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Israel Design Group v. Chabad of Shore

Superior Court of New Jersey, Appellate Division

July 9, 2013

ISRAEL DESIGN GROUP, Plaintiff-Respondent,
CHABAD OF THE SHORE, Defendant-Appellant.


Argued April 30, 2013

On appeal from Superior Court of New Jersey, Law Division, Special Civil Part, Monmouth County, Docket No. DC-15067-11.

Larry S. Loigman argued the cause for appellant.

Joseph P. Fiteni argued the cause for respondent (Mendes & Mount, LLP and Martin S. Zipern, LLC, attorneys; John M. Deitch and Martin S. Zipern, of counsel and on the brief; William S. Wachenfeld, on the brief).

Before Judges Waugh and St. John.


Defendant Chabad of the Shore appeals the June 27, 2012 determination of the Special Civil Part awarding a $15, 000 judgment to plaintiff Israel Design Group in connection with architectural services. Following our review of the record and the arguments advanced on appeal, we affirm.

The record discloses the following facts and procedural history. Defendant is a storefront synagogue, located adjacent to an abandoned theater and several storefronts in Long Branch, under the leadership of Rabbi Laibel Schapiro. Plaintiff is an architectural firm owned by Mel Israel, one of defendant's congregants.

In late 2009, Rabbi Schapiro approached Israel to discuss plans to purchase the adjoining theater with the goal of converting it into a synagogue. They had numerous meetings to ascertain whether converting the property would provide sufficient space to meet defendant's needs. Eventually, it became clear that the theater property was not large enough to accommodate the new synagogue. Rabbi Schapiro then considered purchasing a restaurant that was next door to the theater and asked Israel to prepare plans to renovate both properties.

Rabbi Schapiro and Israel held meetings to discuss the feasibility of the project, the amount of synagogue seating that would be provided, parking issues, and the façade of the new building. Plaintiff produced plans and sketches to depict various configurations, including plans for renovating only the theater, plans to include the restaurant space, alternate floor plans, sketches of parking areas, and different finishes for the external façade of the building. Israel kept a record of the time he spent researching building codes, zoning issues, and construction costs, as well as preparing the drawings.

The parties never agreed upon the terms of compensation for plaintiff's services. Plaintiff did present a proposal for work to be performed through to the project's completion. However, defendant decided to utilize the services of a different architect more experienced in building synagogues. Thereafter, when plaintiff submitted a $17, 000 invoice to cover his preliminary work, defendant refused to pay. In fact, three other firms bid on the new synagogue project and their anticipated fees to provide architecture services were $15, 000, $14, 000 and $15, 300. On two separate occasions in 2007 or 2008, plaintiff had provided similar services to defendant without a written contract, and defendant had paid $13, 000 and $900, the amounts requested by plaintiff.

Plaintiff filed a complaint in the Special Civil Part seeking the monetary limit of $15, 000. After a bench trial, Judge James J. McGann determined that although there was no written contract, there had been a quasi-contract for which plaintiff was entitled to payment. In arriving at this conclusion, the judge relied on the parties' earlier dealings in which plaintiff had been paid for its services notwithstanding the absence of a written contract. The judge found that plaintiff had rendered architectural services in good faith, the plans had been accepted by defendant, there was an expectation of payment, and the amount projected, $15, 000, was reasonable given the fees requested by the other architectural firms.

"The scope of appellate review of a trial court's fact-finding function is limited." Seidman v. Clifton Sav. Bank, S.L.A., 205 N.J. 150, 169 (2011) (quoting Cesare v. Cesare, 154 N.J. 394, 411 (1998)) (internal quotation marks omitted). "[W]e do not disturb the factual findings and legal conclusions of the trial judge unless we are convinced that they are so manifestly unsupported by or inconsistent with the competent, relevant[, ] and reasonably credible evidence as to offend the interests of justice." Ibid. (quoting In re Trust Created By Agreement Dated Dec. 20, 1961, 194 N.J. 276, 284 (2008)) (internal quotation marks omitted). "Deference is especially appropriate when the evidence is largely testimonial and involves questions of credibility." Ibid. (quoting Cesare, supra, 154 N.J. at 412). "Because a trial court hears the case, sees and observes the witnesses, and hears them testify, it has a better perspective than a reviewing court in evaluating the veracity of witnesses." Ibid. (quoting Cesare, supra, 154 N.J. at 412). However, we owe no deference to a trial court's interpretation of the law, and review issues of law de novo. State v. Parker, 212 N.J. 269, 278 (2012); Mountain Hill, L.L.C. v. Twp. Comm. of Middletown, 403 N.J.Super. 146, 193 (App. Div. 2008), certif. denied, 199 N.J. 129 (2009).

Courts generally permit recovery in quasi-contract when one party has conferred a benefit on the other and the denial of recovery would be unjust. Weichert Co. Realtors v. Ryan, 128 N.J. 427, 437 (1992). Quasi-contractual liability "rests on the equitable principle that a person shall not be allowed to enrich himself unjustly at the expense of another." Ibid. Recovery is permitted when services have been provided with a reasonable expectation of payment. Ibid. That type of recovery is "known as quantum meruit ("as much as he deserves"), and entitles the performing party to recoup the reasonable value of services rendered." Id. at 437-38. To recover under the doctrine of unjust enrichment, a party must show: (1) the performance of services, (2) the acceptance of services by the person to whom they are rendered, (3) an expectation of compensation, and (4) the reasonable value of the services. Starkey, Kelly, Blaney & White v. Estate of Nicolaysen, 172 N.J. 60, 68 (2002).

On appeal, defendant argues that in order for a quantum meruit claim to prevail, plaintiff must demonstrate that defendant was unjustly enriched. Here, according to defendant, plaintiff's services were of no value to defendant and therefore there was no unjust enrichment We disagree

Over a period of six months plaintiff researched various aspects of the project including building and zoning requirements materials budgets elevations survey reviews elevator firewall and plumbing requirements Israel and Rabbi Schapiro consulted numerous times regarding defendant's concerns about synagogue space and parking Defendant asked for changes with respect to the façade and whether the renovation would include only the theater property or the theater and the restaurant properties The time and expertise that plaintiff expended enriched defendant because it enabled defendant to better understand its requirements and clarify the scope of the project For this plaintiff was entitled to payment

Defendant contends that plaintiff rendered services in the spirit of volunteerism with no expectation of payment However the parties' past dealings belie this statement because plaintiff received compensation for similar work even though there had been no written contract

Accordingly we discern no error in the judge's finding that plaintiff was entitled to payment for services rendered in quantum meruit.


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