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Carrano v. Pompilio


August 27, 2009


On appeal from the Superior Court of New Jersey, Law Division, Union County, Docket No. L-4142-06.

Per curiam.


Submitted August 12, 2009

Before Judges Rodríguez and LeWinn.

Plaintiff Salvatore Carrano appeals from the September 23, 2008 order of the Law Division entering judgment in favor of defendants Louis Pompilio and Century 21 Louis Pompilio, Inc., following a jury trial. For the reasons that follow, we affirm.

The pertinent factual background may be summarized as follows. In early 2004, plaintiff became employed as a real estate agent in the office of Century 21 Louis Pompilio, Inc., of which defendant Louis Pompilio (Pompilio) is the president and licensed broker.

On January 23, 2006, plaintiff entered into a listing agreement with Joseph and Josephine Caruso to sell a residential property they owned in Plainfield; the term of the agreement was for six months, expiring on July 23, 2006. At Mr. Caruso's insistence, the listing price was set at $459,900, despite plaintiff's recommendation that the listing price be set at $399,000. Caruso was a personal friend of Pompilio, and had known him for many years.

The house remained on the market for several months. Mr. Caruso was displeased that he did not receive his asking price for the property, and rejected a verbal offer of $380,000 as "insult[ing]."

On or about March 20, 2006, Pompilio asked Carrano to withdraw the January 23 listing agreement and to re-enter it into the Multiple Listing Service database in order to re-set its "days on the market" in an effort to stimulate interest in the property. Carrano thereupon created a "new" listing and drew up an amended listing agreement, dated March 23, 2006, which reduced the listing price to $424,900 and extended the term of the agreement to October 23, 2006.

Carrano offered to take the new listing agreement to the Carusos' residence for their signatures, but Pompilio said that he was going there and would take the agreement with him. Pompilio subsequently signed both Carusos' signatures to the agreement. Mr. Caruso testified that he gave Pompilio permission to sign the second listing agreement; however, his testimony was inconsistent on this point.

Plaintiff testified that "[t]ension was extremely high with [Mr. Caruso]." There was an "urgency" to sell the property because the Carusos had signed a contract to purchase another residence and were anxious to close on that.

In early August, when the Caruso property still had not been sold, plaintiff had a telephone conversation with Pompilio, which he described as follows:

[Pompilio] said, "Sal, we have a problem." And I said, "What, Lou?" He said, "[Mr. Caruso] says the listing is over or was over July 23rd."

And I said, "No, Lou, that can't be. I own him until October."

I had a listing agreement that expired in October. And I said to Lou on the phone, "Joe must be talking about the first listing agreement, not the second one. Do you remember when you told me to withdraw it and I had to re-list it and I created a new listing agreement?"

[Pompilio] said, "Yeah, but Sal, I signed that. Joe didn't know anything about that." And I said, "[W]ell, did you tell him?" "Oh, no, no, no, no, no. He was just over my house this past weekend and he threatened to sue. So I didn't want to get in trouble."

So I said, "Well, you've got to handle this, Lou." And he said okay, he'll call me back.

Plaintiff played a recorded conversation between Pompilio and Mr. Caruso, in which Caruso stated that he knew nothing about the second listing agreement, and Pompilio appeared to feign ignorance of that agreement instead of acknowledging that he had signed the Carusos' names to it.

Plaintiff testified that he was "devastated" when he heard that conversation because he did nothing wrong . . . . [Pompilio] knew what was being done, what he did, and he did nothing to step up to the plate and take ownership and responsibility for what he created and what potentially at the time he could have fixed.

Plaintiff called Pompilio and told him "there's no integrity in this office starting from the top down." A few days later, plaintiff learned that the Caruso listing had been assigned to another agent in the office, Tatyana Averbukh.

Plaintiff called Pompilio "and again repeated about integrity and said [he] hear[d] the listing was given to another sales agent." According to plaintiff, Pompilio denied it at first, but when plaintiff pressed him, Pompilio said, "Well, what would you have me do? The nut keeps on calling me, the nut keeps on coming in. I had no other choice." Plaintiff told Pompilio he had "many choices," such as "not to take the listing, not to change the realtors, or best of all, to tell the truth that [Pompilio] signed the agreement."

