COMMUNITY FIRE AND WATER DAMAGE RESTORATION, LLCVS. HARRIET ROTHSCHILDHARRIET ROTHSCHILD VS. ROYAL DISASTER RECOVERY, INC.(L-4148-13, UNION COUNTY AND STATEWIDE) ( 2017 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court."
Although it is posted on the internet, this opinion is binding only on the
parties in the case and its use in other cases is limited. R.1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-2133-15T4
COMMUNITY FIRE AND WATER
DAMAGE RESTORATION, LLC and
CHRIS OJUGO,
Plaintiffs-Respondents,
v.
HARRIET ROTHSCHILD,
Defendant-Appellant.
___________________________________
HARRIET ROTHSCHILD,
Third-Party Plaintiff-
Appellant,
v.
ROYAL DISASTER RECOVERY, INC.
a/k/a ROYAL EMERGENCY DISASTER
RECOVERY INC.,
Third-Party Defendant,
and
CHRIS OJUGO,
Third-Party Defendant-
Respondent.
__________________________________________________
Argued April 25, 2017 – Decided July 31, 2017
Before Judges Espinosa and Grall.
On appeal from the Superior Court of New
Jersey, Law Division, Union County, Docket
No. L-4148-13.
Gavin I. Handwerker argued the cause for
appellant (The Beinhaker Law Firm, LLC,
attorneys; Mr. Handwerker, on the briefs).
Chinemerem N. Njoku argued the cause for
respondents.
PER CURIAM
Plaintiffs, Community Fire and Water Damage Restoration,
LLC and Chris Ojugo, its sole member (collectively CFW)
remediated flood-water damage to a home in Plainfield. CFW sued
the homeowner, defendant Harriett Rothschild, for $34,939.29,
the amount CFW invoiced minus the homeowner's $8394 deposit.
The total amount invoiced, $43,332.29, was significantly lower
than the contract price, $56,137.21. CFW also sought punitive
damages, counsel fees and "such other relief as the Court shall
deem fair and equitable."
Rothschild answered and filed a counterclaim and a third-
party complaint against Ojugo and his solely owned corporation
Royal Disaster Recovery, Inc. She alleged violations of the
Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 to -20, its
supplementing Contractors' Registration Act, N.J.S.A. 56:8-136
to -152, and the Home Improvement Practices regulations,
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N.J.A.C. 13:45A-16.1 to -16.2, authorized by N.J.S.A. 56:8-4 and
directed by N.J.S.A. 56:8-152. She also alleged breach of
contract and the covenant of good faith and fair dealing and
promissory estoppel.
On joint stipulation, the parties tried the case to the
court. Ojugo was the only witness. At the conclusion of CFW's
case, Rothschild's attorney rested and moved for a "directed
verdict," Rule 4:40-1. CFW also rested and moved for directed
verdict. CFW did not move for involuntary dismissal of
Rothschild's CFA claim pursuant to Rules 4:37-2(b) and 4:37-3.
See Perez v. Professionally Green, LLC, 215 N.J. 388, 392-93
(2013) (holding a Rule 4:37-2(b) dismissal of an action under
N.J.S.A. 56:8-19, when based on proofs inadequate to permit a
rational juror to find an ascertainable loss caused by a
technical violation, requires dismissal of the CFA claim and
precludes recovery of counsel fees).
After combined arguments on the motions and summations
addressing the evidence at trial,1 the court filed a written
opinion and entered judgment. The court did not address the
1
"[I]n lieu of separate arguments for counsel with respect to
each directed verdict and then ultimately a summation, [counsel
agreed to] make their argument in one."
3 A-2133-15T4
pending motions and, instead considered the evidence, deemed
Ojugo's testimony credible, found the facts and applied the law.
The court dismissed Rothschild's claims for breach of
contract and promissory estoppel for failure of proof. The
court dismissed Rothschild's CFA claim for failure to establish
an ascertainable loss caused by a technical violation of
N.J.S.A. 56:8.151 or N.J.A.C. 13:45A-16.2(a)(12). The court
awarded Ojugo and CFW $34,938.29, plus interest and court costs,
and denied CFW's request for punitive damages and attorney's
fees.
