BARRY H. GERTSMAN & COMPANY VS. 5218 ATLANTIC AVENUE ASSOCIATES, LLC (L-1531-17, ATLANTIC COUNTY AND STATEWIDE) ( 2019 )

NOT FOR PUBLICATION WITHOUT THE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-1528-18T1
BARRY H. GERTSMAN &
COMPANY,
Plaintiff-Appellant,
v.
5218 ATLANTIC AVENUE
ASSOCIATES, LLC and GAP
PROPERTIES, LLC,
Defendants-Respondents,
and
THE STATE OF NEW JERSEY,
Defendant.
____________________________
Submitted November 6, 2019 – Decided December 10, 2019
Before Judges Hoffman and Firko.
On appeal from the Superior Court of New Jersey, Law
Division, Atlantic County, Docket No. L-1531-17.
Briggs Law Office, LLC, attorneys for appellant
(Norman W. Briggs, of counsel and on the briefs;
Daniel S. Gradwohl, on the briefs).
Jones Wolf & Kapasi, LLC, attorneys for respondents
(Joseph K. Jones, on the brief).
PER CURIAM
In this breach of contract action, plaintiff Barry H. Gertsman & Co.
appeals from the Law Division's May 21, 2018 order granting defendant 5218
Atlantic Avenue Associates, LLC's (5218 Atlantic) cross-motion for summary
judgment finding plaintiff waived its right to receive quarterly commission
payments.1 Plaintiff also appeals from the court's November 14, 2018 order
awarding counsel fees. We affirm substantially for the reasons stated by Judge
John C. Porto in his oral decisions issued as to each order under appeal.
I.
Defendants own a commercial building located at 5218 Atlantic Avenue
in Mays Landing. In 2005, plaintiff, a licensed real estate broker, procured a
tenant, the State of New Jersey, to lease office space from defendants.
1
GAP Properties, LLC was not a signatory to the commission agreement.
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On May 29, 2005, plaintiff and 5218 Atlantic entered into a two-page
commission agreement (agreement) relative to this transaction. Plaintiff
prepared the agreement. Paragraph two states:
2. Upon Lessee's execution of the Lease (the
"Execution Date"), and the commencement of rental
payments, Lessor agrees to pay Broker an annual
amount equal to six percent (6%) of the gross
consideration, including, but not limited to, Rent and
Additional Rent, paid by Lessee to Lessor under the
Lease during any Lease Year, as compensation for
Broker's efforts in effectuating the Lease (the "Broker's
Commission"). Lessor shall pay the Broker's
Commission for each Lease Year in four equal
quarterly installments per year, in advance, no later
than the tenth (10th) day for the first month of each
calendar quarter next following the Execution Date
during each year of the Term of the Lease, including
any renewals thereto.
Additionally, the agreement entitled plaintiff to receive interest and attorney's
fees in the event 5218 Atlantic defaulted on payments.
On September 14, 2006, defendants entered into a lease agreement with
the State, which required the State pay rent on the first day of each month. From
September 2006 until August 2009, 5218 Atlantic paid commission payments to
plaintiff pursuant to the quarterly schedule contemplated in the commission
agreement. However, starting in August 2009, 5218 Atlantic began making
payments on a monthly basis instead of quarterly. Plaintiff did not object to
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receiving the monthly payments. Between 2010 and 2017, 5218 Atlantic
defaulted on its payments.
Collection demands made by plaintiff upon 5218 Atlantic in 2016 were
unsuccessful. Thereafter, on January 13, 2017, plaintiff filed a complaint in the
Chancery Division alleging: (1) defendants breached the terms of the agreement
by failing to make any payments in the final quarter of 2016 and the first quarter
of 2017 (count one); (2) GAP Properties, LLC (GAP) tortiously interfered with
the agreement between plaintiff and 5218 Atlantic by withholding payments
owed by 5218 Atlantic (count two); and (3) plaintiff was entitled to equitable
relief, reforming the agreement and requiring the State to pay commission
payments directly to plaintiff (count three).
After the matter was transferred to the Law Division, plaintiff moved for
partial summary judgment on February 9, 2018, arguing that there were no
genuine issues of material fact warranting trial as to defendants' breach of the
agreement because the express language of the agreement clearly established
their obligation to make quarterly commission payments in advance. On March
6, 2018, defendants cross-moved for summary judgment asserting that the
commission payments were made, and plaintiff waived its right to receive
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quarterly payments in advance because plaintiff accepted payments on a
monthly basis for over a decade.
