SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION DOCKET NO . A - 2753
- 15T3 MORETRAN REALTY, L LC, Plainti ff
- Appellant,

v. BALDEV PATEL AND SON, LLC , BALDEV PATEL and CHETAN PATEL, Defendants
- Respondents.

________

______________________________ Argued February 14, 2017
– Decided Before Judges Messano and Espinosa. On appeal from Superior Court of New Jersey, Law Division, Bergen County, Docket No. L
9032
- 14.
John R . Edwards, Jr., argued the cause for appellant (Price , Meese, Shulman & D'Arminio, PC , attorneys; Mr. Edwards, on the briefs). Douglas J. Kinz argued the cause for res pondent.
PER CURIAM Plaintiff Moretran Realty, LLC, purchased commercial real estate property (the Property) from defendant Baldev Patel and NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court . " A lthough 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.

August 23, 20172 A - 2753
- 15T3

Son, LLC ( Seller ) for $1.6 million . The parties agreed to escrow $100,000 for environmental issues pursuant to a n escrow agreement that also required personal guarantees from defendants Baldev
Patel and Chetan Patel ( collectively the Patels) . 1 This appeal concerns the disposition of the escrowed funds, each side claiming entitlement to the funds. Plaintiff appeals from an order that denied its motion for partial summary judgment and granted summary judgment to defendants, dismissing the complaint with prejudice. We affirm . I. When Seller purchased the Property in 2009, its commercial lender obtained a Phase I Env ironmental Assessment Report that identified two envir onmental issues on the Property. Both issues concerned contamination discovered after the removal of two 1,000
- gallon underground heating oil storage tanks (UST) in 1999 and
2005.
G roundwater near t he first UST was contaminated wit h gasoline constituents that were determined to have migrated from the adjacent U
- Haul facility. Following remediation efforts under the supervision of the New Jersey Department of Environmental

1 Because they share the same surname, we refer to these defendants by their first names; we mean no disrespect.3 A - 2753
- 15T3

Protect ion (NJDEP), the NJD EP issued a No Further Action ( NFA ) letter for the Property regarding the removal of this UST. The second UST was found to have leaked, resulting in soil and groundwater contamination. Following remediation efforts, NJDEP issued an NFA letter for this UST in 2009. In March 2012, plaintiff entered into a contract with Seller to purchase the Pro perty. During the ninety
- da y inspection period, plaintiff's attorney sent written notice to defendants that plaintiff elected to terminate the contract because it had "discovered various u nacceptable condition s at the P roperty including . . . environmental areas of concern and signi ficant defects in the structure of the building and its systems. " The environmental areas of concern (AOC) were identified in a report prepared by TRC Environmental Corporation (TRC) following its inspection of the P roperty. 2 TRC reported it had identifi ed eighteen AOCs. It recommended "additional information or further investigation for" five AOCs:

AOC 2c Abandoned Fuel Oil UST (Unknown

Capacity) AOC 2d Abandoned 2,500
- Gallon #2 Fuel Oil

UST AOC 9 Inactive Production Well AOC 11 Off
- Site Impacts AOC 12 Debris Piles

2 The report provided in Plaintiff's appendix is titled, "Preliminary Assessment/Phase I Environmental Site Assessment Report" and is labeled "DRAFT" throughout.4 A - 2753
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TRC recommended " No Further Action . . . for the remaining
AOCs." Among those were AOC 2a and AOC 2b, which referred to the 1,000 gallon USTs removed in 1999 and 2005, respectively, and which were the subjects of NFA letters from the N JDEP. Plaintiff's counsel wrote a letter to defendant's attorney, dated June 25, 2012, that "confirm[ed] the terms upon which" plaintiff was willing to proceed with the sale. The letter set forth a number of modifications to the contract of sale, includ ing:

