JUDITH A. MOBILIO et al. v. KENNETH SCHWARTZ, et al.

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-1556-05T51556-05T5

JUDITH A. MOBILIO and

FRANCIS E. MANN, h/w,

Plaintiffs-Appellants,

v.

KENNETH SCHWARTZ and

PATRICIA SCHWARTZ, h/w,

WEICHERT REALTORS, MARY

TROUP and LESLIE POLSEN,

Defendants-Respondents.

_______________________________________

 

Argued May 2, 2007 - Decided June 11, 2007

Before Judges A. A. Rodr guez, Sabatino and Lyons.

On appeal from Superior Court of New Jersey, Chancery Division, Morris County, Docket No. C-38-02.

Jeffrey Advokat argued the cause for appellants (Advokat & Rosenberg, attorneys; Mr. Advokat, on the brief).

Gary C. Algeier argued the cause for respondents, Kenneth and Patricia Schwartz, (Algeier Woodruff, attorneys; Mr. Algeier, of counsel and on the brief).

Thomas N. Ryan argued the cause for respondents, Weichert Realtors, Mary Troup and Leslie Polsen (Laddey, Clark & Ryan, attorneys; Mr. Ryan and Lawrence J. Supp, on the brief).

PER CURIAM

Plaintiffs, Judith A. Mobilio and Francis E. Mann, wife and husband, filed a verified complaint alleging that defendants, Kenneth and Patricia Schwartz, also husband and wife, anticipatorily breached a contract to sell their home to plaintiffs when the Schwartzes cancelled the contract because plaintiffs insisted that they replace French doors in the family room. Plaintiffs sought specific performance, or alternatively, damages. Plaintiffs also sued the real estate brokers, defendants, Mary Troup ("Troup") and Leslie Polsen ("Polsen"), and Troup's and Polsen's employer, Weichert Realtors ("Weichert"), alleging defamation by Troup and professional negligence by Troup, Polsen and Weichert. Plaintiffs appeal an order dismissing all of the counts in plaintiffs' suit against all defendants with prejudice. We affirm.

The following factual and procedural history is relevant to our consideration of the issues advanced on appeal. In the latter part of 2001, the Schwartzes put their house on the market. Around the same time, plaintiffs were looking to buy a house. In November 2001, plaintiffs retained Troup to help them find a house. Notably, plaintiff Mobilio had a license to sell real estate through Weichert Realtors, but she had never used it, as she worked as an insurance salesperson for Weichert. Mobilio testified that when she first met Troup she told Troup that she held a real estate license, but Troup denied that.

Shortly after plaintiffs retained Troup, Troup told them about an open house that the Schwartzes had scheduled. Plaintiffs were interested and decided to attend. At the open house, the showing agent gave plaintiffs a sales brochure that described the house and listed its features. Of importance to this appeal was a statement in the brochure that the French doors in the family room were "new to be installed." Plaintiffs testified that they understood that to mean that the Schwartzes would replace the French doors with new ones, regardless of the sale price. Though plaintiffs did not know it at the time, in October 2001 Patricia Schwartz had ordered new French doors worth $3,341 and was awaiting their arrival.

Plaintiffs liked the Schwartzes' house and decided to make an offer. The Schwartzes' asking price was $659,000. In the beginning of December 2001, plaintiffs offered $615,000, but the Schwartzes rejected their offer. The two continued to negotiate a price and ultimately agreed on $633,500 as the price to be listed in the contract.

At that price, however, the Schwartzes did not want to make any financial concessions or improvements to the house, and so notified Polsen, their agent. Specifically, they told her that they would not replace the French doors, and they asked her to make that "very clear" to plaintiffs. Polsen said that she would, but then only told Troup that "this [$633,500] was it, and don't expect any monetary concession from the Schwartzes because this is lower than they were anticipating having to go." Troup said that she relayed that to Mobilio, but Mobilio said that she did not. Notably, at that time Troup knew nothing about the French doors because she did not attend the open house with plaintiffs, and plaintiffs never mentioned the doors to her or showed her the sales brochure.

