MILAN PATEL v. BRIGHTSTAR HOSPITALITY, LLC (L-1406-18, MORRIS COUNTY AND STATEWIDE) ( 2022 )

NOT FOR PUBLICATION WITHOUT THE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-2774-20
MILAN PATEL, and JIGNA
PATEL,
Plaintiff-Respondent,
v.
BRIGHTSTAR HOSPITALITY,
LLC, and JAYENDRA C. PATEL,
Defendant-Appellants.
____________________________
Submitted April 27, 2022 – Decided June 27, 2022
Before Judges Geiger and Susswein.
On appeal from the Superior Court of New Jersey, Law
Division, Morris County, Docket No. L-1406-18.
Hegge & Confusione, LLC, attorneys for appellants
(Michael Confusione, of counsel and on the brief).
Lanciano & Associates, LLC, attorneys for respondents
(Larry E. Hardcastle, II, of counsel and on the brief).
PER CURIAM
Defendants Jayendra C. Patel and Brightstar Hospitality LLC (Brightstar)
appeal from a $350,000 bench trial judgment rendered by Judge Peter A.
Bogaard in favor of plaintiffs Milan and Jinga Patel in their lawsuit claiming
breach of contract and conversion. We affirm substantially for the reasons
explained in Judge Bogaard's through and cogent oral opinion, which spans
fifty-two pages of transcript.
We presume the parties are familiar with the evidence that was adduced
at trial and recounted in detail in Judge Bogaard's opinion. Accordingly, the
pertinent facts need only be briefly summarized in this opinion. Plaintiffs
invested $350,000 into Brightstar to develop a specific parcel of land (the
property) as a Marriot Hotel. That plan depended on defendants purchasing the
property. The parties executed an agreement in connection with the investment.
The agreement provided that defendants would return plaintiffs' investment if
Brightstar did not close on the purchase of the property by December 31, 2016.
The agreement was silent, however, on whether and when the right to request a
return of the investment money would expire.
Defendants did not close on the purchase of the property by December 31,
2016, but nor did plaintiffs request the return of their money by that date. When
A-2774-20
2
the hotel site's owner terminated the sales contract, plaintiffs demanded a return
of their money. Defendants refused to refund their investment.
On July 18, 2018, plaintiffs filed suit claiming breach of contract and
conversion. Judge Bogaard conducted a two-day bench trial on November 4 and
5, 2020. On May 13, 2021, he entered judgment for plaintiffs on both the breach
of contract and conversion counts, and ordered defendants to pay damages in
the amount of $350,000.
This appeal follows. Defendants raise the following contentions for our
consideration:
POINT I
DEFENDANT DID NOT BREACH THE PARTIES'
CONTRACTS BY FAILING TO RETURN
PLAINTIFFS' INVESTMENT MONIES, BECAUSE
WHEN PLAINTIFFS DEMANDED THE RETURN
OF THEIR INVESTMENT MONIES IN FEBRUARY
2018, PLAINTIFFS HAD NO CONTRACTUAL
RIGHT, BY THAT POINT, TO HAVE THEIR
MONIES RETURNED.
POINT II
FAILING TO RETURN PLAINTIFFS' INVESTMENT
MONIES WAS NOT CONVERSION UNDER NEW
JERSEY LAW, BECAUSE WHEN PLAINTIFFS
DEMANDED THEIR INVESTMENT BACK IN
FEBRUARY 2018, IT WAS NO LONGER THEIR
MONEY UNDER THE PARTIES' CONTRACTS.
A-2774-20
3
POINT III
THE WRONGS THAT THE TRIAL JUDGE SAID
DEFENDANT COMMITTED WERE NOT
DETERMINED TO [BE] MATERIAL BREACHES
AS REQUIRED FOR PLAINTIFFS TO RECOVER
ON BREACH OF CONTRACT UNDER NEW
JERSEY LAW.
