DUANE READE v. TPK OF NJ DEVELOPMENT CORP.

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-6704-03T56704-03T5

DUANE READE,

Plaintiff-Appellant/

Cross-Respondent,

v.

TPK OF NJ DEVELOPMENT CORP.,

Defendant-Respondent/

Cross-Appellant.

________________________________

 

Argued October 3, 2005 - Decided September 26, 2006

Before Judges Kestin, Hoens and Seltzer.

On Appeal from a Final Judgment of the

Superior Court of New Jersey, Law Division,

Bergen County, L-1310-03.

Jessica L. Herbster argued the cause for appellant/cross-respondent (Lowenstein Sandler, attorneys; Gregory B. Reilly, of counsel and on the brief; Ms. Herbster and Ramsey C. Ong, on the brief).

Edward S. Rosen argued the cause for respondent/cross-appellant.

PER CURIAM

Plaintiff and defendant cross-appeal from portions of a June 25, 2005, final judgment resolving disputes arising from the untimely delivery of premises leased by defendant to plaintiff. On plaintiff's appeal, we affirm in part and reverse in part; on defendant's appeal, we affirm.

The record, developed over a six-day bench trial, reveals that defendant is the lessee of a parcel of land in Fort Lee on which it intended to construct a shopping center, comprising four buildings, to be sub-let to individual tenants. One of those tenants was plaintiff, which intended to operate a drugstore in Building A. Building B was rented to Borders for use as a bookstore; Building C was rented to Blockbuster Video; and Building D was to be rented to several smaller tenants.

The lease between plaintiff and defendant provided for an initial annual rent of $272,000. The lease also required payment of additional rent, limited to $51,000 per year, which included such items as common area maintenance and tax payments. One of the central provisions of the lease afforded a credit against the rent in the event there had been no "Delivery of Possession" of the premises to plaintiff by May 1, 2001. Section 8.03 of the lease provided:

Fixed Annual Rent payments shall commence on the Rent Commencement Date provided that Delivery of Possession has occurred on or before May 1, 2001. If Delivery of Possession does not occur on or before May 1, 2001, Tenant shall be entitled to an abatement of Fixed Annual Rent and Additional Rent equal to one (1) day of Fixed Annual Rent and Additional Rent for each day that Delivery of Possession is delayed after May 1, 2001, provided that such delay is not solely due to the acts or omissions of Tenant

Section 7.02 defined the term "Delivery of Possession" as the occurrence, or waiver by plaintiff, of each of six described conditions. Those conditions included:

(b) The completion of Landlord's Work . . . .

(c) The Common Areas, and all of the buildings and other improvements depicted on the Site Plan shall have been completed and operational; in addition, all street, storm drainage, traffic signalization, and other off-site improvements (including, but not limited to, all off-site improvements depicted on the Site Plan) required for the Center to open for business and for Tenant to receive a permanent certificate of occupancy shall be substantially completed.

"Landlord's Work" was defined to mean the completion of described improvements, some of which involved work on the interior of Building A in accordance with plans to be supplied by plaintiff.

The testimony at trial revealed that a Certificate of Occupancy could not be issued for the buildings individually. Rather, all four buildings and the common areas had to be completed since only one Certificate of Occupancy would issue for the entire center.

The lease also afforded an extension of the time within which a party was required to perform if timely performance was prevented by one of several enumerated events. Article 51 dealt with "Force Majeure." Section 51.01 provided:

If either party shall be prevented or delayed from punctually performing any obligation or satisfying any condition under this Lease (other than an obligation or condition requiring the making of any payment hereunder) by any condition beyond the reasonable control of such party, including any strike, lockout, labor dispute, inability to obtain labor or

materials or reasonable substitutes

therefore, Act of God, governmental

restriction, regulation or control, enemy or

hostile governmental action, civil commotion, insurrection, sabotage or fire or other casualty, then the time to perform such obligation or satisfy such condition shall be extended for a period equal to the duration of the delay caused by such event plus two (2) days.

The lease also contained a provision, Section 31.01, requiring the unsuccessful party to any litigation involving the lease to reimburse the costs and fees incurred by the successful party:

If at any time during the Lease term either Landlord or Tenant shall institute any action or proceeding against the other relating to the provisions of this Lease or any default hereunder, then the unsuccessful party in such action or proceeding agrees to reimburse the successful party for the reasonable expenses for attorneys' fees, paralegal fees and disbursements incurred therein by the successful party. Such

reimbursement shall include all legal expenses incurred prior to trial, at trial and at all levels of appeal and post-judgment proceedings.