1. The contract price is to be amended to $1,477,000 .00 . It is specifically understood and agreed that the [P] roperty is being sold physically , "as - is" except for the noted issue s stated herein; 2. The sum of $100,000.00 will be escrowed at closing, to be held in trust by [S] eller's attorney, for environmental issues related to the two (2) underground storage tanks, and the contamination generally identified by U
- Haul. The $100,000 .00 shall be released upon the sooner of six (6) months from the closi ng or U - Haul assuming without reservation the clean
up of the subject [P] roperty . In the event that a Phase
- I report by the lender shall reveal any additional environmental issues, the seller shall be entitled to cancel the contract unless the buyer waive s the additional issues found. Additionally, [ Baldev Patel and Chetan Patel] will personally hold [plaintiff] harmless from any environmental issues related to the two (2) underground storage tanks, and the contamination general ly identified by U
- Haul on the [P] roperty. The personal guarantees shall be released upon U
- Haul assuming the clean
- up as above referenced ;5 A - 2753
- 15T3 3. A phase I report must be accepted by [plaintiff's] lender so the transaction may be financed as contemplated; 4. The closing will be July 1 7, 2012, subject to the substantive and scheduling requirements o f the lender; . . . . [( Emphasis added). ] Both parties agree t he c losing occurred on September 11,
2012. The parties executed an escrow agreement that incorporated terms agreed upon in th e June 25, 2012 letter :

[T]he parties have agreed that an escrow shall be established and an escrow agent shall be appointed to enable certain environmental work to be completed, as further described herein, and for [plaintiff] to receive the appropriate d ocumentation of compl etion of the environmental work . . . . 2 . Seller and [plaintiff] agree that the Escrowed Funds will be held in trust by the Escrow Agent, for environmental issues related to the two (2) underground storage tanks on the Property, and the contamination generally identified by U
- Haul. The Escrowed Funds shall be released upon the sooner of six (6) months from the closing date, or U
- Haul assuming without reservation the clean
- up of the Property.
3. Baldev Patel and Chetan Patel jointly, seve rally and personally will hold [plaintiff] harmless from any environmental issues related to the two (2) underground storage tanks, and the contamination generally identified by U
Haul on the Property. The personal guarantees shall be released upon U
- Haul assuming without reservation the clean
- up of the Property.6 A - 2753
- 15T3

According to a certification submitted by John Muchmore, the sole principal of plaintiff, " U - Haul took the position it was not responsible for any of the clean
- up " after the closing. The
p arties extended time periods to further investigate the possibility that U
- Haul would assume responsibility for the clean
up but U
- Haul continued to deny any responsibility. 3 Plaintiff
made numerous demands for defendan ts to take care of the clean
up; def endants refused to do so or release the escrowed funds for plaintiff to use for clean
- up costs. Muchmore certified further "[ t ] he P roperty was contaminated at and prior to the . . . sale " and that "defendants are solely responsible for the costs" which plaintiff has i ncurred and will incur. In the certification he submitted in opposition to plaintiff's motion, Chetan stated there was no contamination on
the P roperty and no clean
- up necessary at the time of the closing. Remediation of the U
- Haul site continued under the direction of Environmental Resources Management (ERM). In January 2013, ERM conducted groundwater sampling of eleven monitoring wells on the
U - Haul site . Finding no excess levels of the gasoline constituents in wells close to the Property, ERM concluded there was no evidence

3 This assertion was not supported by any corroborating evidence and was disputed.7 A - 2753
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of any contamination migrating from the U
- Haul site and that no
clean
- up was necessary on the Property. When the six
- m onth period expired, plaintiff's counsel requested an extension for ninety days . He also demanded t he escrowed funds not be released and that Seller "immediately undertake the required clean
- up, including . . . the groundwater remediation." A letter from plaintiff's counsel, dated April 5, 2013, confirms that defendants did no t agree to the extension. An email, dated July 26, 2013, from Alex Yankaskas, Vice President of Environmental Compliance Monitoring, Inc. (ECM), a
l icensed site r emediation p rofessi onal (LSRP), to plaintiff's counsel provided his interpretation of a report on groundwater sampling information from the U
- Haul site. Yankaskas stated, "At this first, quick glance, this does not appear to support a strong contention relative to an off
- si te source migrating eastwardly ." Although the email stated Yankaskas would take a more thorough look at the report, there is no evidence that his conclusion was altered by further review. Plaintiff's counsel asserted that he and Yankaskas h ad conversatio ns with defendant s ' former attorney, Benne t t
Wasserstrum , that purportedly reflected an agreement by defendants

" to do the work they were obligated to do " regarding the site.8 A - 2753
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In an email relied upon by plaintiff dated March 26, 2014,
Yankaskas states:

