JANIS WILKERSON v. D&D DEVELOPER, INC.

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0339-05T20339-05T2

JANIS WILKERSON,

Plaintiff-Respondent,

v.

D&D DEVELOPER, INC. a/k/a

D&D DEVELOPERS, INC. and

DENNIS GABINELLI,

Defendants-Appellants.

______________________________________

 

Submitted July 5, 2006 - Decided August 1, 2006

Before Judges Skillman and Lisa.

On appeal from Superior Court of New Jersey, Chancery Division, Middlesex County, Docket No. C-249-03.

Dennis Alan Auciello, attorney for appellants.

Hoffman & Hoffman, attorneys for respondent (Jeannette A. Hoffman, on the brief).

PER CURIAM

On July 19, 2001, plaintiff entered into a contract to sell a nine-acre landlocked parcel of land located in East Brunswick to defendant D&D Developer, Inc. (D&D).

The contract provided for a base sales price of $725,000 and required D&D to post a $50,000 deposit. The contract provided that "[D&D] shall have eighteen (18) months from the date of this Agreement to obtain all Development Approvals and all required Permits to build at least eighteen (18) houses." The contract further provided that "[i]n the event . . . [D&D] has been diligently proceeding in good faith, and wishes to continue, it may, upon written request, obtain a six (6) month extension upon the payment of an additional twenty five thousand dollars ($25,000.00) directly to the [plaintiff], which shall be non-refundable."

The eighteen-month period provided under the contract of sale for D&D to obtain municipal development approvals and permits expired without D&D applying for any of the approvals or tendering the $25,000 required under the contract for a six-month extension of the period for obtaining the approvals and permits.

Plaintiff subsequently brought this action claiming that D&D had breached the contract of sale by failing to obtain the required municipal approvals and permits within eighteen months and failing to remit the $25,000 required to obtain a six-month extension of that period. Plaintiff sought a declaration that, in accordance with a liquidated damages clause in the contract, she was entitled to retain D&D's $50,000 deposit.

D&D filed a counterclaim which sought a declaration that "[s]ince the deed into [plaintiff] was not put on record until 1-4-02 and since the title company did not state that there was no lien for unpaid franchise taxes through the calendar year 2001 until it issued its amendment to the Title Commitment on 11-22-02, the eighteen months . . . to obtain the development approvals and permits should equitably be determined to begin to run from 11-22-02."

After a two-day bench trial, the trial court concluded that plaintiff did not have title when she entered into the contract to sell the property to D&D because the deed transferring title from the Church of Religious Science to plaintiff had not been recorded and the Division of Taxation had not issued a determination that the church was exempt from corporate franchise taxes during the period of its ownership of the property. The court further concluded that the parties were operating under a mutual mistake of fact concerning plaintiff's ownership of the property when they entered into the contract of sale. Based on these legal conclusions, the court determined to reform the contract to give D&D eighteen months from November 22, 2002, the date the title insurer advised D&D that the franchise tax liability issue had been resolved, within which to obtain the required municipal approvals and permits.

We reversed the final judgment memorializing this decision in an unreported opinion. Wilkerson v. D&D Developer, Inc., No. A-5253-03T3 (Mar. 8, 2005). We concluded that "plaintiff had title to the subject property when she entered into the contract of sale, even though there were clouds on the title that took a year to resolve[, and t]herefore, there was no basis for the trial court to conclude that the parties entered into the contract under a mutual mistake of fact or for reformation of the deadlines set forth in the contract." (slip op. at 7-8). Although these conclusions required reversal of the judgment in D&D's favor on its counterclaim, our opinion did not resolve all of the issues pertinent to plaintiff's breach of contract claim. Accordingly, we remanded the case to the trial court to "determine whether plaintiff's proofs established a breach as well as defendants' defenses to that claim."

Following our remand, the parties engaged in settlement negotiations. On May 6, 2005, D&D's counsel sent a handwritten memorandum to plaintiff's counsel, which stated:

Please communicate the following offer to purchase to your client:

$1,225,000 subject to subdivision approval (assuming the zoning hasn't changed since parties first went into contract); or

$1,000,000 with no contingencies, closing within 90 days.

