Threatening Criminal Charges Found to be Consumer Fraud

The New Jersey Consumer Fraud Act ("CFA") protects homeowners from (among other things) unconscionable commercial practices of residential contractors, including those who threaten to file criminal charges if they are not paid.  A recent Appellate Court decision involved a homeowner who withheld payment to an HVAC contractor who failed to repair an air conditioning system after three service calls.  The contractor then proceeded to threaten the homeowner with the filing of criminal charges, and then (when payment wasn't made) actually filed charges for theft of services with the local police department.  The charges were eventually dismissed by the municipal court, and the homeowner was ultimately successful on a CFA claim in Superior Court.

On appeal, the Appellate Division upheld the finding of a CFA violation but remanded the case back to the trial court to revisit the award of only $19,800 in attorney fees and costs.   In doing so, the court noted the specific conduct of the contractor stating, "[the contractor] admitted that [it] has a history of instituting criminal actions as a means of collecting its unpaid invoices.  This outrageous abuse of our criminal justice system is precisely the type of unconscionable commercial practice the CFA was designed to protect consumers from and deter unscrupulous commercial entities from engaging in."  Accordingly, the matter was remanded to the trial court to revisit the amount of attorney fees and costs awarded. (Jeffrey S. Jacobs v. Mark Lindsay and Son Plumbing & Heating, Inc., et. al.)