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Kern v. Huettl

August 13, 2009

THOMAS L. KERN AND DEBRA L. KERN, INDIVIDUALLY AND AS GUARDIANS AD LITEM OF THEIR WARD ROBERT ANTHONY FOX, AN INCOMPETENT, PLAINTIFFS-APPELLANTS,
v.
HOWARD HUETTL, TRADING AS HILEEN MODULAR HOMES, GUY E. KERN, TRADING AS WATERFORD REALTY, MUNCY HOMES, A CORPORATION OF THE COMMONWEALTH OF PENNSYLVANIA AND RALPH M. CONSTRUCTION, INC., DEFENDANTS, AND BILL "MICK" MICHEL, TRADING AS HILEEN MODULAR HOMES, J. PATRICK DELANEY, JR., INDIVIDUALLY AND AS BRANCH MANAGER/UNDERWRITER OF COUNTRYWIDE HOME LOANS, INC., BERNADETTE DONNELLEY, INDIVIDUALLY AND AS HOME LOAN CONSULTANT OF COUNTRYWIDE HOME LOANS, INC. AND COUNTRYWIDE HOME LOANS, INC., A FOREIGN CORPORATION, DEFENDANTS-RESPONDENTS.



On appeal from the Superior Court of New Jersey, Law Division, Atlantic County, Docket No. L-1545-04.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Submitted March 11, 2009

Before Judges Stern, Rodríguez and Payne.

Appellants Thomas L. Kern and Debra L. Kern, individually and as guardians ad litem for Robert A. Fox (collectively "the Kerns"), appeal from: (a) the March 2, 2007 order, denying their motion for reconsideration of the order granting J. Patrick Delaney, Jr., Bernadette Donnelley, and Countrywide Home Loans, Inc. (collectively "Countrywide defendants") summary judgment; and (b) the October 5, 2007 judgment, following a bench trial, in favor of defendant Bill "Mick" Michel, t/a Hileen Modular Homes. We affirm.

These are the salient facts. Early in 2002, the Kerns decided to move from Pennsylvania to New Jersey in order for their son Robert A. Fox to have access to a better special education program. The Kerns determined that the Atlantic County Special Services School District would be the best choice. On a trip to the Atlantic County area, they saw a sign for one of the construction projects on which Howard Huettl was currently working. Huettl was trading under the name Hileen Modular Homes. The Kerns spoke to Huettl, who agreed to develop a proposal on a home. Bill "Mick" Michel, was the construction manager for Hileen Modular Homes. Subsequently, Huettl provided the Kerns with a formal proposal to construct a modular home. There were time constraints because the Kerns desired to have their son settled and ready to begin school in early September 2002.

With the assistance of a realtor, the Kerns found a suitable lot for the modular home. Huettl suggested Countrywide as a mortgage lender. The Kerns spoke with defendant Bernadette Donnelley of Countrywide about a construction mortgage. Within a month, the Kerns signed a home construction agreement with Huettl and applied for a construction mortgage loan from Countrywide. Countrywide approved the mortgage loan.

The modular home was delivered on September 27, 2002. The delivery consisted of two module sections. The trucks delivering the modules could not reach the lot because the driveway had not been properly cleared. Thus, the modules were left on trailers in the middle of the road. The subcontractors who cleared the lot brought a bulldozer in to pull the modules back to the building lot. Because the dirt was very loose, the modules got stuck as soon as the bulldozer began to pull. A bigger bulldozer was brought in to move the modules. During this process, the modules came into contact with trees along the driveway. The top halves of the units were protected by a white plastic, like a shrink wrap.

The home was not set up until October 15, 2002. During the time the modules were sitting on the lot, prior to set up, water entered one of the modules through two holes in the protective shrink wrap. The Kerns purchased a tarp to prevent further water damage. The roof was installed on the night of October 15, 2002, in the dark, with only the use of flashlights. According to Thomas Kern, the home had extensive water damage and mold issues. Repairs were subsequently made by the builder, Muncy Homes.

The agreement with Huettl provided that construction would be complete and a Certificate of Occupancy would be obtained within three months from the date of installation of the home on the foundation. The Certificate of Occupancy was issued on December 4, 2002. While waiting for the modular home to be set and finished, the Kerns had to live in a camper in Mays Landing.

The Kerns hired William Dieal, Jr., a professional engineer, planner and a licensed home inspector, to inspect the home. In November 2002, Dieal performed the first of several inspections of the home and prepared a report of the necessary repairs. Dieal opined that the condition of the framing of the home was not structurally stable. He then advised that immediate action be taken to support the structure by installing a temporary beam full length in the crawl space to remain until the satisfactory resolution of litigation or permanent correction of conditions by the builder. This temporary remedy was never made.

The Kerns sued in the General Equity Part, seeking injunctive relief and specific performance from Michel and Huettl. The judge ordered the matter transferred to the Law Division. The Kerns filed an amended complaint, joining the realtor, Guy E. Kern; the Countrywide defendants; Muncy Homes; and Ralph M. Construction, Inc.

The Kerns moved for summary judgment against the Countrywide defendants pursuant to the New Jersey Consumer Fraud Act, N.J.S.A. 56:8-1 to -20 ("CFA"), alleging that Countrywide misrepresented to them that it would inspect the modular home to ensure that it was being built in a workman-like manner. The Kerns based their CFA claim on Countrywide's recommendation to use Huettl as a builder and for making loan disbursements to Huettl over the Kerns' objections. The Countrywide defendants' cross-moved for summary judgment. The judge denied the Kerns' motion for summary judgment and granted the cross-motion.

The Kerns moved for reconsideration alleging that their agreement with the Countrywide defendants was a contract of adhesion. The judge denied the Kerns' motion for reconsideration, concluding that it was an improper attempt to raise the new issue of a contract of ...


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