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McLaughlin v. Batra Creative Homes

February 5, 2010

JOHN MCLAUGHLIN AND EMMY HSU MCLAUGHLIN, PLAINTIFFS-APPELLANTS,
v.
BATRA CREATIVE HOMES, INC., A NEW JERSEY CORPORATION, DEFENDANT-RESPONDENT.



On appeal from the Superior Court of New Jersey, Law Division, Essex County, Docket No. L-3756-05.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued October 19, 2009

Before Judges Lisa and Alvarez.

Plaintiffs John McLaughlin (McLaughlin) and Emmy Hsu McLaughlin, appeal from the May 9, 2008 judgment rendered in favor of defendant Batra Creative Homes, Inc., in the amount of $188,457 following a six-day bench trial completed in the months of November and December 2007. Plaintiffs also appeal the trial judge's decision to deny their motion for a new trial. When he denied the motion, the judge reduced the total award to $179,957. We conclude that the matter must be tried anew because the court failed to engage in necessary factfinding, and reached its legal conclusions in a factual void.

A lengthy discussion of the testimony developed during the trial is necessary. This despite our conclusion that the interests of justice would not be served were we to exercise our authority to make findings of fact "pursuant to the constitutional grant of necessary original jurisdiction and Rule 2:10-5." Pressler, Current N.J. Court Rules, comment 1 on R. 1:7-4 (2010). Ordinarily, we would consider the exercise of such jurisdiction because of the lengthy and burdensome litigation in which the parties have already engaged. The matter was tried over six days but not decided until months later. Justice would be better served, however, if the matter was tried anew, as we explain below, because for us to make findings of fact would require credibility determinations which should be made by the trier of fact. See State in re J.D.H., 336 N.J. Super. 614, 628 (App. Div. 2001); rev'd on other grounds, 171 N.J. 475 (2002).

The parties signed a lump sum contract for the construction of a new home for $650,000 on April 5, 2003. On that date, plaintiffs paid $65,000, the first installment. Plaintiffs initially purchased house plans through the internet; they were advised by Aswar Batra (Batra), defendant's principal, that substantial modifications would have to be made to the plans due to the unique topographical conditions of the wooded, nearly one-acre sloping lot they eventually chose. For $20,000, Batra contacted an architect, obtained revised plans, and together with plaintiffs shepherded the review of the plans by Roseland Borough (Borough) through to the issuance of a building permit. The $20,000 was paid prior to the signing of the contract and was not included in the contract price.*fn1 The construction plans were approved and a building permit issued by the Borough on August 18, 2003. Batra did not pick up the permit until three weeks later on September 8, 2003.

It is undisputed that the contract was prepared by Batra. It did not include the cost for site preparation and contained only the following language as to the home's completion date:

9) Construction and Completion:

This contract is contingent on Contractor obtaining a building permit for the dwelling. Contractor will apply for any and all required permits, inspections, and certifications to enable it to build and convey the dwelling. It takes approximately eight to ten months from the start of the foundation to completion of a custom home of this complexity, subject to weather conditions.

In early October 2003, nearly a month after Batra picked up the building permit, a subcontractor began to clear trees from plaintiffs' lot. The parties had several conversations about the importance of preparing the lot quickly so that the foundation could be installed before winter, but it was not until late November that Batra hired a second subcontractor to grade the site.

The grading and excavation of the foundation area required the removal of many truckloads of topsoil, although the number is in dispute. After December 2003, work on grading the lot stopped until April 28, 2004. Batra proffered no explanation to plaintiffs for the delay, however, he testified that in April he then encountered problems with soil conditions at the site that required him to retain an engineer. He did so two months later in June 2004. Batra did not explain the reason for the delay in obtaining necessary engineering services either.

In June 2004, the foundation framing was finally installed and Batra deemed it ready to contain the poured concrete foundation. The site did not pass the first municipal inspection. After a second inspection on August 3, 2004, the Borough approved the framing for the installation of poured concrete foundation walls. On August 28, 2004, plaintiffs paid defendant an additional $65,000 as called for by the agreement because the foundation was complete.

The choice of foundation material itself generated much conflicting testimony at trial. Plaintiffs claimed that in November 2003, after workers began to clear the lot, Batra proposed switching the foundation material from cinder block to poured concrete so that installation could be finished before winter. McLaughlin testified that Batra said the "upgrade" would cost an additional $10,000, but that since Batra felt responsible for the delay, he would split the cost with plaintiffs. McLaughlin said Batra told him that his share of the additional costs would ...


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