Court Opinion

ID: 5118283
Source: CourtListenerOpinion
Date Created: 2021-10-14 14:08:27.163084+00
Date Added: 2024-06-11T08:22:06.645986
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NOT FOR PUBLICATION WITHOUT THE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 NOS. A-0732-20
                                                                    A-0760-20

1530 OWNERS CORP., GARNIK
AZARNIA, JO ANN CROSS, and
MOE MARSHALL,

          Plaintiffs-Appellants,

v.

AMERICANA ASSOCIATES,
THE OLNICK ORGANIZATION,
INC., ROBERT OLNICK
ASSOCIATES OF NEW JERSEY,
d/b/a ROBERT OLNICK
CORPORATION,

     Defendants-Respondents.
______________________________

1530 OWNERS CORP., GARNIK
AZARNIA, JO ANN CROSS, and
MOE MARSHALL,

          Plaintiffs-Respondents,

v.

AMERICANA ASSOCIATES,
THE OLNICK ORGANIZATION,
INC., ROBERT OLNICK
ASSOCIATES OF NEW JERSEY,
d/b/a ROBERT OLNICK
CORPORATION,

     Defendants-Appellants.
______________________________

           Argued September 23, 2021 – Decided October 14, 2021

           Before Judges Alvarez and Mawla.

           On appeal from the Superior Court of New Jersey,
           Chancery Division, Bergen County, Docket Nos.
           C-000181-19 and C-000281-19.

           John Randy Sawyer argued the cause for appellants in
           A-0732-20 and respondents in A-0760-20 (Stark &
           Stark, PC, attorneys; John Randy Sawyer, of counsel
           and on the briefs).

           Michael B. Kramer (Michael B. Kramer & Associates)
           of the New York bar, admitted pro hac vice, argued the
           cause for respondents in A-0732-20 and appellants in
           A-0760-20 (Michael B. Kramer and Richard A.
           Medina, attorneys; Michael B. Kramer, of counsel and
           on the briefs; Richard A. Medina, on the briefs).

PER CURIAM

     In A-0732-20, plaintiffs 1530 Owners Corp. (the corporation), Garnik

Azarnia, Jo Ann Cross, and Moe Marshall appeal from an August 28, 2020 order

dismissing their complaint and granting summary judgment in favor of

defendants Americana Associates (Americana), The Olnick Organization, Inc.

                                                                      A-0732-20
                                     2
(Olnick), and Robert Olnick Associates of New Jersey (d/b/a/ Robert Olnick

Corporation) (Olnick Associates).      In A-0760-20, defendants challenge a

November 13, 2020 order denying their request for counsel fees. We affirm in

both matters.

      Plaintiffs represent owners of units and shareholders of a cooperative i n

The Colony, an apartment building in Fort Lee. On July 25, 1985, Americana

conveyed the building and corresponding land to the corporation. Americana

formed the corporation, which owns and manages the building. It also created

an offering plan, which outlined conversion of the property to a cooperative and

contained by-laws for governance of the cooperative. According to the plan,

Americana as the sponsor-seller would sell apartments with corresponding

shares in the corporation to tenants residing in the building. Olnick operates as

Americana's management, sales, and leasing agent. Olnick Associates is the

selling agent.

      Pursuant to the plan, tenants were entitled to purchase the shares allocated

to their apartments, which conferred certain rights and benefits on the owner.

The plan provided as follows:

            The [u]nsold [s]hares shall retain their character as
            such, regardless of subsequent transfer, until they are
            purchased and the apartment to which the same relate
            is occupied by a purchaser for bona-fide occupancy for

                                                                            A-0732-20
                                        3
            himself or a member of his family or the holder of
            [u]nsold [s]hares (or a member of his family) becomes
            a bona-fide occupant of the [a]partment.

      Under a section titled "Shares Unsold Prior to Closing", the plan stated:

                  At closing, title to [u]nsold [s]hares shall remain
            in the name of [Americana] or shall be transferred to
            one or more financially responsible natural persons
            procured by [Americana]. [Americana] represents and
            agrees to sell or transfer to one or more financially
            responsible natural persons, by no later than the third
            anniversary of the [c]losing [d]ate, all then remaining
            [u]nsold [s]hares held by it.

