TEACH SOLAIS NJ, LLC VS. RIVKA NAGEL (C-000066-17, ATLANTIC COUNTY AND STATEWIDE) ( 2021 )

NOT FOR PUBLICATION WITHOUT THE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-3291-18
TEACH SOLAIS NJ, LLC,
Plaintiff-Appellant,
v.
RIVKA NAGEL,
Defendant-Respondent,
and
MOHAMMED HOSSAIN, and
WELLS FARGO BANK, NA,
Defendants.
___________________________
Submitted March 25, 2020 – Decided April 15, 2021
Before Judges Fuentes, Mayer and Enright.
On appeal from the Superior Court of New Jersey,
Chancery Division, Atlantic County, Docket No. C-
000066-17.
Haviland Hughes and Daniel J. Gallagher, attorneys for
appellant (Donald E. Haviland, Jr. and Daniel J.
Gallagher, on the briefs).
Reger Rizzo & Darnall LLP, attorneys for respondent
(Richard M. Darnall, on the brief).
The opinion of the court was delivered by
FUENTES, P.J.A.D.
Plaintiff Teach Solais NJ, LLC, a commercial real estate developer,
sought to purchase a property on South Trenton Avenue in Atlantic City that
was owned by Mohammed Hossain. At the same time, Wells Fargo Bank, which
held a mortgage on the property, had commenced foreclosure proceedings
against Hossain. Because a sheriff's sale had not yet taken place, Hossain still
had title to the property when he interacted with Teach Solais. Hossain thus
listed the property as a short sale with real estate agent Rivka Nagel, an associate
of Berkshire Hathaway HomeServices Fox & Roach, Realtors.
Teach Solais responded to the listing and submitted two offers to purchase
the property, each accompanied by contracts, which were both rejected by
Hossain. The property was eventually sold at a sheriff's sale where Teach Solais
opted not to submit a bid. Instead, Teach Solais decided to file a civil action in
the Chancery Division, General Equity Part against Hossain, Nagel, and Wells
Fargo Bank seeking both equitable and compensatory relief.
Teach Solais alleged that Nagel listed the property for $89,900. Based on
this listing, it submitted "an offer to purchase the property for $100,000.00 with
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an escalation clause up to $200,000.00." Teach Solais claimed that because the
property was listed as a short sale, Hossain was required to submit "the highest
and best offer" to Wells Fargo for approval. Despite this, Teach Solais alleged
that "Hossain misrepresented that another offer had been submitted to Wells
Fargo."
Based on these allegations, Teach Solais sought equitable relief in the
form of specific performance directing defendants to convey title to the property
to plaintiff; compensatory damages from Nagel for tortious interference with
contract; and compensatory and punitive damages against Wells Fargo based on
common law fraud. Contemporaneous with this civil action, Teach Solais also
filed a notice of lis pendens 1 on the property. The court granted Wells Fargo's
motion for summary judgment and dismissed all the claims against it. Hoss ain
did not file an answer to plaintiff's complaint nor appear at any stage of the
litigation.
Nagel filed a responsive pleading and after engaging in discovery, moved
for summary judgment seeking the dismissal of Teach Solais' claims based on
1
A notice of lis pendens filed pursuant to N.J.S.A. 2A:15-6 can be filed only in
an action that affects the title to real estate. The statute also makes clear that
"[n]o notice of lis pendens shall be filed . . . in an action to recover a judgment
for money or damages only."
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tortious interference with contract and common law fraud. The motion came for
oral argument before Judge Michael J. Blee on March 15, 2019. The judge
granted Nagel's motion for summary judgment and dismissed the case as a
matter of law in an order dated March 18, 2019. Judge Blee explained the basis
for his ruling in a Memorandum of Opinion attached to the order.
In this appeal, Teach Solais argues the motion judge erred when he held
that it could not prove its tortious interference with contract and common law
fraud claims without a real estate expert to: (1) establish the standard of care
within the industry; and (2) explain how Nagel allegedly breached this standard
under the material facts of this case. Alternatively, Teach Solais argues the
motion judge erred when he ruled the common knowledge doctrine did not
apply. After considering the record presented by the parties and applying the
relevant standard of review, we affirm substantially for the reasons expressed
by Judge Blee.
I.
These are the salient facts. On June 27, 2017, prior to the sheriff’s sale,
Hossain listed the property as a short sale at $89,000 with Berkshire Hathaway
HomeServices Fox & Roach, Realtors. Hossain received an offer of $79,000
from Shahin Alam and agreed to sell him the property. The form of contract
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approved by the New Jersey Real Estate Commission and used by Nagel in this
case contained the following two relevant provisions:
SHORT SALE:
A "Short Sale" is a transaction for the sale and
purchase of real property where the Purchase Price is
less than the amount required to pay off the liens on the
real property, such as mortgages, judgments, taxes,
homeowner or condominium association fees,
assessments, as well closing costs, including but not
limited to brokerage commissions, realty transfer fee
and attorneys' fees. This transaction is or may be a
Short Sale.
