On appeal from the Superior Court of New Jersey, Law Division, Bergen County, Docket No. L-5761-06.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted November 12, 2008
Before Judges Winkelstein and Gilroy.
Plaintiff R.C. Search Co., Inc., appeals from the September 12, 2007 order dismissing its complaint against defendant William J. Torre, Esq., and from the October 29, 2007 order denying its motion for reconsideration. We affirm.
I. Plaintiff is a licensed title insurance agency of New Jersey. The company is owned and operated by Richard Cecere, Sr. (Cecere, Sr.). From 1994 through March 2006, plaintiff employed Richard Cecere, Jr. (Cecere, Jr.), a licensed insurance producer. Defendant is an attorney who represents parties in real estate transactions, including the buying and selling of properties, and mortgage refinancing. From 1994 through March 2006, defendant placed orders with plaintiff through Cecere, Jr., for title searches and commitments for title insurance.
On August 3, 2006, plaintiff filed a complaint against defendant, demanding payment on an open book account for services rendered at defendant's request. On September 6, 2007, the matter was tried to the court without a jury. At the conclusion of the trial, the court rendered an oral decision dismissing plaintiff's complaint, determining that plaintiff "failed to prove by a preponderance of the evidence that any money is due and owing from the defendant." A confirming order was entered on September 12, 2007. On October 29, 2007, the court denied plaintiff's motion for reconsideration.
The only witnesses who testified were Sharlene Walker, plaintiff's Accounts Receivable Manager, and defendant. Walker testified that in November 2005, she made a demand on defendant for payment of the outstanding balance on defendant's running book account for title searches and commitments for title insurance. The accounts receivable totaled $31,268 and covered the period of May 1, 2001 to June 7, 2005. One of the invoices, No. 609763, dated April 12, 2004, in the amount of $4,674, was for a commitment for title insurance, together with its concomitant title search and examination, that defendant requested in relation to the purchase of his home.
According to Walker, plaintiff issued its invoices to defendant at the time it delivered its commitments for title insurance and title searches. Plaintiff would not issue a title insurance policy until the title insurance premium part of the invoice was paid. When title did not close, plaintiff did not seek payment of the title insurance premium; however, plaintiff did expect payment on its title search and examination fees (hereinafter collectively referred to as search fees), including any out-of-pocket expenses. Some of the invoices contained in the accounts receivable list attached to the complaint included premiums for title insurance and title search fees.*fn1 At or before trial, Walker learned that several of those transactions had not closed title. Based on that information, plaintiff, in accordance with its past business practices, reduced the amounts of those invoices by deleting only the amount of the title insurance premiums, not the amounts for the title searches and out-of-pocket expenses.
Walker also acknowledged that plaintiff received payments from defendant against some of the invoices contained in the accounts receivable list between the dates the complaint was filed and the start of trial. Plaintiff credited those payments against defendant's account; and based on those adjustments, plaintiff reduced its demand to $9,174.
As to the invoice pertaining to defendant's own residential closing, Walker conceded that she was unaware whether plaintiff issued a title insurance policy to either defendant or his mortgagee. However, she stated that prior to that closing, plaintiff did issue a closing protection letter in favor of defendant's mortgagee, naming defendant as the closing attorney. Lastly, Walker conceded that she was unaware of any agreement between Cecere, Jr., and defendant wherein plaintiff had agreed to forego its search fees and out-of-pocket expenses when title failed to close.
Defendant testified that from 1994 through March 2006, he developed a close business relationship with Cecere, Jr. During that time, defendant and Cecere, Jr., acknowledged between themselves that they were subject to losses when defendant's clients failed to close title on transactions after plaintiff performed title searches and issued commitments for title insurance. Accordingly, the two agreed that, if defendant ordered either a title search without a commitment for title insurance or a commitment for title insurance that included a title search, and the transaction did not close, defendant would forego a legal fee for his services, and plaintiff would forego its fee for the title searches and out-of-pocket expenses. Pursuant to this agreement, from 1994 through November 2005, plaintiff never charged defendant for its search fees or expenses when defendant's clients failed to close title; nor did defendant charge his clients for his services or for the services performed by plaintiff.
As to his personal real estate transaction, defendant acknowledged that he did not pay a title search fee or a title insurance premium. However, he stated that he did not do so on the advice of Cecere, Jr., who advised him that the invoice was marked "POC" (paid outside of closing), on the title closing statement, "because of the courtesies and relationship with the company for over a ten year period." As to the closing, defendant stated that he did not close the title himself, but rather, title was closed by his brother, also an attorney. Lastly, defendant is unaware of plaintiff issuing a title insurance policy after closing of title to either him or his mortgagee.
At the conclusion of the trial, the court dismissed the complaint, determining that plaintiff failed to prove any monies were owed on defendant's account. In rendering its decision, the trial court reduced plaintiff's claims to three categories. First, the court addressed plaintiff's claim for the balance allegedly owed on a title insurance premium in the amount of $1,040.33 on Invoice No. 610947.*fn2 The court accepted defendant's testimony that his client purchased the property without financing and did not want to insure the property for the full purchase price amount. Accordingly, defendant's client only paid defendant $1,649.67 for a reduced amount of title insurance, and defendant forwarded that sum to plaintiff with a request for a lesser amount of title insurance ...