There was no delivery of possession on May 1, 2001; however, plaintiff did take possession of the premises 590 days later, on December 12, 2002. The lease did not require rental payments until certain defined events occurred. On March 11, 2003, sixty percent of the shopping center was open for business, triggering plaintiff's obligation to pay rent. Prior to that date, however, plaintiff filed a complaint seeking a judgment declaring the rent abatement clause, Section 8.03, to be enforceable and establishing the amount of rent to be credited as a result of the delay in the delivery of the premises. Plaintiff also sought fees pursuant to Section 31.01. Defendant filed a counterclaim seeking immediate payment of unabated rent and the dismissal of the complaint on the grounds that the rent abatement provision constituted an unenforceable penalty.

Defendant did not dispute the calculation of the 590-day delay in the delivery of possession. Rather, the trial centered on: (a) whether defendant was required to provide a rent credit for the entire 590 days or whether some, or all, of that delay was occasioned solely by the acts or omissions of plaintiff; and (b) whether defendant was entitled to reduce the 590-day period of delay because some, or all, of the delay had been occasioned by events described as Force Majeure events in Section 51.01.

The judge ultimately determined that Section 8.03 was an enforceable liquidated damages clause, but that plaintiff was solely responsible for 185 days of the 590-day delay. He also determined that two of the events identified by defendant were covered by the Force Majeure clause and, therefore, awarded defendant an additional sixty-seven and fifty-one days respectively. The total credit awarded to defendant amounted to 303 days and the rent abatement awarded to plaintiff was, therefore, 287 days. Finally, the judge, although characterizing plaintiff as "mostly successful," believed plaintiff's proofs were deficient, and denied plaintiff's fee request.

Plaintiff appeals from the judge's determination that it was solely responsible for 185 days of delay; that two events constituted Force Majeure, entitling defendant to an additional 118-day reduction of the period of delay in delivering possession of the premises; and from the denial of fees. Defendant appeals from the judge's determination that the rent abatement clause was enforceable; that plaintiff's responsibility for the delay was limited to 185 days; and that the length of the credit to defendant attributable to one of the incidents of Force Majeure was insufficient. We consider each of the arguments in turn, adding such facts as are necessary for an understanding of the issues.

I.

We consider first the judge's determination that the rent abatement clause contained in Section 8.03 was a valid liquidated damage clause rather than an unenforceable penalty. The judge recognized that such clauses must be measured in light of the teachings of MetLife v. Washington Ave. Associates, L.P., 159 N.J. 484 (1999) and Wasserman's Inc. v. Middletown, 137 N.J. 238 (1994). The judge formulated the test to be applied as follows:

Parties have a right to agree to such a clause provided the clause is reasonable under the totality of the circumstances. Reasonableness is measured by the amalgam of: 1) the comparison of the specified liquidated amount to the anticipated or actual harm caused by the breach; 2) the difficulties of proof of loss; 3) the inconvenience or non-feasibility of otherwise obtaining an adequate remedy;

4) the bargaining power of the parties; and 5) common practice in a competitive industry, if that's what it is.

No one of these elements is dispositive.

That is a fair statement of the law. See MetLife, supra, 159 N.J. at 493-95. Moreover, such a clause "in a commercial contract between sophisticated parties [is] presumptively reasonable and the party challenging the clause bears the burden of proving its unreasonableness." Id. at 496. The judge reviewed the evidence produced by plaintiff, noting that defendant, who bore the burden of proving the provision unreasonable, produced no affirmative proof and attempted to meet its burden solely through the examination of plaintiff's witnesses.

Plaintiff produced testimonial evidence that, although a delayed opening of the store resulted in damages, those damages were difficult to quantify. Plaintiff's witnesses testified, and the judge found, that the delay adversely affected plaintiff's ability to allocate $800,000 to $1,000,000 in inventory; adversely affected plaintiff's ability to obtain and hire pharmacists to staff the new location; prevented accurate estimates of "pricing considerations and advertising concerns that have to be rolled out and considered in terms of knowing that a premises are going to be delivered;" adversely affected "budgets and fiscal estimates;" adversely affected the stock price of the company; adversely affected "the credibility of management" and the consequent "visibility of this company to the . . . investor marketplace[.]"