                  The persons owning the [u]nsold [s]hares,
            whether they be [Americana] or persons produced by
            [Americana], are herein collectively called "holders of
            [u]nsold [s]hares" or "purchasers of [u]nsold [s]hares."

                  ....

                     Each holder of a block of [u]nsold [s]hares shall
            enter into a [p]roprietary [l]ease [1] covering the [u]nsold
            [a]partment to which such block of [u]nsold [s]hares is
            allocated. In addition, except for [Americana], all other
            holders of [u]nsold [s]hares will represent in writing to
            . . . [the corporation] at closing that they are purchasing
            the same for their own account (beneficial and of
            record) and not as nominee of [Americana] or any
            corporation, joint venture, partnership, trust or estate.
            . . . The [u]nsold [s]hares include shares subscribed to,
            but not fully paid, at closing.

                  ....

1
  The proprietary lease defined the rights and obligations of each shareholder in
their apartment and to the cooperative.
                                                                           A-0732-20
                                         4
             Each holder of [u]nsold [s]hares shall have the
      right, freely and without charge, to sublet his [u]nsold
      [a]partments to such person and on such terms and
      conditions as he deems desirable and shall also have the
      right, freely and without charge, to sell such [u]nsold
      [s]hares and transfer the appurtenant [p]roprietary
      [l]ease to any individual third party, provided the
      consent only of the then managing agent of the
      [b]uilding is first obtained with respect to said
      subletting or sale and transfer, which consent shall not
      be unreasonably withheld and must be given in the case
      of a sublease or sale to a financially responsible
      individual. The consent of . . . [the corporation] or its
      shareholders shall not be required with respect to any
      such subletting, sale or transfer. . . . At closing, . . . [the
      corporation] will enter into an agreement with each
      holder of [u]nsold [s]hares confirming the foregoing
      rights and benefits.

The plan also contained the following provisions:

      Subletting Apartment and Sale of Shares

      b)    Neither the subletting of the [a]partment nor the
      assignment of this [l]ease, by the [l]essee who is the
      holder of the block of [u]nsold [s]hares allocated
      thereto, shall require the consents of the [d]irectors or
      [s]hareholders . . . .

      Change in Form of Lease

      c)      Without the consent of the [l]essee, no change in
      the form, terms or conditions of this [p]roprietary
      [l]ease . . . shall (1) affect the rights of the [l]essee who
      is the holder of the [u]nsold [s]hares accompanying this
      [l]ease to sublet the [a]partment or to assign this [l]ease,
      . . . or (2) eliminate or modify any rights, privileges or
      obligations of such [l]essee.

                                                                        A-0732-20
                                    5
      When plaintiffs commenced this litigation in October 2019, fifty-two out

of 481 apartments, or 25,475 shares, were held by Americana and remained

unsold. Plaintiffs filed a Chancery Division complaint alleging the following

causes of action: breach of contract; breach of the implied covenant of good

faith and fair dealing; breach of implied promise; fraud; negligent

misrepresentation; violation of the New Jersey Consumer Fraud Act, N.J.S.A.

56:8-2; and continuing nuisance.

      Plaintiffs alleged "[t]he [u]nsold [s]hares were never intended to be held

by Americana in perpetuity" and Americana "expressly represented and

promised" to sell or transfer the shares "no later than the third anniversary of the

[c]losing [d]ate." They also contended "[i]t was always contemplated, and

represented to . . . Azarnia, Cross, and Marshall, and the other individual

shareholders of [T]he Colony cooperative, that Americana would sell its shares

to individual shareholders for bona fide occupancy, and would not . . . hold on

to the [u]nsold [s]hares forever."