Following oral argument on March 27, 2018, the judge found the
agreement "unambiguously expressed the mutual responsibilities between the
parties regarding the payment of the commissions." Nevertheless, the judge
indicated that plaintiff "waived the payment provision in the contract [insofar]
as that provision required quarterly payments to be made in advance."
Moreover, the judge explained that plaintiff assented to, and accepted, 5218
Atlantic's monthly payments continuously for eleven years, thereby constituting
a waiver of the quarterly payment schedule set forth in the agreement. The judge
found that the change of "the payments from quarterly to monthly constituted
that new consideration."
Absent an express agreement, the judge noted a party can waive a
provision "provided the circumstances clearly show that the party knew of the
right and then abandoned it either by design or indifference," citing Knorr v.
Smeal, 178 N.J. 169 (2003). The judge concluded that 5218 Atlantic failed to
make timely payments on a monthly basis and breached the agreement.
Finally, the judge considered defendants' cross-motion for summary
judgment. As to defendants' claim for reformation of the agreement based upon
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the course of dealing between the parties, the judge found plaintiff "is deemed
to have waived the right to commission payments quarterly in advance" and
payments are "deemed to be due monthly on the tenth of the month."
In a March 29, 2018 memorializing order, the judge dismissed the State
from the case, and directed plaintiff to submit a letter as to the status of the
tortious interference claim against GAP. A corrective order was issued on May
21, 2018, reflecting that the tortious interference claim, count two, was
dismissed at plaintiff's request. The judge also ordered plaintiff to submit an
application for counsel fees and provided defendants an opportunity to oppose
same.
As directed, plaintiff submitted the May 22, 2018 certification of Norman
W. Briggs, asserting his client incurred $33,960.62 in fees and expenses. In a
supplemental certification dated June 19, 2018, Briggs sought an additional
amount of $1648.28 in interest relative to defendants' late payments, and $1140
in additional attorney's fees incurred since his May 22, 2018 certification was
filed. On November 9, 2018, the judge heard oral argument on plaintiff's
application for counsel fees.
On November 13, 2018, the judge rendered his oral decision on the issue
of counsel fees. In his decision, the judge analyzed the threshold issue as to
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whether the fees were reasonable. He noted plaintiff prevailed on one of the
three counts pled in its complaint, but 5218 Atlantic successfully argued the
commission payments became due on a monthly basis, not quarterly, because
plaintiff chose to forego enforcement of its rights under the agreement .
Moreover, the judge considered the Rule 4:42-9(a) and RPC 1.5(a) factors.
He stated the reasonableness of attorney's fees depends on whether the party
seeking fees prevailed, relying upon the Supreme Court's opinion in N. Bergen
Rex Transp. Inc. v. Trailer Leasing Co., 158 N.J. 561 (1999) and Singer v. State,
95 N.J. 487 (1984). Since plaintiff only prevailed on one of the three counts in
the complaint, the judge concluded plaintiff is only entitled to one-third of its
fees sought. The judge therefore ordered defendants to pay counsel fees to
plaintiff in the sum of $13,252.64, plus interest and costs, for a total of
$14, 906.15, and entered an order to this effect on November 14, 2018.
On appeal, plaintiff argues that the judge erred by granting partial
summary judgment and finding it waived the right to receive quarterly advance
payments, and by awarding plaintiff only a portion of its counsel fees requested.
We disagree.
"In reviewing a grant or denial of summary judgment, [we are] bound by
the same standard as the trial court under Rule 4:46-2(c)." State v. Perini Corp.,
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221 N.J. 412, 425 (2015) (citations omitted). "We must 'consider whether the
competent evidential materials presented, when viewed in the light most
favorable to the non-moving party, are sufficient to permit a rational factfinder
to resolve the alleged disputed issue in favor of the non-moving party.'" Ibid.(quoting Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995)).
In our review, we "must view the facts in the light most favorable to the
non-moving party, which in this case [are]" defendants. Bauer v. Nesbitt, 198
N.J. 601, 604-05 n.1. (2009); see also R. 4:46-2(c); Brill, 142 N.J. at 540.
Summary judgment is appropriate where the record demonstrates "no genuine
issue as to any material fact challenged and that the moving party is entitled to
a judgment . . . as a matter of law." Burnett v. Gloucester Cty. Bd. of Chosen
Freeholders, 409 N.J. Super. 219, 228 (App. Div. 2009) (quoting R. 4:46-2(c)).
