Lj's Acquisition Group, LLC v. John Michael Cohan

• Court: New Jersey Superior Court Appellate Division
• Decided: December 12, 2023
• Docket: A-3961-21
• Status: Unpublished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NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court ."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-3961-21

LJ'S ACQUISITION GROUP, LLC,

Plaintiff-Respondent,

v.

JOHN MICHAEL COHAN,

Defendant-Appellant. _________________________

Submitted October 16, 2023 – Decided December 12, 2023

Before Judges Gilson and DeAlmeida.

On appeal from the Superior Court of New Jersey, Law Division, Camden County, Docket No. DC-002529-22.

Hegge & Confusione, LLC, attorneys for appellant (Michael James Confusione, of counsel and on the briefs).

Greenblatt, Lieberman, Richards & Weishoff, LLC, attorneys for respondent (Nicolas Gordon Rotsides, on the brief).

PER CURIAM Plaintiff LJ's Acquisition Group, LLC (plaintiff or LJ's Group) filed a

summary action in the Special Civil Part, seeking to eject defendant John

Michael Cohan (defendant or Cohan) from real property located at 111 Rich

Avenue, Berlin, New Jersey (the Property). Defendant appeals from a May 6,

2022 judgment awarding possession of the Property to plaintiff and ordering

defendant to vacate the Property. He also appeals from a July 8, 2022 order

denying his motion for reconsideration.

Defendant argues that he was a tenant and was entitled to protection from

ejectment under the Anti-Eviction Act (A-E Act), N.J.S.A. 2A:18-61.1 to -

61.12. The trial court found that defendant was not a tenant and that plaintiff,

who indisputably owned the Property, was entitled to possession. Because those

findings are supported by substantial, credible evidence in the record, we affirm.

I.

We discern the relevant facts from the record. In doing so, we note that

neither party has fully explained the series of transactions resulting in the sale

of the Property to plaintiff. In that regard, on his motion for reconsideration,

defendant submitted numerous documents, including contracts of sales and

deeds. Many of those documents, however, were not fully executed and were

A-3961-21 2 not properly authenticated. Consequently, we focus on the narrow issue of

whether defendant proved he was a tenant.

LJ's Group purchased the Property from ADH Holdings, LLC (ADH LLC)

in December 2019. The deed evidencing that sale was "made on December 3,

2019 and delivered December 6, 2019." The purchase price was identified as

$187,000.

Cohan was associated with ADH LLC, but he has not fully described his

relationship with or ownership interest in that limited liability company. Cohan

did submit documents indicating that the Property had been sold to ADH LLC

by Capitulum, LLC, another limited liability company Cohan asserts he owne d,

on the same day the deed to the Property was delivered to LJ's Group.

Plaintiff and defendant agree that when the Property was sold to LJ's

Group, it was anticipated that Cohan would live at the Property, renovate it, and

purchase the Property back from LJ's Group in ninety days. Accordingly,

Cohan, through a limited liability company identified as "111 Rich Avenue

LLC," signed a promissory note, promising to pay LJ's Group $367,000, plus

interest (the Promissory Note). The Promissory Note was dated December 6,

2019, and was fully executed on January 21, 2020. The Promissory Note called

for 111 Rich Avenue LLC to make monthly "interest-only payment[s]" of

A-3961-21 3 $1,484.74. The principal of $367,000 was "due upon completion of the project

securing this note or within SIX (6) MONTHS from the date of" the Promissory

Note.1

No one disputes that the buy-back never occurred and that LJ's Group

continues to own the Property. What is in dispute is LJ's Group's right to possess

the Property.

LJ's Group contends that Cohan stopped making the monthly payments

under the Promissory Note and that LJ's Group subsequently demanded that he

vacate the Property. In July 2020, LJ's Group filed an eviction action against

Cohan, asserting that he was a tenant who had defaulted on his rent payments

and owed over $11,300. That eviction action was later dismissed without an

adjudication on the merits.

In April 2022, LJ's Group filed this summary ejectment action. LJ's Group

did not seek any monetary damages; rather, the only relief sought was to eject

Cohan from the Property and take possession of the Property.

