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

• Court: New Jersey Superior Court Appellate Division
• Decided: December 10, 2019
• Docket: A-1528-18T1
• Status: Unpublished

Opinion

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court."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. A-1528-18T1 2 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

A-1528-18T1 3 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

A-1528-18T1 4 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

A-1528-18T1 5 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

A-1528-18T1 6 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.,

A-1528-18T1 7 221 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.,

A-1528-18T1 8 111 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

A-1528-18T1 9 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

A-1528-18T1 10 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.

A-1528-18T1 11