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Keith v. Liberty Harbor Marina & Dry Dock, Inc.

Superior Court of New Jersey, Appellate Division

September 23, 2013

PAUL KEITH, Plaintiff-Appellant,


Argued May 20, 2013

On appeal from Superior Court of New Jersey, Law Division, Essex County, Docket No. L-9235-10.

Louis David Balk argued the cause for appellant (Balk & Cistrelli, P.A., attorneys; Henry J. Cistrelli, on the brief).

Shannon Garrahan argued the cause for respondent.

Before Judges Graves and Ashrafi.


Plaintiff Paul Keith appeals from the involuntary dismissal of his claims against defendant Liberty Harbor Marina and Dry Dock, Inc. (the Marina) at the conclusion of his case, and a judgment against him in the amount of $32, 989.91 on the Marina's counterclaim for an outstanding boat storage charge. Based on our examination of the record and the applicable law, we affirm.

The essential facts are not in dispute. In 2007, plaintiff owned a twenty-nine-foot powerboat, and he entered into a slip rental and storage agreement with the Marina. The agreement allowed him to use the Marina during the "summer term" and to store his boat on land during the "winter term." The initial charge for the period from April 15, 2007 to October 14, 2007, was $4161.50, and the agreement authorized the Marina to hold plaintiff's boat "as collateral security for the payment of all outstanding debts due and owing the Marina."

On November 16, 2008, plaintiff went to the Marina's storage yard to remove two batteries from his boat. Plaintiff used one of the Marina's ladders to access his boat. Unfortunately, the ladder gave way while plaintiff was removing one of the batteries, and he fell to the ground. In a letter to the Marina dated February 3, 2009, plaintiff stated: "I suffered a large cut/bruise on my head when I hit the ground and subsequently found my neck was fractured in three places." Plaintiff said he was "still suffering from the broken neck" and asked the Marina to notify its insurance carrier of the accident.

The Marina's insurance carrier assigned the matter to the Walter Nixon Group, an independent adjusting company, and Michael Walters conducted the investigation. During his investigation, Walters learned that plaintiff's boat remained at the Marina and there was an outstanding boat storage charge "in the low $20, 000's." Based on his communications with plaintiff's attorney and Donald Wuertz, the Marina's chief financial officer, Walters thought the parties reached a settlement agreement.

On August 26, 2010, Walters sent an email to Wuertz, which read as follows: "We've reached an overall agreement with Keith. He will pay the Marina $10, 000 and remove his boat within a short period. His attorney will memorialize the agreement in a letter to you." However, on August 27, 2010, Wuertz responded: "We disagree with the settlement. We will accept $10, 000 as a payment. Keith will not get his boat."

In his complaint filed on November 3, 2010, plaintiff stated "the gross settlement proceeds" in the amount of $35, 000 had been paid to his attorney, and his attorney would pay the sum of $10, 000 to the Marina "in full satisfaction of any outstanding storage fees" upon the release of his boat from the Marina. Plaintiff's complaint sought enforcement of the alleged settlement agreement, the release of his boat, and compensation "for any damage" to the boat. In its answer, the Marina denied that it agreed to accept $10, 000 in full settlement of plaintiff's outstanding boat storage charge, and the Marina counterclaimed for the full amount of the unpaid storage charge.

During a bench trial on July 3, 2012, plaintiff's attorney asked Walters to explain his understanding of the settlement agreement. Walters testified as follows:

A. The insurance company would pay $35, 000 to settle Mr. Keith's personal injury claim. And from that $35, 000 Mr. Keith would in turn pay $10, 000 to Liberty Harbor Marina to settle the outstanding boat storage charge claim that it had against him.
Q. And was there anything with regard to Mr. Keith's boat as part of that settlement?
A. Earlier in the negotiations when the proposal had been to settle the boat storage charges for $5, 000 rather than $10, 000, I had discussions with Mr. Wuertz about making a condition of any settlement that Mr. Keith remove his boat promptly.
And around that same time Mr. Keith came up with a counterproposal that he be allowed to inspect his boat to make sure that the Marina didn't take anything of his off the boat, or damage his boat.
In the second round when the proposed boat storage settlement increased to $10, 000 from $5, 000 that same issue was not re-discussed.
Q. When you say that same issue, are you talking about boat inspection or boat removal?
A. Both.
Q. What was your understanding with regards to the position of Liberty Marina concerning Mr. Keith removing his boat once the $10, 000 was paid?
A. I assumed he would be allowed to remove his boat. They would allow him to inspect his boat, and then he would remove his boat.

