January 29, 2010
ALOIA CONSTRUCTION COMPANY, INC., PLAINTIFF,
BFW/HOWELL ASSOCIATES, LLC, BENDERSON DEVELOPMENT COMPANY, INC., BUFFALO-PARKTON ASSOCIATES, LLC, FEUERSTEIN ASSOCIATES, LLC, WAINCO PROPERTIES, LLC, DEFENDANTS-RESPONDENTS, AND TECHNOSTEEL MANUFACTURING, LLC, DEFENDANT-APPELLANT, AND VALAIRCO, INC., HERTZ EQUIPMENT RENTAL CORPORATION-NO. 9173, COMPONENT ASSEMBLY SYSTEMS, INC., DEFENDANTS.
On appeal from the Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-2518-04.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted September 16, 2009
Before Judges Axelrad, Fisher and Sapp-Peterson.
Defendant, TechnoSteel Manufacturing, LLC, appeals from the trial court order granting the cross-motion for summary judgment filed by co-defendants, BFW/Howell Associates, LLC, Benderson Development Company, Inc., Buffalo-Parkton Associates, LLC, Feuerstein Associates, LLC, and Wainco Properties, LLC (collectively referred to as "Benderson"), dismissing defendant's lien and contract claims asserted against Benderson, pursuant to the New Jersey Construction Lien Law, N.J.S.A. 2A:44A-1 to -38 (Act).
Viewing the facts most favorably to defendant as the party defending against Benderson's summary judgment motion, Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 523 (1995), defendant produces structural steel utilized at construction sites. In that regard, it agreed to provide structural steel and drawings to M.J. Fisher Steel Co., LLC (M.J. Fisher) at a cost of $176,000 in connection with a shopping center project known as Howell Commons (the property). Before entering the contract, defendant undertook a credit check of M.J. Fisher and determined that it was not creditworthy. It nonetheless agreed to M.J. Fisher's $176,000 proposal after receiving a copy of a letter that Benderson, the property's labor, equipment and materials contractor, sent to M.J. Fisher dated June 26, 2003 stating:
"Pursuant to the agreement between Benderson Development Company and M.J. Fisher Steel Co., LLC, Benderson Development Company will pay according to Purchase Order #66202 the total sum of Five Hundred and Eighty Thousand Dollars ($580,000.00) to M.J.
Fisher Steel Co., LLC for structural and miscellaneous steel. M.J. Fisher Steel Co., LLC will provide assurances that TechnoSteel has been paid in full for their portion of the work ($176,000.00) prior to the release of their final contract payment."
Defendant's vice president and board member, Scott Cramer (Cramer), stated in his certification, submitted in opposition to Benderson's motion and in support of defendant's cross-motion, that he understood Benderson's letter to M.J. Fisher to mean that "Benderson would withhold a final contract payment of $176,000 from M.J. Fisher until Benderson received proof from M.J. Fisher that [defendant] had been paid in full." He also indicated that this approach was common practice within the construction industry, namely, "for an owner to ensure that a contractor pays a subcontractor or supplier" and that the practice was "similar to giving the supplier a lien on the funds due the contractor." Cramer asserted that defendant supplied the fabricated steel and drawings "[i]n reliance on this payment guarantee." Subsequently, at M.J. Fisher's request, defendant supplied additional structural steel and drawings, with the total amount M.J. Fisher ultimately owed defendant being $208,514.
Defendant delivered the steel to the property in numerous shipments beginning August 5, 2003, with the last delivery occurring on September 29, 2003. Defendant billed M.J. Fisher in several invoices totaling $208,514 between September 30 and October 31, 2003. On November 13, 2003, M.J. Fisher paid defendant $100,000. On December 3, 2003, defendant issued M.J Fisher a credit of $5,487.50 for "minor corrections" M.J. Fisher made at the job site. The balance owed was then $103,026.50.
On December 24, 2003, defendant's New Jersey counsel, Scott
M. Yaffe (Yaffe), filed a construction lien against the property for $103,026.50, naming defendant as the claimant and signing the claim on behalf of defendant, without indicating in what capacity he was signing the claim. In the attached corporate acknowledgment, however, the notary certified that Yaffe had satisfied the notary that he was authorized to sign the instrument as a "duly authorized officer" of the corporation. The lien claim was served upon M.J. Fisher on January 21, 2004, and upon the project's owners on January 31, 2004.
