the car's purchase. It cannot, therefore, be a violation of the CFA. Third, any failure by Billion to discuss the liability limitation in the bill of lading was similarly immaterial because plaintiff believed that since the car was insured, he was protected from any further loss. Lastly, Billion's conditioning of payment for the second repair bill upon plaintiff's acceptance of the car cannot underpin a CFA claim because it, too, occurred after the formation and performance of the contract and was in the nature of an attempt to resolve the conflict.

In short, plaintiff failed to establish a prima facie case of any violation of the CFA against Billion, and the trial judge properly dismissed that aspect of plaintiff's complaint.


Plaintiff argues the judge erred in determining that the jury's interrogatory answers compelled entry of a judgment of no cause of action against Billion. During the post-verdict oral argument, the judge reasoned

Our Uniform Commercial Code . . . provides, where a tender or delivery of goods so fails to conform to the contract, as it did in this case, as to give a right of rejection, which it did in this case because there was damage to the car, the risk of loss remains on the seller, and it did in this case until cure or acceptance . . . .

And it makes sense that the "or" be there, because if it weren't there, someone, such as [plaintiff], would say, ["]I don't accept,["] as he did in this case, unreasonably so, I find. There was damage to his car. There's no question and it was DAS's employee who took it for a joyride.

It wasn't Billion. Billion did what Billion had to do, delivered the car, there was a problem with it, he fixed it. [Plaintiff] comes back, I still don't like it. It['s] got some scratches . . . . Fix it again. Bring it back again. Now is it okay? Again, if acceptance was the only requirement, this could go on forever with someone like [plaintiff] and it probably would . . . .

This was cured, not because [I] say[] so, but because the jury said so. The jury said . . . that Billion cured . . . . Once they sa[id] that, Billion is off the hook because under the law, once it's cured, the risk of loss under [N.J.S.A. 12A:]2-510(1) shifts to the buyer.

Plaintiff argues now, as he did below, that Billion was obligated to not only cure the defect through repairs, but also to "redeliver" the vehicle to plaintiff. He continues that since it was undisputed that Billion never paid the bill for the second round of repairs, but rather conditioned its payment upon plaintiff's concession that he would accept the car, redelivery never occurred.*fn8

Billion counters that under the applicable provisions of the UCC, it was absolved from liability once it "cured" any defects, i.e., made the second round of repairs. Since the jury specifically found it had cured any defects, the judge correctly entered a no cause verdict in its favor. Alternatively, it argues it was entitled to a no cause verdict because the car was delivered undamaged at DAS's Linden facility, and that the risk of loss passed to plaintiff at that point, an argument not specifically addressed by the judge post-verdict.

Proper consideration of the issue requires a review of the applicable provision of the UCC, and relevant case law, limited as it may be. In New Jersey, the UCC preserves the perfect tender rule to the extent of permitting a buyer to reject good for an nonconformity. Nonetheless, that rejection does not automatically terminate the contract. A seller may still effect a cure and preclude unfair rejection and cancellation by the buyer. [Ramirez, supra, 88 N.J. at 290].

If the goods are non-conforming and properly rejected by the buyer, "the risk of their loss remains on the seller until cure or acceptance." N.J.S.A. 12A:2-510(1). Since plaintiff never accepted the car, the issue becomes whether Billion affected a cure for purposes of the UCC.

A valid cure that effectively shifts the risk of loss to the buyer requires that a seller "seasonably notify the buyer of his intention to cure and [] then . . . make a conforming delivery." N.J.S.A. 12A:2-508(1). In Jakowski v. Carol Chevrolet, Inc., 180 N.J. Super. 122 (Law Div. 1981), the defendant/seller, having forgotten to apply a polymer coating to the car as promised by the contract of sale, recalled the car from the plaintiff/buyer to effect a cure. Id. at 124. The buyer returned the car but it was stolen before the seller had the chance to return it. Ibid. In granting judgment in favor of the buyer, the court held "that where a seller obtains possession of the goods in an effort to cure defects in them so as to comply with his end of the bargain, he is under a contractual duty to redeliver them to the buyer." Id. at 127.

A "tender of delivery requires that the seller put and hold conforming goods at the buyer's disposition and give the buyer any notification reasonably necessary to take delivery." N.J.S.A. 12A:2-503(1). A "tender" for purposes of Article Two of the UCC is further defined in the commentary.

