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Mario Ducci and Roberto Ducci v. Blue Sky Consultants

June 9, 2011


On appeal from the Superior Court of New Jersey, Law Division, Essex County, Docket No. L-0434-07.

Per curiam.


Submitted March 7, 2011

Before Judges Lisa and Sabatino.

In this commercial lease case, defendant Nicholas J. Sambuco, Sr. ("Sambuco"), pro se, appeals the trial court's July 20, 2007 order denying his motion to vacate default judgment entered against him in the sum of $491,556.92, plus interest and costs. For the reasons that follow, we affirm the trial court's order. We do so without prejudice to Sambuco potentially seeking relief in the trial court under Rule 4:50-1(d) or (f), based upon plaintiffs' alleged waiver of damages above the $15,000 jurisdictional limit of the Special Civil Part.

The exceedingly contentious relationship between Sambuco and the commercial landlords, plaintiffs Mario Ducci and Roberto Ducci, has spawned at least six summary dispossession actions, at least two collection actions (including this case), as well as related bankruptcy proceedings. We need not detail the full history of those proceedings except insofar as it bears upon Sambuco's contention that his neglect in not filing a timely answer in the present litigation should have been excused by the trial court. We very briefly summarize the pertinent background as follows.

Plaintiffs are the owners of a commercial building in Nutley. Sambuco, along with the individual co-defendant, Laurie Katai, was a principal in defendant Blue Sky Consultants, Inc. ("Blue Sky"), a company doing business as Lateral Wine Bar & Grill. For several years, defendants operated a restaurant in plaintiffs' building, pursuant to written leases.

The tenancy became contentious for a variety of reasons that we need not canvass here. It will suffice to say that defendants repeatedly failed to pay their rent on time. Their non-payment led plaintiffs, or their related business entities, to file a series of summary dispossession actions against the tenants between 2003 and 2006, although none of those cases resulted in the tenants vacating the premises.*fn1

In July 2006, on the brink of a summary dispossession trial, the parties entered into a settlement agreement. Through that agreement, Sambuco and the other defendants agreed to pay plaintiffs certain outstanding rent arrears and also to enter into a new lease commencing August 2006.

After defendants failed to make timely rent payments under the August 2006 lease, plaintiffs filed a fifth summary dispossession action in October 2006. Plaintiffs simultaneously filed a collection action in the Special Civil Part for the overdue rent.

When the fifth summary dispossession action came to trial on November 14, 2006, the parties reached another settlement agreement. Under the terms of the settlement, the parties entered into a lease modification agreement, and both the summary dispossession action and the collection action in the Special Civil Part were dismissed.

The lease modification agreement specified that the rent would be due on the fourth day of each month, without exception. Moreover, if the rent was not received by the seventh day of the month, all future rent would be accelerated and due immediately. If the rent were not paid in full, the tenants would be evicted and they would be liable for the accelerated future rent, plus other specified charges and costs. In particular, paragraph twenty-one of the lease modification agreement stated, in relevant part:

The Tenant shall remain liable for such rents as may be in arrears or future rent that may become accelerated and due immediately as provided in Paragraph 1st, above, and also the rents as may accrue subsequent to the re-entry by the Landlord, to the extent of the difference between the rents reserved hereunder and the rents, if any received by the Landlord during the remainder of the unexpired term hereof, after deducting the aforementioned expenses, fees and costs; the same to be paid as such deficiencies arise and are ascertained each month.

Defendants breached the November 2006 lease modification by not paying the rent that was due on December 4, 2006. This failure prompted plaintiffs to file a sixth summary dispossession action in the Special Civil Part on January 18, 2007. On that same date, plaintiffs also filed a second collection action against defendants, this time in the Law Division.*fn2 That second collection action, which is the sole case underlying the present ...

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