      Plaintiffs claimed Americana and Olnick rejected offers to purchase the

unsold apartments and instead sublet them "rather than market them for sale

. . . as . . . represented . . . in the . . . [p]lan." They asserted the non-owner-

occupied apartments caused the corporation to sustain "increased wear and tear

                                                                              A-0732-20
                                         6
to its building." Plaintiffs alleged defendants refused to provide copies of the

subleases and the names and photo identification for the tenants residing in the

unsold apartments, which created a safety risk because the corporation could not

monitor "violation of [the building's] [a]rticles of [i]ncorporation and [h]ouse

[r]ules and [r]egulations." They contended this hampered "management and

staff [in] assist[ing] first responders who are called to the building, or to identify

residents who would require assistance in an emergency evacuation of the

building." Plaintiffs also alleged the New Jersey Department of Community

Affairs (DCA) inspected and "found multiple violations in the [u]nits owned by

the defendants." They claimed defendants caused the corporation to "expend

additional resources, such as administrative time and legal fees, to address these

and other issues with the defendants."

      The complaint sought the following relief:

             (a) Declaring that the defendants' actions constitute an
             ongoing nuisance against the plaintiffs;

             (b) Declaring that the [u]nsold [s]hares are no longer
             entitled to the "special rights" set forth in the [o]ffering
             [p]lan, and shall be subject to the same restrictions as
             are all issued shares of stock in the [c]orporation;

             (c) Compelling the sale of all [u]nsold [s]hares within
             a period of time to be designated by the [c]ourt;

                                                                                A-0732-20
                                          7
               (d) Prohibiting the defendants from entering into any
               new sub-leases for "[u]nsold [a]partments" once
               vacated by the current sub-tenants;

               (e) Requiring the defendants to provide . . . [the
               corporation], on an annual basis, with copies of all sub-
               leases for occupied "[u]nsold [a]partments," as well as
               the full names of all tenants, and photographs of the
               adult tenants, and to update this information as [u]nsold
               [a]partments are vacated; . . .

               (f) Awarding compensatory damages; [and]

               (g) Awarding pre-judgment interest, post-judgment
               interest, costs of suit and reasonable attorney's
               fees; . . .

         Defendants filed a motion to dismiss the complaint for failure to state a

claim, "and to the extent necessary converting the motion to a motion for

summary judgment pursuant to R[ule] 4:6-2(e)" and sought counsel fees and

costs.     They argued the claims were barred by the statute of limitations.

Furthermore, they contended the plan, by-laws, and proprietary lease did not

impose an obligation on them to sell the unsold shares and did not bar them from

subletting. Defendants asserted plaintiffs failed "to allege how . . . [plaintiffs]

have been damaged in any way by Americana's alleged breaches" because

Americana owned a minority of the shares, had no representation on the

corporation's board, and did not control the corporation, which was "fully viable

and functioning."

                                                                             A-0732-20
                                          8
        Plaintiffs' opposition to the motion consisted of a three-page certification

from their counsel2 attaching an unpublished Chancery Division case they

argued established defendants could not hold the unsold shares in perpetuity.

Plaintiffs did not respond to defendants' argument the complaint lacked evidence

of damaging conduct, except that defense counsel certified that claims against

the Olnick defendants should not be dismissed stating:

              While the full scope and precise details of each of the
              . . . defendants' respective involvement in the
              marketing and sale of [u]nsold [s]hares and rentals of
              apartments at [the building] will be more fully
              established in discovery, there is ample evidence that
              the Olnicks play a significant role in these operations,
              and the claims against them should not be dismissed.

        Following oral argument, the motion judge issued a written opinion, in

which he primarily concluded plaintiffs' claims were barred by the statute of

limitations. He found as follows:

              Here, unlike cases that require a Lopez [3] hearing, the
              date in which [p]laintiffs' claims accrued are clear[ly]
              and expressly stated in the governing documents, and
              is, in fact, the date advanced by [p]laintiffs in the
              [c]omplaint. There is no difficulty in discerning
              [p]laintiffs' claims in this action. It is clear from the
              . . . [p]lan that the date [p]laintiffs' claims accrued was
              three years after the [c]losing [d]ate. As noted above,

2
    Plaintiffs had different counsel in the trial court.
3
    Lopez v. Swyer, 62 N.J. 267, 275 (1973).
                                                                              A-0732-20
                                           9
the . . . [p]lan, in reference to the amount of time . . .
Americana had to transfer the [u]nsold [s]hares, states
the following:

      [Americana] represents and agrees to sell
      or transfer to one or more financially
      responsible natural persons, by no later
      than the third anniversary of the [c]losing
      [d]ate, all then remaining [u]nsold [s]hares
      held by it. . . .

