On appeal from Superior Court of New Jersey, Law Division, Mercer County, Docket No. L-1290-04.
The opinion of the court was delivered by: Payne, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted February 24, 2010
Before Judges Cuff, Payne and Waugh.
Suit was instituted by plaintiffs William W. Allen and Vivian Allen alleging, in the first count, breach of contract by defendant V and A Brothers, Inc., d/b/a/ Caliper Farms Nursery and Landscaping Services, as the result of its improper construction of a retaining wall and substitution of inferior backfill for that specified in the plans, resulting in the failure of the wall and substantial property damage. In the second count, plaintiff alleged violations of the Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 to -184, by V and A Brothers, its principals, Angelo DiMeglio and the Estate of Vincent Di Meglio,*fn1 and its employee, Thomas Taylor.
Thereafter, partial summary judgment was entered in plaintiffs' favor finding defendant V and A Brothers liable for failing to execute a written contract for the work in violation of N.J.A.C. 13:45A-16.2(a)(12), a regulation promulgated pursuant to the CFA. In an additional order of partial summary judgment, the claims against the individual defendants were dismissed. A jury trial then took place, resulting in a finding of liability on the part of V and A Brothers for breach of contract, and an award of damages on that claim in the amount of $100,000. Additionally, the jury awarded damages of $25,000 for the failure by V and A Brothers to execute a written contract in violation of N.J.A.C. 13:45A-16.2(a)(12). It awarded damages of $25,000 for the failure by V and A Brothers to obtain final approval of the project before accepting final payment from plaintiffs in violation of N.J.A.C. 13:45A-16.2(a)(10)(ii), and it awarded damages of $80,000 for the modification by V and A Brothers of the design of the retaining wall and substitution of inferior backfill material for that specified without the knowledge or consent of the plaintiffs in violation of N.J.A.C. 13:45A-16.2(a)(3)(iv). When the damages awarded pursuant to the CFA were trebled, the total amount of the award equaled $490,000. Attorneys' fees were also awarded.
Although plaintiffs prevailed on their claims against V and A Brothers, they have appealed from the dismissal of their CFA claims against the individual defendants, Angelo DiMeglio, the estate of Vincent DiMeglio and Thomas Taylor. We reverse and remand.
The Consumer Fraud Act provides, in N.J.S.A. 56:8-2, that:
The act, use or employment by any person of any unconscionable commercial practice, deception, fraud, false pretense, false promise, misrepresentation, or the knowing, concealment, suppression, or omission of any material fact with intent that others rely upon such concealment, suppression or omission, in connection with the sale or advertisement of any merchandise or real estate, or with the subsequent performance of such person as aforesaid, whether or not any person has in fact been misled, deceived or damaged thereby, is declared to be an unlawful practice;... "Person" is defined in the preceding section to include any natural person or his legal representative, partnership, corporation, company, trust, business entity or association, and any agent, employee, salesman, partner, officer, director, member, stockholder, associate, trustee or cestuis que trustent thereof. [N.J.S.A. 56:8-1d.]
The Supreme Court set forth the history of the CFA in its decision in Cox v. Sears Roebuck & Co., 138 N.J. 2 (1994), stating:
In 1960, the Legislature passed the Consumer Fraud Act "to permit the Attorney General to combat the increasingly widespread practice of defrauding the consumer." Senate Committee, Statement to the Senate Bill No. 199 (1960). The Act conferred on the Attorney General the power to investigate consumer-fraud complaints and promulgate rules and regulations that have the force of law. N.J.S.A. 56:8-4. In 1971, the Legislature amended the Act to "give New Jersey one of the strongest consumer protection laws in the nation." Governor's Press Release for Assembly Bill No. 2402, at 1 (Apr. 19, 1971). The Legislature expanded the definition of "unlawful practice" to include "unconscionable commercial practices" and broadened the Attorney General's enforcement powers. Ibid. That amendment also provided for private causes of action, with an award of treble damages, attorneys' fees and costs. Ibid. Governor Cahill believed that those provisions would provide "easier access to the courts for the consumer, [would] increase the attractiveness of consumer actions to attorneys and [would] also help reduce the burdens on the Division of Consumer Affairs." Governor's Press Release for Assembly Bill No. 2402, at 2 (June 29, 1971). [Id. at 14-15.]
The Court has directed that the CFA, as remedial legislation, be construed liberally in favor of consumers. Id. at 15 (citing Barry v. Arrow Pontiac, Inc., 100 N.J. 57, 69 (1985); Levin v. Lewis, 179 N.J. Super. 193, 200 (App. Div. 1981); State v. Hudson Furniture Co., 165 N.J. Super. 516, 520 (App. Div. 1979); and Martin v. American Appliance, 174 N.J. Super. 382, 384 (Law Div. 1980)). "[T]he Act is designed to protect the public even when a merchant acts in good faith." Cox, supra, 138 N.J. at 16 (citing D'Ercole Sales, Inc. v. Fruehauf Corp., 206 N.J. Super. 11, 23 (App. Div. 1985)).
The Court in Cox explained that to violate the CFA, a "person" must commit an "unlawful practice" as defined in the legislation, and that an unlawful practice can consist of an affirmative act, a ...