Benderson's project manager, Timothy Liddle (Liddle), when deposed, testified that the steel erection phase of the project ended sometime in 2003 and at that time he received verbal assurances from M.J. Fisher that defendant had been paid. The total value of M.J. Fisher's contract with Benderson was $723,775, of which all but $67,775 had been paid to it by the time defendant had filed its lien claim. Liddle indicated that after receiving the lien claim, he discussed it with Michael Fisher, M.J. Fisher's representative, who indicated that he was working on it. In his certification, Liddle, however, characterized the June 26, 2003 letter as "merely confirm[ing] that M.J. Fisher was obliged to provide assurances that M.J. Fisher had paid Techno[S]teel" and that he "did not intend to make a contract or agreement or guarantee." Nor did he intend to "make any promise that Benderson would do (or not do) anything."
On May 28, 2004, plaintiff, Aloia Construction Company (Aloia), filed its complaint against numerous parties, including defendant and Benderson, alleging, among other things, breach of contract and enforcement of a construction lien in connection with its construction of an outbuilding at the property. On July 28, 2004, defendant filed an answer, counterclaim and a cross-claim asserting lien rights in the property. Benderson filed its answer on November 1, 2004.
On December 8, 2005, Benderson moved for partial summary judgment. The motion included its application to dismiss pursuant to N.J.S.A. 2A:44A-16 and defendant's one-count answer, counterclaim and cross-claim filed on or about July 29, 2004. Benderson argued that defendant's cross-claim failed to name all parties having an interest in the real property that would be adversely affected by the judgment and that defendant's claim was also deficient because it failed to name the contractor who allegedly defaulted. Defendant cross-moved for an order consolidating the matter with other pending cases in which other plaintiffs were seeking to foreclose on the property, and to join those other parties. The court denied Benderson's motion but granted defendant's cross-motion.
Two years later, Benderson filed its second summary judgment motion against defendant. Benderson also sought an order compelling certain discovery. In addition to alleging repeated non-compliance with discovery demands, Benderson argued that there was no evidence that defendant's New Jersey counsel, Yaffe, was a duly appointed corporate officer of defendant authorized to sign the construction lien that had been filed against it and that its efforts to confirm this fact through discovery had been continuously rebuffed. Defendant cross-moved for summary judgment on its first and second cross-claims, seeking a declaration that it held a valid lien claim against Benderson in the amount of $103,026.50 and the entry of judgment against Benderson in that amount.
After conducting oral argument on the motions, the court found that defendant's lien was infirm, directed that the lien be stricken, and granted Benderson summary judgment on defendant's breach of contract claim. It denied defendant's cross-motion.
Prior to entry of the order, Benderson moved for counsel fees, which defendant opposed. The court heard argument and reserved decision. On March 3, 2008, the court rendered its determination, awarding Benderson legal fees and directing counsel to submit a certification of services. On August 5, 2008, following additional proceedings and submissions regarding the amount of any award, the court rendered its decision, subsequently memorialized in an order dated August 19, 2008. The court: 1) granted Benderson summary judgment on both counts of defendant's cross-claim; 2) discharged defendant's construction lien; and 3) awarded Benderson counsel fees. The present appeal followed.
On appeal, defendant raises the following points for our consideration:
THE COURT BELOW ERRED IN DISCHARGING TECHNOSTEEL'S LIEN CLAIM AS IMPROPERLY SIGNED WHEN THE OWNERS PROVIDED NO EVIDENCE THAT THE LIEN WAS IMPROPERLY SIGNED.
THE COURT BELOW ERRED IN DISCHARGING TECHNOSTEEL'S LIEN CLAIM AS IMPROPERLY SIGNED WHEN THERE WAS A GENUINE ISSUE AS TO WHETHER IT WAS IMPROPERLY SIGNED.
THE COURT BELOW ERRED IN DISCHARGING TECHNOSTEEL'S LIEN CLAIM AS IMPROPERLY SIGNED WHEN THAT DEFENSE WAS WAIVED BY A FAILURE TO PLEAD.