He also found that the delayed opening would result in "lost customers, lost market share, lost reputation. Here, I am not talking about the investor community. I am talking about the other competitors in the market, CVS and/or Walgreens and/or any other supermarkets that might have pharmacies, if there are any, seizing and continuing to hold persons who might otherwise come to Duane Read."

The judge also accepted plaintiff's testimony respecting "the commonality of the rent abatement clause in retail lease[s]" and defendant's inability to "elicit a persuasive estimate or even support an order of magnitude of damages that might then be compared to the [monetary value of a 590-day rent abatement]."

He concluded:

Under the totality of circumstances test, given the grave difficulty of computing damages, I cannot say that it was unreasonable to affix a day for day rent abatement. There is no evidence in this case that the plaintiff suffered no loss, as the defendant urges. Rather the losses are well-described, very real, even if they are not, even today, capable of precise quantification.

This is as much a failure of proof that the clause is unreasonable as [it is a product of] strong support for the validity of the clause under the circumstances of this case.

We agree with the judge's analysis of this issue and affirm his determination that Section 3.08 of the lease between the parties was reasonable and enforceable as a measure of liquidated damages for the reasons set out by him in his oral opinion of May 26, 2004.

II

The judge then considered the time of the delay from May 1, 2001 to December 12, 2002. That 590-day delay would, absent other considerations, result in a credit to plaintiff of an amount equal to 590 days of rent. Defendant asserted that the delay was "solely due to the acts or omissions of" plaintiff, thus exempting defendant from having to provide credit. The delay that defendant sought to attribute solely to plaintiff involved the interior work to be done by defendant on plaintiff's building once the shell had been completed.

The judge determined, from the uncontradicted evidence, that defendant had agreed to do "so-called interior fit-up work . . . . The [defendant] agreed to do it but the [defendant] needed the [plaintiff's] plans in order to do it because these were going to be built to the specifications of the [plaintiff]." The judge found that plaintiff did not deliver preliminary drawings to defendant until May 18, 2001. Although a building permit was issued for the construction of all buildings on August 24, 2001, some work had been done by defendant without that permit in accordance with what the judge found to be the oral permission of the municipality. In any event, "at the end of October 2001, more complete architectural plans for the material fit-up of [plaintiff's building] were transmitted to [defendant] by the [plaintiff]." Those plans were delivered to the municipality on March 25, 2002, and were ultimately approved on September 26, 2002. The judge found that the delay from March 25, 2002 to September 26, 2002, was occasioned by the failure to provide the drawings. He explained his determination as follows:

The landlord claims that most or all of the delay is a result of acts or omissions of the tenant, and more than that, solely the acts or omissions of the tenant. These relate primarily to the inexcusable, according to the landlord, delay in delivering the tenant's requirements that the landlord was required to install, first, well beyond the May 1st date, and once past there, for a substantial period of time until the tenant's professionals and staff could ultimately get it right. The landlord claims, for the most part, that the [plaintiff's] construction team . . . were cavalier about their oversight and not just oversight, they were cavalier about providing in a timely and seasonable fashion to the landlord the tools that the landlord needed to fulfill the landlord's obligations, vis a vis, tenant fit-up.

I agree with the landlord as to a component of the sole responsibility argument under Section 8.03. . . . But no reasonable explanation was provided as to why it took from March 25th 2002, which was when the landlord transmitted the plans to Fort Lee, until September 26th 2002 -- that was the time the building plans were approved -- to get them approved other than deficiencies caused by tenant's agent.

Now I'm aware that during that period of time the landlord took it upon himself to do some of the work. But I conclude that that time omission, March 25th 2002 until September 26th 2002, which I computed at 185 days, acted to delay the delivery that was solely due to either an affirmative act or neglected omission by the tenant. . . .

So I conclude that that time frame and only that time frame is a delay that is attributable to the tenant. I do not find that the submissions prior to March 25th are the tenant's fault because the landlord didn't turn them in to the town when they could have been.

The judge's factual findings are binding upon us on appeal to the extent they are supported by substantial credible evidence in the record. Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474, 483-84 (1974). The legal conclusions drawn from those findings, however, are not entitled to any deference from us. Balsamides v. Protameen Chem., Inc., 160 N.J. 352, 372 (1999); Manalapan Realty L.P. v. Twp. Committee of Manalapan, 140 N.J. 366, 378 (1995).