The term "tender" is used in this Article in two different senses. In one sense, it . . . contemplates an offer coupled with a present ability to fulfill all the conditions resting on the tendering party and must be followed by actual performance if the other party shows himself ready to proceed. Unless the context unmistakably indicates otherwise this is the meaning of "tender" in this Article . . . . At other times it is used to refer to an offer of goods . . . under a contract as if in fulfillment of its conditions even though there is a defect when measured against the contract obligation. Used in either sense, however, "tender" connotes such performance by the tendering party as puts the other party in default if he fails to proceed in some manner. [Comment, N.J.S.A. 12A:2-503(1).]

"[B]are offers of potentially curative performance" made by the seller are insufficient. Sinco, Inc. v. Metro-North Commuter R.R., 133 F. Supp. 2d 308, 314 (S.D.N.Y. 2001). One court has explained the subtleties of a UCC "tender" by noting, "It is clear that although tender does not require that the seller put the goods in the possession of the buyer, the seller must have the present ability to do so in order to preserve its rights." Allied Semi-Conductors Int'l v. Pulsar Components Int'l, 907 F. Supp. 618, 625 (E.D.N.Y. 1995).

The facts of Allied Semi-Conductors are somewhat analogous to the case at hand. There, the defendant/seller and plaintiff/buyer contracted for the sale of computer chips which the buyer intended for re-sale to a third party. Id. at 621. The third-party returned the chips to the buyer alleging they were defective. Ibid. The buyer returned the chips to the seller, who agreed to take the goods back, beyond the thirty-day return period, on the condition that it would replace those goods that tested as defective. Ibid.

In the interim, the buyer purchased replacement chips at a greatly reduced price from another vendor in order to complete its contract with the third-party. Id. at 621-22. Apparently unable to negotiate an acceptable agreement, the seller did not replace the computer chips returned by the buyer and did not reimburse the buyer for the purchase price, leading the buyer to start suit. Ibid. The district court concluded that the seller had failed to tender delivery, and therefore had failed to effect a cure for purposes of § 508 of the UCC, noting [e]ven if [the buyer] did equivocate regarding replacement or refund, or even if [the buyer] stated to [the seller] that it wanted a refund rather than replacement, . . . nothing [the buyer] could say would have the effect of depriving the [seller] of the right to cure, which is absolute. [The seller] did not have to wait for [the buyer] to state that it would accept replacements. [The seller] simply was required to notify [the buyer] that replacement goods were ready for delivery and shift the burden to [the buyer] to respond by accepting or rejecting [seller's] tender of delivery. In either case, [the seller] would have fulfilled its obligation under the contract and [the buyer] would have been foreclosed from seeking damages. [Id. at 627.]

In this case, during the charge conference, the judge seemingly indicated that Billion's failure to pay the costs of the second round of repairs unless plaintiff took possession of the car was not sufficient "redelivery" so as to affect a cure. He indicated that he would charge the jury in conformance with the principles set forth in Jakowski, supra, and he did. However, at the post-verdict motion to settle the form of the judgment, and relying upon the jury's finding that Billion had "cured," the judge determined essentially as a matter of law that regardless of Billion's refusal to pay for the second round of repairs in advance of plaintiff's acceptance of the car, Billion had made "a conforming delivery." N.J.S.A. 12A:2-508(1).

While plaintiff urges us to reverse on this basis, and, it would appear, enter judgment in its favor against Billion because it failed, as a matter of law, to unconditionally re-deliver conforming goods, we refuse to do so. As we see the issue, a factual dispute was presented as to whether Billion "put . . . conforming goods at [] [plaintiff's] disposition," thus fully effecting a cure, or failed to do so by either not bringing the car into conformance, or not putting it at plaintiff's "disposition" by not paying GSAB's bill for repairs. However, because the importance of the resolution of these factual disputes in the context of the UCC's "cure" provisions were not adequately explained to the jury, we are compelled to reverse the entry of a judgment of no cause of action against Billion, and unfortunately remand the matter for a new trial.

In charging the jury as to these admittedly obtuse legal concepts, the judge accurately but without any explanation, read the relevant provisions of the UCC, stating, With respect to tender, the Code provides that, tender of delivery requires that the seller put and hold conforming goods at the buyer's disposition and give the buyer any notification reasonably necessary to enable him to take delivery . . . .