On May 6, 2022, a hearing was held in the Special Civil Part. Cohan did

not submit the transcript of that hearing on this appeal. Nevertheless, he does

1 The record does not include any document describing the "completion of the project securing the Promissory Note." A-3961-21 4 not dispute that he appeared at that hearing representing himself. The record

also establishes that on May 6, 2022, Cohan contended that he was a tenant who

should not be evicted or ejected because he was protected by the A-E Act. In

addition, Cohan asserted that he had made significant improvements to the

Property, and he should be compensated for the cost of those improvements.

The Special Civil Part judge rejected those arguments and found that

Cohan was not a tenant. Accordingly, on May 6, 2022, the judge entered a

judgment granting possession of the Property to LJ's Group and ordering Cohan

to vacate the Property. The judge also directed that a writ of possession could

not be executed until thirty days later; that is, June 5, 2022.

Thereafter, Cohan retained counsel. On May 18, 2022, Cohan's counsel

filed for reconsideration. In support of that motion, Cohan certified that he was

a tenant of the Property "in a rent-to-own arrangement" with LJ's Group.

Specifically, Cohan certified that he originally purchased the Property "through

a business [he] owned" with the plan to fix up and resell the Property. He

explained that he had defaulted on the original loan he had obtained, "was at risk

of losing the [Property]" and, therefore, "entered into a business arrangement

with" LJ's Group. According to Cohan, LJ's Group purchased the Property with

the plan that he would buy the Property back at a higher price "with the added

A-3961-21 5 benefit of [Cohan] making high-value repairs and/or improvements to the

[Property]."

With his motion for reconsideration, Cohan also proffered an alleged

lease. The lease was between ADH LLC and Cohan and was "made effective as

of this [sixth] day of December, 2019." The lease stated that Cohan would use

the premises "for business" and would pay a monthly rent of $1,500. Cohan also

submitted a letter from Alphonso Hemmeain, the managing member of ADH

LLC and ADH Management LLC. The letter was dated May 5, 2022, and stated

that ADH LLC had made payments of over $40,000 to LJ's Group on Cohan's

behalf and that there had been a "verbal agreement" that Cohan could continue

to live at the Property in exchange for the payments.

On July 8, 2022, the same judge who had entered the judgment of

possession heard argument on the motion for reconsideration. After reviewing

all the new documents submitted, the judge found that Cohan had not established

that he was a tenant at the Property. In that regard, the judge found that the

Promissory Note did not establish a tenancy because it did not include a right to

live at the Property. The judge also rejected the proffered lease as a sham lease.

After reviewing the lease, the judge noted that it was supposedly a lease between

Cohan and ADH LLC but it was dated three days after ADH LLC had sold the

A-3961-21 6 Property to LJ's Group. Accordingly, on July 8, 2022, the judge entered an order

denying reconsideration.

Cohan then moved to vacate the judgment of possession and to stay the

execution of the writ of possession. Those applications were denied in orders

filed in July 2022. So, Cohan filed this appeal.

Shortly after the notice of appeal was filed, the writ of possession was

issued, and Cohan was locked out of the Property in August 2022. LJ's Group

submitted a lease reflecting that it subsequently rented the Property to other

tenants. The lease submitted commenced on December 1, 2022, and was for a

term of six months.

II.

Cohan now appeals from the judgment of possession entered on May 6,

2022, and the July 8, 2022 order denying his motion for reconsideration. Cohan

contends that the Special Civil Part abused its discretion in denying his motion

for reconsideration. He also argues that the court erred in not vacating the

judgment of possession and not allowing him to file an answer contesting the

ejection action.

The limited issue before us is whether Cohan established that he was a

tenant at the Property protected by the A-E Act. Cohan effectively concedes

A-3961-21 7 that if he was not protected by the A-E Act, he had no right to remain at the

Property because he was not paying rent and because he had not bought the

Property back from LJ's Group.

A summary action for ejectment is a limited action brought by a "party

claiming the right of possession of real property in the possession of another, or

[a party] claiming title to such real property." See N.J.S.A. 2A:35-1; R. 6:1-

2(a)(4) (authorizing summary actions pursuant to N.J.S.A. 2A:35-1 to -3, "where

the defendant has no colorable claim of title or possession"); J & M Land Co. v.