On about December 11, 2002, Troup drafted a contract with a purchase price of $633,500 and forwarded it to Polsen. Contrary to the requirements of N.J.S.A. 45:15-17(q), the contract did not disclose Mobilio's real estate license. That statute authorizes the New Jersey Real Estate Commission to discipline any real estate agent who is guilty of "[p]urchasing any property unless he [or she] first discloses to the seller in the contract of sale his status as a real estate broker, broker-salesperson or salesperson."

When the Schwartzes reviewed the contract, they again raised the issue of the French doors. They asked Polsen whether the doors had been excluded from the contract, and she said that they were not an issue because plaintiffs did not specifically mention them in the contract. The Schwartzes accepted Polsen's responses, primarily because plaintiffs wrote into the contract that the Schwartzes' refrigerator was included in the sale, and the refrigerator "was a fraction of the price of the doors." Because they did not want to make any financial concessions, the Schwartzes crossed-out the provision that the sale included the refrigerator and forwarded the contract to plaintiffs.

That night, Troup reviewed the change with plaintiffs and contacted Polsen, who was at the Schwartzes' house. According to the Schwartzes, Troup told Polsen that Mobilio "threw a fit" over the refrigerator and demanded that it be included in the sale. Polsen responded that the Schwartzes would not make any financial concessions at that sale price and thus would not include the refrigerator in the sale. Troup said that she relayed that to plaintiffs, but Mobilio said that she did not.

Patricia Schwartz then offered to sell the refrigerator to plaintiffs for $750, but plaintiffs refused to pay for it. Polsen asked plaintiffs if they would pay $250 if she and Troup agreed to each contribute $250 of their commissions to make up the difference in price, but plaintiffs again refused. Polsen then offered to contribute $500 of her commission if Troup would contribute $250 and Troup agreed.

Polsen testified that if she and Troup had known about Mobilio's real estate license they would not have offered to pay for the refrigerator. She also said that the dispute over the refrigerator made her "uneasy" because "they [plaintiffs] were . . . going to walk away over $250 . . . And in my experience that wasn't sitting right. That's an expensive house. $250. I had never seen anybody do that before."

Troup testified that during the dispute about the refrigerator, Mobilio gave her some "very surpris[ing]" information. Mobilio said that with the aid of "Steve Gordon," "a high level executive at Weichert," Mobilio was having a background check performed on the Schwartzes, and the information she obtained "would give her negotiating leverage in the transaction." Troup did not respond to Mobilio's telling her that, as she "was very surprised," but she did call Polsen to share the information with her. Notably, Steve Gordon was Mobilio's manager, and he lived down the street from the Schwartzes.

Polsen testified that when Troup told her about the background check, Troup did not give details but said that Mobilio "knew all about Ken Schwartz." "Later," said Polsen, Troup told her that "a senior executive in Weichert insurance," who lived in "a subdivision where the Schwartzes lived," told plaintiffs that "Ken Schwartz went out in the insurance business in the late spring and early summer of 2001 . . . and that he was in financial peril because of 9/11 . . . . There was also some comment that was made about him [Ken Schwartz] not paying for the [his] Corvette." Polsen did not share that information with the Schwartzes, explaining that "[i]t was more than I thought it was going to be."

Thereafter, on December 17 and 18, 2001, plaintiffs and the Schwartzes signed a contract to sell the Schwartzes' house to plaintiffs for $633,500. On December 19 and 20, the parties' attorneys made minor changes to the contract and on December 24, 2001 they finalized it. Patricia Schwartz then canceled the order on the French doors, and plaintiffs applied for a mortgage.