This record adequately supports the judge's determination that plaintiff failed to deliver even preliminary plans necessary for defendant to do the interior fit-up work until May 18, 2001, and his subsequent determination that there was a delay in the completion of that fit-up occasioned by plaintiff's failure to provide the final plans. However, the judge's conclusion that the failure to deliver the plans timely resulted in a delay in defendant's obligation to deliver possession within the meaning of the lease finds no support in the record.

Defendant's contractual obligation was not to perform individual components of the work at the property. The lease provides no time frame for individual work. Rather, defendant's obligation was to effect Delivery of Possession, as that term was defined, of Building A to defendant by May 1, 2001. In order to do that, it was necessary to fulfill the conditions of Section 7.02, which required, among other items, the completion of the common areas. The judge specifically found that "delivery of the premises, within the meaning of the lease, did not, and could not, have occurred prior to December 12, 2002. And I say that because neither in August 2002, nor in October 2002, were the preconditions in paragraph 7.02 of the lease satisfied."

The record supports that finding. At the very least, the common areas were not completed until sometime after plaintiff took possession of the property on December 12, 2002. The question then becomes whether this record supports a conclusion that the failure of plaintiff timely to deliver the plans for the interior fit-up, and the consequent delay in completing the fit-up work performed by defendant, was the sole cause of the failure to have the common elements completed by December 16, 2002.

Although the judge never addressed this issue, such a finding would require evidence that defendant was unable to work on the common elements until the interior fit-up was completed. In the absence of such a showing, the delay in delivery would have concurrent causes and defendant would not be excused from providing the rent abatement required by Section 8.03.

We have been unable to locate any testimony that would support such a conclusion. Defendant cites to the testimony of its project supervisor, Golamy Sadig, who had indicated that "If one things goes the wrong, the other things get delayed and hold back. It has big effect on the completion of the date which is schedule moves backward." Nevertheless, that testimony dealt with the effect of a delay in constructing a retaining wall that would support a parking deck. Although other work was done at the other end of the parking deck, defendant was unable to complete the deck until the retaining wall issue was resolved. That is a far cry from a situation involving a failure to do work on common areas that the record does not, in any way, connect with the fit-up work. Indeed, the judge in his decision recognized that delays in one area of the job site did not prevent work on discrete areas when he said, while discussing another area of work that had been delayed by a threatened suit, "and [defendant] still had plenty of other work that it could do on the site."

Absent some logical connection between the inability of defendant to complete the interior fit-up work in Building A and the delay in completing the common areas triggering the delivery of possession, there is no basis in this record for the judge's conclusion that the interior fit-up delay was the sole cause of defendant's inability to deliver possession by before December 12, 2002.

That lack of factual underpinning for the judge's conclusion obviates the necessity to deal with defendant's claim that the delay should have been treated as starting earlier than March 25, 2002. Even were plaintiff responsible to provide the complete plans before that date, the fact remains that the fit-up work was completed before other events necessary to constitute the Delivery of Possession.

Accordingly, we reverse that portion of the judge's order that reduced the rent abatement by 185 days.

III

At trial, defendant identified four delays that it contended fell within Section 51.01, the so-called Force Majeure clause, and which, defendant claimed, should act to extend the period for completion of its work. The judge found that two items, a delay occasioned by an October 9, 2001, stop notice issued by the municipality to allow a determination that the parking structure was sufficiently strong to bear the weight of a newly acquired fire truck; and a delay occasioned by a January 7, 2002, partial temporary restraining order issued as the result of a boundary dispute, fell within Section 51.01. The judge also determined that the other two categories advanced by defendant, a delay occasioned in the site excavation by virtue of soil conditions and a stop notice relating to an encroachment issue, did not fall within that Section. Defendant's brief on appeal explicitly abandons its claim with respect to the site excavation and encroachment issues.

As to the October 9, 2001, stop work order, the judge described the situation as follows:

Another months passes and then a stop work notice is issued by the town on October 9th 2001. This stop work notice relates to, from the testimony, the municipality's desire to triple check -- those are my words -- the engineering calculations relating to the parking structure to see if it could accommodate what's been described as a new ladder truck, a new piece of fire equipment, that would likely be brought to the site in the event of a fire in the vicinity. And I say in the vicinity because I suppose a fire could be fought from this deck if the fire were on adjoining properties, as well on buildings A, B, C or D.

It appears from the record, and I so find, that either the approvals that had been granted did not take into account the existence of this special piece of equipment or the special piece of equipment was purchased and deployed after the initial plans were approved.