POINT IV
THE JUDGE FAILED TO DETERMINE THE
PROPER MEASURE OF DAMAGES THAT
PLAINTIFFS SUFFERED AS A RESULT OF THE
WRONGS THE JUDGE FOUND DEFENDANT
COMMITTED.
Because we affirm substantially for the reasons explained in Judge
Bogaard's commendably thorough and detailed oral opinion, we need not
address defendants' contentions at length. We add the following comments .
The scope of our review of a bench trial verdict is limited. See D'Agostino
v. Maldonado, 216 N.J. 168, 182 (2013) ("Final determinations made by the trial
court sitting in a non-jury case are subject to a limited and well-established
scope of review[.]" (quoting Seidman v. Clifton Sav. Bank, S.L.A., 205 N.J.
150, 169 (2011))). The law is clear that factual determinations made by a judge
hearing a bench trial "must be upheld if they are based on credible evidence in
the record." Motorworld, Inc. v. Benkendorf, 228 N.J. 311, 329 (2017) (citing
D'Agostino, 216 N.J. at 182); see also Zaman v. Felton, 219 N.J. 199, 215–16
A-2774-20
4
(2014) (holding that a trial court's determinations are afforded deference when
they are "substantially influenced by [the judge's] opportunity to hear and see
the witnesses and to have the 'feel' of the case[] . . . ." (quoting State v. Johnson,
42 N.J. 146, 161 (1964))). A trial court's factual determinations will not be
disturbed unless those findings and conclusions were "so manifestly
unsupported by or inconsistent with the competent, relevant and reasonably
credible evidence as to offend the interests of justice." Allstate Ins. Co. v.
Northfield Med. Ctr., P.C., 228 N.J. 596, 619 (2017) (quoting Griepenburg v.
Twp. of Ocean, 220 N.J. 239, 254 (2015)). In contrast, "[a] trial court's
interpretation of the law and the legal consequences that flow from established
facts are not entitled to any special deference." Manalapan Realty, L.P. v. Twp.
Comm. of Twp. of Manalapan, 140 N.J. 366, 378 (1995).
"In the absence of a factual dispute, we review the interpretation of a
contract de novo." Barila v. Bd. of Educ. of Cliffside Park, 241 N.J. 595, 612
(2020) (quoting Serico v. Rothberg, 234 N.J. 168, 178 (2018)). Under New
Jersey law, where the terms of a contract are clear and unambiguous, there is no
room for interpretation or construction, and the courts must enforce those terms
as written. When presented with an unambiguous contract, the court, therefore,
should not look outside the "four corners" of the contract to determine the
A-2774-20
5
parties' intent. Namerow v. PediatriCare Assocs., LLC, 461 N.J. Super. 133,
140 (Ch. Div. 2018); cf. Manahawkin Convalescent v. O'Neil, 217 N.J. 99, 118
(2014) (alteration in original) ("Even in the interpretation of an unambiguous
contract, we may consider 'all of the relevant evidence that will assist in
determining [its] intent and meaning.'" (quoting Conway v. 287 Corp. Ctr.
Assocs., 187 N.J. 259, 269 (2006))).
A contract, however, may be ambiguous if its terms are "susceptible to at
least two reasonable alternative interpretations," Nestor v. O'Donnell, 301 N.J.
Super. 198, 210 (App. Div. 1997), or when it contains conflicting terms, Rockel
v. Cherry Hill Dodge, 368 N.J. Super. 577, 581 (App. Div. 2004). Where
ambiguity exists, "courts will consider the parties' practical construction of the
contract as evidence of their intention and as controlling weight in determining
a contract's interpretation." Cnty. of Morris v. Fauver, 153 N.J. 80, 103 (1998).
"Having found an ambiguity, 'a court may look to extrinsic evidence as an aid
to interpretation[.]'" Porreca v. City of Millville, 419 N.J. Super. 212, 232 (App.
Div. 2011) (alteration in original) (quoting Chubb Custom Ins. Co. v. Prudential
Ins. Co. of Am., 195 N.J. 231, 238 (2008)); see In re Diet Drugs Prod. Liab.