Plaintiff first contends the judge erred by not enforcing the agreement as
written regarding the quarterly payment of the commissions in advance, and
there was never a waiver of that provision.
Waiver "involves the intentional relinquishment of a known right and thus
it must be shown that the party charged with the waiver knew of his or her legal
rights and deliberately intended to relinquish them." Spaeth v. Srinivasan, 403
N.J. Super. 508, 514 (App. Div. 2008) (quoting Shebar v. Sanyo Bus. Sys. Corp.,
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111 N.J. 276, 291 (1988)). "Such a waiver must done 'clearly, unequivocally,
and decisively.'" Cole v. Jersey City Med. Ctr., 215 N.J. 265, 277, (2013)
(quoting Knorr v. Smeal, 178 N.J. 169, 177 (2003)). Where a contract requires
any waiver or modification to be in writing, we will enforce those unambiguous
terms, absent clear conduct that the parties intended to waive the requirement
for a writing. See Lewis v. Travelers Ins. Co., 51 N.J. 244, 253 (1968); Home
Owners Constr. Co. v. Glen Rock, 34 N.J. 305, 316 (1961); Headley v. Cavileer,
82 N.J.L. 635, 637-39 (E. & A. 1912). Clear and convincing evidence is
required to prove waiver of a writing requirement. Home Owners Constr. Co.,
34 N.J. at 317.
Here, 5218 Atlantic clearly and convincingly demonstrated that plaintiff
waived its right to enforce the precise terms of the agreement based upon an
eleven-year course of dealings. By assenting to and accepting the monthly
payments from 5218 Atlantic, plaintiff "relinquished the quarterly payments
provision." The agreement provided plaintiff with the right to a quarterly
advance payment, but that right was voluntarily and intentionally waived by
plaintiff.
Next, we turn to plaintiff's contention that the judge abused his discretion
by awarding plaintiff only one-third of its fees because it only prevailed on one
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of the three counts pled in the complaint. According to plaintiff, counts two and
three were incidental, in that count two was necessitated because of the unclear
relationship between defendants, and count three was dismissed early on in the
litigation.
We review an award of counsel fees for abuse of discretion. Where the
judge follows the law and "makes appropriate findings of fact, a fee award is
accorded substantial deference and will be disturbed only in the clearest case of
abuse of discretion." Yueh v. Yueh, 329 N.J. Super. 447, 466 (App. Div. 2000);
see also Barr v. Barr, 418 N.J. Super. 18, 46 (App. Div. 2011). An abuse of
discretion "arises when a decision is 'made without a rational explanation,
inexplicably departed from established policies, or rested on an impermissible
basis.'" Flagg v. Essex Cty. Prosecutor, 171 N.J. 561, 571 (2002) (quoting
Achacoso-Sanchez v. Immigration & Naturalization Serv., 779 F.2d 1260, 1265
(7th Cir. 1985)); Barr, 418 N.J. Super. at 46.
This court will disturb a counsel fee determination "only on the rarest of
occasions . . . ." Litton Indus., Inc. v. IMO Indus., Inc., 200 N.J. 372, 386 (2009)
(quoting Packard-Bamberger & Co., Inc. v. Collier, 167 N.J. 427, 444 (2001)).
The judge relied on the two-prong test articulated in Singer v. State, 95
N.J. 487, 494 (1984). "The first prong requires that the litigant seeking fees
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establish that the 'lawsuit was causally related to securing the relief obtained; a
fee award is justified if [the party's] efforts are a necessary and important factor
in obtaining the relief.'" Packard-Bamberger, 167 N.J. at 444 (alteration in
original) (quoting N. Bergen Rex Transp. v. Trailer Leasing Co., 158 N.J. 561,
571 (1999)). "The second prong involves a factual and legal determination,
requiring the party seeking fees to prove that 'the relief granted has some basis
in law.'" Ibid. (quoting N. Bergen Rex Transp., 158 N.J. at 571).
The judge found plaintiff satisfied both Singer prongs entitling it to
counsel fees pursuant to the agreement. The record is replete with 5218
Atlantic's failure to make payments over a long period of time. The relevant
factors were considered by the judge. We are unpersuaded by plaintiff's
argument that Singer involved an award of fees pursuant to a statute and not a
private contract between the parties. We discern no error or abuse of discretion.
To the extent we have not specifically addressed any of plaintiff's
contentions, we conclude they are without sufficient merit to warrant discussion
in a written opinion. R. 2:11-3(e)(1)(E).
Affirmed.
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