TONYBARADHI v. JEHAD DAHER and LATIFE A. NASSER and LOUAY ASSOCIATES, LLC -

NOT FOR PUBLICATION WITHOUT THE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 binding only 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-2864-16T1

TONY BARADHI,

        Plaintiff-Appellant,

v.

JEHAD DAHER,

        Defendant,

and

LATIFE A. NASSER and LOUAY
ASSOCIATES, LLC,

     Defendants-Respondents.
______________________________

              Submitted February 6, 2018 – Decided            February 28, 2018

              Before Judges Reisner and Hoffman.

              On appeal from Superior Court of New Jersey,
              Chancery Division, Passaic County, Docket No.
              C-000055-16.

              De Marco & De Marco, attorneys for appellant
              (Patrick C. De Marco, on the brief).

              Michael S. Doran, attorney for respondents.

PER CURIAM
     Plaintiff Tony Baradhi (plaintiff) appeals from a January 31,

2017 order denying his motion to reconsider an October 6, 2016

order dismissing with prejudice plaintiff's complaint against

defendants Latife A. Nasser and Louay Associates, LLC. We conclude

that the complaint states a cause of action, and plaintiff's

certification filed in opposition to the motion to dismiss further

demonstrates a colorable claim.         Moreover, even if the complaint

did not state a claim, it was error for the trial court to dismiss

the complaint with prejudice.    Accordingly, we vacate the October

6, 2016 and January 31, 2017 orders and remand this matter to the

trial court.

                                I

     Viewed in the light most favorable to plaintiff, his complaint

states the following facts.     Jehad Daher was the sole member of

Louay Associates, LLC (the company), which owned a valuable piece

of commercial property in Clifton.        In 2014, Daher sold plaintiff

a one-third interest in the company for $235,000, plus $50,000 in

sweat equity.   Plaintiff paid the money and performed $50,000

worth of work on the property.      In 2015, Daher agreed to buy back

plaintiff's one-third share in the company for $350,000, to be

paid as follows: $30,000 payable immediately, and the balance to

be raised by having the company refinance the property.        In other

words, Daher committed the company to refinance the property and

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promised that $320,000 worth of the proceeds would be paid to

plaintiff.

     On July 7, 2015, without first paying plaintiff what he was

owed, Daher transferred ownership of the company to Latife A.

Nasser.   Nasser was aware of the buy-out arrangement when she

obtained ownership of the company. Viewing the complaint favorably

to plaintiff, Nasser was aware that Daher had committed company

funds to plaintiff, because only the company could refinance the

property and, once the refinancing was accomplished, the funds

would belong to the company.

      On November 18, 2015, Nasser caused the company to refinance

the property for $1.7 million.      However, neither the company, nor

Nasser, nor Daher, paid plaintiff the $320,000 he was owed, and

they also excluded him from any ownership interest in the company.

According to the complaint, Nasser and Daher both acknowledged "a

liability"   to   plaintiff   but   neither   was   willing   to   pay   it.

Plaintiff sought imposition of a "resulting trust" on the company's

property in order to prevent the company, Nasser and Daher from

being unjustly enriched.      Plaintiff did not specifically ask the

court to re-convey to him his one-third interest in the company

or to impress a trust on the company itself, as a remedy.          However,

he did request that defendants account to him.



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       About two months after the complaint was filed, Nasser and

the company filed a motion to dismiss in lieu of an answer under

Rule 4:6-2(e).      The gist of the motion was that plaintiff had no

legal or equitable claim to the property, and had no contractual

relationship with Nasser or with the company.

       In opposition, plaintiff filed a certification, setting forth

his factual allegations in greater detail.              In his certification,

plaintiff attested that Daher paid him $30,000 for his shares of

stock, and also gave him a $20,000 check that bounced.               According

to plaintiff, Nasser's son, Hussain Nasser (Hussain1), was planning

to marry Daher's daughter and buy the company.              Daher and Hussain

both promised plaintiff that they would pay him the remaining sum

owed to him when Hussain bought the company and refinanced the

property.      Then,   suddenly   and       inexplicably,   the    company   was

transferred    to   Hussain's     mother,      Latife    Nasser.     Plaintiff

believed that Daher transferred the property to Nasser in order

to "circumvent the understanding I had with Hussain Nasser, coupled

with the fact that his mother was not residing in this Country."

In other words, Daher was attempting to render himself judgment-

proof.




1
    Meaning no disrespect, we use his first name to avoid confusion.

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     Attached to plaintiff's certification was the "stock purchase

loan agreement and repayment plan" pursuant to which he bought

one-third of the company's stock in exchange for cash, plus work

to be done on the company's property. Significantly, the agreement

was signed by Daher on behalf of "Louay Associates, LLC."         Thus,

contrary to defendant's assertion, there is at least some evidence

that plaintiff had a contract with the company.     Also attached to

the certification were three checks signed by Daher, but drawn on

the company's account, in partial payment for the re-purchase of

plaintiff's stock. There were two $15,000 checks, plus one $20,000

check which, according to plaintiff, was declined by the bank for

insufficient   funds.    Defendants   did   not   file   a   responding

certification.

