AMBER MONSERRATE VS. B&D AUTO SALES, INC. (DC-000080-17, BURLINGTON COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE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-2119-17T2
AMBER MONSERRATE,
Plaintiff-Respondent,
v.
B&D AUTO SALES, INC.,
Defendant-Appellant.
__________________________
Submitted April 30, 2019 – Decided June 12, 2019
Before Judges Yannotti and Rothstadt.
On appeal from Superior Court of New Jersey, Law
Division, Burlington County, Docket No. DC-000080-
17.
Antonio J. Toto, attorney for appellant.
Respondent has not filed a brief.
PER CURIAM
Defendant B&D Auto Sales, Inc. appeals from a judgment awarding
plaintiff $8,868.39, plus court costs. We affirm in part, reverse in part, and
remand for entry of a revised judgment.
I.
On January 5, 2017, plaintiff filed a pro se complaint in the Special Civil
Part, asserting a claim under the Consumer Fraud Act (CFA), N.J.S.A. 56:8-1 to
-210. The judge conducted a trial in the matter on May 1, 2017. Plaintiff
appeared without an attorney.
At the trial, plaintiff testified that on October 19, 2016, she purchased a
2004 Ford Expedition from defendant, with a reported 93,808 miles on the
odometer. The purchase agreement stated that the vehicle was being sold "as
is." It also stated that the "dealer . . . expressly disclaims all warranties, either
express or implied, including any implied warranties of merchantability and
fitness for a particular purpose."
Plaintiff testified that she first saw the vehicle in an online advertisement,
which indicated that the Expedition "was a vehicle of great quality at a great
price." Plaintiff said she was familiar with defendant, having previously
purchased a vehicle at that dealership. According to plaintiff, defendant's
representative, a person named "Patrick," suggested to her that the Expedition
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was safe and "in great shape." Plaintiff said "Patrick" told her not to worry,
since she would have a warranty obtained through the financing company.
The purchase price was $11,576.40, which included $8980 for the vehicle,
$1540 for the warranty or service contract issued by A.U.L. Corp., sales tax of
$736.40, a messenger fee of $68.50, notary and tag fees of $15, a registration
title fee of $131.50, and a document fee of $105. Plaintiff made a cash deposit
of $1556.40, and financed the balance through Pelican Auto Finance (Pelican).
Plaintiff testified that within two or three days after she took possession
of the Expedition, she started to smell gasoline inside the vehicle. She returned
to defendant and was told she may have put too much fuel in the tank. Plaintiff
then had problems with the heating and air conditioning system. Defendant
informed her that a part had to be ordered; however, the repair was never made.
On November 22, 2016, the brakes on the Expedition failed while plaintiff
was driving. Plaintiff had the vehicle towed to defendant's "preferred
mechanic." Later, defendant instructed plaintiff that before the brake repairs
could be made, she had to take the vehicle to a body shop to be evaluated.
Plaintiff claimed the Expedition had extensive damage to its frame. She
also claimed that roofing material had been nailed between "the bottom of the
door frame and the undercarriage of the vehicle in order to hide [the] rust[.]"
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She claimed that nails had "started to lift up because the rust underneath was so
bad" it could not hold the nails to the body of the vehicle.
Plaintiff provided the judge with photos of the undercarriage. 1 The judge
observed that the photos appeared to show that the material had been painted.
Plaintiff testified that Jeff Barris, defendant's President, told her that the repair
was "cosmetic" and it had nothing to do with the safety or operation of the
vehicle.
Later, defendant informed plaintiff that the shop could not make the
repairs. Defendant offered to take the vehicle back and give plaintiff a credit of
$500, which she could apply to purchase another vehicle on defendant's lot.
Defendant told plaintiff that if she did not accept the offer, she would be required
to pay $50 per day for her use of the vehicle. Defendant also told plaintiff she
had to seek refunds of the sales tax and vehicle registration fees from the State.
Plaintiff further testified that Pelican rescinded the loan before she was
obligated to make any payments, and A.U.L. cancelled the service contract.
Plaintiff said she paid $499.90 for auto insurance on the Expedition. Plaintiff
further testified that after she returned the vehicle to defendant, she needed
1
Defendant has not provided this court with copies of the photographic
evidence.
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transportation for herself, her children, and her husband, so she had her 2002
Dodge Caravan repaired. She claimed $899.83, as the costs to repair the
Caravan.
