JANICE KOCHANOWICZ v. MONICA KOCHANOWICZ ROTH

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the internet, this opinion is only binding on the parties in the case and its use in other cases is limited. R.1:36-3.

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0

JANICE KOCHANOWICZ,

Plaintiff-Appellant,

v.

MONICA KOCHANOWICZ ROTH, DAVID

ROTH and MONRO HOLDINGS, LLC,

Defendants-Respondents.

_______________________________

October 3, 2016

Argued September 12, 2016 Decided

Before Judges Nugent, Haas, and Currier.

On appeal from the Superior Court of New Jersey, Chancery Division, Camden County, Docket No. C-0063-2012.

Joseph P. Grimes argued the cause for appellant.

Jay E. Kagan argued the cause for respondents (Dilworth Paxson LLP, attorneys; Mr. Kagan, Francis P. Maneri, and Mark A. Fiore, on the brief).

PER CURIAM

This case arises out of a dispute between two sisters regarding their respective management of several pieces of property, ultimately resulting in one sister (through an LLC) foreclosing on the other's corporate asset, a motel. Defendants, Monica Kochanowicz Roth, David Roth (Roth), and Monro Holdings, LLC were granted summary judgment in the ensuing litigation, and plaintiff, Janice Kochanowicz,1 appeals from the order, contending that issues of material fact required the judge's denial of defendants' application.

Janice and Monica became equal shareholders in two corporations in 2002: Jayson, Inc. and Kaym, Inc. Jayson owned a motor inn and Kaym operated an adult club that was a tenant in the building connected to the motor inn. The sisters agreed that Janice would operate and control the motor inn and Monica would run the club. Kaym paid rent to Jayson for the use of the club's space at the motor inn.

In 2005, Monica learned that Jayson had entered into an agreement with a billboard company that yielded an initial lump sum and an ongoing monthly lease payment. Monica claimed that she and Janice agreed that Kaym would no longer pay rent to Jayson, but would instead contribute towards health insurance costs for Janice and her family as well as other expenses. In her deposition, Janice acknowledged that Kaym had stopped paying rent and as the motor inn was doing well she "did not make an issue out of it." She conceded that she "decided not to pursue [any action]."

In 2007 and 2008, Jayson did not pay the real estate taxes on the motor inn property. After notice to Jayson, the municipality conducted a tax lien auction at which Crusader Lien Services purchased the tax lien certificate. Crusader then paid the 2008, 2009, and 2010 taxes that remained unpaid by Jayson. Crusader bought a second lien certificate that related to additional unpaid taxes and overdue utility bills. By May 2010, the two certificates totaled in excess of $271,000.

Monica contends she was unaware of the delinquent real estate taxes until late 2009, and once apprised of the circumstances, her attorney contacted Janice demanding the taxes be paid. Monica offered to co-sign financing on the property to pay off the liabilities but conditioned her offer on Janice ceding control of the motel to Monica. Janice refused that condition and did not make any attempts to satisfy Jayson's liabilities.

In May 2010, Monica's attorney advised Janice that the real estate tax lien had to be satisfied without delay as Crusader could begin foreclosure proceedings on the property the following month.2

A shareholder meeting was held in June with both sisters and their respective counsel present. Janice acknowledged she was aware that Crusader could foreclose on its lien, but conceded Jayson did not have sufficient funds to pay off the real estate taxes and other debts.

As a result of these circumstances, Monica and her husband created an entity, defendant Monro Holdings, LLC, with the intent to purchase the lien certificates from Crusader. Monica conceded she did not advise Janice of this endeavor as the Roths did not want to invest money while Janice continued to mismanage the operation of the motel.

Monica stated: "I didn't have enough money. I only had $70,000 and my husband was putting the majority of the money up, [$220,000], and . . . he would not loan the money if he knew Janice was in charge."

In October 2010, as the tax certificates had still not been redeemed by Jayson, Monro initiated tax foreclosure proceedings. Although Janice acknowledged service of the complaint and consulted with counsel, no answer was filed and no action was taken by Jayson. During this timeframe, Janice contends that she was repeatedly assured by her sister that Monica was handling the tax lien situation. Janice testified

I just trusted her . . . . Because she said she was handling it and because she seemed like she had everything very confident, I just assumed she had it . . . . I mean she wasn't upset over it. If she wasn't upset over it, I guess she ha[d] things in hand . . . it never occurred to me that she was doing this [creating Monro with the intent to purchase the tax certificates and foreclose on the property].

