Court Opinion

ID: 4208509
Source: CourtListenerOpinion
Date Created: 2017-10-03 13:10:07.27706+00
Date Added: 2024-06-11T14:41:38.016991
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE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-1107-15T3

BC COMPLIANCE GROUP, LLC,

              Plaintiff-Respondent,

v.

ROSEN SEYMOUR SHAPSS MARTIN
& COMPANY, LLP,

          Defendant-Appellant.
______________________________________________

              Argued January 24, 2017 – Decided October 3, 2017

              Before Judges Messano and Guadagno.

              On appeal from the Superior Court of New
              Jersey, Law Division, Monmouth County,
              Docket No. L-2675-13.

              James J. Curry, Jr., argued the cause for
              appellant (The Law Offices of James J.
              Curry, Jr., LLM, attorneys; Mr. Curry and
              Timothy J. Petrin, on the briefs).

              Jerome F. Gallagher, Jr., argued the cause
              for respondent (Norris, McLaughlin & Marcus,
              PA, attorneys; Mr. Gallagher, of counsel and
              on the brief; Bradford W. Muller, on the
              brief).
PER CURIAM

    Following a three-day trial, a jury returned a verdict in

favor of plaintiff BC Compliance Group, LLC (BCCG), against

defendant Rosen Seymour Shapss Martin & Company, LLP, (RSSM) in

the amount of $182,238.77.    RSSM now appeals, not from the final

judgment, but from an order entered on February 6, 2015, denying

its motion for summary judgment and from an order entered on

April 24, 2015, denying reconsideration of the earlier order.

    In 2006, RSSM, a certified public accounting firm, retained

BCCG, a consulting firm specializing in contract compliance, to

examine RSSM's real estate lease expenses to identify and

eliminate overcharges in its leased facilities.    Pursuant to a

"Real Estate Accounting Agreement," RSSM agreed to compensate

BCCG with fifty percent of all benefits recovered.

    In July 2007, BCCG completed its audit which concluded that

RSSM had overpaid $364,000 to its landlord, RFR Realty LLC

(RFR).    BCCG forwarded the analysis to RFR seeking an audit

credit.   In August 2007 and again in November 2007, RFR rejected

BCCG's audit findings.    In July 2008, RSSM and BCCG proposed a

settlement of the audit credit to RFR but received no response.

    In 2010, RSSM began negotiations with RFR to renew its

lease and entered into a formal lease extension in June 2011.

BCCG maintains that the lease extension includes $2.1 million in

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renovations to be paid by RFR; an eleven month rent abatement

valued at $2.1 million; and a new base year which resulted in

annual savings of more than $100,000 in additional rent

expenses.    The lease extension also granted RFR a general

release of all prior claims RSSM may have against RFR.

       In October 2011, BCCG advised RSSM that its audit findings

had been utilized by RSSM to obtain benefits under the lease

extension and demanded $182,238.77, which it calculated as half

of the overcharges identified in its audit.    RSSM refused to

pay.    In July 2013, BCCG filed a complaint in the Law Division

Monmouth County seeking $182,238.77.

       RSSM filed a motion for summary judgment seeking dismissal

of BCCG's complaint.    In support of its motion, RSSM submitted

affidavits by Donald Leavy, RSSM's director of human resources,

and Steven P. Morrows, a representative of RFR.

       Morrows asserted that RFR and RSSM did not take into

account the auditing work by BCCG in negotiations for the

amended lease agreement.    He claimed that the agreement was

based on market conditions only and not the work conducted by

BCCG.

       Leavy asserted that after the initial meeting with RFR, it

was clear to him that the "landlord was not going to voluntarily

acquiesce in any escalation adjustment as a result of the audit

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prepared by [BCCG]."   Leavy also maintained that the issue as to

lease adjustments was on hold and not pursued or mentioned

during the lease amendment negotiations.

    Plaintiff provided a certification from Edward Botti, co-

managing member of BCCG, who was involved with the audit

proceedings with defendant.   Botti attached redacted RFR lease

amendments that plaintiff had reviewed in other cases where it

audited RFR leases, and none of those other leases contained

general release provisions similar to those contained in

defendant and RFR's amended lease.

    Botti certified that RSSM never expressed any disagreement

with BCCG's audit findings and provided emails from Leavy

indicating RSSM wanted to pursue an action, but kept pushing the

matter due to the lease negotiations.   Leavy in his affidavit

claimed RSSM did a cost-benefit's analysis and determined that

"it would not make economic sense to pursue arbitration or

litigation."

    After hearing oral argument on February 6, 2015, Judge

Katie A. Gummer denied RSSM's motion for summary judgment.

