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Pisack v. B & C Towing, Inc.

Superior Court of New Jersey, Appellate Division

June 14, 2018

BERNICE PISACK, on behalf of herself and all others similarly situated, Plaintiff-Appellant Cross-Respondent,
v.
B & C TOWING, INC., Defendant-Respondent Cross-Appellant, and MARIE J. CAVALCHIRE and ALAN ANTHONY YOUNG, Defendants, and B & C TOWING, INC., Defendant/Third-Party Plaintiff-Respondent/Cross-Appellant,
v.
THE CITY OF NEWARK, Third-Party Defendant-Respondent, EPTISAM PELLEGRINO, on behalf of herself and all others similarly situated, Plaintiff-Appellant,
v.
NICK'S TOWING SERVICE, INC., Defendant-Respondent, and NICHOLAS TESTA and SUSAN TESTA, Defendants. CHRISTOPHER WALKER, on behalf of himself and all others similarly situated, Plaintiff-Appellant,
v.
ALL POINTS AUTOMOTIVE & TOWING, INC., Defendant-Respondent, and THOMAS LOCICERO, Defendant.

          Argued April 24, 2018

          On appeal from Superior Court of New Jersey, Law Division, Middlesex County, Docket No. L-6501-13, and Bergen County, Docket Nos. L-1606-17 and L-7929-13.

          Andrew R. Wolf argued the cause for appellant/cross-respondent in A-2546-16 and appellant in A-5668-16 (The Wolf Law Firm, LLC, and Christopher J. McGinn, attorneys; Matthew S. Oorbeek, on the briefs).

          Andrew R. Wolf argued the cause for appellant in A-5399-16 (The Wolf Law Firm, LLC, and Edwyn D. Macelus, attorneys; Matthew S. Oorbeek, on the briefs).

          Gabriel H. Halpern argued the cause for respondent/cross-appellant in A-2546-16 (Pinilis Halpern, LLP, attorneys; Gabriel H. Halpern, of counsel and on the brief).

          Steven F. Olivo, Assistant Corporation Counsel, argued the cause for respondent in A-2546-16 (Kenyatta K. Stewart, Corporation Counsel, attorney; Steven F. Olivo, on the brief).

          Jeremy B. Stein argued the cause for respondent in A-5399-16 (Hartmann Doherty Rosa Berman & Bulbulia, LLC, attorneys; Paul S. Doherty, III, and Jeremy B. Stein, on the brief).

          Brian T. Giblin, Sr., argued the cause for respondent in A-5668-16 (Giblin & Gannaio, attorneys; Brian T. Giblin, Sr., and Brian T. Giblin, Jr., on the brief).

          Before Judges Reisner, Hoffman, and Gilson.

          OPINION

          GILSON, J.A.D.

         These three appeals involve the non-consensual towing of vehicles and raise questions concerning the Predatory Towing Prevention Act (Towing Act), N.J.S.A. 56:13-7 to -23, the Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 to -20, and the Truth-In-Consumer Contract, Warranty and Notice Act (TCCWNA), N.J.S.A. 56:12-14 to -18. Accordingly, we issue a consolidated opinion to address the common questions presented by these appeals.

         Having reviewed the language and legislative history of the Towing Act and its implementing regulations, we hold that: (1) the Towing Act does not require the exhaustion of administrative remedies before the Division of Consumer Affairs (Division) or dispute resolution procedures established by municipalities that have towing ordinances; (2) the Tort Claims Act (TCA) does not provide immunity against claims based on the fees companies charge for non-consensual towing of vehicles; and (3) the Towing Act and its regulations limit the services for which a towing company can charge. We also hold that the TCCWNA applies to the non-consensual towing of vehicles because the bills issued by towing companies are contracts and notices within the definition of the TCCWNA. Finally, we hold that class actions may, in the right circumstances, be appropriate for claims under the Towing Act, the CFA, and the TCCWNA.