Plaintiff thereupon "went to [his] computer and typed a letter" that he sent to Pompilio by certified mail on August 14, 2006. That letter, dated August 13, 2006, reads as follows:

Due to the circumstances surrounding the early termination of my listing [of the Carusos' property], . . . as well as the expiration date of the listing agreement, it was brought to my attention that another sales agent . . . in your office currently has the listing. Since my copy of the listing agreement indicates [an] October[] 2006 expiration date[,] a conflict has occurred. Also, the above mentioned property was removed from the Garden State Multiple Listing without my knowledge or authority.

Since this is an ongoing issue at this point I am keeping it within our office. However, if all parties cannot agree to the terms I have set forth in this document within 14 days[,] a copy of this letter and a formal complaint will be made to the Real Estate Commission requesting any and all commissions related to Mr. Caruso's property be withheld until this matter is resolved.

- If another Real Estate Agency / Agent sells Mr. Caruso's property, I will accept no less than [a] 25% [c]ommission split.

- If Tatyana Averbukh sells Mr. Caruso's property herself, I will accept no less than [a] 35% [c]ommission split[.]

- If the property is sold for less than the highest amount offered during the time I was the listing agent, i.e., offers ranged from $350,000 to $385,000[,] I will accept no less than [a] 50% [c]ommission split.

The letter contained signature lines for plaintiff, Pompilio and Averbukh.

Plaintiff denied that his "main concern" in writing this letter "was the fact that someone else had taken over the listing for the sale of [the Caruso] property." Rather, plaintiff asserted that he did not "trust [Pompilio] in many things because it was extraordinarily disappointing, having this conversation with him on the phone to begin with."

On August 18, 2006, Pompilio left messages on plaintiff's cell and work phones, stating that plaintiff's employment was terminated, adding that "[he] really didn't appreciate being threatened like that." Pompilio also stated: "Go to [the]

[R]eal [E]state [C]ommission, absolutely no problem with that. I'm looking forward to it. . . . I agree to the twenty-five percent, which you were going to get anyway, but you didn't need a letter."

On November 17, 2006, plaintiff filed a complaint against Pompilio under the Conscientious Employee Protection Act, N.J.S.A. 34:19-1 to -14 (CEPA); plaintiff included claims for contract damages, tortious interference with prospective economic advantage and slander. On January 15, 2008, Pompilio filed a counterclaim against plaintiff for frivolous litigation and malicious prosecution. On January 18, 2008, plaintiff filed an amended complaint, adding a claim of unjust enrichment.

A five-day jury trial was held between September 17 and 23, 2008. On September 19, 2008, after plaintiff rested his case, the trial judge granted Pompilio's motion to dismiss the tortious interference with prospective economic advantage claim, and reserved on the defense motion for directed verdicts on the CEPA and unjust enrichment claims. Plaintiff voluntarily dismissed his slander claim.

At the conclusion of the evidence, the trial judge entered a directed verdict for Pompilio on the CEPA claim, allowed the unjust enrichment claim to go to the jury, and dismissed defendant's counterclaim. The judge gave a written statement of reasons in support of her decision. The following day, the jury returned a verdict for Pompilio on plaintiff's unjust enrichment claim.

On appeal, plaintiff challenges only the directed verdict on his CEPA claim, raising the following contentions for our consideration:


The Trial Court Committed Harmful Error In Issuing A Directed Verdict On Plaintiff's CEPA Claim And Not Allowing The Claim To Be Decided By The Jury

A. The Trial Court Erred in finding No ["]Substantial Nexus" Between The Complained-Of-Conduct And Laws or Regulations Identified By Plaintiff At Trial

B. The Trial Court Erred In Finding That Defendant Pompilio Had No Notice Of The Complained-Of-Conduct

Having reviewed these arguments in light of the record and the controlling legal principles, we are convinced that they are without merit. We affirm substantially for the reasons set forth in Judge Marianne Espinosa's written decision provided to counsel on September 22, 2008. R. 2:11-3(e)(1)(A). We add only the following comments.