Shortly thereafter, testified Troup, Mobilio told her that Mobilio had a real estate license and that she wanted to collect a referral fee from Troup. Weichert had a policy that any employee who holds a real estate license and buys a home through Weichert Realtors is entitled to a referral fee in the amount of twenty-five percent of the agent's commission on the sale. In this case Troup's portion of the six-percent commission was two and one-half percent of the selling price. Troup said that she asked Mobilio why Mobilio did not disclose her license earlier, and Mobilio explained that other Weichert brokers had been reluctant to work with her when she told them that she had a real estate license. Believing that Mobilio had acted unfairly by withholding her status as a real estate agent, Troup sought guidance from her manager, Michael Penyak, on whether she had to give Mobilio the referral fee. She also complained to Polsen. Penyak, however, said that Troup had to honor Mobilio's license and give her the referral fee. Notably, no one told the Schwartzes about Mobilio's license at that time. Polsen explained at trial that she did not do so because "I thought the contract was finished, it was done, and that we were over the hump."

Around the same time, a dispute arose over a $10,000 deposit that the contract required plaintiffs to make ten days after the attorney-review period ended. On January 8, 2002, Schwartzes' counsel sent a letter to plaintiffs' counsel advising that the deposit "is now due."

On January 2, 2002, plaintiffs' counsel had sent the Schwartzes' counsel a letter claiming that "due to the extension and uncertainty of the closing date, they [plaintiffs] have discussed with the realtor, and with the apparent agreement of your clients," that the second deposit "can be paid at the time of closing." He asked to "[p]lease review with the Sellers and advise."

Kenneth Schwartz testified that he found that letter "very odd" because he and his wife had never discussed, let alone agreed, to accept the second deposit at closing, and plaintiffs had offered to extend the closing date; the Schwartzes did not request it. Now, said Kenneth Schwartz, they were using that offer "as an excuse to not pay the money."

On January 8, 2002, the Schwartzes' counsel responded that they denied ever discussing or agreeing to accept the second deposit at closing and that they demanded payment. Two days later, on January 11, 2002, plaintiffs paid the $10,000 deposit.

At trial, Mobilio testified that, contrary to her counsel's letter, she never asked to pay the second deposit at closing. Rather, she wanted to decrease the deposit to $1,000 because the closing date was "going to be put off" and she did not want her money "tied up." She said that she discussed that with Troup during the contract negotiations and asked Troup to change the second deposit amount in the contract to $1,000, but Troup made "a typo" and wrote in $10,000. Mobilio said that she did not notice the typo when she reviewed the contract prior to its being finalized. Similarly, she said that she did not notice that her counsel's letter was inaccurate.

Troup, however, denied that plaintiffs asked her to change the amount of the second deposit from $10,000 to $1,000. She said that after the parties finalized the contract plaintiffs decided that they did not want to pay the $10,000 because of the uncertainty of the closing date.

While the parties were arguing over payment of the second deposit, Brian Finn conducted a home inspection on January 7, 2002 on behalf of plaintiffs. Polsen said that during the inspection Mobilio "jumped to . . . the worst and most expensive cure" before Finn could explain the problem. For example, Mobilio asked Finn, (1) if the entire brick path leading to the house had to be replaced because one brick was lifted; (2) if steps had to be replaced because of one crack; and (3) if the house's foundation was compromised because of a small crack. She also told Finn that she and Mann believed that there was a problem with the roof and that they had notified their attorney of it.

On January 8, 2002, the day after the inspection, plaintiffs sent the Schwartzes a letter purportedly memorializing Finn's findings. In relevant part, they said that the roof was "at the end of its economic life, [and] the shingles are curled and brittle"; thus, the roof had to be replaced.

The Schwartzes responded that they had had no problems with the roof and that Finn's report did not say that the roof needed to be replaced. Indeed, the report said only: "Roof system is single layer asphalt shingle - unable to view - snow cover - typical life expectancy is 20-25 years." Thus the Schwartzes refused to replace it.
Plaintiffs then asked Finn to elaborate on the condition of the roof, and on January 19, 2002, he wrote:

The visible sections [of the roof] showed typical wear for a roof approx. 15 years old - some wear around the shingle edges and minor curling and clawing (where roof shingle curls due to age). The roof covering appeared to be an extended life shingle - rated 20 / 25 year shingle life. There is a single layer asphalt shingle and no leaks were apparent from interior attic access.