The court concluded CFW was entitled to $34,938.29 on
alternative grounds: (1) as damages for breach of contract; and
(2) as the reasonable valuable for the services invoiced, which
"substantially discounted" the invoiced amount, finding that CFW
did the work expecting payment and Rothschild would be unjustly
enriched if not required to pay the reasonable value. Marascio
v. Campanella, 298 N.J. Super. 491, 504-05 (App. Div. 1997) Id.
at 504-05. In applying quantum meruit, the trial court relied
on this court's decision in Marascio v. Campanella, 298 N.J.
Super. 491 (App. Div. 1997).
Rothschild appeals and argues: 1) CFW's recovery is barred
by the contractor's "technical violations" of the CFA; 2) she
established an ascertainable loss, specifically an attorney fee
4 A-2133-15T4
she paid to vacate CFW's construction liens, and was, therefore,
entitled to treble damages and attorney's fees; and 3) Ojugo was
not entitled to judgment in his personal capacity.
Because Rothschild did not raise her claim based on the
form of judgment when the court addressed that question prior to
trial, we decline to deviate from our general practice by
considering an issue raised for the first time on appeal.
Nieder v. Royal Indem. Ins. Co., 62 N.J. 229, 234 (1973).
Rothschild did not address quantum meruit in her opening
brief on appeal. She addressed that issue for the first time in
her reply brief.
In her reply brief, Rothschild recognizes quantum meruit as
an exception to the general rule she asserts precluding a
technically violating contractor from recovering the value of
services rendered. In doing so, she defeats her first argument
for reversal of the $34,938.29 award in CFW's favor on that
ground. Rothschild does not urge us to conclude that Marascio
was wrongly decided or argue a different course of action.
Indeed, her attorney brought the trial court's attention to one
of the unpublished decisions of this court relying, in part, on
Marascio.
In Marascio, we held that quantum meruit was a remedy
available to a contractor who could not enforce an oral
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agreement for services for covered by N.J.S.A. 56:8-151(a) and
N.J.A.C. 13:45A-16.2(a)(12). 298 N.J. Super. at 503. Having
concluded that a retrial was required due to erroneous
evidentiary rulings, we directed the trial court to permit the
contractor to establish the reasonable value of the services he
rendered during "the remand trial." Id. at 504.
Rothschild does not argue that the trial court erred in
assessing the reasonable value of CFW's services. The only
argument she advances to defeat an award based on quantum meruit
is that CFW did not plead a claim for that relief. But
Rothschild's attorney raised that issue in his argument at the
end of trial, and, pointing to CFW's general request for
equitable relief, the court rejected the claim. Questions of
pleadings and their amendment to conform to the evidence are
left to the trial court's discretion in light of the situation
existing at the time. Kernan v. One Wash. Park Urban Renewal
Assocs., 154 N.J. 437, 457 (1998).
Given the thrust of CFW's case, the reference to equitable
relief in CFW's complaint and CFW's closing argument stressing
that Rothschild's failure to pay left her with the benefit of a
remediated home and CFW without payment and an obligation to pay
for materials and labor costs, we find no abuse of the court's
discretion in light of the situation at trial that warrants our
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intervention in the interest of justice. R. 2:10-2.
Rothschild's attorney had abbreviated the trial by resting at
the close of CFW's case and did not ask for an opportunity to
reopen to meet the quantum meruit claim as Rule 4:9-2 permits.
Rothschild's argument on quantum meruit has insufficient
merit to warrant any additional discussion. R. 2:11-3(e)(1)(E).
The only remaining argument for reversal is Rothschild's
claim that the court erred in determining that she failed to
establish an ascertainable loss caused by a technical violation.
Rothschild acknowledges, quite correctly, that a party claiming
a technical violation of a mandate set forth in the CFA must
prove "an 'ascertainable loss' directly attributable to [the
offending parties'] unlawful practice" to establish entitlement
to treble damages under the N.J.S.A. 56:8-19. (quoting Roberts
v. Cowgill, 316 N.J. Super. 33, 41 (App. Div. 1998)).
Rothschild contends the $8581.45 attorney fee she incurred
to vacate CFW's lien is an ascertainable loss. But she presents
no argument to establish error in the trial court's conclusion
that the "fee" was not incurred as a consequence of CFW's
technical non-compliance with N.J.S.A. 56:8-151 or N.J.A.C.