On May 12, 2005, plaintiff's counsel responded with a counterproposal which stated:

I have discussed your proposal with Janis Wilkerson and the following is her counterproposal regarding the East Brunswick property:

1. The original contract of 2001 is totally cancelled and voided;

2. Janis Wilkerson will sell to D&D Developers, Inc. 8-1/2 acres for one million dollars ($1,000,000.00);

3. Janis will keep the remaining one-half acre with the already existing house;

4. The seller will pay 5% to the listing realtor. The buyer will pay any amount over that sum;

5. All amounts due the seller will be paid at closing by cashier or bank check; and

6. The buyer will pay an additional $50,000.00 deposit to be held in trust until closing by seller's attorney and closing to occur no later than 90 days from the contract date.

On May 13, 2005, D&D's counsel responded with a new settlement proposal:

1. The original contract of 2001 is totally cancelled and voided.

2. Janis Wilkerson will sell to D&D Developers, Inc. the originally described tract for one million fifty thousand ($1,050,[000].00);

3. The buyer will pay the entire real estate commission;

4. All amounts due the seller will be paid at closing by cashier or bank check; and

5. The buyer will pay an additional $50,000.00 deposit to be held in trust until closing by seller's attorney and closing to occur no later than 90 days from the contract date.

On May 17, 2005, plaintiff's counsel sent a handwritten note to D&D's counsel, which stated:

Any chance you & I can get Francis to adjourn the 5/27/05 date while Mrs. W. discusses this offer with her 3 sons? Your new offer (which she seems ok with) was just mailed to her in Texas. She told me it was "attractive" & she'd like to consider it. She'd need until mid June.

D&D's counsel alleges that he had a telephone discussion with plaintiff's counsel the next day, May 18, 2005, in which they negotiated a final settlement of the case. Plaintiff's counsel denied that she ever represented that her client had approved D&D's last settlement proposal, and there was no written confirmation of the settlement plaintiff purportedly agreed to on May 18th.

On May 26, 2005, D&D's counsel sent a letter to the trial court which stated:

I am pleased to advise that the parties have reached an amicable resolution of the issues involved in the above-referenced litigation.

By copy of this letter I am requesting that [plaintiff's counsel] prepare a Stipulation of Dismissal with Prejudice.

On May 27, 2005, plaintiff's counsel notified D&D's counsel that her client had not accepted D&D's last settlement proposal. On June 1, 2005, D&D filed a motion for enforcement of the purported settlement. The trial court denied the motion, stating in an oral opinion:

[C]ounsel cannot bind a client without the client agreeing to the terms and conditions of a settlement.

There was no memorialization from the plaintiff to the defendant confirming that there was in fact a settlement. . . .

I don't find that there's enough in this case for the court to conclude that there was in fact a knowing and voluntary settlement of this case . . . by the plaintiff.

On July 27, 2005, the trial court issued a written decision which concluded that D&D breached the contract with plaintiff by not closing either within eighteen months of execution of the contract or within the six-month extension period allowed upon payment of an additional $25,000 deposit. The court further determined that because "[t]he contract provided that the damages in the event of a breach would be $50,000[,]" plaintiff was entitled to retain this deposit.

On appeal from the judgment memorializing this decision, D&D presents the following arguments:

I. THE SETTLEMENT AGREEMENT SHOULD HAVE BEEN ENFORCED BY THE COURT.

II. THE SETTLEMENT AGREEMENT IS NOT AFOUL OF THE STATUTE OF FRAUDS (N.J.S.A. 25:1-13).

III. THE TRIAL COURT'S DECISION AS TO BREACH SHOULD BE REVERSED SINCE IT IS IMPROVIDENT AND INEQUITABLE TO ALLOW THE RESPONDENT TO GAIN AN UNFAIR ADVANTAGE BECAUSE OF THE ACTIONS OF JAY HELT.

We reject the arguments presented under D&D's first two points challenging denial of its motion for enforcement of the purported May 18th settlement agreement substantially for the reasons set forth in the trial court's oral opinion. We note in particular the trial court's reliance upon the absence of any writing from D&D's counsel to plaintiff's counsel during the period between May 18th and May 27th confirming that a firm settlement agreement had been reached and the terms of that purported agreement.

The argument that D&D presents under Point III of its brief is clearly without merit and does not warrant discussion. R. 2:11-3(e)(1)(E). There is adequate, substantial credible evidence to support the trial court's finding that D&D breached the contract of sale. See Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474, 484 (1974). Therefore, plaintiff was entitled to retain D&D's $50,000 deposit as liquidated damages for the breach.

Affirmed.

 

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9

A-0339-05T2

August 1, 2006