MICHAEL PERAINO v. KATHERINE CAPIZZI

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-3732-05T13732-05T1

MICHAEL PERAINO,

Plaintiff-Respondent,

v.

KATHERINE CAPIZZI,

Defendant-Appellant.

 

Submitted May 2, 2007 - Decided May 15, 2007

Before Judges Winkelstein and Fuentes.

On appeal from the Superior Court of New Jersey, Law Division, Passaic County, L-876-04.

Patricia A. Michaels, attorney for appellant.

Wasserstrum and Fabiano, attorneys for respondent (Edward C. Fabiano, of counsel; Mr. Fabiano and Jeffrey Zajac, on the brief).

PER CURIAM

Defendant Katherine Capizzi appeals from Judge Graziano's May 4, 2005 order awarding plaintiff Michael Peraino $33,225, plus prejudgment interest, for improvements he made to her home in West Paterson. On appeal, defendant raises the following legal arguments:

A. THE LOWER COURT IMPROPERLY ENTERED A MONETARY JUDGMENT IN FAVOR OF THE TENANT FOR IMPROVEMENTS IN DEVIATION OF THE PLAIN MEANING OF THE LEASE.

B. THE LOWER COURT ERRONEOUSLY APPLIED THE DOCTRINE OF UNJUST ENRICHMENT.

C. THE LOWER COURT LACKED JURISDICTION OVER THE LANDLORD SINCE SHE WAS NOT A PARTY TO THE CONTRACT BETWEEN THE TENANT AND HIS EX-WIFE.

We have carefully considered these arguments in light of the record and controlling law. We conclude that defendant's arguments are without merit and affirm substantially for the reasons expressed by Judge Graziano in his oral decision from the bench on April 5, 2005.

Factually, this is what happened. Plaintiff was married to defendant's daughter, Lisa Capizzi, from March 1998 until they were divorced in February 2002. In 1997, defendant had purchased a home at 21 Hillcrest Avenue in West Paterson. In May 1997, plaintiff and defendant's daughter began to occupy the first floor and the basement of the home, and the parties executed a May 1, 1997 lease reflecting this arrangement. Defendant claims that plaintiff and her daughter rented the first floor of her home at a reduced rate so they could save money to buy their own home. Plaintiff claims the parties intended that he would receive equity in the home; defendant would provide the down payment, and ownership would eventually be transferred to plaintiff and his wife as they were responsible for making a portion of the mortgage payments.

Plaintiff and defendant discussed a number of improvements that plaintiff would make to the home. The week after moving in, he began working on the house; he continued to make improvements on weekends and in the evenings for four years. The improvements included replacement of the upstairs deck, repairing a hole in the upstairs floor left by the floor installer, and leveling the yard. He refurbished the basement, which involved installing a new tile floor; and he installed new countertops, a new sink, dishwasher, stove and refrigerator in the kitchen.

Plaintiff spent approximately $60,000 to complete the improvements. The parties do not dispute that plaintiff performed the work, but they disagree on whether he should be reimbursed. Defendant points to the lease, which contains a clause indicating that alterations of the house were at the tenant's expense, unless approved by the landlord. Plaintiff's argument, however, is that this was not a traditional landlord tenant relationship. Defendant had promised him equity in the house in return for his services, and, because that was no longer feasible as a result of the divorce, he claimed he was entitled to be paid for his work.

The trial judge agreed with plaintiff. The judge found that the agreement between the parties was not a traditional landlord/tenant lease because "a tenant does not improve the property of the landlord gratuitously." The judge determined, based on his credibility assessments of the parties, that the parties' operative understanding was that defendant would pay the down payment for the house, and that defendant's "daughter and . . . plaintiff would pay roughly half the mortgage each month, and that they would be homeowners of the house eventually and that they would be accumulating equity in the home." The judge found that plaintiff made the improvements to the house in reliance on this understanding. The judge said: "These people were not improving the property of the landlord. These people were adding to their investment which was growing every month that they made half of a mortgage payment. They certainly planned to share in the increased value that this property would assume over time."

The judge stated that he believed plaintiff's testimony because plaintiff's continued efforts in performing work on the house was consistent with an understanding that plaintiff shared in the equity of the house. "That's why he did this work. If he's just a tenant he might paint upstairs for his mother-in-law, but he's not going to go put on the deck. He's just not going to do that and incur the expenses himself. It's just not in human nature to do that and I don't believe that was done here."

The judge found that Lisa Capizzi's testimony was not credible. He did not accept her contention that she and plaintiff would have put the work into the house even if it were not owned by her mother.

[Capizzi] blithely maintained that she would have gladly spent the $60,000 on one, $6,000 on another in any place where she was a tenant for a total stranger. That she would just as well have done the same thing. Totally incredible. Totally contrary to human nature. I don't believe it at all. She looked extremely embarrassed and red in the face when she was trying to give me that answer when I questioned her on it after having blithely given it in . . . cross examination by plaintiff's counsel.

Capizzi also testified that the payments she and plaintiff made to defendant were for rent, even after she was confronted with notations in her check ledger that the payments were mortgage payments. The court said: "her reason for that was, yeah. I just kept putting down mortgage but I knew it was a rent payment. That makes no sense whatsoever. That's just not believable. She's an incredible witness and I reject her testimony on key points for those reasons."

The judge concluded that

The benefit [to defendant] was conferred with an expectation. The expectation, whether legally enforceable or not, was certainly the impression that [plaintiff] was operating under when he made these things and it was known to all the parties. There was no surprise to anybody. They all shared in these beliefs. And it would be unfair for the conferral of that benefit to go unpaid.

An appellate court should not disturb findings upon which a judgment in a nonjury case are based unless "they are so wholly insupportable as to result in a denial of justice." Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 483-84 (1974). Findings by the trial judge are binding on appeal when supported by adequate, substantial, and credible evidence. Id. at 484. The aim of a reviewing court is to "determine whether the findings made could reasonably have been reached on sufficient credible evidence present in the record." State v. Locurto, 157 N.J. 463, 471 (1999).

Here, the judge's findings were supported by adequate, substantial, and credible evidence. The record supports the judge's decision that the agreement between the parties may have been a lease in form, but it was not so in substance; that plaintiff did the work in return for a promise of equity in the home, and in the absence of which he was entitled to be paid for his services. Consequently, we affirm substantially for the reasons expressed by Judge Graziano in his well-reasoned oral decision. Defendant's arguments are without sufficient merit to warrant additional discussion. R. 2:11-3(e)(1)(A), (E).

 
Affirmed.

(continued)

(continued)

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A-3732-05T1

May 15, 2007