On appeal from the Superior Court of New Jersey, Law Division, Bergen County, L-12432-04.
The opinion of the court was delivered by: Reisner, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Lisa, Reisner and Alvarez.
Plaintiffs Joseph and Jannine Marrone appeal from two orders dated July 30, 2007, granting summary judgment dismissing their second amended complaint against Sto Corporation, and Sto of New Jersey, Inc. We affirm. Plaintiffs' claims under the Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 to -184, were properly dismissed for lack of proof that any losses they suffered were the result of defendants' alleged unconscionable conduct in manufacturing or marketing an exterior home siding product. We also conclude that plaintiffs' claims based on the Products Liability Act (PLA), N.J.S.A. 2A:58C-1 to -11, were properly dismissed under the economic loss doctrine because the only claimed damage was to the house, of which the siding was a component.
The crux of this case involves alleged defects in an exterior siding product that was applied to a house when it was constructed in 1995. Sto Corporation (Sto) and Sto of New Jersey, Inc. (Sto of NJ), were the manufacturer and distributor, respectively, of this product, which was known as Exterior Insulation Finish System (EIFS cladding). Plaintiffs were not the original owners of the house. They bought the house, located in Mahwah, New Jersey, in 2003 from the original owners, the DeCilveos, who in turn had contracted for its construction with Greer & Polman Construction (G & P). G & P subcontracted with Lester Stucco to apply the EIFS cladding; Lester obtained the material from the distributor, STO of NJ.*fn1
There is no dispute that the DeCilveos had no knowledge about the EIFS cladding and did not receive or rely on any representations about it. In fact, they thought the material was stucco. The DeCilveos lived in the house for eight years without discovering any problem with the exterior cladding.
Plaintiffs had no contact with either Sto or Sto of NJ and did not receive or rely on any information or representations from anyone concerning the EIFS cladding. Nor did they have a written warranty for the exterior cladding. Like the DeCilveos, they believed the exterior was stucco, which is "cement on wood." Before they bought the house, plaintiffs had it inspected by a professional home inspection company.
After they bought the home, plaintiffs allegedly received a letter from their homeowners' insurance company in November 2003, threatening to cancel their coverage because of the EIFS cladding on the house. Plaintiffs also discovered that the EIFS cladding was defective. According to their second amended complaint (complaint), the EIFS cladding was not water-tight, as it was supposed to be, thus resulting in "an unacceptably high moisture content in the underlying substructure of [plaintiffs'] home, causing damage thereto." In their complaint, as it related to the Sto defendants, plaintiffs asserted claims for negligent manufacture and distribution of the EIFS; breach of express and implied warranties; negligent misrepresentations and omissions; intentional misrepresentations or omissions in violation of the CFA; and strict liability under the PLA.
A September 2005 expert report provided to plaintiffs by R.V. Buric indicated that the construction contractor had improperly installed the EIFS cladding. However, Buric also opined that the EIFS system was poorly designed because it depended on the applied cladding being perfectly water-tight and had no back-up system to carry moisture away from the exterior walls if water penetrated behind the cladding. Buric found damage to the EIFS cladding itself, as well as water damage to sheathing and wood framing and to some windows.*fn2
The motion judge granted summary judgment dismissing the complaint. In two written opinions issued July 30, 2007, he agreed with defendants' contentions, which plaintiff did not oppose, that Sto did not issue a written warranty and plaintiffs' implied warranty claim was barred by a four-year statute of limitations. Addressing the intentional misrepresentation claim, the judge found no evidence that plaintiffs "ever received and/or saw and/or reviewed and/or relied upon and/or considered, to their detriment, any representations of any kind" concerning the EIFS product.
Moreover, plaintiffs had no "special or fiduciary relationship" with Sto which would provide a basis to infer that Sto had a "duty to make disclosures" to plaintiffs. Hence, the judge dismissed plaintiffs' claims based on "alleged omissions." Based on the same factual findings, the judge also dismissed the CFA claims.
Finally, the judge dismissed plaintiffs' negligence and strict liability claims based on the economic loss doctrine:
Both of these tort claims are barred by the economic loss doctrine . . . because plaintiffs allege that the EIFS, an integrated component of their home, caused damage solely to their home itself. Where a component of an integrated product causes injury solely to the integrated product, the damage to the integrated product is not considered separate property damage that would remove the claim from the realm of contract law into the field of tort law. Such is the case here, according to the plaintiffs, who admit that they are not seeking damages for personal injury or loss of personal property other than the damage to the home itself. In addition, there is no duty emanating from the defendant [Sto] Corp., to plaintiffs Marrone for the negligence count to remain.
The court denied plaintiffs' motion for reconsideration by order dated October 5, 2007.
Our review of the trial court's summary judgment decision is plenary:
In deciding a motion for summary judgment, the trial court must determine whether the evidence, when viewed in a light most favorable to the non-moving party, would permit a rational fact-finder to resolve the dispute in the non-moving party's favor. Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995). The trial court cannot decide issues of fact but must decide whether there are any such issues of fact. Ibid.; R. 4:46-2(c). Our review of a trial court's summary judgment decision is de novo, applying the Brill standard. Prudential Property Ins. v. Boylan, 307 N.J. Super. 162, 167 (App. Div.), certif. denied, 154 N.J. 608 (1998). [Agurto v. Guhr, 381 N.J. Super. 519, 525 (App. Div. 2005).]
Based on our review of the record,*fn3 we conclude that this case was ripe for summary judgment and that the undisputed facts entitled the Sto ...