Final judgment in the foreclosure action was entered in May 2012.

Both parties moved for summary judgment, and after oral argument on the motions, the judge granted summary judgment to defendants in an oral decision on May 12, 2014, and dismissed plaintiff's claims. The judge found that Janice had waived her claim for rent from Kaym as she had retained counsel to discuss the issue, and thereafter, chose not to take any action towards collecting the rent. Furthermore, the claim for rent was barred under the applicable six-year statute of limitations, N.J.S.A. 2A:14-1, as more than six years had elapsed from the time the rent payments had ceased until the filing of the complaint.

Addressing Janice's claims of fraud, the judge concluded she had not presented sufficient proofs to support her claim. Specifically, the judge noted that Janice was aware of the imminent foreclosure proceedings, she had received multiple notices through the years regarding the deficient tax payments and the tax certificate sale, and she had been advised by counsel of the outstanding tax payments. Armed with all of that knowledge, the judge found Janice could not have "reasonably relied" on Monica's statements that she was taking care of the tax situation.

After all issues between the parties were resolved, a final order of judgment was entered on January 20, 2015.

On appeal Janice argues that (1) the trial judge erred in finding an intentional waiver of the rent payments in 2005; and (2) there were unresolved issues of fact regarding this "shareholder oppression" action.

We review a grant of summary judgment under the same standard as the motion judge. Rowe v. Mazel Thirty, LLC, 209 N.J. 35, 41 (2012). We must determine whether there are any genuine issues of material fact when the evidence is viewed in the light most favorable to the non-moving party. Id. at 38, 41. "The inquiry is whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Liberty Surplus Ins. Corp. v. Nowell Amoroso, P.A., 189 N.J. 436, 445-46 (2007) (quoting Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 536 (1995)) (internal quotation marks omitted). "[T]he legal conclusions undergirding the summary judgment motion itself [are reviewed] on a plenary de novo basis." Estate of Hanges v. Metro. Prop. & Cas. Ins. Co., 202 N.J. 369, 385 (2010).

Applying the above standard, we discern no basis to disturb the judge's ruling. In addressing plaintiff's argument as to the waiver of the rent, we find it devoid of merit. Janice contends that as a result of Kaym's cessation of rent payments in 2005, Jayson was unable to make the real estate tax payments in later years. In granting summary judgment on this claim to defendants, the judge found that Janice had waived her right to rent payments many years earlier. "Waiver is the voluntary and intentional relinquishment of a known right." Knorr v. Smeal, 178 N.J. 169, 177 (2003) (citation omitted). A valid waiver requires not only that a party "have full knowledge of his legal rights," but also that the party "clearly, unequivocally, and decisively" surrender those rights. Ibid.

It is undisputed that in 2005 the sisters agreed that, in lieu of paying rent, Kaym would pay some expenses, including health insurance, for Janice and her family members. A close reading of plaintiff's contentions on appeal reveal that she does not contest that she relinquished her right to the payment of rent; rather, she argues she did not waive her shareholder rights. Because it is clear the judge did not rule that Janice waived her shareholder rights we must reject this argument.

In her second argument, plaintiff contends the court erred when it did not hear testimony on the "complex and disputed issues of fact of corporate oppression." Other than this generalization, there are no specific assertions presented in support of this argument for us to review. Although the motion judge dismissed plaintiff's fraud claims, her brief on appeal does not dispute that ruling nor address it at all. She instead baldly asserts that shareholder oppression actions are fact sensitive and the judge erred in refusing to hear any testimony.3 Without plaintiff providing any specific evidence for us to consider, we are constrained to reject this argument.

We are satisfied that there was sufficient evidence in the record presented to the motion judge to support her rulings on the summary judgment motions.

Affirmed.

1 In referring to Monica and Janice by their first names, we mean no disrespect, but do so for purposes of ease and clarity. David Roth is Monica's husband.

2 Crusader was entitled to foreclose on the tax sale certificates on June 18, 2010.

3 There was no request to the court to hear testimony. There is no proffer to us as to whose or what testimony would have made a difference to the motion judge's decision.