Articles Posted in Supreme Court of New Jersey

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In November 2008, following the collapse of the housing market, the New Jersey Supreme Court implemented a statewide Residential Mortgage Foreclosure Mediation Program to address the economic crisis that left many facing the loss of their homes. After defaulting on her home loan with plaintiff GMAC Mortgage, LLC, defendant TamiLynn Willoughby entered into the Foreclosure Mediation Program. The mediation process led to an agreement between GMAC and Willoughby that gave Willoughby a path to save her home through a permanent modification of the loan. The agreement, executed in 2010, set forth the required down payment and monthly payments, the unpaid principal balance, the amount in arrears, and the length and interest rate of the loan. Willoughby complied with that agreement, paying the down payment and each monthly installment for one year. Then, GMAC began sending Willoughby proposals differing from the 2010 agreement, which GMAC claimed was provisional. Willoughby moved to enforce the 2010 settlement agreement, but instead the chancery court ordered additional mediation sessions. Willoughby never accepted in writing any of GMAC s proposals to modify the original agreement. Protracted litigation ensued. Willoughby's efforts to enforce the 2010 settlement agreement proved fruitless, and GMAC s foreclosure action ended with a Sheriff's sale of Willoughby's home. Willoughby was denied relief by the chancery court, which held that the 2010 mediation agreement was provisional and not enforceable as a final settlement agreement. The Appellate Division affirmed. The New Jersey Supreme Court reversed, concluding Willoughby and GMAC entered into an enforceable settlement agreement through the Foreclosure Mediation Program. The case was remanded to the chancery court to consider an appropriate remedy. View "GMAC Mortgage, LLC v. TamiLynn Willoughby" on Justia Law

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This appeal arose out of the tragic death of eleven-year-old Abiah Jones after she fell from a ride in an amusement park. The issues this case presented for the New Jersey Supreme Court’s consideration was: (1) the circumstances under which a defendant is barred from asserting contribution and common-law indemnification claims against a public entity for purposes of the Tort Claims Act; (2) whether the jury should be permitted to allocate a percentage of fault to a public entity pursuant to the Comparative Negligence Act and the Joint Tortfeasors Contribution Law; and (3) the effect of any such allocation of fault on plaintiffs recovery of damages if the jury returns a verdict in their favor. The Supreme Court reversed the trial court’s determination. The plain language of N.J.S.A.59:8-8 required parties seeking to assert a claim against a public entity to serve a notice of claim within ninety days of the date on which the cause of action accrues. Because the Morey defendants did not serve a timely notice of claim on the Association, their third-party contribution and common-law indemnification claims against the Association are barred. The New Jersey Supreme Court held that the trial court should have afforded defendants an opportunity to present evidence of negligence, that negligence was a proximate cause of Abiah Jones’s death. If defendants present prima facie evidence, the trial court should instruct the jury to determine whether any fault should be allocated in accordance with N.J.S.A.2A:15-5.2. Should the jury find negligence was a proximate cause of Abiah Jones’s death, the trial court should mold any judgment entered in plaintiffs’ favor pursuant to N.J.S.A.2A:15-5.2(d) to reduce the damages awarded to plaintiffs by the percentage of fault that the jury allocates. View "Jones v. Morey Pier, Inc." on Justia Law

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In 1983, the New Jersey Supreme Court affirmed a final consent judgment for a settlement agreement between the New Jersey State Bar Association and the New Jersey Association of Realtor Boards. The terms of the settlement provided that real estate brokers and salespersons may prepare contracts to sell or lease real property, so long as a standard form is used that includes a three-day period for attorney review. Plaintiffs Michael Conley, Jr., and Katie M. Maurer (Buyers) made an offer to purchase a condominium from defendant Mona Guerrero (Seller), and, a few days later, Seller signed and executed the contract. Before the three-day attorney-review period expired, Seller s attorney sent Buyers attorney and their realtor notice of disapproval by e-mail and fax, rather than by the methods approved under the 1983 holding and prescribed in the parties' contract (certified mail, telegram, or personal service). Buyers sued for specific performance, claiming the contract was enforceable because Seller s notification of disapproval was sent improperly. At issue before the Supreme Court was whether the attorney-review provision of a standard form real estate contract had to be strictly enforced, thereby nullifying Seller's notice of disapproval and requiring enforcement of the real estate contract. The Court concluded that, because Buyers received actual notice of disapproval within the three-day attorney-review period by a method of communication commonly used in the industry, the notice of disapproval was valid. The Court also exercised its constitutional authority over the practice of law and found that an attorney's notice of disapproval of a real estate contract could be transmitted by fax, e-mail, personal delivery, or overnight mail with proof of delivery. Notice by overnight mail will be effective upon mailing. The attorney-review period within which this notice must be sent remained three business days. View "Conley v. Guerrero" on Justia Law

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This dispute arose from the construction of Cypress Point, a luxury condominium complex in Hoboken. Co-defendants Adria Towers, LLC, Metro Homes, LLC, and Commerce Construction Management, LLC (collectively, the developer) served as the project's developer and general contractor, and subcontractors carried out most of the work. During construction, the developer obtained four CGL policies from Evanston Insurance Company, covering a four-year period, and three from Crum & Forster Specialty Insurance Company, covering a subsequent three-year period (collectively, the policies). In this appeal, issue before the Supreme Court was whether rain water damage caused by a subcontractor's faulty workmanship constituted property damage and an occurrence under the developer's commercial general liability (CGL) insurance policy. In a published decision, the Appellate Division reversed, holding that, under the plain language of the CGL policies, the unintended and unexpected consequential damages caused by the subcontractors faulty workmanship constituted property damage and an occurrence. The Supreme Court agreed and affirmed, finding that the consequential damages caused by the subcontractors faulty workmanship constituted property damage, and the event resulting in that damage water from rain flowing into the interior of the property due to the subcontractors faulty workmanship was an occurrence under the plain language of the CGL policies at issue here. View "CypressPoint Condominium Association, Inc. v. Adria Towers, L.L.C., et al." on Justia Law