13:45A-16.2(a)(12). The only documentary evidence of the
construction lien does not establish its amount or the reason
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for vacating it.2 By Ojugo's testimony and the representation
made by Rothschild's attorney, who represented her at trial, on
her application to vacate the lien and now represents her on
appeal, the liens were vacated because they included
Rothschild's daughter, who was not a party to the contract but
was identified as an owner of the property. The judgment states
that CFW's opposition to Rothschild's application was "as to
attorney's fees only" and that the fees and costs were awarded
pursuant to N.J.S.A. 2A:44A-12(b) and N.J.S.A. 2A:44A-30(e).
The trial court's opinion states: "In its Counterclaim and
Third-Party Complaint, the defense claimed undetermined single
damages 'of not less than $34,939.29'. . . . At trial, defense
counsel clarified that its claimed ascertainable loss amount for
single damages for purposes of the CFA totaled $8,581.45."
Nevertheless, on appeal Rothschild argues that the "$8000 [sic]
deposit" she paid was an ascertainable loss. That deposit,
actually $8349, was deducted from the $43,332.29 total charge
for services to reach the $34,938.29 amount CFW and Ojugo sought
to recover. Ojugo, whose testimony the trial court credited,
2
It is worth noting Rothschild offered the judgment for
admission into evidence and the court admitted it, over CFW's
objection, after the parties rested, moved for directed verdicts
and argued the motions and the causes of action.
8 A-2133-15T4
estimated the work he undertook would cost $56,137.21, and
during his testimony Ojugo explained he discounted the estimated
price after working with Rothschild's insurer.3 Moreover, the
portion of Rothschild's brief on appeal addressing ascertainable
loss, as with the claim based on the attorney fees in the action
on the liens, includes no argument identifying a causal
relationship between the deposit and CFW's non-compliance with
N.J.S.A. 56:8-151 or N.J.A.C. 13:45A-16.2(a)(12).4
For all of the foregoing reasons, we reject the arguments
Rothschild presents in support of reversal. In reviewing the
record in light of the issues discussed above, we have
considered whether "there is substantial evidence in support of
the trial judge's findings and conclusions," Rova Farms Resort,
3
The trial court found that Rothschild accepted and agreed to
the detailed estimate Ojugo submitted by completing and signing
the contract for services form she signed nine days after
receiving the estimate. Each page of the estimate explaining
the tasks and the cost of the work, materials and labor
involved, states the estimate is subject to the insurer's review
and final approval.
4
The record on appeal includes Rothschild's check for $8349
payable to CFW and dated August 3, 2011. On the memo line
Rothschild wrote, "1/3 of basement cost." The invoice
accompanying the check on the exhibit has an entry stating,
"Initial invoice for mold remediation. Basement remediation
cost is $23,983.55 with a deposit of 35% ($8,349)." The invoice
has a second entry dated September 30, 2011, indicating a
deposit needed in that amount. Another invoice entry indicates
a credit in that amount dated September 30, 2011, which was not
addressed in Ojugo's testimony on direct or cross-examination.
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Inc. v. Inv'rs Ins. Co., 65 N.J. 474, 484 (1974), and we have
accepted the court's "factual findings and legal conclusions"
that CFW is entitled to the award on quantum meruit because we
are not "convinced that they are so manifestly unsupported by or
inconsistent with the competent, relevant and reasonably
credible evidence as to offend the interests of justice[.]"
D'Agostino v. Maldonado, 216 N.J. 168, 182 (2013) (quoting
Seidman v. Clifton Sav. Bank, S.L.A., 205 N.J. 150, 169 (2011)
(alteration in original) (quoting other precedents)); cf. Perez,
supra, 215 N.J. at 399 (discussing summary judgment and noting,
"Our review is de novo; '[a] trial court's interpretation of the
law and the legal consequences that flow from established facts
are not entitled to any special deference.'" (quoting Manalapan
Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378
(1995)). Because Rothschild acknowledges the applicability of
quantum meruit despite technical violations of the CFA and does
not argue entitlement to a counsel fee independent of treble
damages, we do not address that question. We further note that
our opinion should not be understood as approving the trial
court's conclusion that "the defense failed to establish any CFA
violations or is barred by equitable estoppel."
Affirmed.
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