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Pomerantz Paper Corp. v. New Community Corp.

July 1, 2010

POMERANTZ PAPER CORP., PLAINTIFF-APPELLANT,
v.
NEW COMMUNITY CORPORATION, NEW COMMUNITY HOMES ASSOCIATION, LTD., NEW COMMUNITY SENIOR CITIZEN HOUSING CORP., NEW COMMUNITY HOUSING DEVELOPMENT, INC., NEW COMMUNITY ROSEVILLE CORP., NEW COMMUNITY MANOR HOUSING CORP., NEW COMMUNITY COMMONS HOUSING CORP., NEW COMMUNITY HARMONY HOUSE CORP., AND NEW COMMUNITY WORKFORCE DEVELOPMENT CENTER, DEFENDANTS-RESPONDENTS.



On appeal from the Superior Court of New Jersey, Law Division, Hudson County, L-3221-07.

The opinion of the court was delivered by: R. B. Coleman, J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued May 4, 2009

Before Judges R. B. Coleman, Sabatino and Simonelli.

Following a lengthy non-jury trial in the Law Division, the court issued a written opinion dated November 2, 2007, in which it found that plaintiff Pomerantz Paper Corp., a supplier of paper goods and janitorial and maintenance supplies, had failed to prove delivery of most of the invoiced goods that are the subject of its claim of breach of contract against defendant New Community Corp. As a consequence, the court awarded damages in an amount ($10,500) substantially less than plaintiff had sought (approximately $700,000). The court also ruled in favor of defendant New Community, a nonprofit corporation that manages residential properties for low-income tenants throughout the state, on its counterclaim brought under the Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 to -20. On the counterclaim, the trial court awarded damages trebled to $214,711.20, plus attorneys' fees.

Thereafter, defendant applied to fix the amount of the counsel fees and both parties moved for reconsideration of the dispositions of their respective claims. As a result of the motions for reconsideration, the court issued another written opinion, dated February 6, 2008, in which it (a) awarded defendant $86,015.21 in counsel fees; (b) reiterated the conclusion that plaintiff had "failed to meet [its] burden of proof for a substantial portion of [its] claim of damages in this case"; and (c) recalculated the ascertainable loss under defendant's CFA counterclaim to be $72,180.60, which was trebled to $216,541.80.

Plaintiff has appealed and argues principally that the court understated the amount of contractual damages owed by defendant and erroneously determined that plaintiff violated the CFA by overcharging defendant for the items it did deliver. Plaintiff also argues that the trial court improperly exercised its discretion by failing to bar testimony from defendant's expert witness due to the untimeliness of his report or by denying plaintiff the opportunity to present its own expert in rebuttal. Substantially, plaintiff charges that the trial court erred in allowing defendant's expert to offer unsupported net opinions related to the pricing of goods plaintiff sold to defendant.

Having duly considered these arguments, we reverse that portion of the court's amended order awarding only $10,500 on plaintiff's contract claim. We affirm that portion of the amended order that awarded $302,557.01 on defendant's counterclaim under the CFA, and we affirm the trial court's exercise of discretion on the evidentiary issues raised.

I.

As stated above, plaintiff is a supplier of paper goods, janitorial products and maintenance supplies to corporations. Defendant is a federally-funded, non-profit corporation which manages residential properties for low-income tenants. In 1991, the parties began their relationship, which operated according to a routine described by the trial court as follows:

Over the past fifteen (15) years, the parties had a business relationship during which [defendant] New Community purchased items from [plaintiff] Pomerantz based upon the representation of the Vice President of Pomerantz that New Community would be supplied goods at a reasonable price consistent with industry standards. Pursuant to this business relationship, New Community would send a purchase order to Pomerantz, and in return, Pomerantz would create a delivery slip for the goods requested in the purchase order and send that delivery slip with the shipment to New Community through Pomerantz's delivery truck driver. Upon delivery of the goods, Pomerantz's driver would obtain the signature of an employee of New Community on the delivery slip, and after Pomerantz's driver had left, New Community would unpack the shipment. Often times, Pomerantz would deliver its shipments on pallets and shrink-wrapped in plastic to New Community's Environmental Services Department parking lot. Pomerantz's driver would return a copy of the signed delivery slip to Pomerantz, and Pomerantz would then generate an invoice, dated with the same date shown on the delivery slip, for the goods that had been delivered to New Community. Pomerantz would then send the invoice to New Community, and once New Community's Environmental Services Department had confirmed delivery of the goods, the invoice would be sent to New Community's Billing department for payment.

It was the custom and practice of New Community that purchase orders would be sent to Pomerantz without New Community knowing the prices to be charged by Pomerantz for goods listed in the purchase order, and as a result, New Community would not become aware of the actual prices charged until it received a corresponding invoice from Pomerantz. New Community contends that, on or about the year 2000, New Community first began to question the prices being charged by Pomerantz.

It was the custom and practice of Pomerantz that when the items were shipped, the employees of Pomerantz would place a check mark on the delivery slip next to each of the items as the goods were placed onto Pomerantz's delivery truck. Similarly, on the same delivery slip delivered to New Community by Pomerantz's driver, New Community would either place a check mark next to each of the items as the goods were unpacked by New Community or place a line through the check mark that Pomerantz had previously placed on the delivery slip.

The trial court determined that, as a result of this routine or custom and practice of the parties, slips for delivered goods should have at least two marks or a checkmark to confirm that the goods were loaded onto plaintiff's truck and subsequently delivered to defendant. Hence, the court accepted defendant's contention that delivery slips for the invoices in dispute which did not have a checkmark by Pomerantz showing that the goods were in fact loaded onto its truck for delivery to New Community established that the goods had not been delivered. The court reasoned:

Because the placing of a check mark onto the delivery slip by Pomerantz was the custom and practice of Pomerantz and because Pomerantz provided no other credible proof that the goods in question were delivered to New Community, this court finds that Pomerantz can only be deemed to have made a proper delivery, and New Community responsible to pay, where the delivery ...


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