     In dismissing the complaint, the trial court reasoned that

plaintiff had no contractual or other rights against the company

or Nasser and had no right to the company's property.

                               II

     "In considering a motion to dismiss under Rule 4:6-2(e),

courts search the allegations of the pleading in depth and with

liberality to determine whether a cause of action is 'suggested

by the facts.'"   Rezam Family Assoc., LP v. Borough of Millstone,


423 N.J. Super. 103, 113 (App. Div. 2011) (citation omitted).           A

court "must 'ascertain whether the fundament of a cause of action

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may be gleaned even from an obscure statement of claim, opportunity

being given to amend if necessary.'"                Ibid. (quoting Printing

Mart-Morristown v. Sharp Electronics Corp., 
116 N.J. 739, 746

(1989)).    "A pleading should be dismissed if it states no basis

for relief and discovery would not provide one."                   Ibid.       "The

motion to dismiss should be granted only in rare instances and

ordinarily without prejudice."           Smith v. SBC Communs., Inc., 
178 N.J. 265, 282 (2004).          On appeal, our review is de novo.             Rezem

Family Assocs., 
423 N.J. Super. at 114.

     Viewing the complaint, together with the motion papers, in

light of the applicable law, we are able to perceive at least the

outline of causes of action for fraudulent transfer, and for a

constructive trust over the one-third share of the company's stock

that plaintiff sold to Daher but for which Daher did not pay him.

Moreover, taking the facts pled as true, the $1.7 million in

mortgage proceeds belongs to the company, because the company's

property was refinanced.         Plaintiff may have a claim against the

company to preclude the transfer of its funds to Nasser until the

company    pays   the   debt    which,       according   to   plaintiff,     Daher

inferentially agreed the company would pay.

     In this case, although it was not explicitly pled, the

complaint, together with plaintiff's certification, implies a

civil conspiracy claim against Nasser and Daher under the Uniform

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Fraudulent Transfer Act (UFTA).        Under the UFTA "[a] transfer made

or obligation incurred by a debtor is fraudulent," regardless of

whether the claim arose before or after the transfer was made, if

the debtor made the transfer "[w]ith actual intent to hinder,

delay, or defraud any creditor of the debtor."               
N.J.S.A. 25:2-

25(a).    In determining whether the debtor had "actual intent to

hinder, delay, or defraud any creditor of the debtor," courts

consider a host of factors, including whether the transfer was of

"substantially all the debtor's assets" and whether the transferee

paid reasonably equivalent value for the asset.              
N.J.S.A. 25:2-

26(e), (h).

     Further, creditors "in New Jersey may bring a claim against

one who assists another in executing a fraudulent transfer.                 Such

an action would require the creditor to prove that the conspirator

agreed to perform the fraudulent transfer, 'which, absent the

conspiracy, would give a right of action' under the UFTA."                Banco

Popular N. Am. v. Gandi, 
184 N.J. 161, 178            (2005) (quoting Morgan

v. Union Cty. Bd. of Chosen Freeholders, 
268 N.J. Super. 337, 364

(App. Div. 1993)).

     If   plaintiff      can   show   that   Hussain,    Daher    and    Nasser

intentionally acted together to hinder his claim by transferring

ownership     of   the     company    to     Nasser     without   reasonable

compensation, then he may be able to succeed on a UFTA claim

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against Nasser.    He may also be entitled to the remedy of a

constructive trust. "Generally all that is required to impose a

constructive trust is a finding that there was some wrongful act,

usually, though not limited to, fraud, mistake, undue influence

. . . which has resulted in a transfer of property." Stewart v.

Harris Structural Steel Co., 
198 N.J. Super. 255, 266 (App. Div.

1984) (citation omitted). In this case, the wrongfully transferred

property would be the shares of the company, and possibly the $1.7

million if Nasser has transferred it to herself without first

paying the company's debts.   Id. at 267.

     In articulating these legal and equitable theories, we are

in no way opining that plaintiff has a meritorious claim against

any of the defendants.    That is not the issue on a motion to

dismiss.   The only issue is whether there is the germ of a cause

of action and a possible basis for legal or equitable relief.

There has been no discovery in this case, and it is premature to

speculate as to what discovery will reveal.

     Motions to dismiss should "ordinarily [be granted] without

prejudice." Smith, 
178 N.J. at 282. Moreover, if the court intends

to depart from that rule, it should specifically state its reasons

for dismissing the complaint with prejudice.   Hoffman v. Hampshire

Labs, Inc., 
405 N.J. Super. 105, 116 (App. Div. 2009).             We

appreciate that in this case, plaintiff's pleading was obscure;

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however,   favorably   viewed,    the   facts   pled   raise   a   distinct

suspicion of wrongdoing even if the legal theories could have been

more clearly articulated.        On remand, plaintiff should have an

opportunity to amend his pleading before defendants file an answer

and discovery begins.

     Remanded.   We do not retain jurisdiction.




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