Based on this clear language . . . , to the extent that
[p]laintiffs believed they had a claim against . . .
Americana for failing to transfer all [u]nsold [s]hares
within three years of the [c]losing [d]ate, there is no
question that these claims would have arose on July 25,
1988. Thus, [p]laintiffs are not entitled to discovery to
discern this unambiguous accrual date of their claims.

       To the extent that [p]laintiffs were deterred from
bringing claims against [d]efendants because of . . .
Americana's alleged ongoing contractual breaches, . . .
the [c]ourt does not find any merit in this additional
argument for tolling the statute of limitations. . . .
Americana possesses a mere 8.57% of the
[c]orporation's shares. The [c]ourt is unable to see how
an entity with less than [nine percent] of an ownership
stake in a corporation could exert the necessary
influence on a corporation's board to not bring claims
that they felt were warranted. Here, there was no such
influence or continuing breach that impacted the
[c]orporation in such a way as to not bring their claims
in a timely manner.

      Ultimately, this [c]ourt would not need to decide
whether the six-year or twenty-year statute of
limitations applies, because regardless of which

                                                             A-0732-20
                           10
            controls, the timeframe to bring these claims has
            expired.

      Notwithstanding the statute of limitations bar, the judge rejected plaintiffs'

argument Americana was required to sell all its shares. Declining to follow the

unpublished case plaintiffs provided, the motion judge cited 511 W. 232nd

Owners Corp. v. Jennifer Realty Co., 98 N.Y.2d 144 (N.Y. 2002). He noted "the

New York Court of Appeals found that . . . once viability for a cooperative is

reached, then there is no longer a duty to sell the unsold shares still held by the

sponsor." He concluded

            it is clear that . . . Americana's actions, or inactions,
            have left the . . . cooperative viable. First, . . .
            Americana only maintains 8.57% of the shares and
            10.81% of the apartment units. Second, it was
            ultimately discovered by the tenant-owners in Jennifer
            Realty that the sponsor had rejected offers to purchase
            unsold shares/unsold apartments; no such allegations
            have been made here.

                   In addition, [p]laintiffs have failed to plead any
            facts that would demonstrate not only that the
            [cooperative] is less-than-viable as a cooperative, but
            also that there is any frustration in shareholders' ability
            to resell their units or to obtain favorable financing, or
            that the [u]nsold [s]hares have caused damage or wear
            and tear to the [b]uilding causing an increase in
            maintenance payments. There is simply nothing here
            convincing the [c]ourt that the [u]nsold [s]hares have:
            (1) created an unviable existence for this cooperative;
            (2) caused an untenable situation for the unit holders
            regarding the selling, marketing, or financing of their

                                                                              A-0732-20
                                       11
            apartment ownership; or (3) induced additional damage
            to the building with increased maintenance costs

      The judge found the plan, the proprietary lease, and the by-laws did not

impose a

            deadline for . . . Americana to have sold or transferred
            their shares to individuals for occupancy.

                  ....

            . . . Rather, the only obligation on . . . Americana was
            to transfer or sell its [u]nsold [s]hares to natural
            persons.

                  ....

            . . . [T]hese documents emanate an intention of the
            parties to create a clear status of [u]nsold [s]hares, with
            all their rights and obligations, and an intention to dive
            deeply into the characteristics of these units and how
            they operate, all the while expressly utilizing the key
            "for occupancy" language when describing the
            characteristics of the [u]nsold [s]hares, but not for the
            obligations of the sponsor. Thus, the governing
            documents create a partnership in which the sponsor
            retains the [u]nsold [s]hares, must transfer them to
            natural persons, but is not obligated to sell them to
            purchasers for occupancy within any set timeframe.

