VITO SAURINO et al. v. THOMAS SENATORE, et al.

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-5805-04T15805-04T1

VITO SAURINO and SANDRA

SAURINO,

Plaintiffs-Appellants,

v.

THOMAS SENATORE, CINDY

SENATORE a/k/a CINDY FAY

HAMILTON, LUCY LEGGIO,

J.R. HIGGINS REALTY and

ELLIE WILLIAMS,

Defendants-Respondents.

_____________________________________________________________

 

Argued March 7, 2006 - Decided August 15, 2006

Before Judges Kestin, R. B. Coleman and Seltzer.

On appeal from the Superior Court of New Jersey, Law Division, Bergen County, L-6123-04.

Frank T. Luciano argued the cause for appellants Vito Saurino and Sandra Saurino.

Christopher B. Block argued the cause for respondents J.R. Realty and Ellie Williams (Weiner Lesniak, attorneys; Mr. Block, on the brief).

Gregory E. Peterson argued the cause for respondent Lucy Leggio (Connell Foley, attorneys; Karen Painter Randall and Catherine G. Bryan, on the brief).

PER CURIAM

Plaintiffs Vito and Sandra Saurino (plaintiffs) appeal from orders granting summary judgment and dismissing their claims against J.R. Higgins Realty, Ellie Williams and Lucy Leggio (defendants) for common law fraud, consumer fraud and negligence. Plaintiffs also appeal from the court's denial of their own motion for summary judgment.

On appeal, plaintiffs argue that the motion court incorrectly determined that they were required to provide expert testimony in order to sustain causes of action for common law fraud, consumer fraud and negligence against defendants. Moreover, plaintiffs contend that the record demonstrates that there are no genuine issues of material fact that should have precluded the entry of a judgment on liability in their favor as a matter of law. We agree that plaintiffs may establish a prima facie case under the asserted causes of action without resort to expert testimony. We, therefore, reverse the orders granting summary judgment. We affirm the denial of plaintiffs' motion for summary judgment.

In the fall of 2003, plaintiffs began looking for properties from where they could conduct a pet grooming business. Sandra Saurino saw a multiple listing advertisement posted on the internet for property located at 411 Hackensack Avenue, Carlstadt, New Jersey (the property). The listing, which had been prepared and posted by defendant Williams, an employee of defendant Higgins, identified Thomas Senatore as the owner of the property. At the time defendant Williams listed the property, she was aware that Thomas Senatore was not the owner. Sandra Saurino contacted defendant Leggio, also an employee of defendant Higgins, to arrange a time at which she could view the property. Defendant Leggio, relying on the listing, told plaintiffs that Thomas Senatore owned the property.

On January 5, 2004, plaintiffs entered into a lease agreement with Thomas Senatore for the property. The lease identified both Thomas and Cindy Senatore as the landlord, however, Cindy did not sign the lease. On February 1, 2004, plaintiffs occupied the property and began to prepare the property for the opening of their pet grooming business. Shortly thereafter, plaintiffs learned that Thomas Senatore was not the owner of the property, that the Senatores were tenants of the actual owner, Melki Saliba, that the lease under which Senatore occupied the property contained a no-pet clause, and that the lease expired before the lease between Senatore and plaintiffs. Although Thomas Senatore and Melki Saliba amended the lease between themselves to allow the Senatores to sublet the property, and although Senatore contracted to purchase the property, plaintiffs requested further assurances from the Senatores regarding their sublease that the Senatores could not or would not give. Consequently, plaintiffs vacated the property and commenced this civil action.

On April 14, 2004, plaintiffs filed a complaint against Thomas and Cindy Senatore, Lucy Leggio and J.R. Higgins Realty. By way of amendment on April 28, 2004, Ellie Williams was added as a defendant. In the four-count amended complaint, plaintiffs alleged in the first count that they suffered damages as a result of the fraudulent representations of all defendants. In the second count, plaintiffs alleged unlawful and unconscionable commercial practices under the Consumer Fraud Act by defendants Higgins, Leggio and Williams. The third count alleged a breach of contract by the Senatores, and the fourth count alleged the negligence of all defendants with respect to their respective duty to provide accurate information concerning the ownership of the property.

On or about March 26, 2005, the Senatores filed a notice of motion for summary judgment. Higgins and Williams filed their notice of motion for summary judgment on or about March 29, 2005, and on or about April 1, 2005, Leggio filed a notice of motion for summary judgment. Finally, on or about May 2, 2005, plaintiffs filed a cross-motion for summary judgment. On March 13, 2005, oral arguments on all the motions were heard, and on that same day, the judge signed an order granting summary judgment to Leggio and dismissing plaintiffs' claims against her; signed a separate order granting summary judgment to Higgins and Williams and dismissing plaintiffs' claims against them; and signed a third order denying plaintiffs' motion for summary judgment as to all defendants. The court denied without prejudice the motion filed by the Senatores.