After receiving that letter, plaintiffs withdrew their demand for a new roof.

On January 8, 2002, plaintiffs also insisted that the Schwartzes replace or give a credit for the French doors. This was the first time that they had mentioned the doors to Troup and the Schwartzes. They said that "the listing agreement and representations made to the Purchaser, by the realtor, [at the open house,] were that the French doors are to be replaced prior to closing," and thus they expected the Schwartzes to do so.

The Schwartzes reiterated that they would not make any financial concessions and would not replace the doors. Plaintiffs responded that the sales brochure, which promised new French doors, was part of the contract. The Schwartzes disagreed and asked plaintiffs if they intended to cancel the contract or close the deal. In a January 28, 2002 letter, plaintiffs implicitly answered that they intended to close, as they demanded the Schwartzes replace the doors and close on the sale or face a lawsuit "for specific performance of the Contract and/or damages."

Kenneth Schwartz then contacted Polsen in an attempt to resolve the issue. He asked her whether she and Troup would be willing to use part of their commission to pay the balance on the doors, roughly $2,000. Polsen said that she would but that she did not think Troup would because Troup had to use part of her commission to pay Mobilio a referral fee. Kenneth Schwartz asked what she meant by that, and Polsen explained that Mobilio had a real estate license and thus was entitled to a referral fee from Troup. She told him that the "hold-up" on the second deposit was due to Troup's challenging whether she had to pay Mobilio the referral fee and to Mobilio's refusing to make the deposit until Troup agreed to give her the fee. Mobilio denied that during her testimony, but she admitted that she wrote the check for the deposit at the same time that she and Troup executed a referral fee agreement.

Kenneth Schwartz said that he was "shocked" to learn about Mobilio's license but that when he learned of it, "immediately bells went off" in his mind. It explained, he said, "a lot of things about, you know, where she got ideas to infer, perhaps, that a brochure would be part of a contract, even if it has a disclaimer" and "to try and twist" the home inspector's wording.

Soon thereafter the Schwartzes decided to end the contract, primarily because of the dispute over the French doors. That dispute, said Kenneth Schwartz, "was the last straw. It was the last time that we were going to allow them [plaintiffs] to try and misrepresent the contract." Further, he and his wife believed that if plaintiffs sued them it would affect their ability to obtain a mortgage and purchase another home, which they would have to do if they sold their house to plaintiffs.

On January 31, 2002, the Schwartzes notified plaintiffs of their decision. They said that they interpreted plaintiffs' January 28, 2002, letter as a request to cancel the contract and that that request was acceptable to them.

On February 1, 2002, plaintiffs responded that they had no intention of canceling the contract and that they expected the Schwartzes to close on the sale in accordance with the contract. Again they threatened suit if the Schwartzes refused.

That night Polsen met with the Schwartzes and for the first time told them that according to Troup, plaintiffs had done a background check on them. Polsen said that Mobilio knew that the Schwartzes were "maxed out" on their credit cards and delinquent on their car payments. She said that Mobilio believed that Mobilio had the Schwartzes "over the barrel."

Sometime after that, Weichert Realtors offered to replace the French doors, but Kenneth Schwartz declined the offer.

On February 4, 2002, the Schwartzes notified plaintiffs that their position had not changed and that they had decided to take their house off the market. On February 5, 2002, plaintiffs responded that they had "reluctantly agreed to rescind their demands" for the new French doors and to file suit if the Schwartzes did not provide them. The Schwartzes still refused to close the deal, and prior to the closing date, plaintiffs filed suit for anticipatory breach.