      The August 2020 order also denied defendants' request for counsel fees.

Defendants moved for reconsideration of the counsel fee issue citing the

proprietary lease, which reads as follows:

                                                                          A-0732-20
                                       12
            If the [l]essee shall at any time be in default hereunder
            and the [l]essor shall incur any expense (whether paid
            or not) in performing acts which the [l]essee is required
            to perform, or in instituting any action or proceeding
            based on such default, or defending, or asserting a
            counterclaim in, any action or proceeding brought by
            the [l]essee, the expense thereof to the [l]essor,
            including reasonable attorney's lees and disbursements
            shall be paid by the [l]essee to the [l]essor, on demand,
            as additional rent.

Pursuant to this provision, defendants argued counsel fees were compensable

under the Tenant Protection Act, N.J.S.A. 2A:18-61.66.

      The judge denied the request for counsel fees. He concluded: "This was,

in essence, a corporate action by the . . . [corporation] against the entities . . .

that initially did the conversion . . . , not some specific tenant . . . that . . .

[N.J.S.A. 2A:18-61.66] . . . [seeks] to protect."

                                    A-0732-20

      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. A genuine factual issue exists "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-0732-20
                                        13
submission of the issue to the trier of fact."     R. 4:46-2(c).    "[T]he legal

conclusions undergirding the summary judgment motion itself [are reviewed] on

a plenary de novo basis." Est. of Hanges v. Metro. Prop. & Cas. Ins. Co., 202

N.J. 369, 385 (2010).

      A motion for summary judgment will not be defeated by bare conclusions

lacking factual support, Petersen v. Twp. of Raritan, 418 N.J. Super. 125, 132

(App. Div. 2011), self-serving statements unsupported by legally competent

evidence, Heyert v. Taddese, 431 N.J. Super. 388, 413-14 (App. Div. 2013), or

disputed facts "of an insubstantial nature." Pressler & Verniero, Current N.J.

Court Rules, cmt. 2.1 on R. 4:46-2 (2022). Rather, "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."'" Cortez v. Gindhart, 435 N.J. Super. 589, 605 (App. Div. 2014)

(emphasis omitted) (quoting Hoffman v. Asseenontv.Com, Inc., 404 N.J. Super.

415, 425-26 (App. Div. 2009)). "The practical effect of this rule is that neither

the motion court nor an appellate court can ignore the elements of the cause of

action or the evidential standard governing the cause of action." Bhagat v.

Bhagat, 217 N.J. 22, 38 (2014).

                                                                           A-0732-20
                                      14
                        Statute of Limitations and Tolling

      N.J.S.A. 2A:14-1 states: "Every action at law for . . . any tortious injury

to real . . . property . . . shall be commenced within [six] years next after the

cause of any such action shall have accrued." N.J.S.A 2A:14-7 states: "Every

action at law for real estate shall be commenced within [twenty] years next after

the right or title thereto, or cause of such action shall have accrued."

      We have stated:

                   Equitable tolling has generally been
                   applied in three circumstances:

                   (1) [where] "the complainant has been
                   induced or tricked by his adversary's
                   misconduct into allowing the filing
                   deadline to pass" . . .

                   (2) where a plaintiff has "in some
                   extraordinary way" been prevented from
                   asserting his rights [and] . . .

                   (3) where a plaintiff has timely asserted his
                   rights mistakenly by either defective
                   pleading or in the wrong forum.

                   [Freeman v. State, 347 N.J. Super. 11, 31
                   (App. Div.), certif. denied, 172 N.J. 178
                   (2002) (quoting Dunn v. Borough of
                   Mountainside, 301 N.J. Super. 262, 2[80]
                   (App. Div. 1997), certif. denied, 153 N.J.
                   402 (1998)).]