An appellate court's review of a "trial court's grant of summary judgment is de novo, analyzing the evidence under the Brill standard." Vagias v. Woodmont Properties, LLC, 384 N.J. Super. 129, 134 (App. Div. 2006); Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995). The judge must decide "whether the competent evidential materials presented, when viewed in the light most favorable to the non-moving party, are sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party." Brill, supra, 142 N.J. at 540.

Summary judgment is to be granted if "the pleadings, depositions, answers to interrogatories and admissions on file, together with affidavits, if any, show that there is no genuine issue as to any material fact challenged and that the moving party is entitled to a judgment or order as a matter of law." R. 4:46-2(c). On appeal, "[a] trial court's interpretation of the law and the legal consequences that flow from established facts are not entitled to any deference." Manalapan Realty v. Manalapan Tp. Comm., 140 N.J. 366, 378 (1995).

Plaintiffs contend, and we agree, that under the facts of this case, expert testimony is not necessary to establish a prima facie case against defendants on the asserted causes of action for fraud, consumer fraud and negligence. As the Supreme Court has stated, "except for malpractice cases, there is no general rule or policy requiring expert testimony as to the standard of care." Butler v. Acme Markets, Inc., 89 N.J. 270, 283 (1982) (emphasis in original). "Even in malpractice cases, the facts of a given case may be such that the common knowledge possessed by laymen may permit a finding that a duty of due care has been breached." Ibid. "If a subject is so esoteric that jurors of common judgment and experience cannot form a valid conclusion, a jury may not be permitted to draw a particular conclusion without the aid of an expert opinion." Wyatt v. Wyatt, 217 N.J. Super. 580, 591 (App. Div. 1987). More specifically, "expert opinion is admissible if the general subject matter at issue, or its specific application, is one with which an average juror might not be sufficiently familiar, or if the trial court determines that the expert testimony would 'assist the jury in comprehending the evidence and determining issues of fact.'" State v. Berry, 140 N.J. 280, 292-93 (1995) (quoting State v. Odom, 116 N.J. 65, 70 (1989)). On the other hand, expert testimony is not necessary when the subject can be understood by jurors utilizing common judgment and experience. Campbell v. Hastings, 348 N.J. Super. 264, 270 (App. Div. 2002) (concluding that no expert was needed to explain why a poorly-illuminated sunken foyer was dangerous and posed a hazard to persons on the property).

The "elements of common law fraud are: (1) a material misrepresentation of a presently existing or past fact; (2) knowledge or belief by the defendant of its falsity; (3) an intention that the other person rely on it; (4) reasonable reliance thereon by the other person; and (5) resulting damages." Gennari v. Weichert Co. Realtors, 148 N.J. 582, 610 (1997).

The Consumer Fraud Act (the Act), N.J.S.A. 56:8-1 to -20, prohibits the use of any unlawful practice in connection with the sale or advertisement of real estate. The critical provision states:

The act, use or employment by any person of any unconscionable commercial practice, deception, fraud, false pretense, false promise, misrepresentation, or the knowing, concealment, suppression, or omission of any material fact with intent that others rely upon such concealment, suppression or omission, in connection with the sale or advertisement of any merchandise or real estate, or with the subsequent performance of such person as aforesaid, whether or not any person has in fact been misled, deceived or damaged thereby, is declared to be an unlawful practice . . . .

[N.J.S.A. 56:8-2.]

"[A] private plaintiff must have an ascertainable loss in order to bring an action under the Act." Weinberg v. Sprint Corp., 173 N.J. 233, 250 (2002). However, "[t]o say that a plaintiff must present a claim of ascertainable loss to have standing under the Act does not require that the claim ultimately prove successful." Id. at 251.

"In a negligence case, plaintiff must show a duty of care, a breach of that duty, and that the breach proximately caused the harm." Olivo v. Exxon Mobil Corp., 377 N.J. Super. 286, 292 (App. Div. 2005), aff'd and remanded sub. nom., Olivo v. Owens-Illinois, Inc., 186 N.J. 394 (2006). Negligent misrepresentation "requires proof that an 'incorrect statement was negligently made and justifiably relied upon' and that injury was sustained as a consequence of that reliance." Carroll v. Cellco P'ship, 313 N.J. Super. 488, 502 (App. Div. 1998).

