STEPHEN C. LEONARD ESQUIRE v. POLISH ARMY VETERANS ASSOCIATION OF AMERICA POST 208, POLANKA

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-4415-10T3

STEPHEN C. LEONARD, ESQUIRE,

ADMINISTRATOR OF THE ESTATE

OF MARIA RADZIEWICZ,

Plaintiff-Respondent,

v.

POLISH ARMY VETERANS

ASSOCIATION OF AMERICA, POST

208, POLANKA,

Defendant-Appellant.

__________________________________

Submitted April 16, 2012 Decided May 16, 2012

Before Judges Parrillo and Skillman.

On appeal from Superior Court of New Jersey, Law

Division, Middlesex County, Docket No. L-1694-10.

Molander & Associates, attorneys for appellant

(Garth Molander, on the brief).

Leonard and Leonard, P.C., attorneys for respondent

(Stephen C. Leonard, on the brief).

PER CURIAM

This appeal arises from the trial court's grant of plaintiff's motion for summary judgment, awarding the estate of Maria Radziewicz $48,416.59, representing principal and interest on a so-called "promissory note" purportedly executed on behalf of defendant Post 208 of the Polish Army Veterans Association of America (Post). Summary judgment was granted without benefit of oral argument or any findings of fact or conclusions of law. For the following reasons, we reverse.

The Post is a non-profit organization that helps "Polish veterans in their latter years of life." It also donates "time to charitable activities regarding disabled children and the elderly." The Post owns an affiliated Polanka, or picnic grounds, which is rented out or used for events.

On November 7, 2001, Post 208 entered a contract with its National Headquarters, agreeing to pay the remaining $171,107 it owed on a loan. The contract was signed on behalf of Post 208 by Henryk Koszalka, then-Commander of the Post, and was witnessed by Waldemar Szuba, then-Deputy Commander, and Jozef Kalwa, then-Financial Aide-de-camp, among others.

According to the certifications of Koszalka and Szuba, in December 2001, the Board of Directors "unanimously voted to accept money from member contributors to pay off the National Headquarters mortgage under the condition precedent that no contributing member would be entitled to repayment until the Post was financially solvent." Both men noted that the Post "was not in a financial position to guaranty repayment to any contributing member." They explained that, to date, the Post remained insolvent, struggling to pay basic bills and insurance premiums.

Kalwa, as financial secretary, "was authorized to receive and deposit" checks on behalf of the Post. On June 25, 2002, Maria Radziewicz gave the Post a check for $30,000 to assist in the loan repayment. Three months after deposit of the check, on October 1, 2002, Kalwa issued the following letter, signed and notarized on December 2, 2002, addressed to the Board of Post 208:

I hereby confirm that on June 25, 2002 Maria Radzewicz [sic] deposited the amount of $30,000.00 in the Bank of Post 208 for the purpose of paying off the mortgage of

. . . Post 208 to the Executive Board

. . . .

Maria Radzewicz [sic] reserves the right to have the entire amount repaid by the . . . Post 208 after two years from the date of deposit. She also reserves the right to (receive)[1] 7% of the entire amount from the time of deposit.

Plaintiff refers to this letter as the "promissory note" signed by Kalwa on behalf of the Post.

Although Kalwa stated during his deposition that the letter obligated the Post to reimburse Radziewicz, he acknowledged that it did not establish when she was to be reimbursed or the interest amount. He explained that the phrase "to 7 percent" meant that any potential interest payment was not to exceed seven percent.

Koszalka and Szuba, on the other hand, certified that Kalwa "ignored the resolution by the Board of Directors," which required that repayment of member loans would only occur if the Post were solvent, and "acted on his own and without authority to draft the instrument as signed by him and Ms. Radziewicz." Szuba pointed out that the "promissory note" was only signed by Kalwa "and not by the Commander, which [signature] must be obtained before it becomes an official corporate act under the Post by-laws."2

Thus, Koszalka and Szuba certified that:

Without the authority to act in this manner, Mr. Kalwa was acting outside his grant of authority pursuant to the by[-]laws of the Post; done without Board approval; and without any expressed, implied, incidental or apparent authority as treasurer and/or Adjutant Financial Secretary of Post 208 when he unilaterally signed an agreement obligating the Post to pay Ms. Radziewicz $30,000 dollars with up to 7% interest per annum.

When asked whether he was authorized to promise repayment with interest, Kalwa's response was unclear: "Was information about interest that it's up to 7 percent. But not over. But the interest was not ever established." He stated that, prior to her death on September 17, 2006, Radziewicz never asked to be reimbursed. He explained that none of the lenders "ever claimed any interest on the money . . . deposited for . . . paying off the mortgage. And nobody ask[ed] for [their] money back because we want to keep the place going."