Nevertheless, Fort Lee held up this job, which was already an approved job, in order to satisfy itself that the structure could take this new and special equipment. And indeed, through the installation of some stiffening devices and recalculation of load bearing calculus, the municipality was satisfied through the good offices of the landlord's representative, Louis Nacamuli (phonetic), that it was likely that the fire truck would be safe if it were deployed on the parking structure.

By December 13th 2001 the stop work condition was obviated.

. . .

 
The fire truck issue consumed the time from October 9th 2001, which was the stop work order, until December 13, 2001 when Mr. Rosen's letter confirmed that the landlord would go back on the job. This was a delay that was not the fault of the landlord. It was entirely unexpected. It was unique, extraordinary. And frankly, although I haven't heard Fort Lee's side of it, intuitively at least, unsupportable. In other words, I can understand how the municipality wants and has the right to vouchsafe public safety and the public health, safety and welfare by making sure that this structure would support the truck. But to shut down the job or to issue a stop work order is entirely questionable in my mind. And I think that this is a condition beyond the reasonable control of the landlord, notwithstanding the arguments that Nacamuli's calculations and drawings either were inconsistent or incomplete. This is just such an extraordinary event, one that is not to be reasonably anticipated coming from a municipality, that the landlord, I find, has demonstrated that this is a force majeure event.

I should say this. That all construction projects run with them a risk of different levels that the municipality is going to shut down the job. And every contractor has to build in some play in the joints to deal with that. But getting a new piece of fire equipment such as this so late in the process and then have the job shut down it seems to me is highly unusual and suspect. And the landlord ought not to suffer from that.

From October 9th 2001 until December 13th 2001, that's 65 days of delay that is not the fault of the landlord. And the lease provides an extra two days under the force majeure. So that's 67 days, so to speak, that comes off the rent abatement.

Plaintiff argues that the delay was occasioned by faulty calculations originally provided to the municipality. Nevertheless, as the judge found, the municipality had accepted those calculations and approved the project. The delay and stop work order resulted from the municipality's purchase of a new piece of equipment which required the submissions of further calculations. The judge correctly found the delay was the result of a "governmental restriction, regulation, or control" and fell within Section 51.01.

The judge described the issue of the preliminary restraint as arising because the landowner immediately to the north of defendant's property ("Jessico") claimed that a sidewalk used by defendant was either located on the abutting "land or if it wasn't, there was a prescriptive easement or an easement by necessity. And the landlord says that in order to appease whatever concerns the officials had, it stayed away from doing any work in the vicinity of the sidewalk."

On January 7, 2002, however, Jessico instituted suit and obtained a preliminary injunction against further work in that area. On February 25, 2002, defendant and Jessico consented to an injunction with, as the judge found, "the caveat, now clearly expressed, that the landlord could continue to do work, but at its risk." Defendant declined to pursue its work in that area until the dispute was resolved in its favor although there was no legal impediment to completion of the work. The judge found that the period from January 7, 2002, to February 25, 2002, fell within the scope of Section 51.01. He explained:

The Jessico injunction . . . [is] worth 51 days. And the reason why it's worth 51 days is this. I conclude that between the initial injunction of January 7th 2002 and February 15th of 2002 -- that's the interlocutory injunction -- is 49 days plus two days under the lease, is 51 days.

I conclude that during that period of time when the job completion was one of the prospects for timely job completion or seasonable job completion were precarious. These were beyond the reasonable control of the landlord. The plans showed the sidewalk on the landlord's property. Although one might, with perfect 20-20 hindsight, have expected that with that sidewalk encroaching on the landlord's land that there might very well be a dispute sometime in the future, I think that the injunction worked a hardship on the landlord that was not the landlord's fault and was beyond the landlord's control. And upon the "proceed at your own risk" provision the landlord was no longer constrained in the same that it was during January and February. Therefore, 51 days, being 49 plus two, are force majeure days.

Plaintiff claims that the judge improperly found the injunction to be an event of force majeure; defendant claims that the length of the credit should extend to the point at which the dispute was resolved, even though the injunction had been dissolved before that final resolution. Section 51.01 requires an act of "governmental restriction, regulation or control[.]" We cannot fault the judge's implicit conclusion that an order of the judiciary constitutes such an act. Nor can we fault the judge's conclusion that the dissolution of the injunction dissolved the governmental act required by the application of Section 51.01.