CONTINGENCY OF APPROVAL FROM LIEN
HOLDERS OF SHORT SALE:
The Contract is subject to the written consent by the
holders of certain liens on the Property (the
"Designated Lien Holders") to accept less than the
amount owed to them in order to release their liens,
thereby allowing a closing to occur. If such consent(s)
is not obtained, Seller will be unable to convey title to
Buyer in accordance with Section 11 of the Contract.
The Designated Lien Holders and the approximate
amounts of their liens are as follows: [The space
provided in the contract following this provision was
left blank.]
On June 29, 2017, Teach Solais made a $100,000 offer to Hossain in the
form of a contractual agreement that contained a price escalation addendum in
which the offer would increase by $10,000 over any next offer, until it reached
a maximum of price of $200,000. Christine Castellani, a licensed real estate
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agent and broker affiliated with Balsley Losco Realty, represented Teach Solais
at this stage of negotiations. Teach Solais' attorney drafted the contract and
conveyed the second and final offer of purchase made by Teach Solais.
Although Nagel was the real estate agent who represented Hossain in these short
sale negotiations, paragraph twenty-nine of the contract entitled "Real Estate
Commission" provided: "The Seller agrees to pay a commission of [six percent]
to and [sic] Balsley Losco Realty in equal shares for their services in effe cting
this sale, which the Seller agrees to pay at the time of final settlement with the
passing of the deed."
Furthermore, the contract that Teach Solais' attorney drafted also
contained the following self-executing termination clause:
If the Seller has not executed and delivered this
Agreement to the Buyer after three (3) days from the
date of delivery of this Agreement to the Seller, then
this agreement shall be considered null and void and the
Buyer shall be entitled to the immediate return of all
deposit monies held by the escrow agent without
liability to either party for releasing such funds. Buyer
shall also be entitled to the immediate return of all
copies of the Agreement.
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During the litigation, Nagel's counsel deposed Teach Solais' attorney 2 and
specifically questioned him about the intent of this self-executing clause:
Q. So there is a three-day self-executing paragraph
where it's null and void if you do not get it back signed
from the seller within three days of the seller's receipt,
correct?
A. That's what it says. Yep.
Q. So was your intent with this paragraph, because you
drafted it, if you don't get it back in three days signed
by the seller, contract is null and void?
A. Intent was to get the seller to respond within three
days.
Q. Right. But if he doesn't, it's null and void?
A. That's what it says.
Q. And you drafted it?
A. I did.
Hossain rejected Teach Solais' second and final offer. Teach Solais'
litigation attorney questioned Nagel directly about Hossain's rejection of this
offer in the course of her deposition.
Q. Have you ever seen this document before?
2
Because an attorney cannot represent a litigant if he or she is also a fact witness
in the case, Teach Solais retained different counsel to represent its interests in
this litigation before the General Equity Part. See RPC 3.7
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A. Yes.
Q. Can you tell me what it is?
A. That's an agreement that I got from Christine
[Castellani].
Q . And on the back of that agreement, do you see that
there is an escalation clause?
A. Sure. Yes.
Q. And can you tell me what the escalation clause says?
A. Any offer comes, there will be 10,000 more.
Q. And the initial offer was for how much?
A. A hundred thousand.
Q. And it's dated June 29th, 2017; is that when you
received it.
A. I guess. I don't remember, but if it says so. I don't
recall when. Probably she sent it immediately, as I
know her.
Q. When did you present this to the seller?
A. I called the seller, told him to come to my office.
Q. On the same day? On June 29th, 2017?
A. He didn't come immediately. This was a weekend
or something. I don't remember. And he said from
where, from who. I told him from Teach Solais. He
said, "Oh." He said, "Oh, that's one I don't want." I
don't know why.
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Q. Did he explain to you why he didn't want the contract
for more money?
A. I called him. I called Pinky. I said, "Pinky, could
you please come." And she came. I said, Pinky, this
guy, I told her what's happened, he doesn't want this.
So I really I tried to. And I ask him a hundred times
why. He said I don't want to discuss about it. He had -
- he spoke to -- he called the gentleman Mr. Ron, called
him a couple times. I don't know what was said, what
he was offering to him. He said something that's not
acceptable to him at all.
Q. So Mr. Hossain said it was unacceptable to him?
A. Yes. I don't know why.
Despite not having a fully executed contract with Hossain, which included
a self-executing three-day termination clause that by this time had nullified any
alleged agreement, Teach Solais filed its initial complaint in the Chancery
Division on September 6, 2017. In this civil action Teach Solais sought the
equitable relief of specific performance against Hossain, and compensatory and
punitive damages against Nagel based on tortious interference with contract and
common law fraud. On September 12, 2017, Teach Solais filed a notice of lis
pendens on the property.