On February 26, 2002, plaintiffs filed a verified complaint alleging that Kenneth and Patricia Schwartz anticipatorily breached a contract to sell their home to plaintiffs when the Schwartzes canceled the contract because plaintiffs insisted that they replace French doors in the family room. Plaintiffs sought specific performance, or alternatively, damages. The Schwartzes answered plaintiffs' complaint and filed a counterclaim for rescission.

On June 13, 2002, plaintiffs filed an amended complaint adding as defendants plaintiffs' real estate broker, Mary Troup; the Schwartzes' real estate broker, Leslie Polsen; and Troup's and Polsen's employer, Weichert Realtors (collectively "the Weichert defendants"). Plaintiffs alleged that Troup defamed Mobilio by: (1) telling Polsen that Mobilio did an illegal background check on the Schwartzes and that she committed professional negligence and violated her fiduciary duties by failing to properly negotiate for plaintiffs; (2) giving Polsen inaccurate and confidential information; and (3) telling Polsen that Mobilio conducted a background check on the Schwartzes. Plaintiffs alleged that Polsen committed professional negligence by failing to verify information that she received from Troup and by failing to properly assist the Schwartzes in the sale. They contended that Weichert Realtors was liable for Troup's and Polsen's tortious conduct because it was their employer.

In February 2003, plaintiffs filed a second amended complaint alleging defamation against the Schwartzes and emotional distress and loss of consortium against all defendants. The case proceeded through discovery and then eleven days of trial.

At the close of plaintiffs' case, all defendants moved for judgment under R. 4:40-1 on all counts, arguing that there was no evidence to support them. The trial court granted the motion on the defamation, emotional distress and loss of consortium claims, but denied it on the remaining claims. Defendants then presented their cases.

After hearing all of the evidence, the court issued a written decision on September 15, 2005, dismissing all of plaintiffs' claims with prejudice. The trial court found that plaintiffs and the Schwartzes had never finalized a contract. It stated, "[t]he parties failed to reach agreement on a purchase price due to the conflict over credits for the French doors." Alternatively, the trial court held that if they had concluded a contract, plaintiffs were not entitled to specific performance because they had acted inequitably by "refusing to make the second installment of the deposit on time, conducting a background check on the defendants and failing to disclose Mobilio's status as a real estate agent" and had violated the covenant of good faith and fair dealing.

On October 3, 2005, the court entered an order granting judgment in favor of all defendants and dismissing their cross-claims and counterclaims. On November 23, 2005, plaintiffs filed a timely notice of appeal.

On appeal, plaintiffs contend that the trial court erred in finding that the parties did not create an enforceable contract for the sale of the Schwartzes' home. They further contend that the Schwartzes wrongfully breached the contract and that specific performance should have been ordered. They argue further that the Weichert defendants are liable for professional negligence and that the Schwartzes' contractual breach caused plaintiffs to incur financial damages, including counsel fees. The Schwartzes, on the other hand, argue that deference should be given to the trial judge with respect to his findings, that there was no meeting of the minds and that if there were a contract it should be rescinded. The Schwartzes also argue that plaintiffs are neither entitled to equitable relief because they lack clean hands, nor are they entitled to specific performance. The Schwartzes further claim that plaintiffs are not entitled to damages and that the evidence does not support plaintiffs' claims. The Weichert defendants also argue that there was insufficient evidence to find an enforceable contract, that there was no negligence on the part of the realtors, and there are no damages in the record.

We begin our consideration of the arguments raised on appeal by restating applicable legal principles. With respect to an appellate court's scope of review of a trial court's finding of fact, the Supreme Court has said:

The general rule is that findings by the trial court are binding on appeal when supported by adequate, substantial, credible evidence. Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474, 484 (1974). Deference is especially appropriate "when the evidence is largely testimonial and involves questions of credibility." In re Return of Weapons to J.W.D., 149 N.J. 108, 117 (1997). Because a trial court "'hears the case, sees and observes the witnesses, [and] hears them testify,' it has a better perspective than a reviewing court in evaluating the veracity of witnesses." Pascale v. Pascale, 113 N.J. 20, 33 (1988) (quoting Gallo v. Gallo, 66 N.J. Super. 1, 5 (App. Div. 1961)) (alterations in original). Therefore, an appellate court should not disturb the "factual findings and legal conclusions of the trial judge unless [it is] convinced that they are so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence as to offend the interests of justice." Rova Farms, supra, 65 N.J. at 484. The appellate court should "exercise its original fact finding jurisdiction sparingly and in none but a clear case where there is no doubt about the matter." Ibid.