The judge's factual findings concerning the Force Majeure issues are grounded in substantial credible evidence in the record and his conclusions of law are appropriate. See

Rova Farms Resort, supra, 65 N.J. at 483-84. We affirm his decision with respect to the award of 118 days credit under section 51.01 for the reasons given by him in his May 26, 2004 oral opinion.

IV

Plaintiff appeals from the judge's decision denying fees. Although the judge recognized that Section 31.01 required the unsuccessful party to reimburse fees and costs to the successful party, and although the judge characterized plaintiff as "mostly successful," he declined to award fees. He did so because he found insufficient proof that the fees incurred by plaintiff were reasonable.

Fees claimed pursuant to a contractual provision are an element of damage that must be proven in a plenary hearing rather than by affidavit as may be the case when fees are sought puraunt to R. 4:42-9. See Cohen v. Fair Lawn Dairies, Inc., 86 N.J. Super. 206 (App. Div.), aff'd, 44 N.J. 450 (1965). The supporting proof must include evidence that the claimed fees were reasonable. See R.P.C. 1.5 ("A lawyer's fee shall be reasonable."). Plaintiff does not challenge the judge's determination that it had failed to establish that the fees claimed were reasonable; rather it argues that it should have been permitted to prove its fee claim after the conclusion of the trial on the substantive issues.

It did not, however, request the opportunity to do so, nor did it object to the judge's requirement that the fees be proven in plaintiff's case in chief. The only colloquy regarding the issue arose when plaintiff first introduced testimony about the amount of fees incurred as a result of the controversy. When defendant objected to the nature of the document from which plaintiff's witness was testifying, the following exchange occurred:

[Plaintiff's counsel]: I have a suggestion, Your Honor. Maybe we can save some time. Obviously, according to the lease terms, we were entitled to our legal fees if we prevailed. I don't want to sort of jump the gun on an issue here, although I felt I should make a proffer. I am very happy to let the issue of attorney's fees abide the event of Your Honor's decision in the matter so long as we can then make an application as we would in the normal course where we present redacted bills, affidavit of services, and Mr. Rosen can question whatever witness he would like from Duane Reade.

THE COURT: Legal fees are a component of damages that will be proven as damages of any species or type. So I would be disinclined to reserve on it, do it by affidavit. If this were a jury trial we would do it here.

[Plaintiff's counsel]: Fine. Then we'll proceed, Your

Honor.

The judge denied the claim for counsel fees, recognizing that he had never been asked to deal with the fees issue separately:

And it's important to recognize that where attorney's fees are a species of damages to be recovered in litigations such as this they have to be proven like any other species of damages.

. . .

But in a breach of contract claim under a lease that calls for them, they have to be proven during the trial. And many times they are proven during the trial. In fact, in construction defect cases where there are indemnification clauses and construction contracts that provide for providing of defenses and what not, they're regularly proven. Or the claim is made to sever that claim to then first determine whether there is a successful or unsuccessful party and then with or without the same jury or with or without the same judge, then prove the appropriate level of damages. . . . [T]here was no severance requested here[.]

We do not subscribe to the theory that the judge had no alternative but to require proofs in the main trial. Cohen v. Fair Lawn Dairies, supra, deals with the required proof, not the timing of the proof. Whether to require proofs during the substantive trial or to reopen the proofs to allow evidence as to fees is discretionary. See Jennings v. Cutler, 288 N.J. Super. 553, 567 (App. Div. 1996).

Here, however, plaintiff never requested that he be given the opportunity to prove fees at a later time. When the judge indicated that the fees should be addressed immediately, counsel acceded. Plaintiff never suggested that it could not meet its obligation in the main trial and, although it might have been inconvenient, we see no reason why it could not have done so. Since defendant never raised this issue before the trial judge, it is not cognizable on appeal. Nieder v. Royal Inden. Ins. Co., 62 N.J. 229, 234 (1973). In any event, we cannot fault the judge for failing to exercise his discretion in a manner that had not been requested.

We affirm on defendant's appeal; we affirm in part and reverse in part on plaintiff's appeal and remand for the entry of a judgment consistent with this opinion.

 

For the sake of convenience, we refer to document governing the relationship between plaintiff and defendant as a lease, although it is, in fact, a sub-lease.

The parties sought other relief as well, but the cross-appeals relate only to those portions of the judgment resolving the claims we have identified.

(continued)

(continued)

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A-6704-03T5

 

September 26, 2006