                                                                           A-0732-20
                                       15
                   "[A]bsent a showing of intentional inducement or
            trickery by a defendant, the doctrine . . . should be
            applied sparingly and only in the rare situation where it
            is demanded by sound legal principles and in the
            interest of justice." Ibid. As required by the doctrine
            of substantial compliance, equitable tolling requires
            plaintiffs to "diligently pursue their claims" because
            although it "'affords relief from inflexible, harsh or
            unfair application of a statute of limitations,' [it] does
            not excuse claimants from exercising the reasonable
            insight and diligence required to pursue their claims."
            Id. at 31-32 (quoting Villalobos v. Fava, 342 N.J.
            Super. 38, 52 (App. Div.), certif. denied, 170 N.J. 210
            (2001)).

            [Binder v. Price Waterhouse & Co., 393 N.J. Super.
            304, 312-13 (App. Div. 2007) (first and second
            alteration in original) (emphasis added).]

      Plaintiffs assert the judge granted summary judgment based on disputed

assertions and discovery was necessary before he could determine when their

claims accrued because not every claim "depend[ed] on the date Americana

represented it would sell or transfer all [u]nsold [s]hares to natural persons."

Plaintiffs argue the plan and the articles of incorporation, which contemplated

Americana would sell the apartments in its control and the attendant shares rebut

the finding Americana was not required to sell its shares. They also contend the

allegation defendants rejected offers to purchase unsold shares and apartments,

which therefore tolled the statute of limitations, constituted a material factual

dispute. They argue the judge did not resolve whether the applicable statute of

                                                                           A-0732-20
                                       16
limitations was six years, under N.J.S.A. 2A:14-1, or twenty years, pursuant to

N.J.S.A. 2A:14-7.

      Having considered plaintiffs' arguments and reviewed the record, we

affirm the grant of summary judgment on counts one through six as barred under

the statute of limitations for the reasons expressed by the motion judge. The

plan demarcates a date for the transfer of the unsold shares. Apart from the

continuing nuisance count, which was an alleged ongoing harm, plaintiffs' other

claims accrued on July 25, 1988, which is the third anniversary of the closing

date and the date plaintiffs allege the sales of the unsold shares must have been

concluded. No discovery was required to determine the accrual date.

      We are unconvinced the statute of limitations should have been equitably

tolled, or discovery was necessary to determine the accrual date. The record

lacks any evidence defendants rebuffed offers to purchase the unsold units.

Moreover, the record is devoid of evidence showing plaintiffs were deprived of

asserting their rights by defendants in an "extraordinary way" and the expanse

of time that has passed since plaintiffs' claims accrued in 1988 impels us to

conclude they did not timely assert their rights. Plaintiffs' claims exceeded the

statute of limitations under N.J.S.A. 2A:14-1 and N.J.S.A 2A:14-7.

                                                                           A-0732-20
                                      17
                              Continuing Nuisance

      Our Supreme Court has defined nuisance as follows:

            The essence of a private nuisance is an unreasonable
            interference with the use and enjoyment of [property].
            The elements are myriad. . . . Litigation of this type
            usually deals with the conflicting interests of property
            owners and the question of the reasonableness of the
            defendant's mode of use of his [or her property]. The
            process of adjudication requires recognition of the
            reciprocal right of each owner to reasonable use, and a
            balancing of the conflicting interests. The utility of the
            defendant's conduct must be weighed against the
            quantum of harm to the plaintiff. The question is not
            simply whether a person is annoyed or disturbed, but
            whether the annoyance or disturbance arises from an
            unreasonable use of the neighbor's [property] or
            operation of his [or her] business.

            [Sans v. Ramsey Golf & Country Club, Inc., 29 N.J.
            438, 448-49 (1959) (emphasis added).]

      Plaintiffs argue the complaint sufficiently pled a cause of action for

continuing nuisance, which should have survived summary judgment. They

contend defendants' subletting of apartments and refusal to identify their tenants

created a safety risk because the corporation had "no way of knowing with

certainty that the people who are walking through the building actually belong

there." Plaintiffs assert the building "'sustained increased wear and tear . . . '

due to the non-owner occupants in Americana's [fifty-two] apartments." They

point to the DCA violations as an example of how "defendants' conduct has been

                                                                            A-0732-20
                                       18
injurious to [p]laintiffs' safety, comfort, and well-being" and interfered with

plaintiffs' use and enjoyment of their apartments. Plaintiffs argue the judge

erred when he concluded they failed to demonstrate the corporation's lack of

viability and the judge did not explain how a continuing nuisance claim was

barred by the statute of limitations.