[Cesare, supra, 154 N.J. 394, 411-12 (1998).]

"A contract arises from offer and acceptance, and must be sufficiently definite 'that the performance to be rendered by each party can be ascertained with reasonable certainty.'" Weichert Co. Realtors v. Ryan, 128 N.J. 427, 435 (1992) (quoting West Caldwell v. Caldwell, 26 N.J. 9, 24-25 (1958)). "Thus, if parties agree on essential terms and manifest an intention to be bound by those terms, they have created an enforceable contract." Weichert, supra, 128 N.J. at 435. However, "where the parties do not agree to one or more essential terms . . . courts generally hold that the agreement is unenforceable." Ibid.

The Restatement (Second) of Contracts 33(2) (1981), provides, "[t]he terms of a contract are reasonably certain if they provide a basis for determining the existence of a breach and for giving an appropriate remedy." Comment (a) to that section notes, "[i]f the essential terms are so uncertain that there is no basis for deciding whether the agreement has been kept or broken, there is no contract." Comment (e) exemplifies this point with specific reference to the sale of goods when it notes, "[w]here the parties manifest an intention not to be bound unless the amount of money to be paid by one of them is fixed or agreed and it is not fixed or agreed, there is no contract." See also N.J.S.A. 12A:2-305(4); Turkington v. Zuber, 100 N.J. Eq. 285, 286, 288 (E. & A. 1926) (holding that "[t]he purchase price of the property . . . [is an] essential term of a contract for the purchase of real property.")

The trial court in this case found no enforceable contract, reasoning that the parties never finalized their agreement "on a purchase price due to the conflict over credits for the French doors." Plaintiffs disagree with this decision. They argue that French doors were not a material term of the contract and that the parties both acted, after finalizing the language of the contract, as if they had an enforceable contract by taking steps to close. The trial judge concluded, though, that the contract was never finalized.

Based on a review of the record, it is clear that the trial judge viewed the issue of the French doors as directly affecting the price to be paid for the home. It is clear from the testimony, which the trial judge evidently accepted on behalf of the Schwartzes, that the purchase price of $633,500 was fixed in the Schwartzes' mind and was not to be reduced by any credits whatsoever. The dispute regarding the refrigerator supports that. If plaintiffs succeeded in their argument that the French doors were included in the price of the home, and the Schwartzes had not replaced them by the time of closing, they would have been entitled to a credit for $3,341 (the cost of the doors). That would have effectively reduced the price stated in the contract. One could argue that the amount of the French doors is not a significant percentage of the purchase price listed in the contract. However, from the facts outlined above, a fixed price of $633,500 with no offsets or credits, at least for these parties, was an essential term of the contract. As the Weichert case points out, a contract must be "sufficiently definite [such] 'that the performance . . . can be ascertained with reasonable certainty.'" 128 N.J. at 435. Here, the performance as to price cannot be ascertained with reasonable certainty. Plaintiffs would have viewed the price as $633,500, less $3,341 for the French doors while the Schwartzes would have expected to receive the full $633,500 without any offset or credit and without having to install new French doors at their expense. Consequently, given our scope of review and the deference we accord the fact findings of the trial judge, as well as the fact that price is an essential term in a contract such as this, we concur with the trial judge that there was no enforceable agreement on these facts.

The trial judge also went on to find that even if there had been a contract made, plaintiffs' conduct would violate the covenant of good faith and fair dealing inherent in any contract and would serve as an equitable defense against enforcement by specific performance.