THE COURT BELOW ERRED IN DISCHARGING TECHNOSTEEL'S LIEN CLAIM AS IMPROPERLY SIGNED WITHOUT APPLYING THE GALIK [V. CLARA MAASS MED. CTR., 167 N.J. 341 (2001)] CONSIDERATIONS.
THE COURT BELOW ERRED IN DENYING SUMMARY JUDGMENT TO TECHNOSTEEL ON ITS FIRST CROSS-CLAIM.
THE COURT BELOW ERRED IN DISMISSING TECHNOSTEEL'S CONTRACT CLAIM ON THE GROUND THAT THERE WAS NOT AN ENFORCEABLE AGREEMENT.
A. THERE WAS A MEETING OF THE MINDS.
B. THE AGREEMENT WAS NOT MEANINGLESS.
C. THERE WAS CONSIDERATION OR IT WAS NOT NEEDED.
THE COURT BELOW ERRED IN NOT GRANTING SUMMARY JUDGMENT TO TECHNOSTEEL ON ITS CONTRACT CLAIM OR THE CLAIM SHOULD HAVE BEEN TRIED.
A. THERE WAS NO ASSURANCE.
B. A FALSE ASSURANCE CANNOT RELIEVE BENDERSON.
THE COURT BELOW ERRED IN GRANTING LEGAL FEES UNDER THE [THE ACT] WITHOUT ADDRESSING THE SUBSTANTIAL COMPLIANCE DOCTRINE.
THE COURT BELOW ERRED IN GRANTING LEGAL FEES UNDER THE CLL WHEN THE FEES HAD NOT BEEN INCURRED.
THE COURT BELOW ERRED IN THE AMOUNT OF FEES IT AWARDED.
A. THERE WAS NO ISOLATION OF THE LIEN CLAIM FROM THE CONTRACT CLAIM
B. THERE WAS NO ISOLATION OF THE LIEN CLAIM FROM THE OTHER PARTIES' LIEN CLAIMS.
C. EXTRANEOUS CHARGES WERE INCLUDED.
LEGAL FEES SHOULD BE AWARDED TO TECHNOSTEEL UNDER THE CONSTRUCTION LIEN LAW.
We have considered each of the points raised in light of the record, arguments of counsel, and applicable legal principles. We reject each of defendant's points and affirm substantially for the reasons cogently expressed by Judge Jamie Perri in her March 3 and August 5, 2008 oral opinions.
In reviewing a motion for summary judgment, the trial court must "consider whether the competent evidential materials presented, when viewed in the light most favorable to the non-moving party in consideration of the applicable evidentiary standard, are sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party." Brill, supra, 142 N.J. at 523. Therefore, in the present matter, the court must assume that defendant's version of the facts is true and give defendant the benefit of all favorable inferences. Id. at 536. In our review of a trial court order granting summary judgment, we do so de novo, using the same standard as the trial court under Rule 4:46-2(c). Turner v. Wong, 363 N.J. Super. 186, 198-99 (App. Div. 2003). Thus, we must determine whether a genuine issue of material fact is present and, if not, evaluate whether the trial court's ruling on the law was correct. Prudential Prop. & Cas. Ins. Co. v. Boylan, 307 N.J. Super. 162, 167 (App. Div.), certif. denied, 154 N.J. 608 (1998).
Under the Act, any construction lien claim shall be signed, acknowledged and verified by oath of the claimant or, in the case of a partnership or corporation, a partner or duly authorized officer thereof, and filed with the county clerk not later than 90 days following the date the last work, services, material or equipment was provided for which payment is claimed. No lien shall attach, or be enforceable under the provisions of this act and, in the case of a residential construction contract, compliance with sections 20 and 21 of this act, unless the lien claim is filed in the form, manner and within the time provided by this section and [N.J.S.A. 2A:44A-8], and a copy thereof served on the owner and, if any, the contractor and the subcontractor, against whom the claim is asserted, pursuant to [N.J.S.A. 2A:44A-7]. [N.J.S.A. 2A:44A-6 (footnotes omitted).]
