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Louis Perri, M.D v. Prestigious Homes

January 13, 2012

LOUIS PERRI, M.D., PLAINTIFF-APPELLANT/ CROSS-RESPONDENT,
v.
PRESTIGIOUS HOMES, INC., GARY LANSMAN, INDIVIDUALLY,
NEIL LANSMAN, INDIVIDUALLY,
DELAWARE VALLEY REAL ESTATE HOLDINGS, LLC, MASSACHUSETTS STREET PROPERTIES, LLC,
CG LIMITED INVESTORS, LLC,
SCOTT HOMEL, INDIVIDUALLY,
PAUL ROSENBERG, INDIVIDUALLY,
JOEL GREEN, INDIVIDUALLY,
PRUDENTIAL FOX & ROACH REALTORS, KATHLEEN A. CRUSCO A/K/A KATHLEEN A. RUSSO, INDIVIDUALLY, DEFENDANTS-RESPONDENTS/ CROSS-APPELLANTS, AND M & K REALTY, LLC, KAMMERMAN'S ATLANTIC CITY MARINA, JOINTLY, SEVERALLY AND IN THE ALTERNATIVE, DEFENDANTS.



On appeal from Superior Court of New Jersey, Law Division, Atlantic County, Docket No. L-4169-08.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued September 19, 2011

Before Judges Grall and Skillman.

Plaintiff Louis Perri purchased a new home in Atlantic City situated on a narrow peninsula bordered by Snug Harbor Inlet and Gardner's Basin. Following the closing, sea water entered his garage on two occasions and the street numerous times. Alleging failure to disclose a known flooding condition and a misrepresentation by his real estate agent that flooding was not something to worry about, Perri filed a complaint charging the builder, sellers and brokers with violations of the Consumer Fraud Act (CFA), common law fraud and conspiracy.*fn1 N.J.S.A. 56:8-1 to -20. Perri appeals from the trial court's entry of summary judgment in favor of defendants on those claims.*fn2 We affirm because the record does not support either cause of action.

I

Perri's property fronts North Massachusetts Avenue, which is a twenty-four-foot-wide public street. There is a bulkhead on the opposite side of the street and about forty-two feet from Perri's house. That bulkhead is the only structure that separates the street and Perri's home from Snug Harbor Inlet. At the rear boundary of Perri's property, which is one hundred feet from the lot's front line, there is another bulkhead adjacent to Gardner's Marina. Perri describes his property as a stone's throw from the inlet and on the basin.

Perri purchased the property from CG Limited Investors, LLC, Delaware Valley Real Estate Holdings, LLC and Massachusetts Street Properties, LLC (collectively defendant sellers). The defendant sellers owned several lots on the street; defendant Prestigious Home, Inc. built the houses to be sold by the defendant sellers. During the period construction was underway, Perri was interested in waterfront property with the capacity to keep a boat and was working with a real estate agent, defendant Kathleen A. Russo of defendant Prudential Fox & Roach Realtors.

Russo first took Perri to this property in March 2005. At that point, the house was framed and roofed. By Perri's account, he visited the property while it was under construction about six times before he signed the contract of sale in August 2005 and another six to eight times before the closing, which took place in March 2006. Defendants contend the visits were much more frequent.

There is some dispute about flood conditions Perri witnessed on his pre-purchase visits. According to defendants, during several visits the street in front of the house had water in it, was impassable or had deep puddles and debris obviously indicative of recent flooding. Defendants' accounts include descriptions of conditions requiring removal of shoes, jumping over puddles and parking away from the house due to water in the street in front of the property. According to Russo, Lisa Kalin, a decorator who worked with Perri and the builder, and Gary Lansman, the office manager for the builder who visited the site several times, there were also water marks in the garage that were visible during Perri's visits. The builder's supervisor recalls an occasion during construction when he and Perri arrived at the street and were forced to leave because it was impassable.

Perri, however, denies seeing any sign of flooding before his signing of the contract and closing. He contends that the day he and the builder's supervisor both drove away from the street because of flooding was after he purchased the house. Otherwise, he asserts he does not recall observing any telltale conditions.

Perri admits knowing that the property was in a flood zone and that he would be required to obtain flood insurance. The contract of sale Perri signed states that use of the property may be limited if it is in a flood zone and that the mortgage lender may require flood insurance.

Perri also knew the house was constructed in accordance with Federal Emergency Management Agency (FEMA) regulations applicable to the flood zone. The home he purchased, like others on the street, is built on a slab, with no habitable space on the ground floor and with "masonry construction." There is no machinery or equipment servicing the house at an elevation lower than 10.82 feet, and the structure at the ground floor includes seven permanent openings within one foot above the adjacent grade. These permanent openings are flood vents designed to allow water flow through the structure. The walls of the front entry leading to the habitable space above is tiled up to about three feet from the floor, and the foyer is at a higher elevation than the garage.

The FEMA elevation certification submitted with Perri's application for flood insurance refers to the ten-foot base flood elevations, the seven flood vents, and the respective elevations of the mechanicals and living space in Perri's house. Perri does not dispute the contents.

There is evidence, which Perri disputes, demonstrating his actual awareness of water entering the ground floor of the structure before he purchased the home. According to Kalin, she and Perri had discussed tiling the foyer walls to prevent water damage and his idea of installing a ramp or lift in the garage to elevate his Corvette and thereby protect it from water damage. Lansman also recalls Perri talking about a lift for the Corvette prior to closing.

Perri denies having any conversation about flooding with anyone other than Russo prior to closing or having any concern about flooding or its impact on his Corvette before he moved into the house. According to Perri and the builder's construction supervisor, they discussed a lift for the Corvette after Perri owned the property. Perri also explains that he viewed the flood insurance as something necessary in the ...


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