      We affirm dismissal of the continuing nuisance count because viewing the

allegations in their most favorable light we are unpersuaded the claim warrants

submission to a factfinder. Summary judgment was appropriate because the

record shows defendants provided plaintiffs a list of the tenants occupying

defendants' apartments. Furthermore, plaintiffs failed to supply the judge with

the DCA violation notice and did not explain with any specificity the violations

and how they were attributed to defendants. The same is true for plaintiffs'

allegation of wear and tear to the building. Evidence of these claims was neither

pled with specificity nor adduced in opposition to defendants' motion.

                           Viability of the Corporation

      Finally, plaintiffs argue the question of a sponsor's obligation to sell

shares in a cooperative is an issue of first impression in New Jersey, which could

not be decided on summary judgment, and that the judge should have relied upon

unpublished case law rather than New York law. At the outset, we know of no

                                                                            A-0732-20
                                        19
bar to adjudicating such issues on a summary judgment basis. And as a general

proposition, we have held "[a]bsent New Jersey precedent, it is appropriate to

look to out-of-state cases for guidance." Sulcov v. 2100 Linwood Owners, Inc.,

303 N.J. Super. 13, 30 (App. Div. 1997).

      The motion judge did not err in relying on Jennifer Realty to adjudicate

whether the minority of shares held by defendants affected the corporation's

viability. In Jennifer Realty, a rent-controlled building was acquired in 1974

and transferred to the defendant sponsor. 98 N.Y.2d at 150. The defendant

received approval from the New York Attorney General to convert the building

to a cooperative in 1987, and thereafter sold the building to the plaintiffs, the

cooperative board, and defendant retained the unsold shares. Ibid. The plaintiffs

sued alleging the defendant retained more than sixty-two percent of the shares

corresponding to forty-one of the sixty-six apartments in the building. Ibid. The

plaintiffs claimed the defendant ceased updating the offering plan, causing it to

lapse, thereby preventing the defendant from selling or marketing shares, and

refused offers for purchase of the vacant apartments. Id. at 151.

      The plaintiffs alleged the defendant breached its contractual duty to

dispose of its shares within a reasonable time and "undermined the contract

[and] that its fundamental objective—the creation of a viable cooperative—

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[was] subverted." Id. at 151, 153. The plaintiffs claimed the defendant's actions

affected the cooperative's viability because the defendant 1) retained the

majority of the shares; 2) "gave no hint that it would make a sizeable profit by

retaining a majority of those shares and leasing apartments at market rates, free

of the strictures of rent regulation[;]" 3) "did not mention the risk that the

sponsor would keep most of the shares for itself[;]" 4) defeated the purpose of

its contract with the plaintiffs by retaining the majority of the shares; 5) "by

rejecting offers from prospective buyers and allowing its offering plan to lapse ,

. . . frustrated [the] plaintiffs' ability to resell their shares, interfered with the

[c]o-op [b]oard's refinancing of the building's mortgage and caused shareholders

maintenance payments to increase[;]" 6) rented to transient tenants causing

"increased wear and tear . . . forcing the [c]o-op [b]oard to charge even higher

monthly maintenance fees[;]" and 7) caused "[the] plaintiffs [to] surrender[]

their rights pursuant to the Rent Stabilization Code by purchasing shares, but

now pay more in monthly maintenance and cooperative loan payments than they

had paid in rent as tenants." Id. at 152-53.

      The New York Court of Appeals held the plaintiffs pled a cause of action

sufficient to survive the motion to dismiss "[b]ecause the sponsor's documentary

evidence does not clearly refute these assertions, and particularly in light of the

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sponsor's duty imposed by the Attorney General not to abandon the offering plan

after filing an effectiveness amendment (see 13 NYCRR 18.3[r][11]) . . . ."[4]

Id. at 153 (alteration in original).