Litig., 706 F.3d 217, 224 (3d Cir. 2013) ("[I]f the written contract is ambiguous,
a court may look to extrinsic evidence to resolve the ambiguity and determine
A-2774-20
6
the intent of the parties." (quoting Glenn Distribs. Corp. v. Carlisle Plastics, Inc.,
297 F.3d 294, 300 (3d Cir. 2002))); Bohler-Uddeholm Am., Inc. v. Ellwood
Group, Inc., 247 F.3d 79, 93 (3d Cir. 2001) (alteration in original) ("A court
may, however, look outside the 'four corners' of a contract if the contract's terms
are unclear[.]").
A cause of action exists for breach of contract when the plaintiff can
demonstrate that there exists "a valid contract, defective performance by the
defendant, and resulting damages." Coyle v. Englander's, 199 N.J. Super. 212,
223 (App. Div. 1985). The construction of contract terms and whether the
manner in which they were executed constitutes a breach is an issue of fact best
left for the trier of fact. See Great Atl. & Pac. Tea Co. v. Checchio, 335 N.J.
Super. 495, 502 (App. Div. 2000).
Defendants argue that the trial court erred in finding that plaintiffs timely
exercised their contractual right to demand a return of their money. The trial
court had to decide whether plaintiffs' right to demand a return of their money
expired before they exercised it. That question required the trial court to
interpret the terms of the agreement. Because the relevant documents were
unclear on the question as to the expiration of the right to demand a return of
the investment money, the court had to look beyond the four corners of the
A-2774-20
7
agreement to determine the intent of the parties. In this instance, that
determination hinged on an assessment of the credibility of the witnesses.
The trial court believed plaintiffs' testimony. In contrast, the court found
defendant Jayendra Patel's testimony to be "bizarre, nonsensical, [and] divorced
from the realities of the transactions." As we have noted, we defer to the trial
judge's factual findings during a bench trial. Judge Bogaard was in a far better
position than us to make credibility findings because he had an opportunity to
see the witnesses and develop a feel for the case. See Zaman, 219 N.J. at 215–
16.
Based in large part on his credibility assessments, Judge Bogaard also
determined that defendants committed a material breach of the contract by
failing to return plaintiffs' investment. The court accepted plaintiffs' version of
the relevant events and concluded that the "preponderance of the credible
evidence establishes that the only reason [plaintiffs] didn't ask earlier than
approximately January of 2018 for a return of the funds, is because they weren't
being provided with full and complete information." The trial judge also likened
defendants' conduct in using Brightstar's funds to pay debts on other projects to
a "Ponzi scheme." Based on those factual findings, which are amply supported
by credible evidence in the record, the trial court ultimately concluded that a
A-2774-20
8
breach of contract clearly occurred. We see no reason to disturb that fact-
sensitive determination.
Judge Bogaard also properly found that the appropriate measure of
damages for defendants' failure to return plaintiffs' $350,000 investment was an
award of that sum. Under New Jersey law, defendants are liable for "all of the
natural and probable consequences of the breach of th[eir] contract." Pickett v.
Lloyd's, 131 N.J. 457, 474 (1993); see also Donovan v. Bachstadt, 91 N.J. 434,
444 (1982) (The goal of a damage award is "to put the injured party in as good
a position as . . . if performance had been rendered . . . .").
To reiterate, the trial judge found that the April 23, 2016 agreements
required defendants to return "all monies paid" by plaintiffs if defendants did
not close on the purchase of the property on which the hotel was to be built. I t
is undisputed that plaintiffs each paid $175,000 for a total of $350,000. Because
defendants failed to close on the property, the trial court appropriately found
that plaintiffs suffered damages in the amount of $350,000.
To the extent we have not specifically addressed them, any remaining
arguments raised by defendants lack sufficient merit to warrant discussion in
this opinion. R. 2:11-3(e)(1)(E).
Affirm.
A-2774-20
9