         Accordingly, we reverse the orders on appeal in each of these three cases and remand for further proceedings. Specifically, in Walker, we reverse a July 24, 2017 order granting summary judgment to defendants and remand for further proceedings; in Pisack, we reverse a January 13, 2017 order denying plaintiff's motion to certify a class and granting defendants' cross-motion for summary judgment, and we remand for further proceedings; and in Pellegrino, we reverse a June 5, 2017 order striking plaintiff's request to certify a class action and remand to allow class discovery.

         I.

         Each of these appeals involves certain common facts. None of the three named plaintiffs consented to the towing of their vehicles. Instead, the vehicles were towed from public roads at the direction of the police. Plaintiffs then were charged for the non-consensual towing of their vehicles by privately-owned towing companies that had contracts with the local municipalities to provide such towing and storage services.

         Beyond those common facts, the three cases arise out of different factual backgrounds and involve different procedural histories. Thus, we will summarize the relevant facts and procedural history of each case to give context to the issues.

         Walker

         In the early morning hours of December 29, 2012, Christopher Walker was driving his vehicle in River Edge when he was stopped by a police officer. The officer observed the vehicle was not registered. Thus, the officer issued Walker a summons and directed that the vehicle be towed and held until Walker registered the vehicle. Defendant All Points Automotive & Towing, Inc. (All Points Towing), which had a contract with River Edge, towed Walker's vehicle.

         Walker registered the vehicle later that same day, which was a Saturday, and tried to pick up the vehicle from All Points Towing before it closed for business at 1 p.m. Walker contends that the police authorized the release of his vehicle on December 29, 2012, but All Points Towing refused to release the vehicle to him because they were closing for the remainder of the weekend. In contrast, All Points Towing maintains that the police did not authorize the release of the vehicle until the following Monday, December 31, 2012.

         On December 31, 2012, Walker retrieved his vehicle, and All Points Towing charged him $290.85. Walker was given a bill that listed the charges as: Towing Charge $125; Storage $120; "Admin" $35; Tax $10.85; and Total $290.85. Walker paid the bill in cash without disputing the charges.

         In October 2013, Walker filed a complaint on behalf of himself and similarly situated individuals against All Points Towing and its owner. Walker alleged that the Towing Act did not permit an administrative charge for the non-consensual towing of a vehicle that was not involved in an accident. Walker contended that the administrative charge violated the Towing Act, the CFA, and the TCCWNA. Walker also asserted that All Points Towing unlawfully failed to release his vehicle after normal business hours as required by the Towing Act and its regulations. Thus, Walker asserted that a class action should be certified.

         The case effectively was stayed while Walker was on active military service. See R. 1:13-6. Following the completion of discovery, defendants moved for summary judgment. Walker had not filed a motion to certify the class. The trial court heard oral argument and, on July 24, 2017, issued a written opinion and entered an order granting defendants summary judgment.

         In Walker's case, the court granted defendants summary judgment on two grounds. First, the court found that Walker had failed to administratively resolve his dispute. In that regard, the court held that the Towing Act regulations required vehicle owners who disputed charges imposed by a towing company for non-consensual towing services to use good faith efforts to resolve the dispute before filing a lawsuit. The court also held that if those good faith efforts failed, the vehicle owner then must either go to the Division to seek reimbursement of the disputed amount, or avail himself or herself of the dispute resolution mechanisms established by the municipality. Second, the court reasoned that the administrative fee was allowed by the River Edge towing ordinance and, therefore, was a permitted fee.

         The trial court never addressed Walker's claim that defendant unlawfully failed to release his vehicle after hours. The trial court also did not clarify whether Walker could refile his lawsuit after he exhausted his administrative remedies.

         Pisack

         On June 25, 2013, the son of Bernice Pisack illegally parked her car on a public street in Newark. The Newark Police contacted B & C Towing, Inc. (B&C Towing) and directed it to tow Pisack's vehicle to its lot. B&C Towing had a contract with Newark to provide such towing services.

         Later that day, Pisack's son went to B&C Towing's lot and retrieved the vehicle. He was given a bill for $152.45, which listed the charges as: Towing $65; Labor (recovery) $25; Administrative Fee $50; Storage $10; and Tax $2.45. Under B&C Towing's contract with Newark, B&C Towing retained $25 of the administrative fee and remitted the remaining $25 to Newark. The son paid the bill without contesting the charges.

