STATE OF NEW JERSEY VS. JOSEPH EHRMAN (18-19 AND 19-19, HUDSON COUNTY AND STATEWIDE) (CONSOLIDATED) ( 2021 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-4144-19
A-4447-19
STATE OF NEW JERSEY,
APPROVED FOR PUBLICATION
Plaintiff-Respondent, July 23, 2021
v. APPELLATE DIVISION
JOSEPH EHRMAN,
Defendant-Appellant.
_______________________
Argued May 10, 2021 – Decided July 23, 2021
Before Judges Sabatino, Currier and Gooden Brown.
On appeal from an interlocutory order of the Superior
Court of New Jersey, Law Division, Hudson County,
Municipal Appeal No. 18-19; and the Superior Court
of New Jersey, Law Division, Hudson County,
Municipal Appeal No. 19-19.
Alison C. Ingenito argued the cause for appellant in
A-4144-19.
Joseph B. Fiorenzo argued the cause for appellant in
A-4447-19 (Sills Cummis & Gross, PC, attorneys;
Joseph B. Fiorenzo and David W. Phillips, of counsel
and on the briefs).
David J. Labib, Assistant Municipal Prosecutor,
argued the cause for respondent (Jacob V. Hudnut,
Chief Municipal Prosecutor of City of Jersey City,
attorney; David J. Labib, on the briefs).
The opinion of the court was delivered by
GOODEN BROWN, J.A.D.
In these back-to-back appeals, which we consolidate for purposes of
issuing a single opinion, defendant Joseph Ehrman challenges numerous
complaint-summonses issued in municipal court by the Jersey City Department
of Housing, Economic Development and Commerce (Department) for
municipal violations in rental properties owned by various limited liability
companies (LLCs) 1 in which Ehrman has an interest.
In A-4144-19, by leave granted, Ehrman appeals from the June 18, 2020
Law Division order denying reconsideration of the March 10, 2020 order,
which denied his motion to dismiss twenty-five complaint-summonses issued
1
A limited liability company exists pursuant to the authority conferred under
the New Jersey Limited Liability Company Act (LLCA), N.J.S.A. 42:2B-1 to -
70, which was supplemented and repealed in part by the Revised Uniform
Limited Liability Company Act (RLLCA), N.J.S.A. 42:2C-1 to -94. Under
N.J.S.A. 42:2C-4, "[a] limited liability company may have any lawful
purpose," N.J.S.A. 42:2C-4(b), and "is an entity distinct from its members."
N.J.S.A. 42:2C-4(a). Thus, "[t]he debts, obligations, or other liabilities of a
limited liability company, whether arising in contract, tort, or otherwise . . .
are solely the debts, obligations, or other liabilities of the company," N.J.S.A.
42:2C-30(a)(1), and "do not become the debts, obligations, or other liabilities
of a member or manager solely by reason of the member acting as a member or
manager acting as a manager." N.J.S.A. 42:2C-30(a)(2).
2 A-4144-19
to him individually for alleged housing code violations at two different rental
properties. Ehrman argues that because the properties were owned by an LLC
of which he was a member, rather than by him individually, the complaints
were fatally defective on their face. Thus, Ehrman asserts that the trial court
erred in denying his motion to dismiss the complaints and granting the State's
cross-motion to amend the complaints to name the LLC instead of him. For
the reasons that follow, we agree with Ehrman's assertions. Accordingly, we
reverse and remand for entry of an order of dismissal without prejudice to the
Department reissuing the complaint-summonses to the correct party, if
appropriate.
In A-4447-19, Ehrman appeals from the June 30, 2020 order
adjudicating guilt following a trial de novo in the Law Division for failure to
file an annual registration for rental property in violation of the rent control
municipal ordinance. Although the complaint-summons was issued to Ehrman
individually for property owned by an LLC of which he was a member, the
court found that the complaint-summons was intended to be issued to the LLC,
instead of Ehrman individually. Thus, the court found only the LLC guilty of
the violation. However, because it is undisputed that the LLC made no
appearance by counsel during the trial or on appeal, and the municipal court
record of conviction still lists Ehrman as the guilty party, consistent with our
3 A-4144-19
ruling in A-4144-19, we reverse and remand for the entry of an order vacating
the record of conviction as to Ehrman individually and for a new trial as to the
LLC. 2
I.
A-4144-19:
In this appeal, the facts are not disputed. On March 6, 2019, a housing
code enforcement officer for the Department issued Ehrman eleven complaint-
summonses alleging housing code violations at 47 Duncan Avenue in Jersey
City. 3 The violations included failure to repair walls, ceilings, and floors, and
failure to repair a porch and walkway. On March 20, 2019, a different housing
code enforcement officer for the Department issued Ehrman fourteen
complaint-summonses alleging housing code violations at 630 Bergen Avenue
in Jersey City. 4 The violations included failure to repair, scrape, and paint
2
The Attorney General declined our invitation to participate as amicus in
these two appeals.
3
The complaint-summonses were numbered 353831, 353833, 353834,
353835, 353836, 353837, 353838, 353839, 353840, 353841, and 353842. The
specific housing code violation ordinance cited in the complaints is unclear in
the record. See Jersey City, N.J., Ordinance § 254-45 (listing general safety
and sanitation maintenance requirements for property owners).
4
The complaint-summonses were numbered 354726, 354727, 354728,
354729, 354730, 354731, 354732, 354734, 354735, 354736, 354737, 354798,
354799, and 354800. The specific housing code violation ordinance cited in
4 A-4144-19
walls and ceilings, failure to repair light fixtures, failure to eliminate
infestation of mice, and failure to properly install heaters, carbon monoxide,
and smoke detectors.
All twenty-five complaint-summonses were issued to Ehrman
individually at a P.O. Box in Farmingdale. It is undisputed that Ehrman is not
the record owner of either property. Instead, tax records and other documents
show that at the time in question, both 47 Duncan Avenue and 630 Bergen
Avenue were owned by Journal Square Group LLC, of which Ehrman is a
member.