On September 23, 2017, Nagel notified Teach Solais' real estate agent
Christina Castellani that the property was again available. Teach Solais'
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attorney again submitted a form of contract, which contained the same three-day
self-executing termination clause. Hossain rejected the offer, both orally and in
a written statement dated October 3, 2017. On that same date, Hossain entered
into a contract with MASA Investment, LLC, for the sale of the property in the
amount of $105,000. Hossain also signed the New Jersey Realtors Addendum
Regarding Possible Short Sales, which disclosed that Chase Bank had a lien on
the property in the amount of $300,623.68.
This second potential sale was also nullified. The property was sold at a
sheriff’s sale held on January 18, 2018, for $81,000.00. A representative of
Teach Solais did not attend the sheriff’s sale nor bid on the property. Its
representative claimed he was not aware that the property was scheduled to be
sold at a sheriff’s sale. Teach Solais' real estate agent did not inform it that the
property was scheduled for a sheriff’s sale.
II.
A motion for summary judgment should be granted "if the pleadings,
depositions, answers to interrogatories and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to any material fact
challenged" and the party seeking this relief "is entitled to a judgment or order
as a matter of law." R. 4:46-2(c). Thus, to defeat a motion for summary
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judgment, the opposing party must do more than merely "point[] to any fact in
dispute" to establish a genuine issue of material fact. Brill v. Guardian Life Ins.
Co. of Am., 142 N.J. 520, 529 (1995). As Justice Coleman noted in Brill, if the
party opposing the summary judgment motion
offers . . . only facts which are immaterial or of an
insubstantial nature, a mere scintilla, "fanciful,
frivolous, gauzy or merely suspicious," he will not be
heard to complain if the court grants summary
judgment, taking as true the statement of
uncontradicted facts in the papers relied upon by the
moving party, such papers themselves not otherwise
showing the existence of an issue of material fact.
[Ibid (quoting Judson v. Peoples Bank & Trust Co. of
Westfield, 17 N.J. 67, 75 (1954)).]
As an appellate court, we review a summary judgment decision by the
same standard that governs the motion judge's determination. RSI Bank v.
Providence Mut. Fire Ins. Co., 234 N.J. 459, 472 (2018) (citing Bhagat v.
Bhagat, 217 N.J. 22, 38 (2014)). That is, we review the evidence in the record,
including all legitimate inferences therefrom, in the light most favorable to the
non-moving party. In this light, we discern no legal or factual basis to disagree
with Judge Blee's decision to grant Nagel's motion for summary judgment and
dismiss this complaint against her as a matter of law.
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A party seeking compensatory relief based on tortious interference with a
contract is required to present some evidence that the offending party
intentionally and improperly interfered with its prospective contractual relation
and as a result, is liable for the aggrieved party's pecuniary loss. The
interference must consist of: "(a) inducing or otherwise causing a third person
not to enter into or continue the prospective relation or (b) preventing the other
from acquiring or continuing the prospective relation." Nostrame v. Santiago,
213 N.J. 109, 122 (2013) (quoting Restatement (Second) of Torts, §766B).
Here, the factual record shows Teach Solais was represented by counsel
and retained the services of an independent real estate broker to represent its
interests at every stage of the negotiations to purchase this property. Nagel was
Hossain's real estate agent and acted at all times on his behalf. Nagel never
misrepresented her role in the negotiations and acted in good faith when she
conveyed Hossain's decisions to reject Teach Solais' offers. Of particular
relevance, Teach Solais' failure to purchase this property is attributable to its
decision, whether by ignorance or by choice, not to attend the sheriff's sale and
participate in the bidding process. The record does not contain any evidence
that Nagel or anyone acting on her behalf ever attempted or conspired to conceal
the date and location of the sheriff's sale. In short, Teach Solais did not establish
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a prima facie case of tortious interference with a contract. See Printing Mart-
Morristown v. Sharp Elecs. Corp., 116 N.J. 739, 751-52 (1989).
Teach Solais' claims based on common law fraud are equally without
merit. "The elements of common-law fraud are '(1) a material misrepresentation
of a presently existing or past fact; (2) knowledge or belief by the defendant of
its falsity; (3) an intention that the other person rely on it; (4) reasonable reliance
thereon by the other person; and (5) resulting damages.'" Allstate New Jersey
Ins. Co. v. Lajara, 222 N.J. 129, 147 (2015) (quoting Banco Popular N. Am. v.
Gandi, 184 N.J. 161, 172-73 (2005)). "A misrepresentation amounting to actual
legal fraud consists of a material representation of a presently existing or past
fact, made with knowledge of its falsity and with the intention that the other
party rely thereon, resulting in reliance by that party to his [or her] detriment."
Jewish Center of Sussex Cty. v. Whale, 86 N.J. 619, 624 (1981).
The record we have described at length here is utterly devoid of any
evidence that Nagel's behavior in her role as Hossain's real estate agent was
anything other than professional and honest. She accurately conveyed her
client's wishes in a timely fashion. Teach Solais' remaining arguments lack
sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).
Affirmed.
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