After the trial court denied defendant's motion to dismiss plaintiff's
complaint, Barris testified. Barris stated that defendant purchased the
Expedition at a dealer auction in Philadelphia. He explained that the purchaser
at the auction has "[twenty-four] hours to check the car out and make sure it's
good." According to Barris, the Expedition was taken for a test drive at the
auction site. He said "the car ran good." There was "no engine light" and "no
issues with the car at all." Barris decided to proceed with the purchase of the
vehicle.
Barris stated that the Expedition was delivered to defendant, and
defendant created a video, which was posted on YouTube, which he described
as a "basically generic . . . video." The video mentioned the "Carfax guarantee,"
which indicates that Carfax had not received any report that the Expedition was
damaged or had been in an accident.
Barris disputed plaintiff's contention that the Expedition had frame
damage. He stated that any such damage would have been noted on the Carfax
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report. He also stated that photos of the vehicle show surface rust on the bottom
of the frame, but he insisted this was not frame damage.
Barris said the Expedition's brake line had failed, which was not
something out of the ordinary for vehicles of that age. He testified that in this
case, "one of the [brake] lines cracked." He explained that this caused the brake
fluid to leak out and sent the "brakes to the floor[.]" Barris attributed this to
"wear and tear." He stated that the Expedition was later repaired, and defendant
put the vehicle "up for sale again."
Barris asserted that defendant has been in business for many years, and it
does not engage "in any kind of fraud." He stated that defendant always sells
its vehicles "as is" because defendant does not repair vehicles, but it provides
purchasers with a warranty company that issues a service contract. He stated
that the service contract issued to plaintiff did not cover the problem with the
brakes or the surface rust.
After hearing closing arguments, the trial judge placed an oral decision on
the record. The judge found plaintiff's testimony to be credible. The judge
determined that plaintiff had established a violation of the CFA because
defendant knowingly concealed material facts concerning the Expedition, and
also violated an administrative regulation, which requires a dealership to
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disclose if a motor vehicle has been previously damaged or had substantial
repairs or body work.
The judge noted that the photos of the vehicle showed rust on the
undercarriage and that "some type of roofing materials" had been used to repair
the body. The judge stated that defendant had concealed material facts
concerning the condition of the Expedition. The judge also stated that defendant
had engaged in an unconscionable commercial practice because defendant failed
to disclose prior problems with the vehicle.
The judge found that plaintiff had established the following damages: the
down payment of $1556.40, $499.90 to insure the Expedition, and $899.83 to
repair the Caravan. The judge noted that plaintiff had been planning to get "rid
of" the Caravan when she purchased the Expedition, but "she was forced to make
repairs to" the Caravan "in order to transport herself and her family."
The judge decided that plaintiff had sustained an ascertainable loss in the
amount of $2956.13, which she trebled pursuant to N.J.S.A. 56:8-19. The judge
entered an order awarding plaintiff $8868.39, with court costs. Defendant's
appeal followed. Thereafter, the judge filed a letter opinion pursuant to Rule
2:5-1(b) amplifying the reasons for her decision.
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II.
On appeal, defendant argues that plaintiff did not establish that defendant
engaged in an unlawful practice in violation of the CFA. We disagree.
Where, as here, the court conducts a trial, sitting without a jury, the court's
findings of fact are "binding on appeal when supported by adequate, substantial
and credible evidence." Rova Farms Resort, Inc. v. Inv'rs Ins. Co. of Am., 65
N.J. 474, 483-84 (1974) (citing N.J. Turnpike Auth. v. Sisselman, 106 N.J.
Super. 358, 370 (App. Div. 1969)). We note, however, that on appeal, "[a] trial
court's interpretation of the law and the legal consequences that flow from
established facts are not entitled to any special deference." Manalapan Realty,
LP v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995) (citations omitted).
"The CFA was enacted to 'provide[] relief to consumers from "fraudulent
practices in the market place."'" Dugan v. TGI Fridays, Inc., 231 N.J. 24, 50
(2017) (alteration in original) (quoting Lee v. Carter-Reed Co., 203 N.J. 496,
521 (2010)). The CFA provides that
[t]he act, use or employment by any person of any
unconscionable commercial practice, deception, fraud,
false pretense, false promise, misrepresentation, or the
knowing[] concealment, suppression, or omission of
any material fact with intent that others rely upon such
concealment, suppression or omission, in connection
with the sale or advertisement of any merchandise or
real estate, or with the subsequent performance of such
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person as aforesaid, whether or not any person has in
fact been misled, deceived or damages thereby, is
declared to be an unlawful practice . . . .
