In a recently-published opinion from the Appellate Division, the court found that the plain language of the County Improvement Authorities Law exempts county improvement authorities from the provisions of the Municipal Mechanics’ Lien Law which permit liens to be filed for unpaid work on public projects. Relying upon the definitions of a “public agency” in the lien law, as well as language in the statute permitting county improvement authorities and stating that they are not, “a county or municipality or agency or component of a municipality for the purposes of any other law,” the Court found that the plain language of the applicable laws exempted county improvement authorities from being subject to the lien law. Consequently, contractors and sub-contractors should be aware that there is no ability to file a lien on any projects funded by a county improvement authority. (Mastec Renewables Construction Co. Inc. v. Sunlight General Mercer Solar LLC)
The NJ Supreme Court recently affirmed an Appellate Division's decision that medical providers' claims for reimbursement, related to and arising from treatment rendered in a workers' compensation context, are not time barred by the two-year statue of limitations as found in the enabling workers compensation statute but rather remain legally viable for the full six-year period allotted for contracts per N.J.S.A. § 2A:14-1.
The genesis of the challenge was a 2012 amendment to the WC enabling statute which "granted the Division of Workers' Compensation . . . exclusive jurisdiction over claims brought by medical providers for payment of services rendered to injured employees." The employers, by and through their insurance providers, argued that the Legislature must have also truncated the statue of limitations for medical providers' claims for reimbursement, related to and arising from treatment rendered in a workers' compensation context, because of the 2012 amendment. The Court disagreed with that argument after an examination of the Legislature's intent when it amended N.J.S.A. § 34:15-51. Since the amended statute remained silent as to altering the statute of limitations, and because for many, many years prior the SOL was a six-year period, there could be no finding that the medical providers' claims should be time barred after two-years. The Court noted the Legislature can reexamine this issue and could truncate the SOL, however it did not do so with the 2012 amendment. (The Plastic Surgery Center, PA v. Malouf Chevrolet-Cadillac, Inc. ) In a recently decided case, the NJ Supreme Court rejected the Appellate Division's attempt at expanding a commercial landlord's non-delegable duty (a duty that cannot be assigned). Over the course of decades, our courts have created certain duties for commercial landlord's which cannot be assigned to a tenant. One such duty is that of maintaining a safe sidewalk for the general public to use. However no court has ever found that same duty exists for any private area of the leased property.
In the case at bar, the plaintiff slipped and fell on a portion of icy driveway which was separated by a fence from the sidewalk. The tenant had been assigned all the duties to maintain the property and was even declared the "de facto owner" per the lease terms. Further, the tenant testified that he was solely responsible for clearing snow and ice from the property. Regardless of the weight of evidence, the Appellate Division still found the commercial landlord had liability in not verifying that the driveway was free of the transient condition of snow and ice prior to plaintiff's fall. However, the Supreme Court disagreed and prevented such holding from overturning years of precedent. In doing so, the Court held (1) a driveway is private property, open to invitees, and not akin to a sidewalk which is used by the general public, (2) this particular lease assigned complete control of the property to the tenant even where the landlord reserved a right to enter to make repairs or in the case of emergency, and (3) even under alternative analysis of Hopkins v. Fox & Lazo Realtors the landlord here did not have a duty to protect the plaintiff (especially since plaintiff did recover for his injuries from the tenant). In sum, a commercial landlord has certain duties which it cannot delegate to its tenant. Maintaining a private portion of the leased premises is not one of those items - yet. (Shields v. Ramslee Motors) In a case of first impression in New Jersey, the Appellate Division held that an employer can be ordered to reimburse an injured worker for the costs of purchasing medicinal marijuana in conformity with the workers' compensation act and the medical marijuana act (the "MMA"). In this case the employer argued it could not be ordered to purchase pot for a patient because that would amount to aiding and abetting a crime. However the Appellate Division disagreed and ordered the employer to buy the marijuana for the former employee.
The facts of the matter involved a former construction worker who was injured on the job and suffered some severe spinal injuries. The injuries caused great pain and over the course of a decade and a half, the injured worker had several surgeries to no avail. Eventually the worker was using opioids as the sole form of pain relief. In trying to prevent a cycle of drug abuse, the injured worker sought the assistance of a doctor that specialized in prescribing medical marijuana and received a prescription for same. Part of the issue is that under Federal Law, marijuana is a Class 1 drug (meaning there is no inherent medicinal benefit through use) and opioids are Class 2 drugs (meaning there is a medicinal benefit with use). New Jersey's MMA creates an affirmative defense to a patient if caught in the State with marijuana. However, the Federal government does not recognize such a defense. In addition, this case turned away a pre-emption challenge (State law vs. Federal law) by the former employer. In doing so the Court weakly pointed to the mere words of this State's Legislature when that body declared that, "compliance with this act does not put the State of New Jersey in violation of federal law." (Vincent Hager v. M & K Construction ) New Jersey's Public bidding laws were enacted to protect the taxpayer by providing an even playing field for public construction projects (such as school construction), and mandating the project be awarded to the lowest responsible bidder. Taken from a recent opinion, a plaintiff submitted the lowest bid for work to be performed at a public school and the defendant submitted the third-lowest bid for the project. However, the school board decided to "review" the bids after bidding closed and subsequently disqualified plaintiff (and the second-lowest bidder) because those bid submissions included certifications from subcontractors which were used in a prior round of bidding for the same project, three weeks prior. Thus the board awarded the defendant the construction project.
