Diamond Beach, LLC v. Mar. Assocs., Inc.

199 A.3d 306, 457 N.J. Super. 265
CourtNew Jersey Superior Court Appellate Division
DecidedDecember 24, 2018
DocketDOCKET NO. A-1704-17T1
StatusPublished
Cited by5 cases

This text of 199 A.3d 306 (Diamond Beach, LLC v. Mar. Assocs., Inc.) is published on Counsel Stack Legal Research, covering New Jersey Superior Court Appellate Division primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Diamond Beach, LLC v. Mar. Assocs., Inc., 199 A.3d 306, 457 N.J. Super. 265 (N.J. Ct. App. 2018).

Opinion

FASCIALE, J.A.D.

*269In 2011, the Legislature substantially amended multiple sections of the Construction Lien Law, N.J.S.A. 2A:44A-1 to -38 (the 2011 amended CLL). This appeal requires us to decide whether N.J.S.A. 2A:44A-6(a)(1) and N.J.S.A. 2A:44A-8 (the signatory-requirement amendments) apply retroactively. We limit our holding to the retroactive effect of that part of the signatory-requirement amendments that replaced the previous mandate that a "duly authorized officer" sign a corporate construction lien. We do *270so because the signatory-requirement amendments, and the 2011 amended CLL in general, contain other significant changes, which potential retroactive effect are not at issue in this appeal.

Sloan & Company, Inc. (Sloan) appeals from five orders entered after Sloan filed its construction lien claim in 2008.1 At that time, a corporate claimant - like Sloan -*309had to show that it "duly authorized" an officer to sign its lien-claim form. After conducting a plenary hearing in 2014, the judge found that the individual who signed Sloan's lien-claim form - Robert Luderer - was not a "duly authorized officer." Instead, he was an "Accounting & Information Systems Manager," a position that Sloan maintains satisfies the signatory requirements of the new law.

In early 2016, Sloan unsuccessfully attempted to vacate all the orders, arguing for the first time that the signatory-requirement amendments applied retroactively. Sloan contended that in so amending the CLL, the Legislature was "clarifying" the meaning of "duly authorized officer." But in 2011, the Legislature did not "clarify" what it meant by "duly authorized officer"; it deleted the phrase altogether from the original text of N.J.S.A. 2A:44A-6, and required compliance with a new claim form identified in N.J.S.A. 2A:44A-8 (the Section 8 claim form).

The Section 8 claim form changed who can now sign a corporate lien claim. Under paragraph one, the signatory must be an "officer/member" of the corporate entity. And under a section entitled "Suggested Notarial for Corporate ... Claimant," a notary must be satisfied that the signatory is a "Secretary (or other officer/manager/agent) of the Corporation." The signatory must now *271swear or affirm - unlike before - that he or she possesses authority to act on behalf of the corporate claimant by "virtue of its By[-]laws, or Resolution of its Board of Directors."

We conclude that the signatory-requirement amendments at issue are not "curative" for purposes of retroactivity analysis. There is no basis to conclude that the Legislature eliminated the phrase "duly authorized officer" to cure defects, inadvertence, or error in the CLL or in its administration; or did so to explain the intent of that part of the CLL; or to clarify, rather than change, the signatory requirement. Instead, it deleted "duly authorized officer" from the text, and created new requirements for signing corporate construction lien claims.2

We therefore reject Sloan's retroactivity argument, and hold that the signatory section of the 2011 signatory-requirement amendments applies prospectively. We defer to the judge's factual findings at the plenary hearing, which are supported by substantial evidence in the record, and conclude that the judge correctly applied the governing law. Accordingly, we affirm the orders under review.

I.

Diamond Beach originally owned several acres of vacant land (the Property). It developed the Property as a condominium *272community, generally consisting of almost *310100 residential units, a nine-story building, and recreational and parking facilities (the Project). Diamond Beach retained March Associates, Inc. (March) as the general contractor, who subcontracted carpentry work to Sloan. March filed a Chapter 11 Bankruptcy Petition and did not pay Sloan for the work Sloan allegedly performed on the Project. First Indemnity of America Insurance Company issued bonds to secure Sloan's lien.

When Luderer signed Sloan's lien-claim form in 2008, he did not identify himself as Sloan's "duly authorized officer." Rather, in three separate sections of the form, he referred to himself as an "Accounting & I[nformation] S[ystems] Manager." Defendants filed a motion for summary judgment and argued that in 2008, N.J.S.A. 2A:44A-6 required a "duly authorized officer" to sign a corporate lien claim. Defendants contended that Luderer was a manager, not a "duly authorized officer," and therefore sought to discharge the lien because he lacked authority to sign it.

In opposition to the motion, Sloan submitted a certification from Scott Casabona, Sloan's President as of 2002. He certified that Luderer signed the lien claim as Sloan's "duly authorized corporate officer." Casabona explained further that

Mr. Luderer was acting in this capacity on behalf of Sloan prior to the time I became President and a member of the Board of Directors. Sloan had duly authorized Mr. Luderer to act as an officer for purposes of collecting monies owed to the company[,] and [for] signing and filing construction liens on behalf of the company prior to the time that I joined Sloan.
[Emphasis added.]

According to Casabona, "Luderer ... was duly authorized by the prior President, Peter Shanley, and the Board of Directors[,] when he was [first] hired to ... sign[ ] and fil[e] [Sloan's] construction lien[s] ...." Shanley did not produce his own certification in opposition to the motion - although he could have - and he did not have an opportunity to testify at the hearing because he died three months after Sloan opposed the summary judgment motion.

On the return date of the motion, the judge found that Casabona's certification created a genuine issue of material fact about *273whether Luderer was a "duly authorized officer," which precluded summary judgment. The judge permitted the parties to engage in discovery on that issue. She then conducted the plenary hearing.

At the plenary hearing, Casabona dealt head-on with the absence of any written corroborative evidence that verified Luderer was a "duly authorized officer." He explained that Sloan's Board of Directors did not issue written resolutions or minutes memorializing its elections of officers. For example, he testified that although Sloan "followed all of its corporate formalities in holding [the] meeting [that elected Casabona as] [P]resident," there was no written resolution reflecting that election. Likewise, when the Board first elected Casabona as Vice President, there were no resolutions or minutes confirming that election. He emphasized that this method of conducting business was "just the way [Sloan] operated."

Casabona acknowledged that Sloan's by-laws required the Board to elect officers.

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Cite This Page — Counsel Stack

Bluebook (online)
199 A.3d 306, 457 N.J. Super. 265, Counsel Stack Legal Research, https://law.counselstack.com/opinion/diamond-beach-llc-v-mar-assocs-inc-njsuperctappdiv-2018.