[N.J.S.A. 56:8-2.]
An "unlawful practice" that violates the CFA may be established with
proof of "(1) an affirmative act; (2) a knowing omission; or (3) a violation of an
administrative regulation." Dugan, 231 N.J. at 51 (citing Thiedemann v.
Mercedes-Benz USA, LLC, 183 N.J. 234, 245 (2005); Cox v. Sears Roebuck &
Co., 138 N.J. 2, 17 (1994)). "A showing of intent is not essential if the claimed
CFA violation is an affirmative act or a regulatory violation, but such a showing
is necessary if the claimed violation is an omission pursuant to N.J.S.A. 56:8 -
2." Ibid. (citing Bosland v. Warnock Dodge, Inc., 197 N.J. 543, 556 (2009);
Gennari v. Weichert Co. Realtors, 148 N.J. 582, 605 (1997); Cox, 138 N.J. at
17-18).
Here, plaintiff claimed that defendant engaged in an "unlawful practice"
by selling the Expedition without disclosing the serious defects in the vehicle.
The trial court found that defendant engaged in conduct deemed to be unlawful
under N.J.S.A. 56:8-2 because "it clearly misrepresented and concealed material
facts relating to the sale of the vehicle" and intended that plaintiff would rely
thereon. The court decided that defendant misrepresented that the vehicle was
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in good condition, despite its body damage, and further misrepresented that if
anything went wrong with the vehicle, the service contract would cover the
problem.
On appeal, defendant argues that plaintiff presented no testimony or
evidence that defendant had knowledge of any prior repair or body work on the
Expedition. Defendant asserts that when it purchased the car, it "had no
issues[,]" and the Carfax report indicated that no prior accidents or damage had
been reported. We disagree.
There is sufficient credible evidence to support the trial court's finding
that defendant misrepresented and concealed material facts concerning the
condition of the Expedition, with the intent that plaintiff would rely thereon and
purchase the vehicle. The record supports the court's determination that
defendant engaged in a knowing omission or concealment, which is an unlawful
practice under N.J.S.A. 56:8-2.
Defendant further argues that the trial court erred by finding that it
violated N.J.A.C. 13:45A-26A.7(a)(7), a regulation that applies to
advertisements for the sale or lease of new or used vehicles. The regulation
states that the following practice is unlawful:
The failure to disclose that the motor vehicle had been
previously damaged and that substantial repair or body
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work has been performed on it when such prior repair
or body work is known or should have been known by
the advertiser; for the purpose of this subsection,
"substantial repair or body work" shall mean repair or
body work having a retail value of $1,000 or more[.]
[Ibid.]
Defendant contends expert testimony was required to show that
substantial repair or body work, having a value of $1000 or more, was performed
on the vehicle. We need not address defendant's contention that expert
testimony was required because plaintiff failed to present sufficient evidence to
show "that substantial repair or body work has been performed" on the
Expedition and that such repair or body work had "a retail value of $1,000 or
more." See ibid.The photographic evidence that plaintiff presented to the trial court
apparently showed damage to the body of the Expedition and a rusty frame. It
appears that the body was repaired in some fashion, but there is no evidence
from which an inference could be drawn that the repairs had a retail value of
$1000 or more. In addition, it appears that the frame had not been repaired
before defendant sold the Expedition to plaintiff.
Therefore, we conclude the evidence supported the trial court's finding
that defendant engaged in an unlawful practice under N.J.S.A. 56:8-2 by
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knowingly concealing the condition of the vehicle when it was advertised and
sold to plaintiff. However, the evidence does not support the court's finding that
defendant violated N.J.A.C. 13:45A-26A.7(a)(7).
III.
Defendant also argues that plaintiff failed to show that she sustained an
ascertainable loss as a result of its alleged unlawful practice under the CFA.
Defendant therefore argues that the court erred by awarding plaintiff damages
of $8868.39.