On June 19, 2019, Ehrman filed a motion in Jersey City municipal court
to dismiss the complaints on the ground that under the RLLCA, he could not
be named individually in the complaints when it was undisputed that the
property was owned by an LLC of which he was a member. The State opposed
the motion and cross-moved over Ehrman's objection to amend the complaints
pursuant to Rule 7:2-5 to list the defendant as Journal Square Group LLC and
designate Ehrman as "care of" to ensure proper service.
the complaints is unclear in the record. See Jersey City, N.J., Ordinance §
254-45 (listing general safety and sanitation maintenance requirements for
property owners); Jersey City, N.J., Municipal Code § 1-25.A (describing
permissible penalties and fines for violating codes and ordinances).
5 A-4144-19
On August 12, 2019, the municipal court judge denied Ehrman's motion
and granted the State's cross-motion. Relying on Rule 4:9-1, which permits
amendment of pleadings "by leave of court which shall be freely given in the
interest of justice," the judge determined there was no prejudice to Ehrman in
amending the complaint-summonses as requested by the State. The judge
noted that inasmuch as the matters have not yet gone to trial, no liability has
attached. Moreover, according to the judge, because Ehrman was designated
as "care of" on the complaint-summonses, as "an officer of the LLC," he had
"a fiduciary duty to disclose [the violations] to the LLC" once he received
"notice" 5 of them.
Ehrman filed a motion in the Law Division seeking leave to appeal the
interlocutory order entered by the municipal court judge, which motion was
granted by the trial court. See R. 3:24(a) and (c). On February 13, 2020, after
hearing the case de novo, the court denied Ehrman's motion to dismiss the
complaints and granted the State's cross-motion to amend them. In a
memorializing order entered on March 10, 2020, and accompanying written
decision, the court explained that while Rule 7:2-5 allows the amendment of a
summons "to remedy . . . [a] technical defect," "wrongfully filing a complaint
5
The registered agent of Journal Square Group LLC is not identified in the
record.
6 A-4144-19
against the wrong individual is more than a technical defect" that would
"ordinarily warrant dismissal of the complaints." However, relying on Rule
4:9-1, the court determined that amending the complaints as the municipal
court judge had done was "an appropriate remedy" to overcome the "defect."
The court also rejected Ehrman's position that any remedy other than
dismissal would "unfairly prejudice" him "personally and/or professionally."
The court explained that
dismissing the entire complaint against the LLC is not
a remedy to the reputation hardship that [Ehrman] may
suffer due to lawsuits and is not intended to be a
remedy for such. Instead, the amendment is one
which speaks to the "interest of justice" in fair
litigation of the issue.
Additionally, the court rejected the State's contention that "the
participation theory" justified "'pierc[ing] the veil' in an effort to hold
[Ehrman] liable for using the LLCs as 'shell companies.'" The court noted that
under N.J.S.A. 42:2C-4, "[a] limited liability company is an entity distinct
from its members." The court also acknowledged that "[i]n certain
circumstances, it is within the discretion of the court" to "'pierce the corporate
veil' under the participation theory, which requires a showing that corporate
officers are involved in tortious conduct surrounding the LLC or corporation."
See Saltiel v. GSI Consultants, Inc., 170 N.J. 297, 304 (2002) ("New Jersey
cases that have applied the participation theory to hold corporate officers
7 A-4144-19
personally responsible for their tortious conduct generally have involved
intentional torts . . . . involv[ing] fraud and conversion.").
However, here,
[t]he [c]ourt [was] not convinced that there [was]
enough evidence to support that assertion. The State
asserts, "there is a strong, if not seamless, connection
between Joseph Ehrman and the LLC." This [c]ourt
does not believe that a "strong" connection between
an[] individual and a corporation or LLC is the type of
connection intended by law to warrant piercing the
corporate veil.
Therefore, [Ehrman] cannot be held personally
liable for the acts committed by the LLC.[6]
Ehrman moved for reconsideration, which was denied in a June 18, 2020
order. Thereafter, we granted leave to appeal
solely limited to the issue of the propriety of the State
issuing summonses solely to a principal of a[n LLC]
. . . that is the record title holder of the subject
premises without naming the LLC itself as a defendant
or a codefendant, and seeking in the prosecution to
impose individual liability upon a member of the LLC
for municipal code violations.
On appeal, Ehrman raises the following points for our consideration:
I. [N.J.S.A.] 42:2C-30 ASSIGNS THE DEBTS,
OBLIGATIONS OR OTHER LIABILITIES OF AN
LLC SOLELY TO THE LLC AND NOT TO ITS
MEMBERS.
6
The State did not move for leave to file a cross-appeal from that ruling.
8 A-4144-19
II. [N.J.S.A.] 42:2B-23 EXPRESSLY STATES THE
LIABILITIES OF AN LLC SHALL BE THOSE OF
THE LLC AND NOT OF AN INDIVIDUAL BY
REASON OF BEING A MEMBER.
III. [N.J.S.A] 42:2C-4A EXPRESSLY STATES AN
LLC IS AN ENTITY DISTINCT FROM ITS
MEMBERS.
IV. ALLOWING THE DEFENDANT'S NAME TO
BE AMENDED ON A COMPLAINT WHEN IT WAS
KNOWINGLY INCORRECTLY ISSUED, ALLOWS
FOR SELECTIVE PROSECUTION AND ABUSE OF
PROCESS BY JERSEY CITY HOUSING CODE
ENFORCEMENT AND THE STATE.
V. THE LOWER COURT ERRED IN ITS
RELIANCE ON R[.] 7:2-5 AND R[.] 4:9-1 TO
ALLOW AN AMENDMENT OF THE NAME OF
THE DEFENDANT ON THE QUASI-CRIMINAL
COMPLAINTS.
The dispositive issue presented in this appeal is whether a municipal
court complaint-summons issued to the wrong defendant must be dismissed or
may be amended. "[P]rocedurally . . . a prosecution for violation of an
ordinance is essentially criminal in nature irrespective of whether the penal
section of the ordinance provides for a fine only or for both fine and
imprisonment and even though such violation does not constitute an indictable
offense. . . ." State v. Yaccarino, 3 N.J. 291, 295 (1949). Under N.J.S.A.
2B:12-17, a municipal court's jurisdiction includes "[v]iolations of county or
municipal ordinances" "within the territorial jurisdiction of the court. . . ."