I reached and spoke with Bennett Wasserstrum just now. He is onboard with our recent discussions. We will provide him a proposal this week for the borings. One point that came to mind relative to Patel vs. [plaintiff] as the client: The results will be t he client's (whomever that may be) and therefore, there should be an agreement between the parties to share those findings. As part of that agreement, it would be prudent to add/confirm mutual objectives for the work, especially given the potential LSRP a spect ( if on
- site contamination is confirmed ). [(Emphasis added).]
ECM presented the following Proposed Scope of Work: The proposed investigation will consist of a limited soil boring and ground water sampling program and associated reporting. This program is designed to assess general environmental conditions relative to two [ USTs ] previously removed from the site and po tential gasoline groundwater contamination migrating from the adjacent (U
- Haul) site. A draft agreement prepared by plaintiff's attorney stated the parties agreed ECM would "conduct the investigation and take the LSRP position in remediating the [P] roper ty as required by existing
law." This agreement was never executed. Plaintiff brought this action, seeking declaratory judgment pursuant to the Spill Compensation and Control Act, N.J.S.A. 58:10
-9 A - 2753
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23.11 to
- 23.24 , that defendants are jointly and severally liable for all investigatory, cleanup and removal costs and expense s and also seeking treble damages and indemnification. In addition, plaintiff alleged causes of action based on negligence, strict liability, nuisance, breach of contract and indemnificati on from
the Patels pursuant to the ir personal guarantees. Defendants filed an answer and counterclaim in which they demanded judgment against plaintiff compelling the rel ease of the escrowed funds. Plaintiff filed a motion for partial summary judgment, t o compel the release of the escrowed funds for it to use for clean
- up costs and to require th e Patels to be liable for those costs. Def endant filed a cross
- motion for summary judgment, seeking the dismissal of the complaint and release of the escrowed fun ds. At oral argument, defense counsel argued plaintiff had produced no evidence of contamination to support its claims. Plaintiff contended such evidence existed, citing a reference in a certification from Wasserstrum to TRC's recommendation for
"further investigation" regarding tw o USTs, AOC 2c and AOC 2d, one 2,500 gallon tank and the other of unknown capacity. In the certificati on, Wasserstrum maintained there was no contamination associ ated with these two tanks . He further asserted that plaintiff's concern and the subject of the escrow agreement were the two USTs removed from the P roperty in 1999 and 2005.10 A - 2753
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The trial judge denied plaintiff's motion for partial summary judgment , g ranted defendants' cr o ss - motion for summary judgment
and set forth her reasons on the record. She stated:

Plaintiff has conceded that U
- Haul refused to assume responsibility for any cleanup of the [P] roperty since its testing revealed no evidence of ongoing contamination and the need for any such cleanup. Accordingly, more than six months have passed from the closing date, under the express language of the agreement . . . the escrow funds must be released.
The trial judge also noted the existence of evidence to support the conclusion that there was no contamination on the Property and the absence of evidence to the contrary. In its appeal, plaintiff argues summary judgment should not have been granted 4 because there were genuine issues o f material fact (Point I), the matter was not ripe for summ ary judgment (Point II) and the trial judge erred in making factual determinations based on information that related to the U
- Haul site rather than to the Property (Point III). After reviewing these arguments in light of the record and applicable principles of law, we conclude they lack merit and further, the arguments raised in Points I I and
II I require no discussion. R. 2:11
- 3(e)(1)(E) .

4 Plaintiff has not argued the trial judge erred in denyin g its motion for partial summary judgment.11 A - 2753
- 15T3 II. In reviewing a decision on a summary judgment motion, we view the evidence "in the light most fa vorable to the non
- moving party, " Brill v. Gu ardian Life Ins. Co. of Am. , 142 N.J. 520, 529 (1995) , to determine whether the competent evidential materials presented "show that there is no genuine issue as to any material fact challenged and that the moving party is entitled to a judgm ent or order as a matter of law, " R. 4:46
- 2(c). 5
In Cortez v. Gindhart , 435 N.J. Super. 589 (App. Div. 2014), certif. denied , 220 N.J. 269 (2015), we described the proofs necessary to defeat a motion for summary judgment:

[ T ] he opponent must "'come forward with evidence' that creates a genuine issue of material fact." "An issue of fact is genuine only if, considering the burden of persuasion at trial, the evidence submitted by the parties on the motion, together with all legi timate inferences therefrom favoring the non - moving party, would require submission of the issue to the trier of fact."

