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Carlton Hotel Associates, Inc. and the Berger Organization, LLC v. City of Newark

September 25, 2012

CARLTON HOTEL ASSOCIATES, INC. AND THE BERGER ORGANIZATION, LLC, PLAINTIFFS-APPELLANTS,
v.
CITY OF NEWARK, CITY OF NEWARK, DEPARTMENT OF HEALTH AND HUMAN SERVICES, CITY OF NEWARK DIVISION OF PUBLIC WELFARE, DEFENDANTS-RESPONDENTS, AND STATE OF NEW JERSEY, DEFENDANT.



On appeal from the Superior Court of New Jersey, Law Division, Essex County, Docket No. L-1286-09.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Submitted September 10, 2012 -

Before Judges Fasciale and Maven.

Plaintiffs Carlton Hotel Associates, Inc. and The Berger Organization, LLC (plaintiffs) appeal from a July 22, 2011 order granting summary judgment to defendant City of Newark and dismissing plaintiffs' breach of contract complaint. We conclude that no contract existed and affirm.

In reviewing a grant of summary judgment, we apply the same standard under Rule 4:46-2(c) that governs the trial court. See Liberty Surplus Ins. Corp. v. Nowell Amoroso, P.A., 189 N.J. 436, 445-46 (2007). We must "consider whether the competent evidential materials presented, when viewed in the light most favorable to the non-moving party, are sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party." Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995). Viewed most favorably to plaintiffs, the summary judgment record established the following facts.

Defendant, through its Department of Health and Human Services,*fn1 administered an Emergency Assistance Program (EA Program) pursuant to the Work First New Jersey General Public Assistance Act (the Act), N.J.S.A. 44:8-107 to -145.5, and its attendant regulations, N.J.A.C. 10:90-1.1 to -20.13. The EA Program provided eligible recipients with temporary or emergency housing in state-authorized shelters and hotels. Under the Act, the State of New Jersey authorized plaintiffs to provide shelter services. Plaintiffs provided temporary or emergency housing to welfare recipients from 1989 to June 30, 2008.

Generally, a recipient appeared at defendant's welfare office, a caseworker conducted an interview, and then the caseworker provided the recipient with a voucher for a shelter or hotel. If a recipient visited the shelter or hotel first, then the shelter or hotel provided the individual with a referral to defendant's welfare office to begin placement. A voucher typically identified the recipient, service period, and the dollar amount that the shelter or hotel would receive. Plaintiffs would then bill defendant monthly, based on rental rates that derive from N.J.A.C. 10:90-6.7.

The State's General Assistance Automated System (System) provided for an electronic process that required defendant to maintain a zero-balance account. The State electronically funded the account with the exact amount necessary to pay the benefits issued to recipients by plaintiffs. Defendant would then provide a check to plaintiffs' representative upon review and acceptance of the reconciliation form. Defendant provided plaintiffs with the reconciliation forms, which identified the month of the bill, the name of the provider, the amount the provider invoiced defendant, the amount of exceptions for that month, the net amount due, the payment generated, and any possible balance due to ineligibility. At the end of the day, the account would zero out. The System would not permit payment for recipients who had become ineligible for benefits. Upon signing a reconciliation form, plaintiffs acknowledged and accepted that the amounts in the form represented "a complete reconciliation of the shelter payment for th[e] month," and "that all amounts due are paid and the exceptions are noted."

In December 2007, defendant's Municipal Council passed a resolution to transfer the administration and management of the EA Program to the County of Essex. In approximately March 2008, defendant and the County of Essex notified all shelter providers that the transfer would take place on June 30, 2008. The County of Essex notified all shelter providers of a mandatory meeting to discuss the transfer. At the meeting, defendant advised all shelter providers to submit to it all claims prior to June 30, 2008. Defendant explained that after June 30, 2008, it would lose its ability to process any claims because thereafter the County of Essex would be administering the EA program. On June 30, 2008, the County of Essex took over the placement and payment of the recipients, and defendant ceased its administration of the EA Program.

On or about November 1, 2008, plaintiffs submitted invoices to defendant for services allegedly rendered from September 2007 to February 2008. Plaintiffs maintain that defendant did not satisfy those invoices.*fn2

In February 2009, plaintiffs filed a breach of contract complaint against defendant and the State of New Jersey.*fn3

Plaintiffs sought damages for outstanding invoices and alleged that defendant was unjustly enriched.

In June 2011, defendant filed a motion for summary judgment and argued that (1) no contract existed between the parties, (2) it was not unjustly enriched, and (3) if a contract existed, then plaintiffs' complaint is barred by the doctrines of laches, accord and satisfaction, impossibility, and by public policy. Plaintiffs opposed the motion, asserted that defendant was equitably estopped from asserting ...


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