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Warshauer Electric Supply Company v. Munroe Electric; Chester Dinkel

January 10, 2013


On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-204-10.

Per curiam.


Submitted March 20, 2012

Before Judges Baxter and Nugent.

Plaintiff Warshauer Electric Supply Company appeals from a Law Division order that entered judgment for plaintiff against defendant Ja Din Corp., an electrical contractor, on a book account, but also entered judgment against plaintiff in favor of defendant Chester Dinkel ("Dinkel"). Plaintiff contends that because Ja Din Corp. transacted business under a trade name registered to Dinkel, and because Ja Din Corp. did not include "Corp." in its name on its business documents, Ja Din Corp.'s principal shareholder, Dinkel, is personally liable for the balance due on the book account, and the trial court erred by finding to the contrary. After considering plaintiff's arguments in light of the record, we affirm.


Plaintiff and Dinkel each produced one witness at the non-jury trial: James Warshauer, plaintiff's president and owner since 1982; and Dinkel's wife of fifty-two years, Irene. Dinkel had been disabled by a stroke in 1984. The parties also introduced documentary evidence. The proofs established the following background facts about Dinkel and Ja Din Corp.

In 1962, Dinkel, an electrician, started an electrical contracting business as a sole proprietor. Because he was "in Monroe Township," Dinkel and a man named Dawson registered the trade name "Monroe Electric Co." in 1966 and Dinkel traded under that name. In June 1971, Dinkel incorporated his business as Ja Din Corp.*fn1 He changed the name on his trucks from "Monroe Electric" to "Munroe Electric." Dinkel also registered the corporation with the State Board of Examiners of Electrical Contractors as Ja Din Corporation t/a Munroe Electric.

According to a corporate resolution dated July 26, 1971, Ja Din Corp. "erroneously opened" a checking account in the name of Munroe Electric. The resolution authorized the bank to change the name on the checking account to "Ja Din Corp., trading as Munroe Electric[.]" On January 26, 1972, Dinkel registered the trade name "Munroe Electric."

According to Mrs. Dinkel, everyone knew Munroe Electric was a trade name for Ja Din Corp. She told customers herself when asked about the name change from M-O-N to M-U-N. She acknowledged that neither she nor her husband knew James Warshauer or, to her knowledge, personally ever did any business with him.

Mrs. Dinkel was questioned about why the documentary evidence did not identify Ja Din as "Ja Din Corp. t/a Munroe Electric." She explained that the company's supervisors prepared purchase orders. As an example, Tim Divins made his own business card which identified the company as Munroe Electric, Inc. Mrs. Dinkel acknowledged certifying interrogatory answers on behalf of Ja Din that stated "Munroe Electric has always been a corporation and never operated in any other form."

James Warshauer testified plaintiff had sold electrical materials since at least 1982 when he became its president and owner. He confirmed the parties' stipulation that the amount due plaintiff was $94,834.16. According to Warshauer, he never knew that Munroe Electric was actually a corporation named Ja Din Corp. trading as Munroe Electric. Although Warshauer "believe[d]" that his invoices "said Munroe Electrical Contractors," he produced no invoices to corroborate his belief. He testified that he had received various documents over the years from Munroe Electric, including stationery, letterhead, and business cards, but none led him to believe that Munroe Electric was a corporation. No one told him that the corporate name was Ja Din Corp trading as Munroe Electric. In short, he did not know with whom he was dealing.

During cross-examination, Warshauer was shown numerous purchase orders and checks identifying the purchasing and paying entity as "Ja-Din TA Munroe Electric." The exception was one purchase order dated November 30, 2009, which bore only the name of "Munroe Electric Inc[.]" He was also confronted with a check drawn on the account of Ja Din Corp t/a Munroe Electric, Inc., dated October 29, 2009, which plaintiff cashed as payment for materials purchased by Ja Din Corp. in May and June 2009. Warshauer eventually conceded that purchase orders submitted to plaintiff between 2003 and 2009 were submitted by "Ja Din" trading as either Munroe Electric or Munroe Electric, Inc. Warshauer acknowledged that he knew there was a "Ja Din" in the picture as early as 2003 or 2004, but "didn't know what it represented." He also acknowledged that "Mr. Div[i]ns was the guy who was running the business." Finally, he acknowledged that "t/a" or "TA" meant "trading as."

Warshauer never asked Divins for a personal guarantee. When plaintiff started doing business with Ja Din Corp. trading as Munroe Electric, it was not "commonplace" to ask for personal guarantees from customers. Divins eventually left Ja Din Corp. and started his own company, taking with him some of Ja Din Corp.'s work. When Divins formed his own company ...

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