9 A-4144-19
Rule 7:1 specifies that "[t]he rules in Part VII govern the practice and
procedure in the municipal courts in all matters within their statutory
jurisdiction. . . ." Rule 7:2-1(a) provides that in general, a municipal
complaint "shall be a written statement of the essential facts constituting the
offense charged" and "the complaining witness shall attest to the facts
contained in the complaint by signing a certification or signing an oath before
a judge or other person so authorized . . . ." Under Rule 7:2-1(c), "[t]he
summons shall be directed to the defendant named in the complaint, shall
require defendant's appearance at a stated time and place before the court in
which the complaint is made, and shall inform defendant that a bench warrant
may be issued for a failure to appear."
Unlike a citizen complaint, "[a] summons on a complaint made by a
Code Enforcement Officer charging any offense within the scope of the Code
Enforcement Officer's authority and territorial jurisdiction may be issued
without a finding by a judicial officer of probable cause for issuance." R. 7:2-
2(a)(4). A Code Enforcement Officer "responsible for enforcing the
provisions of any state, county or municipal law, ordinance or regulation
which the public employee is empowered to enforce," "may personally serve
the summons on the defendant."
10 A-4144-19
Like a criminal indictment, the primary purpose of the complaint is "to
inform a defendant of the charges he must defend against." State v. Salzman,
228 N.J. Super. 109, 114 (App. Div. 1987). "Due process requires that the
charging instrument not only inform a defendant respecting the nature of the
charge, but it must also inform an accused of how many charges he or she
faces and when they occurred." Ibid. To that end, "[t]he charging instrument
such as a complaint cannot be a blank warrant to be filled in only at the time of
trial as the evidence unfolds in the court room." Ibid.Nonetheless, Rule 7:14-2 allows the court to
amend any process or pleading for any omission or
defect therein or for any variance between the
complaint and the evidence adduced at the trial, but no
such amendment shall be permitted which charges a
different substantive offense, other than a lesser
included offense. If the defendant is surprised as a
result of such amendment, the court shall adjourn the
hearing to a future date, upon such terms as the court
deems appropriate.
See State v. Koch, 161 N.J. Super. 63, 66-67 (App. Div. 1978) (holding that
while "[m]ere correction of errors or statutory references by amendment of a
complaint does not offend traditional concepts of due process" an amendment
that changed a motor vehicle violation to a more serious disorderly persons
offense "deprived defendant of the due process or fundamental fairness
inherent in any penal proceeding, criminal or otherwise").
11 A-4144-19
Likewise, Rule 7:2-5 provides that "[n]o person arrested under a warrant
or appearing in response to a summons shall be discharged from custody or
dismissed because of any technical insufficiency or irregularity in the warrant
or summons, but the warrant or summons may be amended to remedy any such
technical defect." See State v. Bierilo, 38 N.J. Super. 581, 583-84 (App. Div.
1956) (rejecting the defendant's objection to "the informality of the summons"
because the summons "actually fulfilled its purpose in apprising the defendant
of the time and place of the hearing," despite "its unconventional
phraseology").
Courts have permitted amendments under the rules to change a
defendant's name. In State v. Sirvent, 296 N.J. Super. 279 (App. Div. 1997),
the State initially charged the defendant's brother, Joseph Sirvent, with various
motor vehicle violations but amended the complaint-summonses to "John Doe"
once Joseph came to court and the officer informed the prosecutor that Joseph
was not the person to whom he had issued the tickets. Id. at 281-82. After the
municipal court judge dismissed the motor vehicle violations, we upheld the
Law Division order reinstating the complaints against the defendant because
"copies of the complaints were personally served upon defendant before his
release on the complaint-summonses" and the defendant "expressly confirmed
that he was the person who received the summonses at the time the complaints
12 A-4144-19
were issued." Id. at 288. "Stated differently, defendant acknowledges that the
complaint-summonses in his brother's name were served upon him when he
was stopped or before his release from the police station the night he was
stopped and the tickets were issued." Id. at 288-89.
A similar result was reached in State v. Rondinone, 291 N.J. Super. 489(Law Div. 1996), where the Law Division denied a motion to dismiss a driving
while intoxicated complaint-summons served upon a driver who produced
somebody else's license, resulting in the summons being issued in the name of
the licensee. The judge explained:
[D]efendant's argument that the summons[] should be
dismissed . . . fails since the defendant was issued a
summons at the scene of the violation . . . , albeit in
the wrong name. The fact that the summons was
issued in the name of Michael Ottomanelli does not
change the fact that defendant was personally issued
process thereby giving him sufficient notice of the
violation so that he was not forced to defend a stale
claim.
[Id. at 496.]
Corresponding provisions to Rules 7:2-5 and 7:14-2 appear in "[t]he
rules in Part III govern[ing] the practice and procedure in all indictable and
non-indictable proceedings in the Superior Court Law Division and . . . other
courts . . . ." R. 3:1-1. While these provisions are inapplicable to these
proceedings, they provide some guidance. See Richmond & Burns, N.J.
13 A-4144-19
Municipal Court Practice, 8:5 (2021) (noting that "the language of a Part VII
rule and the corresponding Part III rule . . . may be relevant in interpreting the
Part VII rule").
In that vein, Rule 3:3-4 provides:
(a) Amendment. No person arrested under a warrant
or appearing in response to a summons shall be
discharged from custody or dismissed because of any
technical insufficiency or irregularity in the warrant or
summons, but the warrant or summons may be
amended to remedy any such technical defect.
(b) Issuance of New Warrant or Summons. If prior to
or during the hearing as to probable cause, it appears
that the warrant executed or summons issued does not
properly name or describe the defendant, or the
offense with which the defendant is charged, or that
although not guilty of the offense specified in the
warrant or summons there is reasonable ground to
believe that the defendant is guilty of some other
offense, the court shall not discharge or dismiss the
defendant but shall forthwith cause a new complaint to
be filed and thereupon issue a new warrant or
summons.
Additionally, Rule 3:7-4 provides:
The court may amend the indictment or accusation to
correct an error in form or the description of the crime
intended to be charged or to charge a lesser included
offense provided that the amendment does not charge
another or different offense from that alleged and the
defendant will not be prejudiced thereby in his or her
defense on the merits. Such amendment may be made
on such terms as to postponing the trial, to be had
before the same or another jury, as the interest of
justice requires.