N.J.S.A. 2A:44A-7 addresses the mailing and proof of service of the construction lien claim. N.J.S.A. 2A:44A-8 prescribes the format to be followed in setting forth the lien claim and the information to be provided. In that regard, the format expressly requires the signatory to indicate his or her "[t]itle." Ibid.
So-called mechanics and materialman's liens are statutory in nature. Baldyga Constr. Co. v. Hurff, 174 N.J. Super. 616, 618 (App. Div. 1980) (citation omitted). Because they are in derogation of the common law, provisions creating liens are strictly construed, though the remedies they afford are applied liberally to effect a remedial statutory policy. Ibid.
In finding the lien claim deficient, the trial court noted:
Applying the Brill standard, which the
[c]court is required to do in this circumstance, and to consider the proofs in the light most favorable to the non-moving party, Techno[S]teel has failed to produce any competent evidence that its bylaws permitted one officer to unilaterally appoint another individual as an officer of the corporation for the purposes of executing a lien. Techno[S]teel has refused to produce its corporate documents in discovery and has failed to provide a copy of the bylaws as part of the motion record.
[C]ramer's claim regarding the content of the bylaws is hearsay and is nonspecific regarding the actual terms of the bylaws.
[C]ramer's reference to an e-mail which was allegedly sent by another officer is similarly hearsay and is not competent. Nowhere does Yaffe state under oath that he was authorized by Lutchin or by any other individual to assume the position of a corporate officer. In his certification he simply makes an oblique reference to
[C]ramer's certification and by implication the hearsay contained in the [C]ramer certification.
Techno[S]teel cannot on the one hand refuse to respond to Benderson's discovery requests and at the same time take the position that Benderson has failed to offer proof that Yaffe was not a corporate officer.
The [c]court therefore finds that applying the Brill standard and based upon the record before the [c]court, whether a reasonable fact finder could resolve the alleged disputed issue in favor of Techno[S]teel, the [c]court finds that no reasonable fact finder could make such a decision because of the dearth of competent evidence and the actions of Techno[S]teel.
We are satisfied that there is ample support in the record for these findings. As Judge Perri observed, in the fall of 2006, Benderson's attorney advised defendant's attorney that Benderson believed the lien was invalid because it had been signed by defendant's attorney as opposed to a corporate officer. Rather than respond to this contention, defendant moved to amend its cross-claim to assert a breach of contract claim against Benderson claiming that it was a third-party beneficiary of Benderson's contract with M.J. Fisher. Benderson thereafter propounded interrogatories and document requests that included a discovery demand as to Yaffe's status as a corporate officer. Defendant did not provide responsive answers. Instead, in response to the specific question whether "Scott Yaffe was ever one of [defendant's] directors, officers or managers[,]" defendant stated that the information requested was "confidential, not relevant to any claim or defense in this action or any potential defense in this action." Additionally, the discovery master appointed in the matter requested that defendant respond to this discovery request but defendant failed to do so. Moreover, when the parties convened for depositions, Yaffe was asked on the record whether defendant would respond to the discovery request and responded, "I'm not going to be on the record about a discussion about this," and then walked out of the room.
The law in New Jersey is clear. It is insufficient for an attorney to sign a lien claim on behalf of a client when acting simply as the client's attorney. Gallo v. Sphere Constr. Corp., 293 N.J. Super. 558, 566 (Ch. Div. 1996). In the case of a corporation such as defendant, N.J.S.A. 2A:44A-6 requires that in order for a lien claim to attach, it must be "signed, acknowledged and verified" by a duly authorized officer. Interpreting this statutory requirement, the Court, in D.D.B. Interior Contracting, Inc. v. Trends Urban Renewal Ass'n, Ltd., 176 N.J. 164, 170 (2003), noted that "harm to a corporation or its shareholders or prejudice to interested parties may result when an individual who signs a lien claim form on behalf of a corporation is not an officer of that corporation." Therefore, the Court said that in appointing an attorney to sign and verify a lien claim, the corporation "must comply with its certificate of incorporation and bylaws to ensure that the attorney executing those duties is a corporate officer." Ibid.
