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Gregory v. Pulasky

October 1, 2010

STEPHEN GREGORY, PLAINTIFF-APPELLANT,
v.
KENNETH PULASKY, DEFENDANT-RESPONDENT.



On appeal from the Superior Court of New Jersey, Law Division, Burlington County, Special Civil Part, Docket No. DC-7427-09.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued September 20, 2010

Before Judges Lisa and Sabatino.

Plaintiff, a residential landlord, sued defendant, his tenant, for rent due and other expenses resulting from defendant's premature vacation of the premises. Defendant did not respond to the action and default was entered. After a proof hearing, the court entered judgment in plaintiff's favor for $10,514.86, plus costs and interest. The court did not allow additional expenses claimed by plaintiff in the total amount of $3773. Plaintiff appeals, arguing that the court erred in disallowing the additional expenses. We agree with plaintiff as to one item, advertising costs of $1383, but not the others. We therefore modify the judgment, increasing the amount by $1383, and affirm in all other respects.

The parties entered into the lease agreement for a single family home in Pitman on June 23, 2005. It was for a five-year term from July 2, 2005 to June 30, 2010. The initial monthly rent was $1450. The lease provided that defendant would be responsible for increases in real estate taxes and insurance as additional rent. As a result, the monthly rent was increased on July 1, 2006 to $1475, and on September 1, 2007 to $1510. At the end of April 2008, defendant vacated the premises, providing plaintiff only one day of notice.

The lease contained the following provision for mitigation of damages in the event of default by the tenant:

In the event of default by the resident, which would require the owner to relet the premises for the remainder of the term of the lease, the resident shall be responsible for and pay for all costs incurred by the owner during the process of re-renting including, but not limited to: costs of advertisement, an agent's rental commission not to exceed one months rent in the event that the owner should elect (at it's option) to employ an agent to show the apartment to prospective residents, or a milage [sic] expense reimbursement (not to exceed 32 cents per mile) in the event that the owner should elect to show the apartment to prospective residents, all of which shall be as rent due and owing under the lease agreement.

At the commencement of the lease, plaintiff had collected a security deposit of $2175. At the time of the proof hearing, plaintiff continued to hold the deposit, which, with accrued interest, equaled $2,182.24. Defendant left the property in an undamaged state except for normal wear and tear. On May 9, 2008, plaintiff wrote to defendant advising that he intended to retain the security deposit as an offset against rent to become due. Defendant had paid the rent through April 2008.

Immediately after defendant moved out, plaintiff took two steps to try to find a new tenant. He began placing advertisements in the local newspapers and he engaged the services of a realtor, who listed the property on the multiple listing service (MLS). The commission would be equal to one month's rent. The property was advertised for a monthly rental of $1510. Plaintiff's arrangement with the realtor was that plaintiff would pay for the newspaper advertisements, which would list the realtor's telephone number for responses. In this way, the realtor would engage in all contacts with prospective tenants and would show the property. Plaintiff deemed this arrangement fair and necessary because in this adverse economic climate he anticipated that finding a qualified tenant would be difficult and time-consuming. Thus, the costs of advertising would not justify the commission and the realtor was not willing to pay for advertising. Plaintiff took an aggressive twofold approach through newspaper advertising and the MLS to maximize his effort to quickly find a tenant and mitigate defendant's damages. Moreover, plaintiff considered this twofold approach authorized by the mitigation of damages provision in the lease that we have quoted.

Although the property was shown to a number of prospects, a new tenant did not move in until December 2008. As an added incentive, plaintiff allowed the new tenant to live in the property rent-free in December, and the new tenant agreed to monthly rent of $1550 rather than the $1510 listing price. The new tenant began paying rent January 1, 2009.

The judge allowed plaintiff only seven months rent, from May through November 2008. He rejected plaintiff's claim for the rent-free month of December 2008, finding that plaintiff entered into that arrangement with the new tenant "for whatever reason to entice or induce the new tenant but I don't find that would be properly the responsibility of the defendant." Therefore, the judge awarded plaintiff $10,570 for seven months rent at $1510 per month.

The judge also allowed reimbursement for the following expenses, which he found reasonable: water and sewer charges of $149.31; electric charges of $215.79; lawn care expenses of $195; and the realtor's commission of $1510. From the total allowances of $12,640.10, the judge deducted the security deposit plus interest of $2182.24, resulting in a judgment of $10,457.86.

Besides the disallowance of $1510 for the rent-free month, the judge also disallowed plaintiff's claims for his newspaper advertising expenses of $1383, painting expense of $800, and $80 for a skip trace to locate defendant in order to serve him with process in this action. The judge found that defendant should bear no responsibility for painting because plaintiff acknowledged that the premises were left in a good state of repair, normal wear and tear excepted. Although the judge did not expressly comment on the $80 claim, we infer that he found no basis on which to impose that litigation-related expense to defendant. The judge found the advertising expenses unreasonable because he felt the ...


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