To obtain an award of damages on a CFA claim, the plaintiff must prove
"'an ascertainable loss . . .' and 'a causal relationship between the unlawful
conduct and the ascertainable loss.'" Dugan, 231 N.J. at 52 (quoting D'Agostino
v. Maldonado, 216 N.J. 168, 184 (2013)). Therefore, under the CFA, a plaintiff
can only be awarded damages if the plaintiff "demonstrate[s] a loss attributable
to the conduct made unlawful by the CFA." Id. at 53 (quoting Thiedemann, 183
N.J. at 246).
On appeal, defendant argues that plaintiff did not suffer an ascertainable
loss of her down payment, which was $1556.40. We disagree. It is undisputed
that defendant did not return that payment when it agreed to the return of the
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vehicle. The purchase agreement states that the total price included sales tax in
the amount of $736.40, plus registration, tag, and title fees totaling $320.
The record also shows that the purchase price included $1540 for the
A.U.L. service contract. Plaintiff testified at trial that A.U.L. cancelled the
contract. There is nothing in the record to support defendant's assertion that
A.U.L. required plaintiff to pay $500 for her use of the vehicle before she
returned the vehicle and the service contracted rescinded.
Moreover, the record includes a document entitled "Instant Delivery
Conditions," which plaintiff signed along with the purchase contract . The
document states in pertinent part:
It is also my understanding that if my credit is found to
be unsatisfactory or unacceptable to any of the
dealership's financing institutions, or if any term or
condition of the sale is not satisfied, I will promptly
return the vehicle to the dealership upon the
dealership's request. I agree that if the vehicle is not
returned to the dealership within [twenty-four] hours of
the dealership[']s request, I agree to permit the
dealership to take any and all action to recover
possession of the vehicle. I agree and will be charged
a $250 credit application fee along with a fee of $50.00
per day for use charges. There will be a $5.00
temporary tag fee, along with Fed-Ex fees for shipment
of said documents to the finance company.
This condition was inapplicable because there is no evidence that
plaintiff's credit was "unsatisfactory or unacceptable" or that plaintiff did not
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satisfy a condition of the agreement. Plaintiff returned the Expedition because
the brakes failed and the frame had rust damage. There is nothing in the record
to support defendant's claim that plaintiff was required to pay $50 a day for the
use of the Expedition before it was returned.
Furthermore, there is no merit to defendant's contention that plaintiff did
not suffer an ascertainable loss of the sales tax or registration, tag, and title fees
that she paid. Defendant asserts that plaintiff must file claims with the State for
refunds of these payments. There is, however, no assurance the State would
refund the monies paid. In addition, the record shows that plaintiff paid
defendant the sales tax and fees, and would not have done so had defendant not
engaged in unlawful practices in violation of the CFA.
We also reject defendant's contention that plaintiff did not suffer an
ascertainable loss of $499, which defendant claims plaintiff paid to obtain auto
insurance for the Expedition and the Caravan. Plaintiff testified that she made
payments of $311 and $188 to insure the Expedition and that she paid an
additional $119 to insure the Caravan. Thus, the payments totaling $499 were
to obtain insurance for the Expedition.
Defendant argues that the monies plaintiff paid to insure the Expedition
are not recoverable because plaintiff was legally obligated to have auto
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insurance. Again, we disagree. Plaintiff incurred that expense because she
purchased the Expedition, and would not have done so, but for defendant's
violation of the CFA.
We therefore conclude that the record supports the trial court's
determination that plaintiff suffered an ascertainable loss of her down payment
of $1556.40 and the $499 she spent to obtain auto insurance for the Expedition.
However, we reach a different conclusion with regard to the $899.83 plaintiff
spent to repair the Caravan.
The Caravan required repairs, but plaintiff did not incur that expense due
to defendant's violation of the CFA, which pertained only to the sale of the
Expedition and the losses plaintiff sustained in that transaction. Plaintiff
testified that after she returned the Expedition, she needed a car to transport
herself and her family. Even so, the court erred by requiring defendant to bear
the cost to repair the Caravan. In our view, plaintiff failed to establish a
sufficient nexus between defendant's unlawful practices that violated the CFA
and the repairs plaintiff had made to the Caravan.
Therefore, plaintiff's ascertainable loss was $2055.40, not $2956.13, as
found by the trial court. When trebled pursuant to N.J.S.A. 56:8-19, the damage
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award should be $6166.20, plus court costs. We remand the matter for entry of
a revised judgment in that amount.
Affirmed in part, reversed in part, and remanded to the trial court for entry
of a revised judgment in accordance with this opinion. We do not retain
jurisdiction.
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