Plaintiff filed suit and the trial court judge reversed the school board's decision, and anointed the plaintiff the lowest responsible bidder. The trial judge found that the three-weeks old certifications were not a material defect but were rather a minor defect which did not cause the parties to be on unequal footing when submitting their respective bids. Further, the plaintiff's bid would save the taxpayers nearly $190,000 verses the defendant. An appeal was filed by the defendant seeking to be reinstated as the lowest responsible bidder but the Appellate Division rejected the attempt and adopted the trial judge's reasoning. This highlights two important reminders to the bidders for public contracts: pay attention to the details in your submissions, and mere technical defects should not override the public policy of saving the taxpayer money. (Thassian Mechanical Contracting, Inc. v. East Brunswick Board of Education and Hanna's Mechanical Contractors, Inc.) In an unpublished Appellate Division opinion issued last month, an award of lost rents was affirmed in a matter where two neighbors were pitted against each other in a residential construction dispute. One property owner wanted to raze his house and build a brand new two-family house for use as a rental property. However, after neighbor #1 demolished the existing home and completed construction of the new first floor, the owner realized the the next door neighbor's fire-escape protruded onto his property. Therefore, construction of the new home was forced to stop as the second floor would hit the protruding fire escape. Both neighbors had land surveys performed which confirmed the encroachment, but the "stubborn" neighbor refused to modify or remove the fire escape - even after owner #1 offered to pay for such action. After an almost two-year delay to construction, the "stubborn" neighbor relented and repaired the fire escape to conform with the property boundaries. However, since the neighbor caused a two-year delay, the first owner filed suit seeking compensation for weather damage to the new but unfinished construction, as well as the lost rents. The trial court found the "stubborn" neighbor at fault and awarded neighbor #1 those damages, a decision that was upheld on appeal by the Appellate Division. (Rosario v. Pallazhco)
In an older opinion from 2018 that was eventually published recently, the Appellate Division considered whether or not the provisions in the operating agreement governing the value of the business upon retirement of a member would be strictly construed or amended based upon the members conduct. Specifically, the retiring member was seeking to have the value of his membership based upon the fair market value of the company as opposed to the operating agreement formula which was the last agreed upon value adjusted to reflect an increase or decrease in the net worth of the company. The retiring member argued that sixteen years passed since the parties determined an agreed value of the company, and during that time the company had used the fair market value method to value the company on three separate occasions for planning purposes. However, the Court disagreed and enforced the terms of the operating agreement as written. In doing so, the court affirmed existing caselaw which requires that there be a "mutual and clear" intention to modify a written agreement by conduct. Where, as here, such an intention is not demonstrated by the evidence, the court will enforce the operating agreement as written. (Namerow v. Pediatricare Associates LLC, et. al.)
In a precedential opinion, New Jersey's Appellate Division held that a one-time internet post created by a private out-of-state resident seeking to sell a used vintage automobile did not create sufficient contacts to invoke the jurisdiction of the New Jersey Courts. The internet post was made by a California man, seeking to sell his used vintage automobile. A man in New Jersey responded to the internet post and the parties came to a quick agreement on price ($40,000). The New Jersey man hired a third-party trucking company to pick up the car in California and transport it to New Jersey. When the vintage car arrived in New Jersey, the Buyer did not like the condition of the car and wanted to sue the California man in New Jersey state court. However, the court held that the one-time internet post by an out-of-state resident did not create sufficient contacts to invoke the jurisdiction of the New Jersey Courts, and the lawsuit would have to be filed in California.
This case is an example of the 21st Century's caveat emptor or "buyer beware." Buyers, when purchasing products on-line, have to remain vigilant in vetting where virtual purchases are made. Large on-line retailers generally have sufficient contacts with the majority of continental states that jurisdiction can be readily invoked. However an individual seller that merely posts a "for sale" ad does not personally submit to the jurisdiction of the Courts of the State wherein the ad is answered. When a problem arises, it is buyer beware. (Jardim v. Overley) In a recent unpublished decision from the Appellate Division, the court found that a real estate broker had waived the right to receive quarterly commission payments in advance since the realtor failed to enforce that contractual provision for 11 years. The commission agreement at issue was for the lease of a commercial property and stated that the realtor would be paid a 6% commission on the rent, "in four equal installments per year, in advance..." While such payments were originally made in advance on a quarterly basis, at some point the owner switched to making monthly payments instead. In ruling for the owner the trial court found that the realtor accepted, "monthly payments continuously for eleven years, thereby constituting a waiver of the quarterly payment schedule set forth in the agreement." Such finding was upheld by the Appellate Division. This case underscores the importance that parties to a contract not sit on their rights and enforce contractual provisions in a timely manner when they are not being followed. (Barry H. Gertsman & Company v. 5218 Atlantic Avenue Associates LLC, et. al.)
A recent unpublished decision from the Appellate Division found there to be no enforceable contract between a buyer and seller of real estate where, despite a term sheet and letter of intent, no formal contract was signed. The case involved the sale of commercial property in Millstone, New Jersey. The parties exchanged a term sheet and letter of intent for the buyer to purchase the property, and the attorneys proceeded to draft and modify a formal contract for the sale. Despite the buyer signing the negotiated contract, the seller never executed it and decided not to move forward with the transaction. Consequently, the buyer filed suit and sought a court order directing that the sale go through.
The Buyer argued that while the language of the LOI stated that terms of the LOI would be enforceable upon a mutually-agreed upon contract. it did not specify that the contract had to be signed. Therefore, based upon the signed LOI and the negotiated contract terms, there was an valid agreement to be enforced by the court. However, both the trial judge and Appellate Division disagreed, finding that the evidence as a whole demonstrated an intent that a final agreement was contingent upon the parties executing a formal written contract. Since this didn't happen, the Buyer's case was dismissed. (501 Jersey Ave LLC v. XXXIII Associates/Riverside Center, LLC) |
AuthorsPeter J. Vazquez, Jr. Archives
June 2023
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