      Subsequent cases have adopted the holding in Jennifer Realty. In Bauer

v. Beekman Int'l Ctr., LLC, the defendant sponsor sold a majority of the units in

a newly constructed condominium and the plaintiff brought suit arguing Jennifer

Realty required the defendant to sell all of the units. 1 N.Y.S.3d 808 (App. Div.

2015). The appellate court disagreed and affirmed the trial court's grant of

summary judgment dismissal of the plaintiff's complaint noting "the motion

court correctly found that [the] defendant demonstrated its prima facie

entitlement to judgment regarding the elements of . . . viability relied on by [the]

plaintiff, which tracked the language in Jennifer Realty but without elaboration,

and [the] plaintiff failed to raise an issue of fact in opposition." Ibid.

      In other words, viability is not defined exclusively by the quantity of units

or shares retained by a sponsor but rather by evidence of the sort discussed in

Jennifer Realty, showing the sponsor's operation of its portion rendered the

corporation unviable. See also Gillespie v. St. Regis Residence Club, N.Y. Inc.,

4
  13 NYCRR 18.3(r)(11) prohibits a sponsor from abandoning a plan subject to
certain exceptions, which are inapplicable to our discussion.
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                                        22
343 F. Supp. 3d 332, 343 (S.D.N.Y. 2018) ("declin[ing] to expand the holding

of Jennifer [Realty] . . . to imply an obligation that the [s]ponsor sell 'all' of [its]

[i]nterests.")

      Here, applying Jennifer Realty we conclude the corporation was viable

and plaintiffs presented no evidence to avoid summary judgment in defendants'

favor. Defendants possessed less than nine percent of the total share, held no

position on the board of the corporation, and did not interfere with the board's

operations or its ability to obtain financing or meet its expenses. Defendants did

not affect the individual plaintiffs' ability to sell or finance their units. No

evidence was presented defendants' units increased either the corporation's

expenses or the cost of living in the building. Plaintiffs presented no "competent

evidential material[,]" Hoffman, 404 N.J. Super. at 426 (quoting Merchs.

Express Money Ord. Co. v. Sun Nat'l Bank, 374 N.J. Super. 556, 563 (App. Div.

2005)), establishing a material issue of fact for a factfinder to resolve regarding

the corporation's viability.

                                      A-0760-20

      We review the adjudication of a motion for reconsideration for an abuse

of discretion. Cummings v. Bahr, 295 N.J. Super. 374, 389 (App. Div. 1996).

Similarly, "fee determinations by trial courts will be disturbed only on the rarest

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of occasions, and then only because of a clear abuse of discretion." Packard-

Bamberger & Co. v. Collier, 167 N.J. 427, 444 (2001) (quoting Rendine v.

Pantzer, 141 N.J. 292, 317 (1995)). "[A]n abuse of discretion [occurs] when a

decision is 'made without a rational explanation, inexplicably departed from

established policies, or rested on an impermissible basis.'" Deutsche Bank Tr.

Co. Ams. v. Angeles, 428 N.J. Super. 315, 319 (App. Div. 2012) (citing U.S.

Bank Nat'l Assoc. v. Guillaume, 209 N.J. 449, 467 (2012)) (first alteration in

original).

      Defendants argue they are entitled to counsel fees pursuant to N.J.S.A.

2A:18-61.66 because the proprietary lease is a residential lease and Americana

is the corporation's tenant. They assert the lease mandates an award of fees and

affords the motion judge discretion only as to the amount of the award. We

disagree.

      Like the motion judge, we are unconvinced N.J.S.A. 2A:18-61.66 applied

here because the statute governs the award of attorney's fees in a landlord tenant

action arising from a residential lease. Neither party asserted a cause of action

sounding in tenancy. Our review of the statute's legislative history does not

convince us the Legislature intended it to address a dispute such as this one. See

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generally N.J.S.A 2A:18-61.1(a). For these reasons we discern no abuse of

discretion in the denial of fees to defendants.

      Affirmed in A-0732-20 and affirmed in A-0760-20.

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