14 A-4144-19
Notably, under Rule 3:7-4, "[a] minor misnomer of the defendant does
not constitute a material change if the defendant is in no way misled or
otherwise prejudiced thereby." Pressler & Verniero, Current N.J. Court Rules,
cmt. 2 on R. 3:7-4 (2020). See State v. Gillison, 153 N.J. Super. 65 (Law Div.
1977) (holding that the difference between "Michael Tillison" and "Michael
Gillison" was a minor misnomer); see also In re Hubbard v. State, 62 N.J.L.
628, 629 (1898) (holding that the difference between "Armstead Herbert" and
"Armstead Hubbard" was a minor misnomer).
Applying these principles in our de novo review, we conclude that
issuing a complaint-summons to the wrong party in the circumstances of this
case is a fatal defect that is not subject to amendment under either Rule 7:2-5
or Rule 7:14-2. See State v. Kuropchak, 221 N.J. 368, 383 (2015) ("[L]egal
conclusions are subject to de novo review."). This is not a situation in which
Ehrman provided a false name or a situation in which the difference between
the LLC and Ehrman could be characterized as a minor misnomer. Instead, the
record owner of the rental property cited for the violations and the facially
responsible party under the RLLCA is indisputably the LLC, not Ehrman, its
member. See N.J.S.A. 42:2C-30(a)(1), (a)(2).
Further, we find that the court's reliance on Rule 4:9-1 was misplaced.
Rule 4:9-1 provides that:
15 A-4144-19
A party may amend any pleading as a matter of course
at any time before a responsive pleading is served or,
if the pleading is one to which no responsive pleading
is to be served, and the action has not been placed
upon the trial calendar, at any time within 90 days
after it is served. Thereafter a party may amend a
pleading only by written consent of the adverse party
or by leave of court which shall be freely given in the
interest of justice.
However, pursuant to Rule 4:1, "[t]he rules in Part IV, insofar as applicable,
govern the practice and procedure of civil actions in the Superior Court, Law
and Chancery Divisions, the surrogate's courts and the Tax Court except as
otherwise provided in Part VI and Part VIII." Thus, Rule 4:9-1 is a rule of
civil practice and does not apply to a quasi-criminal matter in municipal court
as involved here.
We also conclude that the appropriate remedy is dismissal of the
complaints without prejudice. Under Rule 2:10-2, an "error or omission shall
be disregarded by the appellate court unless it is of such a nature as to have
been clearly capable of producing an unjust result. . . ." While we are mindful
of the procedural posture of the case, we believe that a remand for dismissal of
the complaints without prejudice will address Ehrman's claims of prejudice.
Although Ehrman was hailed into court by a summons rather than a warrant,
"[a] summons in lieu of warrant is not . . . without consequence since it
initiates the criminal process, compels appearance to answer the complaint,
16 A-4144-19
and may lead to the routine issuance of an arrest warrant upon the failure of
appearance." State v. Ross, 189 N.J. Super. 67, 73-74 (App. Div. 1983).
Indeed, Ehrman claims that the consequences he suffered included the need "to
hire personal legal counsel to represent him at his own cost"; "the possibility
of a warrant being issued for his arrest"; the complaints appearing in "a public
record search" of him; being subjected "to baseless allegations, in open court,
which are damaging both personally and professionally"; and the possibility of
incurring personal liability for the "LLC's financial obligations for housing
violations."
We note that the dueling accusations of gamesmanship on the part of
each side are irrelevant to the limited issues presented in this appeal and we
make no determination as to whether any of those claims have merit. We do
point out, however, that the trial court was "not convinced" that there was
enough evidence to support the State's assertions that the connection between
Ehrman and the LLC justified piercing the corporate veil under the law. 7
Nonetheless, our holding does not preclude the Department from reissuing the
7
In its February 13, 2020 oral decision on the motion, the court also stated
that there was insufficient evidence to support Ehrman's claim that he was
being purposefully targeted or harassed by the Department.
17 A-4144-19
complaints to the correct defendant and proceeding in a manner consistent with
the law.
II.
A-4447-19:
In this appeal, on December 11, 2018, Deja Anderson, a code
enforcement officer for the Department, issued complaint-summons No.
353437 for failure to file an annual rent registration "on or about [December
11, 2018,]" for a property located at 95 Beacon Avenue in violation of Jersey
City, N.J., Municipal Code § 260-2.F (section 260-2.F). 8 Section 260-2.F
provides:
Every owner and/or landlord shall within 90 days
following the effective date of this subsection or the
creation of the first tenancy in any dwelling containing
five (5) or more housing spaces, whether or not
subject to the restrictions of rent increases under this
Chapter, file a landlord registration statement with the
Bureau of Rent Leveling[9] . . . .
8
A violation of any section of the Municipal Code carries with it a potential
fine "of up to two thousand dollars . . . ." Jersey City, N.J., Municipal Code §
1-25.A; see also N.J.S.A. 40:49-5 (providing authority for municipalities to
impose penalties "not exceeding [$2000]" for code violations).
9
Jersey City Municipal Code created the "Bureau of Rent Leveling" within
the Department, "the head of which shall be the Rent Leveling Administrator,"
Jersey City, N.J., Municipal Code § 260-8.A, whose authority included the
power to "remedy violations" and "bring[] appropriate legal charges as
provided in th[e] chapter." Jersey City, N.J., Municipal Code § 260-9.A.
Pursuant to Jersey City, N.J., Municipal Code § 260-9.B, the appointment of
18 A-4144-19
The information to be included in the registration statement includes "[t]he
name and address of the record owner or owners of the dwelling and the record
owner or owners of the rental business if not the same person." Jersey City,
N.J., Municipal Code §260-2.F(1)(a). "If the record owner is a corporation,
the name and address of the registered agent and corporate officers of the
corporation" were also required. Jersey City, N.J., Municipal Code §260-
2.F(1)(b).
Additionally,
[b]etween January 1 and March 3 of each calendar
year, all owners and/or landlords of dwellings shall
file with the Bureau of Rent Leveling a new landlord
registration statement for each dwelling owned. An
owner and/or landlord who purchases a dwelling on or
after April 1 of any year shall also file a landlord
registration statement within seven (7) days of
purchase.