5 Plaintiff was required and did not support its motion with a statement of material facts that includes

a citation to the portion of the motion record establishing the fact or demonstrating that it is uncontr overted. The citation shall identify the document and shall specify the pages and paragraphs or lines thereof or the specific portions of exhibits relied on. [ Rule 4:46
- 2(a).]12 A - 2753
- 15T3 Although we must view the "evidential materials . . . in the light most favorable to the non
- moving party" in reviewing summary judgme nt motions, we emphasize that it is evidence that must be relied upon to establish a genuine issue of fact. "Competent opposition requires 'competent evidential material' beyond mere 'speculation' and 'fanciful arguments.'" [ Id. at 605 (citations omitte d).] The issues presented by this appeal concern a question of law, the interpretation of the escrow agreement languag e, and a question of fact, whether the evidence supported the disbursement
of the escrowed funds to Seller . 6
A. Because the interpretat ion of a contract is a question of law, our review is de novo. Kieffer v. Best Buy , 205 N.J. 213,
222 (2011). "The judicial task is simply interpretative; it is not to rewrite a contract for the parties better than or different from the one they wrote fo r themselves." Id. at 223. Contractual terms should be read and interpreted by using "their plain and ordinary meaning." M.J. Paquet, Inc. v. N.J. Dep't of Transp. , 171 N.J. 378, 396 (2002) . However, "[i]f the terms of the contract are susceptible to at least two reasonable alternative inter pretations, an ambiguity exists, " Chubb Custom Ins. Co. v.

6 Defendants concede that their agreement to indemnify plaintiff survives the dismissal of plaintiff's complaint.13 A - 2753
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Prudential Ins. Co. of Am. , 195 N.J. 231, 239 (2008) , and extrinsic evidence may be used to discern the parties' intent , Conway v. 287 Corp. Ctr. Assocs. , 187 N.J. 259, 270 (2006). Neither party contends the language of th e escrow agreement is ambiguous and we agree. The funds were explicitly " held in
trust . . . for environmental issues related to the two (2) underground storage tanks on the Property, and the contamination generally identified by U
- Haul. " The escrow agreement also established the criteria for the release of the escrowed funds:

" The Escrowed Funds shall be released upon the sooner of six (6) months from the closing date, or U
- Haul assuming without reservation the clean
- up of the Property. " The parties agree the closing occurred on September 11 , 2012. It is also undisputed that U
- Haul never assumed responsibility for
a clean
- up of the Property and, in fact, affirmatively discl aimed any responsibility for a clean
- up. Contrary to plaintiff's assertion, there is no evidence in the record that defendants agreed to an extension of the six
- month period. Therefore, the

escrow agreement provided for the release of the escrowed funds at the end of the six
- month period.
B. Plaintiff contends summary judgment should not have been granted because it presented evidence in the form of "the no14 A - 2753
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further action letter, the TRC report and the proposed scope of
work to be done sent on March 31, 2014 " that established a genuine issue of fact as to the existence of contamination on the Property. We disagree. As we have noted, the escrow agreement called for the release of funds no later than six months after the closing. The discovery
of any con tamination on the Property thereafter would not, therefore, have any bearing on whether the escrowed funds should be released. Plaintiff has produced no evidence of any contamination from " the two (2) underground storage tanks on the Property, and the con tamination generally identified by U
- Haul " within that six
- month period. The ERM tests done in January 2013 found no evidence of any contamination migrating from the U
- Haul site , the basis for U
- Haul's conclusion that no clean
- up was necessary on the Prop erty. Plaintiff has presented no evidence that refutes that conclusion within the six
- month period. Even if we review the record beyond the six
- month period, plaintiff has still produced no evidence of actual contamination relating to the issues identifi ed in the escrow agreement. At best, plaintiff has produced a proposal from ECM to conduct investigative borings. But even in making the proposal in March
2014 , Yankaskas referred to activity that would occur " if on - site contamination is confirmed." (Em phasis added). Thus, even a year15 A - 2753
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after the escrow period had expired, there was no proof of contamination relating to the USTs referenced in the escrow agreement or contaminants that had migrated from the U
- Haul site. Affirmed.