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Park Crest Cleaners, LLC v. A Plus Cleaners and Alterations Corp.

Superior Court of New Jersey, Appellate Division

March 29, 2019


          Submitted March 19, 2019

          On appeal from Superior Court of New Jersey, Chancery Division, Camden County, Docket No. C-000078-14.

          Salmon, Ricchezza, Singer & Turchi LLP, attorneys for appellants (Ronald L. Daugherty, of counsel and on the briefs).

          Genova Burns LLC, attorneys for respondents (James Bucci and Michael C. McQueeny, of counsel and on the brief).

          Before Judges Fisher, Suter and Geiger.

          FISHER, P.J.A.D.

         In the unique circumstances presented, we conclude that defendants' appeal must be dismissed. To explain, we need to delve somewhat into the case's procedural history.

         Plaintiffs Park Crest Cleaners, LLC, Salvatore Tamburo, and Daniela Tamburo (plaintiffs) commenced this action against defendants A Plus Cleaners and Alterations Corp., A Plus Cleaners, LLC, Lee Stephen Chin, Elsa Chin, and Sabrina Chin (defendants) alleging defendants' sale to them of a West Berlin dry cleaning business was, among other things, fraudulently induced. The business was conducted on premises leased to defendants by Cherry Plaza, LLC.

         Plaintiffs sought rescission and damages but never joined Cherry Plaza as a party even though, to the extent plaintiffs' suit bore fruit, there would be a need to address the parties' then and future relationship with Cherry Plaza. So, prior to trial, defendants moved to dismiss, claiming Cherry Plaza was an indispensable party; plaintiffs cross-moved for leave to file an amended complaint adding Cherry Plaza as a party. Both motions were denied, and a jury trial thereafter commenced.

         At the trial's conclusion in early August 2015, the jury awarded plaintiffs $682, 000 in compensatory damages and $319, 000 in punitive damages. Plaintiffs then moved for the issuance of equitable relief - rescission - and defendants moved for a judgment notwithstanding the verdict or, alternatively, for a new trial. Defendants' multi-faceted motion was denied, and plaintiffs' claim for equitable relief was granted. The judge determined that the contractual documents were to be rescinded and defendants restored to ownership of the business and its equipment. As part of their motion, plaintiffs also sought rescission or reformation of the lease. The judge reserved on this aspect of the motion so Cherry Plaza could be given notice. To that end, the judge entered an order in October 2015, that required Cherry Plaza - and defendants as well - to show cause: (a) why Cherry Plaza should not be enjoined from enforcing the lease as to plaintiffs, (b) why the lease should not be rescinded or reformed to render defendants the primary obligors, and (c) why plaintiffs should not be discharged from any obligations or liabilities arising from the lease.

         In response, Cherry Plaza argued, among other things, a deprivation of proper process because the judge bypassed the requirement that plaintiffs file a complaint against Cherry Plaza and instead proceeded directly to whether a final judgment ought to be entered against Cherry Plaza. Undeterred by Cherry Plaza's arguments, the judge entered a final judgment that, among other things, removed plaintiffs as the lease's tenants or guarantors. Having restored plaintiffs and defendants to their pre-transaction status, the judge reduced the damage award to approximately $350, 000.[1]

         Defendants appealed the judgment, and Cherry Plaza cross-appealed parts of the judgment. Defendants then failed to prosecute or perfect its appeal, which we eventually dismissed, leaving for disposition only those issues raised in Cherry Plaza's cross-appeal, to which only plaintiffs responded. We ultimately found flawed the procedures utilized by the judge in rendering relief against Cherry Plaza. Park Crest Cleaners, LLC v. A Plus Cleaners & Alterations Corp., No. A-1734-15 (App. Div. Oct. 17, 2017) (slip op. at 13) (holding that the trial judge's summary disposition "in plaintiffs' favor denied non-party Cherry [Plaza] a fair opportunity to be heard and defend against the relief requested"). Because no complaint was ever filed against Cherry Plaza, we concluded "there [was] no pending matter to remand," ibid., and, so, we merely sent the case back to the trial court for amendment of the judgment, id. at 14, to relieve Cherry Plaza of the judgment's former consequences.

         After our remand, the trial judge entered an amended judgment that vacated the relief entered against Cherry Plaza. This November 6, 2017 judgment also restored the full amount of compensatory damages awarded by the jury in favor of plaintiffs and against defendants.[2]

         Defendants then instituted this appeal. We agree with plaintiffs that the appeal must be dismissed because defendants should have pursued the issues it ...

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