Plaintiff's claim that he is a "whistleblower" within the purview of CEPA is fatally undermined by the fact that he conditioned his "threat" to report Pompilio to the Real Estate Commission upon the failure of "all parties . . . [to] agree to the terms [he] . . . set forth in th[e] document within 14 days . . . ." Those "terms" consisted of three alternative demands for a commission upon the sale of the Caruso property. The clear import of plaintiff's August 13, 2006 letter was that, if one of those alternative demands was agreed upon, he would not file a complaint with the Real Estate Commission.

Plaintiff contends that the phrase "[d]ue to the circumstances surrounding the early termination of my listing" in his letter "demonstrate[d] that his concerns were much greater than whether he would receive a commission." However, the tenor of plaintiff's letter indicates that his primary concern was, in fact, the loss of his commission. Plaintiff's language clearly evinces his desire to achieve a financial settlement of the matter, rather than his intent to report allegedly fraudulent conduct for the sake of "[d]isclos[ing] or threaten[ing] to disclose . . . to a public body an activity . . . of the employer . . . that the employee reasonably believes . . . is in violation of a law, or a rule or regulation promulgated pursuant to law . . . ." N.J.S.A. 34:19-3(a)(1).

Whether or not Mr. Caruso authorized Pompilio to sign the second listing agreement is essentially irrelevant. Plaintiff claimed to "reasonably believe" that Pompilio forged the Carusos' signatures on that document. His "threat" to report that conduct to the Real Estate Commission, however, was not clearly premised upon his sense of duty to report illegal conduct, notwithstanding his protestations to the contrary. If plaintiff was so concerned about Pompilio's allegedly fraudulent conduct, he should have reported that conduct to the Real Estate Commission irrespective of whether or not he eventually earned a commission on the Caruso property.

Likewise, the issue of whether Pompilio had "notice" of the "complained-of[]conduct" is also immaterial. Even assuming, as plaintiff argues, that no such notice is required because "the activity, policy, or practice [wa]s known to . . . the employer[,]" N.J.S.A. 34:19-4, the fact remains that plaintiff's conditional "threat" defeats his entitlement to claim whistleblower status.

In fact, plaintiff's letter does not expressly reference Pompilio's allegedly fraudulent act of forging the Carusos' signatures. Rather, the letter refers only to the fact that "another sales agent . . . ha[d] the listing." This claim, in and of itself, does not constitute the type of conduct protected by CEPA. N.J.S.A. 34:19-3(a).

As the trial judge noted, plaintiff's "only reference to a violation of law came during cross-examination, when he stated that he believed that the creation of the listing agreement with Tatyana Averbukh after the 'forged' agreement was a violation of law." We are satisfied that the judge properly rejected plaintiff's claim that he believed Pompilio violated N.J.S.A. 45:15-17, which authorizes the Real Estate Commission to investigate licensed brokers for certain enumerated improprieties, and N.J.A.C. 11:5-6.2, which governs a broker's obligation to communicate with clients about the contents of their listing agreements. This ruling is based upon findings which are adequately supported by the record. R. 2:11-3(e)(1)(A).

We concur with the trial judge's conclusion that plaintiff never adequately described the conduct that allegedly violated the law to [Pompilio]. As a result, [Pompilio] never had an opportunity to correct the allegedly unlawful conduct described at trial. The conduct complained of and the complaints themselves are more closely related to the plaintiff's own pecuniary interest in securing a commission he believed was due to him than the protection of the real estate client's interests that underlies the statutes and regulations cited at trial. There is no "substantial nexus" between the statutory provisions and regulations cited at trial and the conduct complained of. Accordingly, the plaintiff did not possess an objectively reasonable belief that the defendants' actions violated the statute and regulation cited as a matter of law.

We are satisfied that plaintiff's arguments do not warrant further discussion in this opinion. R. 2:11-3(e)(1)(E).



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