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Chaudhry Corporation v. City of Newark

December 28, 2011

CHAUDHRY CORPORATION, PLAINTIFF-APPELLANT,
v.
CITY OF NEWARK, DEFENDANT-RESPONDENT.



On appeal from the Superior Court of New Jersey, Chancery Division, Docket No. C-32-09.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Telephonically Argued September 29, 2011- Before Judges Sabatino and Fasciale.

Plaintiff, Chaudhry Corporation, appeals from an August 10, 2010 order issued by the Chancery Division after a one-day bench trial. The order dismissed plaintiff's action for specific performance against defendant, the City of Newark ("the City"). The lawsuit sought to compel the City to convey to plaintiff real estate that it had contracted to purchase twelve years earlier. After hearing the proofs and finding that the testimony of plaintiff's owner lacked credibility in various respects, the Chancery judge ruled that the doctrine of laches barred plaintiff's demand for the equitable relief of specific performance. We affirm.

The proofs at trial revealed the following relevant circumstances and series of events. In essence, as the Chancery judge found, the chronology reflects a situation in which plaintiff did not act with sufficient alacrity to enforce its contractual rights and have the court compel a closing to transfer title to the subject real estate.

The parcel in question ("the property") is located at 184-190 Sixteenth Avenue (Tax Lot 30, Block 309.01) in Newark. The City obtained title to the property through in rem tax foreclosure proceedings in 1993 and 1995.

Plaintiff is a New Jersey corporation that operates a taxi business in Newark. Abaid Chaudhry ("Chaudhry") is the company's president and sole officer.

On February 26, 1998, plaintiff contracted to buy the property from the City at a public auction. Plaintiff intended to use the property in connection with its business.

On March 19, 1998, the City sent a letter to plaintiff, stating that the sale had been approved by the Municipal Council. The letter also stated:

IT IS SUGGESTED THAT YOU OBTAIN A TITLE SEARCH PRIOR TO CLOSING TITLE ON THE PROPERTY (read Condition of Sale #14*fn1 in the auction brochure).

[Y]our closing must be scheduled by appointment, to take place on or before May 18, 1998. If you do not arrange to close by the deadline, you will automatically forfeit your deposit and/or any additional monies paid toward the balance due on the property. [Bold and capitals in original.]

Consequently, on May 27, 1998,*fn2 plaintiff retained Royal Title Services, Inc. ("Royal Title") to perform a title search on the property.

On August 4, 1998, Royal Title ordered a judgment search for "Getty Oil Company" and "Getty Oil Company (Eastern Operations)." The latter entity was the immediate predecessor-in-title to the property, having been previously deeded the property by Getty Oil Company. The Getty companies are distinct legal entities. However, at the time of its judgment search, Royal Title was apparently not aware of or attentive to that distinction. The judgment search revealed judgments against Getty Oil Company, but none against Getty Oil Company (Eastern Operations). Consequently, Royal Title mistakenly determined, at least initially, that title to the property was unmarketable.

Chaudhry testified that he contacted the City when he discovered that there were potential defects in the title. Specifically, Chaudhry testified that he spoke with Delores J. Garrett, who was then employed in the City's Division of Property Management.*fn3 Chaudhry claimed that he thereafter contacted Garrett by phone "every week or fifteen days" to check on the status of the property. He asserted ...


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