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Manhattan Trailer Park Homeowners Association, Inc. v. Manhattan Trailer Court and Trailer Sales, Inc.

Superior Court of New Jersey, Appellate Division

October 28, 2014

MANHATTAN TRAILER PARK HOMEOWNERS ASSOCIATION, INC., VINCENT MOSCA AND NORMA CARRANZA, Plaintiffs-Appellants,
v.
MANHATTAN TRAILER COURT AND TRAILER SALES, INC., Defendant-Respondent, and MANHATTAN MTC ASSOCIATES, LLC, Defendant

Argued September 10, 2014

Approved for Publication October 28, 2014.

Page 1216

On appeal from the Superior Court of New Jersey, Law Division, Hudson County, Docket No. L-912-10.

Jeffrey M. Beides argued the cause for appellants.

Russell J. Passamano argued the cause for respondent ( DeCotiis FitzPatrick & Cole, LLP and Kaufman, Semeraro & Leibman, LLP, attorneys; J. Sheldon Cohen, of counsel; PassamanoMr., on the brief).

Before Judges LIHOTZ, ESPINOSA and ROTHSTADT. The opinion of the court was delivered by LIHOTZ, P.J.A.D.

Page 1217

[438 N.J.Super. 188] OPINION

LIHOTZ, P.J.A.D.

This dispute centers on the parties' respective rights and obligations under the Mobile Home Protection Act (the Act), N.J.S.A. 46:8C-2 to -21. Plaintiff Manhattan Trailer Park Homeowners Association, Inc. (the Association) is a nonprofit corporation comprised of the homeowner community residing in the North Bergen private residential leasehold community (the park property) owned by defendant Manhattan Trailer Court and Trailer Sales, Inc. The individual plaintiffs, Vincent Mosca and Norma Carranza, each [438 N.J.Super. 189] lease a lot on the park property and also served as the president and assistant secretary of the Association, respectively.

Plaintiffs' complaint sought to enjoin defendant from selling the park property to a third-party, arguing the Association exercised its statutory right of first refusal provided under the Act. The trial judge disagreed and granted defendant's motion for summary judgment, after concluding the Association failed to pursue its right to purchase the park property. The motion judge held the two-year delay in advancing an agreement to purchase the park property " estopped [the Association] from seeking remedies under the [Act]."

On appeal, plaintiffs maintain the Act's provisions cannot be waived, as a matter of law, making the application of estoppel erroneous. Further, they assert defendant's failure to comply with the Act's notice requirements precludes its ability to transfer the park property. Alternatively, plaintiffs argue summary judgment was improvidently granted in light of the evidence that the Association exercised its right of first refusal, which defendant allegedly ignored.

Following our review, we conclude the anti-waiver provision of N.J.S.A. 46:8C-5 aims at unscrupulous landlords who attempt to circumvent the Act's requirements when leasing mobile home lots and does not preclude the court's ability to award equitable relief. Under the circumstances

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presented, we also hold defendant's failure to strictly comply with the Act's notice provisions was ultimately cured by its subsequent conduct that fully advanced the Act's spirit and purpose, giving the Association an opportunity to buy the park property. Further, despite this opportunity, the Association did not follow the process outlined in the Act to complete the purchase. We conclude the Association's failure equates to a refusal to exercise its right to acquire the park property. Accordingly, we affirm the summary judgment dismissal of plaintiffs' complaint.

We recite the facts taken from the summary judgment record, viewed in the light most favorable to plaintiffs, the non-moving [438 N.J.Super. 190] party. Davis v. Brickman Landscaping, Ltd., __ N.J. __, __, 219 N.J. 395, 98 A.3d 1173 (2014). Defendant, a New Jersey corporation, was equally owned by the estate of Julius Wassil (decedent), administered by Paul Kaufman, and Lynchen Wassil, decedent's former wife. Defendant's largest asset was the park property, which is comprised of 5.28 acres, divided into 130 mobile home pads, with each tenant owning his or her respective trailer unit set on a pad.

In the course of administering decedent's estate, Kaufman published notices in the New York Times and Bergen Record, soliciting offers for the purchase and development of the park property. Kaufman also mailed termination notices to the individual park residents, advising them the property would no longer be used as a mobile home park.

Prospective buyers transmitted offers to Kaufman, who decided the proposal by Manhattan MTC Associates, LLC (Manhattan) was best. Manhattan offered to buy the park property for no less than $5.5 million, with the possibility of additional sums paid, depending upon the number of lots approved for an affordable housing subdivision. Manhattan's offer did not contain a financing contingency. Kaufman negotiated acceptable contract terms for Manhattan's acquisition of the park property, subject to Wassil's acceptance and approval by the Probate Part.

Sometime after receiving Kaufman's notice to quit, park residents formed an association, pursuant to the Act.[1] See N.J.S.A. 46:8C-15(a) (requiring mobile home owners to form an association to exercise rights granted under the Act). By letter dated December 11, 2008, Kaufman was advised of the Association's existence. Shortly thereafter, he conveyed the terms of Manhattan's offer by providing copies of correspondence between Manhattan and himself to the identified Association Board of Directors. The [438 N.J.Super. 191] letter included the minimum sales price and highlighted key terms in Manhattan's offer. Importantly, Kaufman attached an unsigned proposed twenty-eight page purchase and sale agreement, drawn in accordance with the terms of Manhattan's offer. The proposed agreement left blank the appropriate sections to insert the identity and signature of the proposed purchaser, designated by the Association.

In a February 3, 2009 letter, Kaufman informed the Association's counsel " the opportunity to purchase [the park property was] on the same terms and conditions" as set forth in Manhattan's offer. He also provided a report prepared in anticipation of the sale. Later that month, Kaufman met with members of the Association to discuss the terms of Manhattan's proposed contract of sale and the Association's right

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to match that offer. There, he informed the Association's representatives any " offer with a financing contingency was not acceptable," because Manhattan's offer contained no such contingency, which he considered " an essential term of the offer."

On February 20, 2009, the Association tendered its proposed terms to purchase the park property. The letter sent by Real Estate Advisory Development Services (READS), on behalf of the Association, provided for the same down payment amount, minimum purchase price, period of due diligence and other requirements as Manhattan's offer. Most significant, however, the Association's proposal required approval of the terms by the general membership of the Association and a contingency provision to secure and obtain $6 million to finance the acquisition, closing, and renovation costs. The READS letter attached a statement from ROC USA Capital, LLC that described its willingness to consider financing the Association's purchase of the park property if requisite underwriting requirements were met. The letter closed with a provision stating: " Upon ...


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