Here, defendant failed to provide a copy of its bylaws demonstrating that Yaffe was a duly appointed corporate officer authorized to sign corporate documents. It also failed to provide any competent proof, as Cramer claimed in his certification submitted in opposition to the summary judgment motion, that defendant's vice president could have appointed Yaffe as a corporate officer without board approval. Further, defendant failed to provide a copy of any resolution or confirmatory writing that the board was consulted and approved Yaffe's appointment. Consequently, at the time the summary judgment motion was filed, more than two years after litigation had commenced and more than a year after Benderson made its initial discovery demand related to this issue, the only evidence that Yaffe had been duly appointed to sign the lien claim consisted of Cramer's and Yaffe's self-serving, unsupported certifications in opposition to the motion.
"Mere sworn conclusions of ultimate facts, without [a] material basis or supporting affidavits by persons having actual knowledge of the facts, are insufficient to withstand a motion for summary judgment." James Talcott, Inc. v. Shulman, 82 N.J. Super. 438, 443 (App. Div. 1964). The party opposing summary judgment must do more than simply demonstrate some abstract doubt about material facts. O'Loughlin v. Nat'l Cmty. Bank, 338 N.J. Super. 592, 606-07 (App. Div.) (citations omitted), certif. denied, 169 N.J. 606 (2001). "[S]peculation," "fanciful arguments" and "disputes as to irrelevant facts" will not bar summary judgment." Merchs. Express Money Order Co. v. Sun Nat'l Bank, 374 N.J. Super. 556, 563 (App. Div.), certif. granted, 183 N.J. 592 (2005), appeal dismissed Jan. 3, 2006.
In opposing summary judgment, defendant did not claim the need for additional discovery and offered no reason why it could not produce the types of evidence the Court in D.D.B. Interior said were needed to satisfy the burden of proving that a corporate lien claim had been filed by an authorized officer. D.D.B. Interior, supra, 176 N.J. at 170. We note that during oral argument, Yaffe acknowledged to the court that he could have produced the names of the board members involved in his appointment as a corporate officer but did not do so because he did not think that it was "necessary." Given the demand for this information in Benderson's discovery request, the discovery master's further direction that the discovery request be honored, and the undisputed fact that defendant was in the best position to produce the information, we are in complete accord with Judge Perri's conclusion that it was "disingenuous" for defendant to argue that Benderson failed to prove that Yaffe was not a duly appointed corporate officer authorized to sign the lien claim. As such, the court properly concluded that the lien claim was invalid.
Nor do we agree that defendant substantially complied with the requirements of N.J.S.A. 2A:44A-6. We initially observe that this contention raised on appeal does not, based upon our review of the trial court record, appear to have been asserted in opposition to the summary judgment motion. Notwithstanding, we address the merits of this contention.
The substantial compliance doctrine is an equitable doctrine "based on justice and fairness, designed to avoid technical rejection of legitimate claims." Galik v. Clara Maass Med. Ctr., 167 N.J. 341, 352 (2001). It is aimed at avoiding "harsh consequences that flow from technically inadequate actions that nonetheless meet a statute's underlying purpose." Ibid. However, "not every non-complying act is salvageable under the substantial compliance doctrine." Id. at 353. Rather, its application requires: (1) absence of prejudice to the defending party; (2) "'a series of steps'" actually taken to comply with the statutory requirements; (3) "'general compliance with the purpose of the statute'"; (4) reasonable notice of the claim; and (5) a "'reasonable explanation'" why the statute was not complied with strictly. Ibid. (quoting Bernstein v. Bd. of Trs. of the Teachers' Pension & Annuity Fund, 151 N.J. Super. 71, 76-77 (App. Div. 1977)). Each case is therefore fact specific. Galik, supra, 167 N.J. at 354.