[Jersey City, N.J., Municipal Code §260-2.F(2).]
The complaint-summons was issued to "Joseph Ehrman, c/o JC Group,
LLC" at an address on Central Avenue in Farmingdale. The property that was
the subject of the citation, 95 Beacon Avenue, was purchased on June 13,
2017, by three entities with different percentage interests: JCP Group 5 LLC;
JCP JE 5 LLC; and JCP ZELL 5 LLC. Under section 260-2.F(2), a landlord
the Rent Leveling Administrator is delegated to "the Director of the
Department . . . ."
19 A-4144-19
registration statement for 95 Beacon Avenue was required within seven days
of the June 13, 2017 purchase date.
A three-day trial on the complaint-summons was conducted in the Jersey
City municipal court on non-consecutive days, beginning June 4, 2019.
During the trial, Anderson, the State's sole witness, testified that she issued the
complaint-summons in question because an audit revealed that as of December
11, 2018, there was no landlord registration statement on file for 2017 for 95
Beacon Avenue, which was an eleven unit rent control property subject to the
registration requirements of section 260-2.F. She testified that based on the
tax records and deed recorded for the property, which listed JCP Group 5 LLC
as one of three record owners as of June 13, 2017, a landlord registration
statement was due by June 20, 2017, but was never submitted.
Anderson stated she was instructed by her division director "to add a
name" of "an individual, most often the managing agent's name," to "any
summons . . . being written out to an LLC" because "warrants for failure to
show up cannot be executed on an LLC." She averred that the complaint-
summons was not issued to Ehrman "individually," but "to the LLC." She
acknowledged that her "intent" was to issue the complaint-summons to "JCP
Group 5, LLC, care of Joseph Ehrman," in his capacity as "managing member
20 A-4144-19
of the LLC," 10 but that she mistakenly issued it to "Joseph Ehrman, care of JCP
Group, LLC" instead. 11
Anderson confirmed that she was authorized to issue the complaint-
summons. She stated that although she held a different civil service title, on
August 6, 2018, she "was appointed by the [D]epartment [D]irector" as one of
"two acting alternate rent leveling administrators" authorized to perform the
duties of the then Rent Leveling Administrator, Charles Odei, who went out on
medical leave from July 2018 to April 2019. 12 Anderson stated that from June
20, 2017, when the 2017 landlord registration statement for 95 Beacon Avenue
was due, to July 2018 when Odei went out on sick leave, to her knowledge,
Odei had not issued a complaint-summons for violating the ordinance.
Anderson stated that on October 19, 2018, she was administered an oath that
authorized her to act as a code enforcement officer for the Department and was
10
On cross-examination, Anderson acknowledged that Ehrman was known to
her office in connection with his non-compliance with requirements related to
other Jersey City properties with which he was affiliated.
11
Notwithstanding Anderson's testimony, as the municipal court judge noted,
the handwritten complaint-summons in the record reads "J.E. Group, LLC."
12
According to Anderson, in October 2018, there was a restructuring in the
Department whereby the Bureau of Rent Leveling, headed by Odei, and the
Office of Landlord Tenant Relations, managed by Anderson, were placed in
the Division of Housing Preservation headed by Director Dinah Hendon.
21 A-4144-19
therefore duly authorized to issue the subject complaint-summons on
December 11, 2018.
Anderson testified further that after the complaint-summons was issued,
on February 20, 2019, her office received an incomplete and untimely 2017
landlord registration statement for 95 Beacon Avenue. 13 According to
Anderson, the statement was signed on February 18, 2019, but the "landlord
name and title [were] blank." Additionally, the statement listed the owner of
the property as Sixth Boro Rentals and listed the owner's street address on
Central Avenue in Farmingdale. Ehrman was listed as President, Treasurer,
and Secretary of Sixth Boro Rentals in the "partners or corporate officers"
section of the statement, and "JCP Group Member" was listed as the registered
agent. While Ehrman's street address on the statement was listed as Central
Avenue in Farmingdale, the registered agent's address was listed as Central
Avenue in Jersey City, which Anderson recognized as an incorrect address.
At the conclusion of the State's case, Ehrman moved to dismiss the
complaint on several grounds pursuant to Rule 3:18-1, one of which was that
the Department charged "the wrong defendant" because Ehrman was not the
record owner of 95 Beacon Avenue. Defense counsel asserted that Ehrman
13
On cross-examination, Anderson stated she never sent a notice to anyone
advising them that they had thirty days to cure the 2017 violation because it
was not office policy.
22 A-4144-19
was a member of the LLCs that owned the property and, as a member, could
not "be held personally responsible for an act of the LLC." In opposition, the
prosecutor asserted that "[n]obody[ was] seeking to . . . hold . . . Ehrman[]
personally responsible" or "to pierce the corporate veil." The prosecutor
confirmed that he was prosecuting the LLC only, and, as such, dismissal was
not warranted. In denying the motion, the municipal court judge agreed that
"[t]he State [was] prosecuting the LLC," of which "Ehrman just happen[ed] to
be a member." The judge stated that pursuant to Rule 7:2-5, there was no
"deadly defect" warranting dismissal because the LLC was "listed on the face
of the [complaint-]summons." Thereafter, four witnesses testified for the
defense, Charles Odei, Yechezkel (Chez) Whiter, Alison Ingenito, and Henry
Ehrman, Joseph Ehrman's brother.
Odei believed he was the only person authorized to appoint an acting
Rent Leveling Administrator to serve in his absence from the office. Because
he did not authorize Anderson to act in that capacity or issue complaint-
summonses during his absence, he opined that Anderson's actions were not
legally authorized. Further, he confirmed that prior to his extended absence,
he did not issue a violation for 95 Beacon Avenue. Odei also acknowledged
that the landlord registration statement received in the office in February 2019
purporting to be the statement for 2017 was noncompliant.
23 A-4144-19
However, to support the defense theory that the required landlord
registration statement had been filed on time, Odei testified that on July 12,
2017, he emailed Henry Ehrman, attaching a "copy of the [landlord]
registration form" pursuant to their prior discussions, and requesting that he
"complete one [form] for all the newly acquired properties . . .
manage[d]/own[ed]" by his company, including 95 Beacon Avenue. Odei also
informed Henry in the email that "pursuant to the code[,] said form should be
filed with [his] office within [seven] days of any changes in ownership or
management." However, Odei testified that because the entities involved had
simultaneously acquired a large number of properties, he extended the filing
deadline an additional thirty days.