Specific performance is an equitable remedy within the trial court's discretion. Stehr v. Sawyer, 40 N.J. 352, 357 (1963). In deciding whether to grant specific performance, a court must be guided by principles of fairness:

This means, among other things, that the party asking the aid of the court must stand in conscientious relation to his adversary; his conduct in the matter must have been fair, just and equitable, not sharp or aiming at unfair advantage. The relief itself must not be harsh or oppressive. In short, it must be very plain that his claim is an equitable one.

[Ibid.]

"There is no automatic right to specific performance. The court must make a complete evaluation of the claims asserted, the defenses raised, the hardships imposed on the parties, the fairness and reasonableness of both parties' conduct, and the availability of other remedies before determining whether to grant equitable relief." William A. Dreier & Paul A. Rowe, Guidebook to Chancery Practice in New Jersey II.G (6th ed. 2005).

In this case, the trial judge in stating his findings implicitly found a lack of credibility on plaintiff's part. He specifically concluded that plaintiff acted inequitably by refusing to make a second installment on the deposit on time, conducting a background check of defendants Schwartzes and failing to disclose Mobilio's status as a real estate agent as required by N.J.S.A. 45:15-17(q). Further, he concluded that these acts, in addition to being inequitable, would violate the implied covenant of good faith and fair dealing found in every contract. See Brunswick Hills Racquet Club v. Route 18 Shopping Ctr. Assocs., 182 N.J. 210, 224 (2005); Palisades Props. v. Brunetti, 44 N.J. 117, 132 (1965). The covenant requires contracting parties to "refrain from doing 'anything which will have the effect of destroying or injuring the right of the other party to receive' the benefits of the contract." Brunswick Hills, supra, 182 N.J. at 225 (quoting Palisades Props. supra, 44 N.J. at 130). Thus, it "emphasizes faithfulness to an agreed common purpose and consistency with the justified expectations of the other party." Wilson v. Amerada Hess Corp., 168 N.J. 236, 245 (2001) (quoting Restatement (Second) of Contracts 205 comment a (1981)). Failure to honor the covenant is a ground to deny equitable relief. Ibid. The record in this case amply supports the trial judge's findings that plaintiffs acted in bad faith as set forth above. Consequently, had the court found a contract would have been concluded, it properly would have denied plaintiffs' specific performance application. Plaintiffs contend that if they were not entitled to specific performance, they should be awarded damages which they assert, include counsel fees and costs. We find this argument to be without merit. First of all, the court concluded that there was no agreement, and secondly, there is no authority for their contention that they are entitled to attorneys' fees and costs of suit.

Lastly, plaintiffs contend that the Weichert defendants' dismissal constituted error. We disagree. While the trial court did not specifically make findings with respect to their liability, contrary to the dictates of R. 1:7-4, a review of the record permits us to discern that the trial court would have been unable to find damages in the record even if there were liability of the Weichert defendants' part. There is nothing in the record on which to base a damage award for the claims of negligence asserted against the Weichert defendants. Plaintiffs arguably point to their claim for legal fees, however, such fees are not recoverable in a tort action absent expressed authorization by statute, court rule or contract. See State, Dept. of Envtl. Prot. v. Ventron Corp., 94 N.J. 473, 504 (1983). Consequently, the court having found as a matter of fact that plaintiff conducted a background check and giving appropriate deference to the trial court's other factual findings, and further recognizing that proof of damages must be present to prevail in a negligence action, the trial judge's dismissal with prejudice of the claims against the Weichert defendants was appropriate. See Nappe v. Anschelewitz, Barr, Ansell & Bonello, 97 N.J. 37 (1984); Muller Fuel Oil Co. v. Ins. Co. of No. Am., 95 N.J. Super. 564 (App. Div. 1967). Accordingly, we affirm the judgment of the trial court.

 

The actual price of the doors was $3,341, but the Schwartzes made a $1,000 nonrefundable deposit when they ordered them.

(continued)

(continued)

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June 11, 2007