After his November 29, 2007 demand for repayment was declined, plaintiff, administrator of Radziewicz's estate, sued the Post for principal and interest due on the "promissory note." Defendant answered, denying liability and characterizing the June 25, 2002 deposit of $30,000 as a donation. Thereafter, plaintiff moved for summary judgment, which defendant opposed. Without benefit of oral argument, on April 1, 2011, the judge granted plaintiff's motion, finding that "no genuine issue as to any material facts ha[d] been shown to exist," and awarded $48,416.59 to plaintiff. No findings of fact or conclusions of law accompanied the June 7, 2011 order.

On appeal, defendant contends that issues of fact exist as to whether: (1) Kalwa was acting outside the scope of his authority, apparent or express, when he authored and signed the promissory note; and (2) the promissory note was ratified by the Post. We agree.

Summary judgment motions are granted where "the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact . . . ." R. 4:46-2(c); see also Brill v. Guardian LifeIns. Co. of Am., 142 N.J. 520, 523 (1995). In accordance with Rule 4:46-2(c), an issue of fact is genuine if, "considering the burden of persuasion at trial, the evidence submitted by the parties on the motion, together with all legitimate inferences therefrom favoring the non-moving party, would require" a trial. On appeal, the same standard applies. Prudential Prop.& Cas. Ins. Co.v. Boylan, 307 N.J. Super. 162, 167 (App. Div.), certif. denied, 154 N.J. 608 (1998).

Contrary to plaintiff's contention and the motion judge's ruling, genuine issues of material fact exist as to the purpose, effect and binding qualities of the so-called "promissory note" as well as Kalwa's explicit, implied or apparent authority to bind the Post by his action in executing that document. As to the former, we simply note that the document referred to by plaintiff as a "promissory note" is actually a letter issued to the Post, dated October 1, 2002, which was more than three months after the decedent gave the $30,000 to the Post, on June 25, 2002. Moreover, no payment of principal or interest was ever made to the decedent in accordance with this letter even though she lived significantly beyond the two-year period after which she was "guaranteed her right to receive the whole amount back . . . ."

Factual issues also exist as to whether Kalwa had the authority to enter into an agreement on behalf of the Post. "An agency relationship is created when one party consents to have another act on its behalf, with the principal controlling and directing the acts of the agent." Sears Mortg. Corp. v.Rose, 134 N.J. 326, 337 (1993) (citations omitted). Where no agency agreement exists, courts will look to the parties' conduct, and may find implied authority where "'the nature or extent of the function to be performed, the general course of conducting the business, or from particular circumstances in the case.'" Id. at 338 (quoting Carlson v.Hannah, 6 N.J. 202, 212 (1951)). "Even if a person is not an 'actual agent,' he or she may be an agent by virtue of apparent authority based on manifestations of that authority by the principal. Of particular importance is whether a third party has relied on the agent's apparent authority to act for a principal." Ibid. (citations omitted).

Here, although, as treasurer, Kalwa was clearly authorized to receive and deposit checks, he himself was somewhat equivocal about whether he was authorized to promise repayment with interest, while Koszalka and Szuba both insisted in their certifications that Kalwa acted on his own and without authority to execute the "promissory note." Of course, even if Kalwa lacked actual authority, questions remain whether he had apparent authority on which decedent reasonably relied when considered from Radziewicz's perspective.

Given the dueling inferences to be drawn from the facts, and from the general state of conflict in the facts themselves, the grant of summary judgment to plaintiff was inappropriate as defendant was entitled to have the factual controversies resolved by a jury.

Finally, we would be remiss if we did not comment on the motion judge's entry of summary judgment without the requisite findings of fact and conclusions of law mandated by Rule 1:6-2(f); Rule 1:7-4(a); and Rule 4:46-2(c). "Failure to perform that duty 'constitutes a disservice to the litigants, the attorneys and the appellate court.'" Curtis v.Finneran, 83 N.J. 563, 569-70 (1980) (quoting Kenwood Assocs. v. Bd.of Adj. of Englewood, 141 N.J. Super. 1, 4 (App. Div. 1976)). Our published decisions reminding trial judges of their obligation are far too numerous to cite and unfortunately suggest a frequency that is simply unacceptable. The instant matter presents yet another lapse, made worse by the absence of oral argument. Ordinarily, we would remand for the motion judge to perform this necessary function. See Curtis, supra, 83 N.J. at 570-71; Monte v. Monte, 212 N.J.Super. 557, 565 (App. Div. 1986); Hungerford v.Greate Bay Casino Corp., 213 N.J. Super. 398, 402 (App. Div. 1986). In this case, however, we decline to do so because the motion record amply demonstrates the existence of multiple issues of fact and therefore the inappropriateness of summary judgment.

1 This parenthetical presumably was inserted by the translator as no such parenthetical appears in the original Polish document.

2 The Post by-laws were not included in the motion record.