Odei acknowledged that on July 18, 2017, Chez Whiter sent him the
landlord registration statements for the properties, including 95 Beacon
Avenue's, which he forwarded to his staff for processing notwithstanding the
fact that there was information missing from the 95 Beacon Avenue statement
and the required filing fee was not tendered. Odei also admitted that the office
policy required the submission of a hard copy in conjunction with an email
submission, and that a hard copy of the registration statement was never
received.
24 A-4144-19
Henry, an employee of Sixth Boro Rentals, confirmed receipt of Odei's
July 12, 2017 email and testified that he forwarded it to Whiter for handling.
Whiter testified that in response to Odei's email, on July 18, 2017, he sent an
email to Odei attaching the landlord registration statements for thirty-four
buildings acquired by his company on June 13, 2017. The acquisition included
95 Beacon Avenue. He acknowledged that the statement for 95 Beacon
Avenue listed Sixth Boro Rentals as the record owner because of its affiliation
with the record owners and listed Joseph Ehrman as the "[m]anaging
[m]ember" and the "[r]egistered [a]gent[]" of the record owner. 14
Whiter also acknowledged that although the landlord registration
statement was a "three or four[-page]" form, he only sent the first page of the
form and, therefore, did not file a complete statement. He further
acknowledged that the portion of the statement showing the year for which it
was filed was left blank. He also admitted that he did not send a hard copy and
did not include the required filing fee. However, he stated that when he did
not receive any further communication from Odei, he assumed that Odei had
14
As the managing member, Ehrman's address was listed on Central Avenue
in Farmingdale, but as the registered agent, his address was listed as Central
Avenue in Jersey City.
25 A-4144-19
accepted the statement as compliant and that nothing further was needed until
the 2018 statement was due. 15
On cross-examination, Whiter acknowledged that there were
inconsistencies between the statement he emailed to Odei on July 18, 2017,
and the statement that was later received by the Bureau of Rent Leveling in
February 2019, which was submitted by Alison Ingenito, a practicing attorney
who represented Sixth Boro Rentals. Ingenito testified she submitted the
statement along with a check for the required filing fee that was subsequently
cashed by the Department. However, Ingenito candidly admitted that the filing
was late. She testified further that "Sixth Boro Rentals, LLC" was not the
owner of 95 Beacon Avenue but was "the umbrella corporation" that served as
the "management group" for the record owners of 95 Beacon Avenue.
At the conclusion of the defense's case, defense counsel renewed his
motion for dismissal of the complaint-summons, pointing out that he
"represent[ed] Joseph Ehrman, not any one of the three LLCs" listed as the
record owners of 95 Beacon Avenue. In response, the prosecutor reiterated
that "nobody [was] seeking to hold Mr. Ehrman personally liable . . . but . . .
15
Anderson testified that a 2018 landlord registration statement for 95 Beacon
Avenue was filed on June 4, 2018, and included a check issued by Sixth Boro
Rentals in the amount of $110 for the required property registration fee.
26 A-4144-19
[was] seeking to . . . hold the LLC liable." The municipal court judge again
denied the motion.
Following summations, the judge found "J.C.P. Group, LLC guilty of
[violating] the ordinance" and imposed a $700 fine with $33 in court costs. In
an oral decision, the judge found Anderson, the State's only witness, "credible"
"based upon her demeanor," "her recollection," and "her ability to answer
questions posed by both the prosecution and defense." Accordingly, the judge
made detailed factual findings in accordance with her testimony.
In contrast, the judge found Odei "lack[ed] credibility." According to
the judge, "Odei appeared uninterested, nonchalant, indifferent, somewhat
bitter and aggrieved, rebellious, strategic, and inert." Based on "Odei's
testimony and demeanor," the judge discerned that "there was and is some sort
of power play going on within the Rent Leveling Office." Likewise, the judge
found that Whiter "also lack[ed] credibility" and "was clearly apprehensive,
nervous, and . . . uncomfortable on the witness stand." Although the judge
found Henry Ehrman "partially credible," he was also "extremely
apprehensive, unsure and . . . uncomfortable on the stand" and "had very little
to provide . . . in terms of pertinent facts."
In analyzing the witnesses' testimony, the court explained that
if Odei had actually received the landlord registration
statement as both Whiter and Henry Ehrman testified,
27 A-4144-19
his clerks would have contacted the landlord to
explain the forms were deficient and also explain the
need for a hard copy.
Both Whiter and Henry Ehrman testified that
they never heard from Odei once they allegedly
submitted the statements. Hence, there is a significant
question as to whether the forms were ever really
submitted.
Regarding Ingenito's testimony, while the judge found her testimony
"credible," and presumed that her submission of the statement in February
2019 was in response to the complaint-summons issued in December of 2018,
the judge "question[ed] why [she] would . . . file the statement in February of
2019 if Whiter filed it via email in July of 2017." The judge queried:
If the statement [w]as sent as an attachment via email
in July of 2017 as testified by Whiter, why not
forward that exact copy of the statement to the Rent
Leveling Office. Why the need to fill out a whole new
form. Was that because the form in July of 2017 was
never actually filed? Was it because the form was
deficient to say the least and Whiter knew that? It is
this [c]ourt's opinion that quite frankly Ms. Ingenito
bolstered the State's case.
The judge concluded that "the State has proven its case beyond a reasonable
doubt" based on Anderson's testimony that the June 13, 2017 purchase of 95
Beacon Avenue required the submission of a compliant landlord registration
statement by June 20, 2017, and that the statement was never submitted.
28 A-4144-19
The judge again rejected Ehrman's argument "that the [c]ourt should
either dismiss [the complaint-summons] . . . or render a not guilty finding
based upon the fact that the [complaint-summons] reads specifically Joseph
Ehrman care of J.C.P. Group, LLC as opposed to J.C.P. Group, LLC care of
Joseph Ehrman." The judge reasoned:
Anderson who issued the summons testified that she
inadvertently reversed the names on the summons[]
when she wrote it. She testified that at no time was
she issuing a ticket to the defendant personally. She
included Joseph Ehrman's name on the summons since
he is the managing agent.