After thoroughly reviewing the submissions of both parties,

Judge Gummer found there was no dispute as to the existence of a

contract, but there was an issue whether RSSM breached that

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contract by failing to compensate BCCG pursuant to the terms of

the contract:

              It's not in dispute that someone at least
         at the landlord's, in the landlord's group,
         someone at the landlords was aware of the
         audit. I understand that was three years
         before, I understand all of the testimony
         that's before the Court that any negotiations
         specifically   about   the  audit   had   been
         rejected.

              But a reasonable fact finder could
         conclude that the existence of that audit and
         the alleged overcharges were well within the
         mind of the person who ultimately signed the
         lease on behalf of the landlord. And I think
         that's enough to put the issue before the
         jury.

              I think that's a genuine issue of
         material fact that, although a person who is
         the lead negotiator may not have known about
         it, may not have argued about it, the landlord
         could well, the person who ultimately made the
         decision to sign the lease could have
         concluded   that,   could   have  taken   into
         consideration the information provided in that
         audit.

    RSSM than moved for reconsideration based on an affidavit

by Aby Rosen, co-founder of RFR who signed the 2011 lease

amendment.   Rosen certified that he was not aware of BCCG's

audit or RSSM's claim for overcharges when he signed the lease.

RSSM argued that Rosen's affidavit proved that it did not

receive any benefit from RFR as a result of BCCG's audit.

                                5                           A-1107-15T3
    On April 24, 2015, Judge Gummer denied the motion for

reconsideration finding that genuine issues of material fact

remained that a reasonable fact finder could resolve in favor of

BCCG.     The judge found that the jury should determine "whether

or not those beneficial results . . . in the new lease came from

anything that plaintiff did or were wholly unrelated to anything

that plaintiff did . . . to determine credibility issues on that

front."

    The judge also rejected RSSM's argument that the lack of

expert testimony required dismissal, concluding that BCCG did

not need an expert because "under the language of the agreement

there is effectively a presumption or a recognition that the

benefits came as a direct result of BCCG's efforts and that

there's no dispute as to the amount of benefits at issue here."

    The matter proceeded to trial before another judge and a

jury returned a verdict in favor of BCCG on October 14, 2015.

    On appeal, RSSM argues its motion for summary judgment

should have been granted, as no evidence established that RSSM

received a benefit from RFR as a result of BCCG's audit; the

motion judge failed to make rulings on evidential objections

raised by RSSM; and the judge relied on inadmissible and

irrelevant evidence in denying RSSM's motions.

                                  6                         A-1107-15T3
    "[A] denial of summary judgment is always interlocutory[.]"

Hart v. City of Jersey City, 308 N.J. Super. 487, 498 (App. Div.

1998).   "[A]n order denying summary judgment . . . decides

nothing and merely reserves issues for future disposition."

Gonzalez v. Ideal Tile Importing Co., Inc., 371 N.J. Super. 349,

356 (App. Div. 2004) aff'd, 184 N.J. 415 (2005), cert. denied,

546 U.S. 1092, 126 S. Ct. 1042, 163 L. Ed. 2d 857 (2006).

    An interlocutory order is preserved for appeal with the

final judgment or final agency decision if it is identified as a

subject of the appeal. In re Carton, 48 N.J. 9, 15 (1966).     That

may be done in the notice of appeal or the case information

statement. Synnex Corp. v. ADT Sec. Servs. Inc., 394 N.J. Super.

577, 588 (App. Div. 2007) (permitting consideration of order

granting partial summary judgment identified in case information

statement); Sikes v. Twp. of Rockaway, 269 N.J. Super. 463, 465-

66 (App. Div.) (declining to review trial ruling not identified

in notice of appeal), aff'd o.b., 138 N.J. 41 (1994).   However,

where there is no appeal from a final judgment, a court lacks

jurisdiction and may dismiss the appeal.

    As we raise this jurisdictional issue sua sponte without

prior notice to plaintiff or an opportunity to respond, we

consider the merits of RSSM's claim that summary judgment should

have been granted. See N.J. Office of Emp. Relations v. Commc'n

                                7                           A-1107-15T3
Workers of Am., 154 N.J. 98, 108 (1998) (a court that recognizes

a jurisdictional defect should notify the parties and permit

them to address the issue of the court's jurisdiction).

    The undisputed facts of BCCG's audit, which discovered

RSSM's overpayment to RFR; the favorable lease extension

subsequently negotiated by RSSM and RFR; and the release of RFR

from liability for prior claims by RSSM; raise a significant

question of fact of whether RSSM secured benefits from RFR and

was thus obligated to pay a fee to BCCG.

    We are satisfied that Judge Gummer correctly denied RSSM's

motion for summary judgment as her determination that there were

genuine issues of material fact which could only be resolved by

a jury finds ample support in the record.

    Affirmed.

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