JS PROPERTIES, LLC v. Brown & Filson, Inc.

914 A.2d 297, 389 N.J. Super. 542
CourtNew Jersey Superior Court Appellate Division
DecidedDecember 27, 2006
StatusPublished
Cited by3 cases

This text of 914 A.2d 297 (JS PROPERTIES, LLC v. Brown & Filson, 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
JS PROPERTIES, LLC v. Brown & Filson, Inc., 914 A.2d 297, 389 N.J. Super. 542 (N.J. Ct. App. 2006).

Opinion

914 A.2d 297 (2006)
389 N.J. Super. 542

JS PROPERTIES, L.L.C., Jonathan Schwartz and Scooter Jolley, Plaintiffs-Respondents,
v.
BROWN AND FILSON, INC., t/a Shelby's, Defendant-Appellant.

Superior Court of New Jersey, Appellate Division.

Argued November 29, 2006.
Decided December 27, 2006.

*298 Kevin M. Hahn, Hackettstown, argued the cause for appellant (Courter, Kobert & Cohen, attorneys; Mr. Hahn, of counsel; Amanda Mulvaney, on the brief).

James M. Docherty, Roseland, argued the cause for respondents (Vinick & Docherty, attorneys; Kathleen M. Lee and Mr. Docherty, on the brief).

Before Judges WEFING, C.S. FISHER and MESSANO.

The opinion of the court was delivered by

FISHER, J.A.D.

In this commercial tenancy matter, we consider but do not decide whether a tenant's claim of constructive eviction may legitimately be based upon the fact that the landlord has sued for possession because the tenant here continued in possession of the leased property for an unreasonable period of time after the filing of the landlord's suit. We, thus, affirm the dismissal of the tenant's novel constructive eviction claim but reverse and remand for a new trial on damages because the trial judge erred in excluding the tenant's expert testimony regarding the fair market sale or rental value of the leasehold, which was offered to show that the landlord did not take reasonable steps in mitigating damages.

The record reveals that the parties have been in conflict about the tenant's ability to enjoy the leased premises in Stanhope nearly from the onset of their relationship. For many years, plaintiffs Jonathan Schwartz and Scooter Jolley operated a business in the building in question. In June 1987, defendant Brown and Filson, Inc. (the tenant) purchased this business from plaintiffs; the plaintiffs retained ownership of the building and entered into a ten-year lease with the tenant.[1]

The tenant began experiencing roof leaks within the first month of the lease term. A lawsuit was commenced in the Law Division by the landlord in 1989 as a result of the tenant's withholding of rent due to the roof leaks. In 1992, the parties entered into a written settlement agreement of that suit, which, among other things, included the landlord's "recogni[tion] *299 [of] its obligation to keep the roof in repair with the intention of [l]andlord providing the [t]enant with a dry store." The agreement also included a method for testing the integrity of the roof as well as the landlord's promise to make any necessary roof repairs. In addition, the agreement declared that, in the event of future water damage,

the Tenant shall be entitled to monetary recovery in the following manner (which may be deducted from the rent):
a) the current retail value of the damaged or wet merchandise;
b) said merchandise to be picked up by the Landlord within 72 hours of notice to Landlord;
c) Tenant shall be entitled to the costs of clean-up and repairs to the area affected by the leaks;
d) costs may include Tenant's own costs of labor required for said clean-up at $20.00 per man hour[;]
e) The Tenant agrees to act reasonably and responsibly in respect to a, b, c and d hereof.

In July 1997, the parties entered into a new ten-year lease agreement. Among other things, this new lease agreement expressly obligated the landlord "to provide a water tight roof and roof water removal system to satisfactorily remove water from the roof" and declared, absent the application of an exception not relevant here, that "[s]hould any leak occur . . . the Landlord will be responsible for damages upon the same terms as set forth" in the 1992 settlement agreement.

Three or four months later, the roof again began to leak and, according to the tenant's testimony, approximately ninety-seven leaks occurred during the first three years of the 1997 lease; the landlord acknowledged that it was given notification of leaks on over twenty occasions. As a result, the tenant made deductions from its rent payments for certain expenses to which it claimed entitlement pursuant to the 1992 settlement agreement. Included among these deductions was an amount for the loss of business during a Valentine's Day sale in 2000; the tenant also recognized that on two occasions it deducted an amount based upon a labor charge in excess of the $20 per hour rate referred to in the settlement agreement.

In January 2000, work began to replace the roof, which resolved the long-standing problem with leaks. It is undisputed that there were no further leaks in the roof starting well before the landlord filed suit in the Special Civil Part on September 15, 2000.

The landlord filed suit to obtain possession of the leased premises, alleging that the tenant had not paid rent in the amount of $16,651.45; this amount represented the amount of deductions the tenant had previously made when it was burdened by roof leaks. Soon after the suit was commenced, the tenant moved for a transfer of the matter to the Law Division, citing the "complexity of the issues" and claiming a need for discovery and the joinder of additional parties and claims. The judge who was then assigned to the matter agreed with the tenant's contentions and ordered a transfer to the Law Division on October 13, 2000 for the reasons expressed in a written decision.

On November 13, 2000, the tenant filed an answer and counterclaim, which included, among other things, claims for compensatory and punitive damages based upon (1) the landlord's "false[] and malicious[]" suit that was filed, according to tenant, with "the intent and purpose to harass and prevent the proper operation" of the tenant's business and with the "ulterior motive . . . to expunge or renegotiate" the 1992 settlement agreement; (2) the landlord's *300 alleged breach of the tenant's right to quiet enjoyment of the premises; and (3) the landlord's alleged "unconscionable commercial practices and other unlawful practices" designed to terminate the tenancy.

On March 31, 2001, the tenant vacated the premises and returned the keys to the landlord. The tenant then amended its counterclaim, adding a claim which asserted that the landlord had "deprived [tenant] of the quiet enjoyment" of the premises and that the premises were rendered "substantially unsuitable for the purpose for which they were leased," which constituted tenant's "constructive eviction" from the premises.

On September 6, 2002, the landlord moved for "an order limiting issues to be decided by the jury and directing judgment in favor of the plaintiffs on breach of contract issues." The tenant now argues on appeal that the motion was procedurally deficient. Although there is merit to this point, we find the tenant was not prejudiced by the motion's inadequate description of the relief sought. The record reveals that the tenant understood that the landlord was seeking, in part, the dismissal of the constructive eviction claims and that the tenant had a full and fair opportunity to respond to the landlord's contentions. The judge also understood the landlord's motion in that way and her ruling reveals that the judge either expressly or implicitly applied the standards imposed by R. 4:6-2 and R. 4:46. We thus see no harm or prejudice to the tenant arising from the landlord's inartful motion or the procedures that followed.

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914 A.2d 297, 389 N.J. Super. 542, Counsel Stack Legal Research, https://law.counselstack.com/opinion/js-properties-llc-v-brown-filson-inc-njsuperctappdiv-2006.