....
[Rule] 7:2-5 specifically states that any
technical insufficiencies or irregularities in the . . .
summons may be amended to remedy such defect.
However, this is not an actual defect per se. The
named defendant is listed on the [complaint-summons]
as is one of the managing agents' names. The order in
which they appear is irrelevant. Had the prosecution
sought to prosecute Joseph Ehrman personally, the
summons would have been written out to his name
alone.[16]
16
The judge also rejected "defense counsel's argu[ment] that the actual
corporate name on the summons [was] incorrect and [did] not match any of the
names listed on the deed." The judge explained that although "[t]he deed
list[ed] J.C.P. Group V, LLC as an owner" and the complaint-summons was
missing "the numeral [V]," defense counsel "waived" the issue by failing to
object "prior to trial []or during the actual trial." The judge noted further that
the defense was not "prejudiced" and had defense counsel made a timely
objection, "the prosecutor would have moved to amend . . . pursuant to [Rule]
7:2-5."
29 A-4144-19
When defense counsel reiterated that he did not represent "J.C.P. Group[]
LLC," the judge stated that he "waived that argument by not raising it pretrial."
The Law Division reviewed the case de novo pursuant to Rule 3:23-8.
In an order entered June 30, 2020, the trial court found J.C.P Group LLC
guilty of violating the ordinance in question and re-imposed the fine imposed
by the municipal court judge. In an accompanying written decision, the trial
court gave due deference to the municipal court judge's credibility
determinations but conducted a de novo trial on the record, making its own
findings of fact and conclusions of law. See State v. Robertson, 228 N.J. 138,
147 (2017) ("At a trial de novo, the court makes its own findings of fact and
conclusions of law but defers to the municipal court's credibility findings.").
Regarding the amendment of the complaint-summons to name the LLC rather
than Ehrman individually, consistent with its earlier March 10, 2020 decision
on Ehrman's interlocutory appeal of the issuance of twenty-five unrelated
complaint-summonses, the court "deemed it proper to allow for the complaint
to be amended to include the LLC[] rather than [Ehrman] individually."
In this ensuing appeal, Ehrman, in his individual capacity, raises the
following points that were previously rejected by the trial court for our
consideration:
30 A-4144-19
POINT ONE[17]
THE SUMMONS WAS CLEARLY ISSUED WELL
BEYOND THE EXPIRATION OF THE STATUTE
OF LIMITATIONS, AND SHOULD HAVE BEEN
DISMISSED AS A MATTER OF LAW.
POINT TWO
THE SUMMONS WAS NOT ISSUED BY A LAW
ENFORCEMENT OFFICER OR A CODE
ENFORCEMENT OFFICER, AND THERE WAS NO
PROBABLE CAUSE HEARING.
POINT THREE
THE TRIAL COURT FAILED TO TAKE INTO
ACCOUNT THE UNCONTESTABLE FACT THAT
THE CITY RECEIVED A 2017 RENT
REGISTRATION FOR THE PROPERTY ON JULY
18, 2017.
POINT FOUR
THE TRIAL COURT SHOULD HAVE DISMISSED
THE SUMMONS BECAUSE THE CITY NAMED
JOSEPH EHRMAN AS A DEFENDANT.
POINT FIVE
THE SUMMONS SHOULD BE DISMISSED FOR
FAILURE TO GIVE 30-DAYS['] NOTICE AND AN
OPPORTUNITY TO CURE.
Because it is undisputed that the finding of guilt was against the LLC,
and not against Ehrman individually, we remand for the entry of an order
17
We condensed the points for clarity.
31 A-4144-19
vacating the record of conviction as to Ehrman. In light of that disposition, we
need not address the points raised by Ehrman in his individual capacity. See
In re D'Aconti, 316 N.J. Super. 1, 13 (App. Div. 1998) (reiterating that to have
standing a plaintiff must have "suffered an injury in fact, an injury must be
'fairly . . . trace[able] to the challenged action of the defendant, and not . . .
th[e] result [of] the independent action of some third party not before the
court,' and it must be likely that the injury will be redressed by a favorable
decision." (alterations in original) (citing Lujan v. Defenders of Wildlife, 504
U.S. 555, 560 (1992))).
Regarding the LLC, we cannot sustain the finding of guilt because of an
even more basic defect in the proceedings, not raised by the parties. It is
undisputed that the LLC never appeared by counsel in the municipal court trial
nor on appeal. In accordance with Rule 1:21-1(c), subject to certain
exceptions not applicable here, "an entity, however formed and for whatever
purpose, . . . shall neither appear nor file any paper in any action in any court
of this State except through an attorney authorized to practice in this State."
See also Pressler & Verniero, Current N.J. Court Rules, cmt. 3 on R. 1:21-1(c)
(2020). In our view, in the absence of an appearance by counsel or a clear
waiver of such, the finding of guilt against the LLC constitutes a violation of
constitutional dimension requiring reversal.
32 A-4144-19
Rule 7:2-2(h) provides "[i]f a corporation, partnership or unincorporated
association has been served with a summons and has failed to appear on the
return date, the court shall proceed as if the entity had appeared and entered a
plea of not guilty." Given Ehrman's position as a member of the LLC, duly
served with a summons for the LLC in his representative capacity, we find no
fault with the municipal court or the trial court proceeding as if the LLC had
appeared and entered a plea of not guilty. See R. 7:6-2(a)(2) ("If a defendant
that is a corporation, partnership, or unincorporated association fails to appear
or answer, the court, if satisfied that service was duly made, shall enter an
appearance and a plea of not guilty for the defendant and thereupon proceed to
hear the complaint."). It does not follow, however, that a court may conduct a
full-blown trial and render a verdict against the LLC without the LLC's
appearance by counsel or the courts' inquiry as to a valid waiver for the
entirety of the trial.
Generally, proceedings in municipal courts for violations of ordinances
are governed by criminal procedural rules. Newark v. Pulverman, 12 N.J. 105,
114 (1953). See also State v. Labato, 7 N.J. 137, 151 (1951) (noting that such
"quasi-criminal" proceedings are "subject to the procedural rules governing
criminal prosecutions"); State v. Taimanglo, 403 N.J. Super. 112, 115 (App.