Where a tender . . . or delivery of the goods so fails to conform to the contract as to give a right of rejection, the risk of their loss remains on the seller until cure or acceptance. Where a seller obtains possession of goods in an effort to cure the defect in them so as to comply with his end of the bargain, he is under a contractual duty to redeliver them to the buyer. If the seller fails to do so, such failure will constitute a breach of contract . . . .

Where any tender or delivery by the seller is rejected because [it is] nonconforming, . . . the seller may seasonably notify the buyer of his intention to cure. And may then . . . make a conforming delivery.

The judge did not, however, explain how the disputed facts of the case impacted the legal concept of "cure," nor did he attempt to define what the Code means when it requires the seller to place the now-conforming goods at the buyer's "disposition" in order to cure.

Plaintiff did not object to the charge, nor does he specifically raise the issue on appeal, instead arguing Billion failed to cure as a matter of law. However, under the unusual facts of this case, we believe the jury required further guidance that related these abstract concepts to the contested facts in the testimony, and lacking such instructions, the charge was confusing and misleading. "It is well settled in our State that the trial judge has the right, and oftentimes the duty, to review the testimony and comment upon it." Reynolds v. Gonzalez, 172 N.J. 266, 290 (2002)(quotation omitted). "The failure to tailor a jury charge to the given facts of a case constitutes reversible error where a different outcome might have prevailed had the jury been correctly charged." Id. at 289.

First, in order to have cured, Billion had to demonstrate that it "put . . . conforming goods at the [plaintiff's] disposition and g[a]ve [plaintiff] any notification reasonably necessary to enable him to take delivery." N.J.S.A. 12A:2-503(1). Whether the goods were conforming or not after the second round of repairs was disputed. Plaintiff testified that the car still was not fixed and claimed that Ciccone essentially told him so. Ciccone testified that the car was totally repaired and that no further repairs were necessary. We believe that the jury's attention needed to be directed to this testimony, requiring its their resolution of the dispute, and that in order to obtain the benefits of the cure provisions of the UCC, Billion needed to demonstrate that after the second round of repairs, the car was in fact in a condition that conformed to the original contract. See N.J.S.A. 12A:2- 106(2)(defining conforming goods as those "in accordance with the obligations under the contract").*fn9

Second, the jury needed to conclude that after the second round of repairs, the car was at plaintiff's "disposition," i.e., that plaintiff needed only to present himself to GSAB and drive the BMW away.*fn10 Plaintiff at one point testified that he was not going to accept the car unless he received some additional compensation and David Billion testified that he would only pay for the repairs if plaintiff took the car. It would appear that the man who actually was in a position to testify as to whether plaintiff could have simply driven away with the car, Ciccone, was never asked the question. In any event, the jury's attention was not sufficiently focused on the resolution of this critical issue in the case.

Using just the limited, general guidance it received on the legal concepts surrounding the critical issue of "cure," the jury found that Billion had cured through repairs, but nonetheless found the quantum of damages to be $93,000, a sum of money that reflects both the return of plaintiff's full purchase price and all the money he was obligated to pay under his car loan. The jury found the car still had a value of $75,000 after it was repaired, a figure of importance only as to plaintiff's non-rescission remedy against DAS, but also found plaintiff had mitigated his damages. The jury verdict, viewed in its entirety, does not inspire confidence that a just result was reached. Reynolds, supra, 172 N.J. at 286.

Billion argues there is an alternative reason why the no cause judgment should be sustained. It asserts that since the jury found that the damage to the car occurred at DAS's facility, and since its contract with plaintiff was a "destination contract," the risk of loss shifted to plaintiff upon the car's delivery in Linden.

N.J.S.A. 12A:2-509(1)(b) provides

(1) Where the contract requires or authorizes the seller to ship the goods by carrier . . . . (b) if it does require him to deliver them at a particular destination and the goods are there duly tendered while in the possession of the carrier, the risk of loss passes to the buyer when the goods are there duly so tendered as to enable the buyer to take delivery.