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In 1995, Jazz Photo Corp., one of several commercial entities (collectively referred to as the Jazz Entities), entered into a factoring agreement with Rosenthal & Rosenthal, Inc. Jazz Photo sold Rosenthal its accounts receivable in return for cash. Five years later, Vanessa Benun, the daughter of Jack Benun, a principal of the Jazz Entities, guaranteed Jazz Photo's obligations under that agreement. At that time, Benun also executed a mortgage on real property she owned in Monmouth County as security for her personal guaranty. In March 2005, another of the Jazz Entities, Ribi Tech Products, LLC entered into a factoring agreement with Rosenthal. Benun personally guaranteed Ribi Tech's obligations to Rosenthal. In March 2007, Riker, Danzig, Scherer, Hyland & Perretti, L.L.P. (Riker), a law firm providing legal services to Jack Benun and the Jazz Entities, obtained a third mortgage from Benun on the same real property. This mortgage was executed in favor of Riker to secure Jack Benun's personal debt under a letter agreement. When Benun executed the mortgage, Jack Benun owed Riker $1,679,701.33 in unpaid legal fees, and the letter agreement reflected his obligations to Riker and Riker's promise to provide continuing legal representation. Riker's mortgage was recorded on April 13, 2007. Rosenthal received actual notice of the Riker mortgage in August 2007. Despite notice of the Riker mortgage, Rosenthal continued to make advances to the Jazz Entities that totaled millions of dollars. In September 2009, Jazz Products filed for bankruptcy. The Jazz Entities defaulted on their obligations to Rosenthal, owing Rosenthal close to $4 million. Benun, in turn, defaulted on her personal guaranty to secure the debt. After Riker recorded its mortgage on the Monmouth County property, it continued to perform legal services for Jack Benun, and his unpaid legal fees ballooned to over $3 million. Jack Benun, and the Jazz Entities defaulted on their obligation to Riker and Benun defaulted on her guaranty. Rosenthal filed a foreclosure complaint against Benun, her husband, and Riker. Benun and her husband did not respond, and Rosenthal requested that a default judgment be entered against them. Riker answered, disputing the priority of Rosenthal's mortgages. Later, both Rosenthal and Riker filed cross-motions for summary judgment regarding the priority of their respective mortgages. The trial court granted Rosenthal's motion, determining that the dragnet clauses in the Rosenthal mortgages were fully enforceable. With regard to priority, the trial court held that Riker's argument that its mortgage displaced the two Rosenthal mortgages was legally flawed because the firm accepted a mortgage on the property with knowledge of two prior mortgages, each securing an obligation of up to $1 million, and with knowledge of the anti-subordination clauses. The court concluded that there was no convincing justification for rewarding Riker a superior priority. Riker appealed, and the Appellate Division reversed. The Supreme Court affirmed the Appellate Division, finding that Rosenthal had advance notice of the law firm's intervening lien but nonetheless proceeded to make optional advances to the commercial entities. "Having done so, its mortgages securing those optional future advances were subordinated to the law firm's intervening lien." View "Rosenthal & Rosenthal, Inc. v. Benun" on Justia Law

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In this appeal, the issue presented for the Supreme Court's review centered on the standard governing revocation of direct access from a state highway to property used for commercial purposes pursuant to the State Highway Access Management Act (the Act), N.J.S.A. 27:7-89 to -98, and the State Highway Access Management Code (Access Code), N.J.A.C. 16:47-3.5(e)(11) and -3.8(k)(2). Arielle Realty, L.L.C. was the owner of a three-tenant commercial property located on the northbound side of Route 166 in Toms River. The DOT informed Arielle that access to its property from Route 166 would be eliminated because the DOT intended to construct an additional northbound travel lane. The DOT also advised Arielle that it intended to construct a median to separate northbound and southbound traffic on Route 166. This design would eliminate the eight parking spaces in the front of the building. The plan would also prevent direct access to Arielle s property for motorists traveling south on Route 166 because a motorist would no longer be able to make a left-hand turn onto West Gateway. According to the DOT design plan, a southbound motorist on Route 166, who intends to access Arielle s property, would be required to drive past the property, turn right onto a local road, turn right onto another local road, turn left onto Route 166 at an intersection controlled by a traffic signal, and turn right onto West Gateway. This alternative route traversed approximately three-quarters of a mile. In affirming the DOT Commissioner's decision, the Appellate Division determined that the DOT met its burden of proof that the alternative access plan was not only reasonable but also provided a convenient, direct, and well-marked means to enter the business and to return to the state road. Accordingly, the Appellate Division determined that the property owner failed to overcome the presumption of validity accorded to the DOT design. The Supreme Court affirmed: "the Commissioner's analysis is ultimately aimed at selecting the plan that will best achieve the overarching goal of providing reasonable access to the state's system of highways rather than maximizing the business interests of a particular property owner." View "In re Revocation of the Access of Block #613" on Justia Law