Div. 2008) ("Part III of the Rules Governing the Courts of the State of New
33 A-4144-19
Jersey apply to municipal appeals in the Law Division. . . ."); State v.
Woodlands Condominium Ass'n, 204 N.J. Super. 85, 89 (Law. Div. 1985)
("The action was quasi-criminal in nature with all inherent constitutional
guarantees that attach to such proceedings.").
The constitutional right of an accused to the assistance of counsel is
fundamental. "Both the Federal and State Constitutions guarantee criminal
defendants the right to counsel." State v. Maisonet, 245 N.J. 552, 565 (2021)
(citing U.S. Const. amend. VI; N.J. Const. art. I, ¶ 10). In Rodriguez v.
Rosenblatt, 58 N.J. 281, 295-96 (1971), the Court recognized the right to
counsel in quasi-criminal municipal court prosecutions.
Like individuals, "corporations are entitled to the assistance of counsel
under both the United States Constitution and New Jersey Constitution. . . ."
State v. W. World, Inc., 440 N.J. Super. 175, 202 (App. Div. 2015); see In re
668 Advisory Comm. on Pro. Ethics, 134 N.J. 294, 302 (1993) (recognizing
that the Sixth Amendment's right to counsel applies to corporations); see also
N.J.S.A. 1:1-2 (defining person to include "corporations, companies,
associations, societies, firms, partnerships and joint stock companies as well as
individuals, unless restricted by the context to an individual as distinguished
from a corporate entity"); N.J.S.A. 2C:1-14(g) (providing that under the
34 A-4144-19
Criminal Code, "'[p]erson[]' . . . include[s] any natural person and, where
relevant, a corporation or an unincorporated association").
"Defendants possess not only the right to counsel, but the right to
dispense with counsel and to proceed pro se." State v. Crisafi, 128 N.J. 499,
509 (1992). However, "[a] defendant can exercise the right to self-
representation only by first knowingly and intelligently waiving the right to
counsel." Id. at 509. Trial judges are required "to engage in a searching
inquiry with defendants seeking to proceed pro se" and are required to
"establish the waiver on the record." Id. at 509-10.
Additionally, "[t]he right of the accused to be present in the courtroom at
every stage of the trial is an essential ingredient of our organic law." State v.
Davis, 281 N.J. Super. 410, 413 (App. Div. 1995); see R. 3:16(b). However, a
defendant may waive the right by "express written or oral waiver placed on the
record" or "conduct evidencing a knowing, voluntary, and unjustified absence
after (1) the defendant has received actual notice in court or has signed a
written acknowledgement of the trial date, or (2) trial has commenced in
defendant's presence." R. 3:16(b); see Taimanglo, 403 N.J. Super. at 121
(recognizing that despite their entitlement to be present at de novo appeals
from municipal court, "defendants frequently elect not to attend when
35 A-4144-19
represented by counsel" but requiring "a waiver . . . submitted by counsel
either in writing or orally by counsel if authorized to do so").
[I]n order to sustain a waiver of the right to be present,
it must be shown the trial date was actually
communicated to the defendant and the accused
unjustifiably failed to appear. Moreover, the right
cannot cursorily, and without inquiry, be considered
waived by the trial judge simply because the accused
does not appear on the date set for trial. The trial
judge should attempt to learn where the defendant is
and why he is absent and make appropriate factual
findings.
[Davis, 281 N.J. Super. at 416 (citing State v. Hudson,
119 N.J. 165, 182-84 (1990)).]
See also State v. Luna, 193 N.J. 202, 214 (2007) ("[T]he court must conduct an
inquiry before proceeding with trial in order to determine if defendant's
absence is knowing and voluntary.").
In the case of a corporate defendant, "[a] corporation shall appear by its
attorney for all purposes." R. 3:16(b). Notably, when a corporation is charged
with an indictable offense, the corporation should be "noticed to appear on a
date certain by written communication mailed to its last known business
address." In re Appointment of Counsel to CLM Const. Co., 277 N.J. Super.
329, 332-33 (App. Div. 1994). If necessary, the court may compel, "by
appropriate writ," the appearance of the president or registered agent "to
36 A-4144-19
answer questions respecting the corporation's status, its ability to retain
counsel and its plan respecting the defense to the indictment." Id. at 333.
Here, while the municipal court was justified in entering a plea of not
guilty when the LLC failed to make an appearance by counsel in response to
the complaint-summons, R. 7:2-2(h), both the municipal and trial courts erred
in conducting a trial in the LLC's absence without inquiring on the record to
ascertain whether there was a knowing and voluntary waiver. R. 3:16(b); see
Taimanglo, 403 N.J. Super. at 122 (finding that where "[t]here [was] no
question defendant did not waive his right to be present on the municipal
appeal," "[t]he trial de novo should not have proceeded . . . without some
waiver, even though defendant's attorney asked to proceed").
"We are not unaware of the provision of R[ule] 3:23-8(c), which
provides that the taking of a de novo appeal to the Law Division 'shall operate
as a waiver of all defects in the record including any defect in, or the absence
of, any process . . . .'" Ross, 189 N.J. Super. at 74 (alteration in original)
(quoting R. 3:23-8(c)). "It is also well settled, however, that the waiver does
not apply in respect of defects of a constitutional or jurisdictional nature."
Ibid. "We regard the nature of the defect here as one of such substantial
magnitude as to compel the inapplicability of the waiver rule." Id. at 74-75.
Therefore, we reverse the order of conviction and remand for a new trial.
37 A-4144-19
"[T]he result reached in this case . . . should not be thought to foreclose other
constructive approaches to the problems underlying this litigation; nor should
our ultimate determination be interpreted as a lack of awareness . . . with
respect to the significant public concerns which actuated this prosecution."
State v. Lawn King, Inc., 84 N.J. 179, 216 (1980).
In A-4144-19, reversed and remanded for dismissal of the complaint-
summonses without prejudice.
In A-4447-19, reversed and remanded for the entry of an order vacating
the record of conviction as to Ehrman and for a new trial as to the LLC. We
do not retain jurisdiction.
38 A-4144-19