Billion originally contended that the contract it had with plaintiff was not a "destination contract," but rather a "shipment contract," and did not seek dismissal of plaintiff's complaint on these grounds at trial. However, at the post-verdict motions to fix the form of the judgment, it posited this argument. The judge, however, having concluded Billion should be relieved of liability because it cured any defects, did not consider it.

Billion cites Lumber Sales, Inc. v. Brown, 469 S.W.2d 888 (Tenn. 1971) in support of its argument that once the BMW reached DAS's Linden facility, all risk of loss or damage passed to plaintiff. However, that court interpreted the language of § 509(1)(b) as requiring that before the risk of loss shifts to the buyer, "the seller [] place the goods at the buyer's disposal so that he has access to them and may remove them from the carrier's conveyance without lawful obstruction, with the proviso, however that due notice of such delivery be given to the buyer." Id. at 892 (emphasis added).

Billion never sought dismissal of plaintiff's complaint at trial on this ground, never requested that the jury consider the issue and respond to specific interrogatories, and only raised the issue in its post-verdict cross-motion. On the record that exists, we must conclude that there was sufficient evidence that plaintiff acted promptly as soon as he was notified that the car was ready to be picked up at DAS's lot, i.e., when the goods were tendered for delivery, and at that point they were already damaged.

Furthermore, it is difficult to reconcile any application of N.J.S.A. 12A:2-509(1)(b) to the facts of this case. Billion reclaimed possession of the car from DAS, authorized its transfer to GSAB, and agreed to repair the vehicle before seeking plaintiff's acceptance. While David Billion claimed this was a "business accommodation" to a customer, we fail to see how once those events occurred, the legal provisions of § 509(1)(b) should be retroactively resuscitated to limit plaintiff's rights to reject non-conforming goods.

In short, we are constrained to reverse the entry of the judgment of no cause against Billion, and, because the critical factual issues are unresolved, remand the matter for a new trial.


We consider the final aspect of plaintiff's cross-appeal in which he contends that the judge erred in denying his request for counsel fees through application of the doctrine of judicial estoppel.

Plaintiff argued at the post-verdict motion that he was entitled to counsel fees based on the language of the bill of lading, which provides that "[i]f a contractual dispute arises between the parties, the losing party shall be responsible for the prevailing party's legal fees including attorney fees and court costs." The judge determined that because plaintiff had argued in earlier opposition to DAS's summary judgment motion that he was not a party to the bill of lading and that its provisions did not apply to him, he advanced "irreconcilably inconsistent" positions in the same litigation and was judicially estopped.

For the doctrine to apply, not only must a party take two inconsistent positions; he must also have successfully asserted and prevailed on the earlier position. Our Supreme Court has said, "[T]o be estopped [a party must] have convinced the court to accept its position in the earlier litigation. A party is not bound to a position it unsuccessfully maintained." Ali v. Rutgers, 166 N.J. 280, 288 (2000)(quoting In re Cassidy, 892 F.2d 637, 641 (7th Cir.), cert. denied, 498 U.S. 812, 111 S.Ct. 48, 112 L.Ed. 2d 24 (1990)).

Here, plaintiff previously sought to defeat DAS's motion for summary judgment limiting its liability for damages to $250 by arguing he was not a party to the bill of lading between Billion and DAS. That argument was rejected and, as a result, plaintiff was indeed held to the bill of lading's terms. He only escaped its limitation on damages by proving to the jury's satisfaction that DAS's employees were grossly negligent. Because he never prevailed on his earlier assertion, the doctrine of judicial estoppel does not apply.

No other argument has been raised by DAS in opposition to plaintiff's request for counsel fees. Therefore, we must reverse the order under review, and remand the matter to the trial court for further proceedings and the entry of an appropriate award in plaintiff's favor.


In summary, we reverse the order for judgment in favor of plaintiff in the amount of $93,000 against DAS and remand to the trial judge for the entry of an order entering judgment in plaintiff's favor against DAS in the amount of $7476.17. We reverse that portion of the order that entered a judgment of no cause of action against Billion, and remand the matter for a new trial on all issues.*fn11 We reverse the second order under review that denied plaintiff's counsel fees and costs request, and remand for further proceedings in that regard. We do not retain jurisdiction.

Reversed and remanded.

Buy This Entire Record For $7.95

Official citation and/or docket number and footnotes (if any) for this case available with purchase.

Learn more about what you receive with purchase of this case.