Here, plaintiffs contend the defendants knew or reasonably should have known that Senatore was not the owner of the property and that defendants affirmatively misrepresented the nature of his interest to plaintiffs' detriment. Nothing about defendants' alleged acts or omissions is "so esoteric" as to preclude "jurors of common judgment and experience" from "form[ing] a valid conclusion . . . without the aid of an expert opinion." Wyatt, supra, 217 N.J. Super. at 591. Moreover, the average juror is sufficiently familiar with the concepts of negligence and fraud that he or she does not need an expert to offer an opinion as to whether the identification or alleged misidentification of the owner of the property was material, whether it was relied upon to plaintiffs' detriment, and whether plaintiffs sustained damages as a proximate result.

Defendants contend that a person claiming to be a specialist in real estate is "required to employ not merely the skill of a salesperson, but that special degree of skill normally possessed by the average realtor licensed in New Jersey who has devoted special study and experience in the field of real estate sales." Farrell v. Janik, 225 N.J. Super. 282, 289 (Law Div. 1988). Accordingly, they argue that "what constitutes the standard of care to be employed by [such] an expert and whether there was a deviation from that standard can be established only from the testimony of similar experts who testify in court." Ibid. However, it is clear that "[i]f the conduct of an expert is so obviously wanting in skill and care we depart from the normal rule requiring that the standard of care and deviation be established by expert testimony." Ibid.

It is well established that "[u]nder the common knowledge doctrine, . . . a malpractice case against a licensed professional may present triable issues without resort to the testimony of an expert." Rosenberg v. Cahill, 99 N.J. 318, 325 (1985). "In such a case, the jury itself is allowed to 'supply the applicable standard of care and thus to obviate the necessity for expert testimony relative thereto.'" Ibid. (quoting Sanzari v. Rosenfeld, 34 N.J. 128, 141 (1961)). "The trial of such a case is essentially no different from 'an ordinary negligence case.'" Ibid.

Plaintiffs place considerable -- indeed, too much -- stock in the common knowledge doctrine when they argue that they were entitled to partial summary judgment. They urge that defendants were negligent as a matter of law "when . . . they failed to disclose that the Senatores were not yet the owners of the [p]roperty, but merely contract purchasers, and/or . . . [when defendants] told the Saurinos that the [p]roperty was actually owned by Thomas Senatore." According to plaintiffs, common sense would require an average juror to conclude that a real estate broker involved in the instant transaction "must speak truthfully and disclose all material facts associated with that transaction." While we agree that the common knowledge doctrine applies, eliminating the need of an expert, we do not agree the motion judge properly could have determined the material issues in favor of plaintiffs as a matter of law. There are disputed material issues of fact bearing on causation and damages that precluded summary judgment for any party.

Defendants, of course, vigorously contend that the common knowledge doctrine is inapplicable. They argue that plaintiffs would have to prove such things as the applicable standard of care required of real estate professionals in real estate transactions, the responsibility of defendants to inform plaintiffs regarding Thomas Senatore's status as a contract purchaser, and the difference between a lease and a sublease. According to defendants, a juror of average intelligence could not understand these complicated issues without the assistance of expert testimony. To the extent those matters would assist the jurors in understanding better the defense raised, it is incumbent upon defendants to go forward with such proofs. We merely conclude that such proofs are not an indispensable part of a prima facie case.

Defendant Leggio also suggests that the instant matter is "not as simple as those cited by [plaintiffs]" for the proposition that the common knowledge doctrine should apply. According to defendant Leggio, in the cases cited by plaintiffs there was clear evidence of an injury, whereas in the present matter an expert is necessary to determine damages. Therefore, says defendant Leggio, plaintiffs' failure to provide an expert as to negligence is fatal.

These arguments, in our view, fail to recognize the difference between what proofs are required to present a prima facie case and what may be necessary for plaintiffs ultimately to prevail. The focus is upon "whether the competent evidential materials presented, when viewed in the light most favorable to the non-moving party, are sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party." Brill, supra, 142 N.J. at 540. Under that standard, summary judgment should not have been granted.