         In October 2013, Bernice Pisack filed a proposed class action against B&C Towing and its owners, alleging violations of the Towing Act, the CFA, and the TCCWNA. Specifically, Pisack challenged the labor charge and the administrative fee.

         B&C Towing moved to dismiss the complaint, but in an order entered on March 28, 2014, the trial court denied that motion. B&C Towing then filed an answer and asserted a third-party complaint against Newark. Thereafter, the claims against Newark were severed and transferred to another vicinage.

         Following discovery, Pisack filed a motion to certify the class, and B&C Towing cross-moved for summary judgment. After hearing oral argument on the motions, the trial court entered an order on January 13, 2017, granting summary judgment to defendants and denying plaintiff's motion as "moot."

         The court explained its reasons on the record and identified four grounds for its decision: (1) the TCCWNA was inapplicable because there was no contract between Pisack and B&C Towing; (2) Pisack failed to exhaust administrative remedies before pursuing a court action; (3) the fees charged by B&C Towing were permitted under Newark's towing ordinance; and (4) B&C Towing was entitled to derivative immunity under the TCA because the towing was performed at the direction of the police.

         Pelleqrino

         On November 28, 2015, Eptisam Pellegrino was involved in a motor vehicle accident in East Rutherford. At the direction of the East Rutherford Police, Nick's Towing Service, Inc. (Nick's Towing), towed Pellegrino's vehicle. Three days later, Pellegrino contacted Nick's Towing to inquire about the charges related to the towing and storage services. She was informed that the charges totaled $448.36, and she authorized Nick's Towing to charge her credit card.

         Thereafter, Nick's Towing sent Pellegrino an itemized bill, which listed the charges as: Flatbed/Towing $125; Yard Charge $40; Crash/Collision Wrap $60; Credit Card Surcharge $13.06; Administrative Charge $4 0; Sweep Roadway/Cleanup $30; Storage Fee $120; and Sales Tax $20.30.

         In March 2017, Pellegrino filed a complaint on behalf of herself and similarly situated individuals against Nick's Towing and its owners. Pellegrino alleged that the yard charge, the credit card surcharge, the administrative charge, and the storage fee violated the Towing Act, the CFA, and the TCCWNA.

         Without engaging in discovery, defendants filed a motion to dismiss Pellegrino's complaint. Alternatively, defendants sought to deny class certification. The trial court heard oral argument and, on June 5, 2017, issued a written opinion and entered an order ruling that Pellegrino could pursue her claims only in her individual capacity and not on behalf of a class. The court also denied the remainder of the motion to dismiss.

         The court found that Pellegrino could not satisfy the standard for class certification because the questions of law and fact affecting the class did not predominate over those affecting individual members of the proposed class. We granted plaintiff's motion for leave to appeal the interlocutory order of June 5, 2017.

         II.

         To summarize, plaintiffs appeal from three orders. Walker appeals from a July 24, 2017 order granting summary judgment to defendants. Pisack appeals from a January 13, 2017 order denying class certification and granting summary judgment to defendants. On leave granted, Pellegrino appeals from a June 5, 2017 interlocutory order denying her request to certify a class and allowing her to proceed only on her individual claims.

         Collectively, the appeals raise four legal issues: (1) whether the Towing Act requires the exhaustion of administrative remedies and dispute resolution procedures before a civil suit can be filed in court; (2) whether towing companies that engage in non-consensual towing at the direction of the police are immune from liability under the TCA for claims related to the fees they charge; (3) whether the Towing Act limits the types of services for which a towing company can charge a fee for the non-consensual towing of a vehicle; and (4) whether the TCCWNA applies to the non-consensual towing of vehicles. The appeals also raise a fifth fact-based issue of whether certain claims for violations of the Towing Act, the CFA, and the TCCWNA can be pursued as class actions.

         To put these issues in context, we will start with an overview of the relevant statutes, which include the Towing Act, the CFA, and the TCCWNA. We will then address the four legal issues. Thereafter, we will analyze the class action issue. Finally, we will apply our ...


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