In addition, on cross-examination, Walters agreed that Wuertz never asked him to settle the Marina's storage charge claim:

Q. . . . Mr. Wuertz never asked you to settle the outstanding storage charges did he?
A. No.
Q. And Mr. Wuertz never asked you to interject yourself into the business dealings of Liberty Harbor Marina, did he?
A. No.
Q. And, in fact, it was [plaintiff's attorney] who asked you to do that wasn't it?
A. Yes.
Q. Okay. So, you were never requested by Liberty Harbor to [settle its storage charge claim], correct?
A. Correct.
Q. And you weren't acting as an agent for Mr. Keith, were you?
A. No.
Q. And you weren't acting as an agent for [plaintiff's attorney], were you?
A. No.
Q. Okay. But they asked you to do that?
A. I was in the middle conveying both sides back and forth. I don't know that they asked me to, it was my job to convey to each side what the other side was proposing.
Q. Okay. So, you were just the messenger?
A. Right.

Walters also testified that "the injury claim was to settle for $35, 000 period. Whether $10, 000 or $5, 000 or some other number was going to settle the boat storage charge claim was between Mr. Keith and his attorney and the Marina."

After plaintiff rested, the Marina moved for an involuntary dismissal of plaintiff's claims under Rule 4:37-2(b). The court granted the motion, reasoning as follows: "[P]laintiff has failed to establish that there was a meeting of the minds, and therefore there was no settlement, so there is no settlement to enforce." The court also found there was no evidence to support plaintiff's claim that his boat had been damaged while it was at the Marina.

Wuertz then testified regarding the Marina's counterclaim for the outstanding storage charge. Based on his testimony, which the court found to be credible, the court entered a judgment in favor of the Marina in the total amount of $32, 989.91.

On appeal, plaintiff argues that Walters was authorized by the Marina "to negotiate a global resolution, " plaintiff reasonably relied on Walter's authority to bind the Marina, and the court erred in ruling that Walters was not an agent of the Marina "under the doctrine of apparent authority." We do not agree.

"The power of an agent to bind his principal is limited to such acts as are within his actual or apparent authority." Carlson v. Hannah, 6 N.J. 202, 212 (1951). A party seeking to rely on the apparent authority of an alleged agent must establish:

(1) that the appearance of authority has been created by the conduct of the alleged principal and it cannot be established alone and solely by proof of [conduct by] the supposed agent; (2) that a third party has relied on the agent's apparent authority to act for a principal; and (3) that the reliance was reasonable under the circumstances.
[AMB Prop., LP v. Penn Am. Ins. Co., 418 N.J.Super. 441, 454 (App. Div. 2011) (quoting Mercer v. Weyerhauser Co., 324 N.J.Super. 290, 318 (App. Div. 1999) (alteration in original)).]

Therefore, a conclusion that Walters acted with apparent authority must be based upon the conduct of the Marina and, as the trial court correctly concluded, the Marina never agreed to compromise its claim for the unpaid storage charge, it never authorized Walters to settle its claim, and there was no evidence that the Marina misled plaintiff into believing Walters was authorized to settle its storage charge claim.

"Analytically, the standard for determining summary judgment motions is similar to that required for an involuntary dismissal under Rule 4:37-2(b)." Schneider v. Simonini, 163 N.J. 336, 360 (2000), cert. denied, 531 U.S. 1146, 121 S.Ct. 1083, 148 L.Ed.2d 959 (2001). In this case, it is clear that Walters merely conveyed plaintiff's settlement offer to the Marina, and, in fact, Walters was "just the messenger." Thus, the record fully supports the trial court's determination that there was no settlement agreement to enforce.


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