Here, on its face, defendant's lien appears to satisfy the technical requirements for filing a construction lien insofar as it was signed, acknowledged and verified by oath of a person identified on the document as a duly authorized corporate officer of defendant and was filed within the requisite time period. However, contrary to defendant's contention, D.D.B Interior does not support application of the substantial compliance doctrine to defendant. There, while upholding the lien, the Court based its decision in part on the "unique facts of [the] appeal." D.D.B. Interior, supra, 176 N.J. at 169. The attorney who signed the lien claim did so pursuant to a power of attorney. Id. at 169-70. The Court reasoned that the Legislature had not indicated in the Act whether a "duly authorized officer" could include an individual acting as an attorney in fact. Ibid. Thus, it concluded there was a reasonable basis for the claimant's belief that signing the claim pursuant to a power of attorney was sufficient. Ibid. While it did address other substantial compliance factors, namely, prejudice, notice, and reliance, it did so in light of the facts of that case. Id. at 168-69. More importantly, however, it made clear that "in the future when a corporation intends to appoint an attorney to sign, acknowledge and verify a lien claim, that corporation must comply with its certificate of incorporation and bylaws to ensure that the attorney executing those duties is a corporate officer." Id. at 170. The import of this statement was that going forward, a corporation could no longer satisfy the lien statute's signature requirements merely by substantially complying. Ibid. D.D.B. Interior was decided in May 2003, defendant began shipping steel in August 2003, and the lien claim was recorded in December 2003. Thus, defendant's claim was subject to the D.D.B. Interior standard.
Moreover, one of the requirements of substantial compliance is "'general compliance with the purpose of the statute.'" Galik, supra, 167 N.J. at 353 (citation omitted). The Court in D.D.B. Interior recognized that the purpose of the corporate signatory requirements under N.J.S.A. 2A:44A-6 is to protect the corporation, its shareholders and other interested parties who might otherwise be prejudiced if the person signing a corporate lien claim "is not an officer of that corporation." D.D.B. Interior, supra, 176 N.J. at 170. The absence of defendant's bylaws to clarify whether defendant's vice president, unilaterally without board approval, could appoint Yaffe as a corporate officer, and the lack of explicit documentation supporting defendant's contention that Yaffe was authorized to sign the lien claim as a corporate officer, together with defendant's refusal during discovery to provide any of the documentation sought to confirm defendant's contention, does not further this purpose and militates against application of the substantial compliance doctrine here.
We next turn to defendant's claim that the court erred in dismissing its breach of contract cross-claim on the basis that it was unenforceable. The court found there was no "meeting of the minds" between the parties and that to the extent some obligation was created by the June 26, 2003 letter, the obligation was "to merely provide assurances." We view the June 26, 2003 letter as creating an obligation between Benderson and M.J. Fisher, to which defendant was a third-party beneficiary. See Broadway Maint. Corp. v. Rutgers, The State Univ., 90 N.J. 253, 259 (1982) (footnote omitted) (noting "[t]he principle that determines the existence of a third[-]party beneficiary status focuses on whether the parties to the contract intended others to benefit from the existence of the contract, or whether the benefit so derived arises merely as an unintended incident of the agreement"); see also N.J.S.A. 2A:15-2. Nonetheless, we agree with the trial court that the obligation created under the letter did not create a guaranty relationship as between defendant and Benderson.
As the trial court noted, the obligation imposed by the letter was that M.J. Fisher would "provide assurances" that defendant had been paid in full. The letter did not say to whom such "assurances" were to be provided. However, given its context, the assurances were obviously intended to be given to Benderson, who in turn would then release the final contract payment. The June 26, 2003 letter did not specify the form that such assurances were to take. Nor did the letter require that Benderson notify or contact defendant, or that Benderson verify the "assurances" M.J. Fisher was to provide. It therefore cannot be said that M.J. Fisher and Benderson intended to confer any particular benefit to defendant beyond merely being shown the June letter, being apprised of its terms, and presuming that M.J. Fisher would "assure" Benderson that defendant had been paid before Benderson made final payment to M.J. Fisher. Thus, viewing the facts most favorably towards defendant, we are not persuaded that the June 26, 2003 letter raised a genuinely disputed issue that it intended to evidence a "contractual intent to recognize a right to performance" by defendant. Broadway Maint., supra, 90 N.J. at 259. Therefore, the trial court properly dismissed defendant's breach of contract claim against Benderson.
In view of our determination that defendant's lien claim was infirm and that the doctrine of substantial compliance is inapplicable under the facts presented, we need not address the claims raised in Points IV, VI, VII, and X of defendant's brief. We find the remaining arguments advanced in Points II, VIII, and IX without sufficient merit to warrant extensive discussion in a written opinion. R. 2:11-3(e)(1)(E). We do, however, briefly address defendant's arguments related to the award of counsel fees.