Defendants Higgins and Williams maintain that Gennari, supra, 148 N.J. 582, supports the judge's holding that expert testimony was required at least for the negligence claim in this matter. In Gennari, the Court noted that it could not "say that the trial court erred in dismissing the negligence claim against Weichert" for "the purchasers' failure to present expert testimony to establish the standard of care in the real estate industry[.]" Id. at 612. The Court also noted that the appellate panel had not reached that issue in its review. Ibid. Since its decision in Gennari, the Court has observed, in the context of the affidavit of merit statute, that "[i]n a common knowledge case, whether a plaintiff's claim meets the threshold of merit can be determined on the face of the complaint. [When a] defendant's careless acts are quite obvious, a plaintiff need not present expert testimony at trial to establish the standard of care." Palanque v. Lambert-Woolley, 168 N.J. 398, 406 (2001). See also Hubbard v. Reed, 168 N.J. 387, 394 (2001) (explaining that "by definition, in common knowledge cases an expert is not needed to demonstrate that a defendant breached a duty of care"). Such observations by the Court support our view that the application of the common knowledge is fact-dependent and is not to be deemed inapplicable to any particular theory of recovery.

In their reply brief, plaintiffs assert that defendants' contentions are legal in nature, and, therefore, "expert testimony is not only not required, but not permissible." In support of their argument, plaintiffs state that they engaged an expert for their trial against the Senatores, who "aggressively sought to bar that testimony," claiming that it was either inadmissible as an issue of law or subject to the common knowledge exception. That circumstance was not before the court when it ruled on the motions from which the appeal was taken and an evidentiary ruling made by a court in a different context may or may not be relevant in a subsequent proceeding. It is not relevant to this appeal.

Defendants' contention, relying on Macedo v. Dello Russo, 178 N.J. 340 (2004), that the Act does not apply to real estate professionals, is clearly an incorrect reading of that case. In Macedo, the Court concluded that our jurisprudence and the Legislature, through its awareness and acquiescence in the Court's previously articulated judicial view, differentiate between real estate professionals and members of the learned professions, such as medicine, dentistry, accounting, law and engineering. Id. at 344. Moreover, the Court observed that although the Act has not been "amended to encompass the advertising of professionals[,] . . . the only major substantive change" to the substance of the Act was a 1976 amendment that included "the sale of real estate in the definition of 'merchandise.'" Id. at 344. The term "sale" is, of course, defined broadly by the Act to "include any sale, rental or distribution, offer for sale, rental or distribution or attempt directly or indirectly to sell, rent or distribute." N.J.S.A. 56:8-1(e). Thus, the Court in Macedo only held that learned professionals, but not real estate sales professionals, acting within their professional capacities, are beyond the reach of the Act. Id. at 345-46.

Defendants raise one final argument that we will address briefly. They submit that Senatore was the contract purchaser and that the law recognizes a contract purchaser as an owner. Accordingly, they argue it is apparent that there was no material misrepresentation of a presently existing or past fact. From that premise, they argue that their statements were not false, that plaintiffs failed to meet the second prong of the common law fraud, and that defendants had no knowledge or belief of any falsity.

The short answer is that those arguments beg the critical question which must be answered by the trier of fact. Undoubtedly, a contract purchaser's interest is cognizable for some purposes, but it is not synonymous with legal title and not the equivalent of ownership in all contexts. For example, the Court recently acknowledged that "[t]he doctrine of equitable ownership or equitable conversion is not a fixed rule but a fiction devised to achieve justice between the parties to a real estate transaction." Jock v. Zoning Bd. of Adjust., Wall Tp., 184 N.J. 562, 587 (2005). "[T]he doctrine has been used as a loss allocation device as between the parties to a real estate contract where property is damaged or destroyed after a contract is executed but before title has passed." Ibid. It "is invoked to give effect to the mutual intent of the parties[,]" but it "does not effect a transfer of legal title." Id. at 588. Thus, it is not a complete answer for defendants to say that the Senatores were contract purchasers and, hence, equitable owners. The import of that interest and its bearing upon the transaction with plaintiffs is for the trier of fact to evaluate.

Moreover, plaintiffs contend that the Senatores' contract of purchase post-dated the representations of ownership made by defendants to them and included in defendants' advertisement. Plaintiffs further allege that the leasehold interest initially conveyed to the Saurinos in the Senatore/Saurino lease expired after the term of the Saliba/Senatore lease and that the no-pet clause was antithetical to their intended use of the property. Defendants, of course, contend there was no harm and that plaintiffs had no good reason for abandoning the premises. All of these issues, we believe, warrant further development of the record.

We reverse the orders granting summary judgment in favor of defendants. We affirm the order denying summary judgment to plaintiffs. The matter is remanded to the Law Division for further proceedings.

 

Defendants Thomas and Cindy Senatore have not participated in this appeal. Their motion to dismiss plaintiffs' complaint was denied without prejudice because the judge concluded there existed questions of material fact. Thereafter, plaintiffs settled with the Senatores and on June 30, 2005, those parties entered into a stipulation of dismissal.

(continued)

(continued)

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A-5805-04T1

 

August 15, 2006