First Union Nat'l Bank, 166 N.J. 493, 520 (2001). To prevail, the party seeking

possession must demonstrate that it owns or controls the property and that the

person who is to be ejected has no right to remain at the property. Phoenix

Pinelands Corp. v. Davidoff, 467 N.J. Super. 532, 615 (App. Div. 2021) (citing

Perlstein v. Pearce, 12 N.J. 198, 204 (1953)).

In its summary ejectment action, LJ's Group sought only possession of the

Property. It did not seek any monetary damages. Thus, the limited issue before

the Special Civil Part was whether Cohan had a colorable claim to remain at the

Property. The A-E Act protects residential tenants from being evicted from

properties so long as the landlord cannot show good cause for removal under

one of the enumerated grounds, which include a tenant's nonpayment of rent.

A-3961-21 8 N.J.S.A. 2A:18-61.1(a); 447 Assocs. v. Miranda, 115 N.J. 522, 527-28 (1989);

Hale v. Farrakhan, 390 N.J. Super. 335, 340 (App. Div. 2007). To fall within

the ambit of the protections afforded by the A-E Act, the person seeking to

prevent eviction must be a traditional residential tenant or lessee. Guttenberg

Sav. & Loan Ass'n, 85 N.J. 617, 623-25 (1981) (holding that the A-E Act applies

only to traditional landlord-tenant relationships based upon an analysis of the

Act's statutory framework and the legislative intent behind its enactment).

On May 6, 2022, the Special Civil Part conducted a hearing and found that

Cohan was not a tenant at the Property. The record on the motion for

reconsideration reflects that the Special Civil Part judge initially focused on the

Promissory Note and found that that Note provided no right for Cohan to reside

at the Property. That finding is supported by the substantial, credible evidence

in the record.

On the motion for reconsideration, the court also considered the newly

filed documents, including the purported lease. At that hearing, the judge found

that the alleged December 6, 2019 lease between ADH LLC and Cohan was

invalid because ADH LLC had transferred ownership of the Property to LJ's

Group through a deed executed on December 3, 2019. In short, the judge found

that the lease was a sham because ADH LLC was not the legal owner of the

A-3961-21 9 Property on the date of execution of the alleged lease. That finding is also

supported by the substantial, credible evidence in the record. There is no

evidence demonstrating that the lease was ever shown to or made known to LJ's

Group. Nor is there any evidence that Cohan paid rent to LJ's Group.

Cohan relies heavily on the prior eviction action filed by LJ's Group. In

that action, LJ's Group certified under oath that Cohan was a tenant and that he

had failed to pay his rent and, therefore, should be evicted. That inconsistent

statement, however, does not establish that Cohan was a tenant. LJ's Group

dismissed the eviction action before any adjudication on the merits.

Consequently, LJ's Group is not collaterally estopped by its claim that Cohan

was a tenant. See Arena v. Borough of Jamesburg, 309 N.J. Super. 106, 109-10

(App. Div. 1998) ("The entire controversy doctrine does not affect a plaintiff's

right to file a new action based on the same factual allegations as a prior action

which has been dismissed without prejudice pursuant to Rule 4:37-1(a).");

Watkins v. Resorts Int'l Hotel & Casino, Inc., 124 N.J. 398 (1991) ("[O]nly a

judgment 'on the merits' will preclude a later action on the same claim .")

We need not determine whether Cohan has a separate claim based on that

inconsistent statement. Instead, the issue before us is whether Cohan has

established that he was a tenant at the Property. As already summarized, there

A-3961-21 10 is no evidence establishing that he was a tenant. Accordingly, because there is

no dispute that LJ's Group owned the Property, it had a right to possess the

Property and eject Cohan. Therefore, we affirm the May 6, 2022 judgment of

possession and the July 8, 2022 order denying reconsideration.

In doing so, we point out that our ruling does not preclude Cohan from

filing a separate action seeking compensation for the alleged improvements he

made to the Property. Indeed, in its brief on this appeal, LJ's Group conceded

that Cohan could file such an action even if we affirmed the judgment of

possession and order denying reconsideration in this matter.

Affirmed.

A-3961-21 11