Defendant contends the court erred in awarding counsel fees to Benderson Development Company because it was not the "owner, contractor or subcontractor" on the project and was therefore ineligible to recover counsel fees under N.J.S.A. 2A:44A-15(a). The court rejected this argument and accepted Benderson's representation that defendant BFW/Howell was the property's tenant and that counsel fees were incurred by its authorized agent, defendant Benderson Development Company. We are in agreement with this analysis.
N.J.S.A. 2A:44A-15(a) permits owners, contractors, subcontractors or "any combination" to recover counsel fees in discharging a lien claim. Moreover, N.J.S.A. 2A:44A-2 defines "owner" as including a tenant "with an estate or interest in real property who personally or through an authorized agent enters into a contract for improvement of the real property." Additionally, the definition of an "interest in real property" includes "any . . . enforceable interest" not limited to leases, among other things. Ibid.
In support of its explanation about the Benderson defendants' relationship, counsel also provided the certification of David H. Baldauf, the vice president of Benderson's successor and a manager of defendants, Buffalo-Parkton and BFW/Howell. Baldauf confirmed counsel's representations about the lease to BFW/Howell, that Benderson Development Company was Benderson's authorized agent, and the fact that BFW/Howell paid the counsel fees at issue.
Also, defendant obviously knew that M.J. Fisher had contracted with Benderson. The June 26, 2003 letter upon which defendant relies as creating a guaranty of payment to it for the structural steel and drawings delivered to M.J. Fisher was written on Benderson letterhead and references the agreement for structural steel between M.J. Fisher and Benderson, not between M.J. Fisher and BFW/Howell. Further, in its counterclaim, defendant expressly adopted the portion of the complaint alleging that BFW/Howell and Benderson were the owners' authorized agents. In short, there is substantial credible evidence in the record to support Judge Perri's findings on this issue and we discern no basis to interfere with this determination.
Finally, defendant challenges the amount of counsel fees awarded. Specifically, defendant claims Benderson failed to adequately parse services it performed in connection with the lien claim from those performed in connection with the contract claim. During oral argument before the trial court, Benderson argued that once defendant amended the lien claim to include its contract claim, the claims were so similar that the events that occurred following the amendment "clearly relate" to both claims, entitling defendant to full compensation.
Benderson sought $82,720.18 in counsel fees in its initial submission, which included $5,591.93 in expenses. Thereafter, its attorney sought an additional $8,076.50 in fees and $26.23 in costs in a supplemental request. The court determined that Benderson's application was "supported by a comprehensive affidavit of services which the [c]court f[ound] more than adequately addresse[d] the [relevant RPC 1.5 factors]."
Nevertheless, it acknowledged that the matter was "complicated" because defendant's asserted lien "was not the only claim Benderson was called upon to defend in this matter." The court found that counsel had "gone to great lengths to meticulously divide the services" provided for plaintiff's claim alone (for which no fee was sought), defendant's claim (for which one hundred percent of the fees incurred was sought), and "work performed in connection with both the [plaintiff's] and [defendant's] claims, for which fifty percent reimbursement is sought." The court noted that defendant's objection was not to the actual amount of time spent, nor to the hourly rate charged. The court also recalled defendant's apparent choice, during the course of the litigation, to "perpetuate the litigation both by frustrating Benderson's discovery requests and by opposing" summary judgment. The court denominated defendant's contract claim as "part and parcel of Techno[S]teel's claim against Benderson and may be reasonably viewed as a tactical measure intended to enhance Techno[S]teel's position on the lien or its ultimate negotiations." It found counsel's proposed allocation of fees undertaken for work that could not be neatly parsed "both fair and reasonable under the circumstances." These findings are supported by substantial credible evidence in the record and are entitled to our deference. Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474, 483-84 (1974).
We are satisfied that Judge Perri appropriately considered RPC 1.5 in awarding counsel fees to Benderson. On appeal, we will not disturb a trial court's counsel fee award absent a clear abuse of the trial court's discretion in rendering such an award. Packard-Bamberger & Co. v. Collier, 167 N.J. 427, 443-44 (2001). We perceive no such abuse here.
© 1992-2010 VersusLaw Inc.