New Jersey Attorney Law Review Blog

  In an unpublished decision issued on December 11, 2014, the Appellate Division of the Superior Court of New Jersey was confronted with deciding whether a corporation was the successor in interest to the plaintiff's former commercial tenant such that the corporation should be held liable for tenant's breach of the lease.  40 Eisenhower Drive, LLC v. Karoon Capital Markets, Inc., et al. , Docket No.: A-2620-12T4 (App. Div. Dec. 11, 2014).  Ruling in the affirmative, the appeals court provides a salient summary of New Jersey law on successor liability in the context of corporate law.  Generally,"when a company sells its assets to another [entity], the acquiring company is not liable . . . simply because it has succeeded to the ownership of the assets of the seller." Lefever v. K.P. Hovnanian Enters. , 160 N.J. 307, 310 (1999). There are, however, four exceptions to this principle:  (1) the successor expressly or impliedly assumes the predecessor'

In a July 31, 2014 unpublished decision, a Bergen County judge fined a mortgage lender $26,125 in legal fees for duping a 70-year old borrower into a refinance transaction that benefited only the lender.   Finding that the lender committed an unconscionable commercial practice by charging the borrower over $11,000 in mortgage closing costs that would have taken her 5+ years to recoup based on the paltry savings of $63/month from her monthly mortgage payment, the Court chastised the lender for acting in its own self-interest. A more detailed analysis about this case appears on our website blog: http://njlawconnect.com/litigation/bergen-county-chancery-judge-hits-mortgage-lender-with-26000-in-counsel-fees-for-violating-new-jersey-consumer-fraud-act/

What is my business worth?   You say $100,000, she says $1,000,000.  Whether arguing with an irate spouse in the context of a divorce case or a business partner in a partnership dispute, the answer is often difficult and expensive to determine. As the New Jersey Supreme Court observed in Balsamides v. Protameen Chemicals, Inc. , 160 N.J. 352, 368 (1999) (“ Balsamides “), and Lawson Mardon Wheaton, Inc. v. Smith , 160 N.J. 383, 397 (1999) (“ Lawson “), valuation of a closely-held business is not an exact science. See also Bowen v. Bowen , 96 N.J. 36, 44 (1984) (quoting Lavene v. Lavene , 162 N.J. Super. 187, 193 (Ch. Div. 1978) (on remand) ( Lavene II )); John R. MacKay, II, 2 New Jersey Business Corporations § 14-6(d)(1) (2d ed. 1996). In Lavene v. Lavene , 148 N.J. Super. 267 (App. Div.), certif. denied , 75 N.J. 28 (1977) ( Lavene I ), where the Appellate Division held that the husband’s 43% interest in a closely-held corporation “constitute[d] a dis

In an unpublished decision, a New Jersey appeals court clarified the legal requirements that credit card debt purchasers must meet in order to pursue collection from consumer account holders. Main Street Acquisition Corp. v. Nemeth (App. Div., April 1, 2014). Click here to read the full post.

In a recent unpublished decision, the New Jersey Appellate Division upheld a trial court's sanctioning HSBC more than $54,000 due to the bank's filing of a foreclosure suit without being able to prove that it holds the proper chain of title to the underlying mortgage and promissory note. HSBC Bank vs. Nini, A-1941-11T1 (App. Div. , Unpublished, April 30, 2014).  The irony of this decision is that despite claiming to be owed more than $700,000 on a property valued at only $361,000, the lender was forced to foot the bill for about half of the mortgagor's legal fees and expenses. Talk about getting a free ride!   Click here to read a more in-depth discussion of this Appellate Division case.

  Effective April 1, 2014 , all limited liability companies (“LLCs”) formed in New Jersey will be governed by the Revised Uniform Limited Liability Company Act, N.J.S.A. 42:2C-1 through N.J.S.A. 42:2C-17 (the “Revised Act”). The Revised Act became effective as to newly formed LLCs on March 18, 2013. Starting on April 1, 2014, the Revised Act applies to all previously existing LLCs filed in New Jersey. The Revised LLC Act differs from the predecessor limited liability company Act in several substantial respects, of which current operating LLCs and those individuals deciding whether to incorporate a LLC in New Jersey should be aware, including the following:  An LLC will no longer have a limited duration, but instead will have perpetual duration under the Revised LLC Act.  The former LLC Act required a written Operating Agreement. Under the Revised LLC Act however, the Operating Agreement may be in writing, oral or even implied based on how the LLC operates. 

In this post I examine the attorney witness rule incorporated in New Jersey Rule of Professional Conduct (“RPC”) 3.7, and how the Rule can be used to disqualify a lawyer representing a party in litigation when the lawyer possesses factual knowledge of contested issues that go to the heart of the case.  Because courts generally are reluctant to disqualify a party’s choice of counsel, a motion brought pursuant to RPC 3.7 requires the moving party to bear the burden of proof by demonstrating that the attorney’s continued representation would violate the Rule. J.G. Ries & Sons, Inc. v. Spectraserv, Inc. ,384 N.J. Super. 216 (App. Div. 2006). RPC 3.7(a)  states: A lawyer shall not act as advocate at a trial in which the lawyer is likely to be a necessary witness except where: (1) the testimony relates to an uncontested issue; (2) the testimony relates to the nature and value of legal services rendered in the case; (3) disqualification of the lawyer wo

Depending upon the claims and defenses raised in the context of a particular civil lawsuit, the information contained in a party’s business or personal income tax return may be a relevant area of inquiry for pretrial discovery. However, most taxpayers will not voluntarily surrender their tax returns simply because the information is being sought by the other side’s lawyer. To the contrary, a demand for production of income tax returns is often met with resistance. Thus, before seeking the production of an adversary litigant’s income tax returns as part of pretrial discovery demands, careful thought must be given as to why the information is needed, what it may help prove, and whether there is sufficient reasons or “good cause” to be demanding it?  The scope of discovery in New Jersey civil litigation matters is dictated by R. 4:10-2, which allows for the “discovery of any matter, not privileged, which is relevant to the subject matter involved in the pending action

In New Jersey, a homeowner can lose his or her home for failure to pay real estate taxes to the town/city where the property is located.   Unlike mortgage foreclosure cases where the property is required to go to a judicial sale and the homeowner is given one final shot to save the home by “redeeming” or paying off the judgment within 10 days from the sale date, in tax foreclosure cases there is no judicial sale and the opportunity to redeem is thus lost once the final judgment is entered.  In other words, the entry of a final judgment in real estate tax foreclosure cases serves to transfer title of the property to the foreclosing plaintiff. What, if anything, can the homeowner do in this situation to recover the property?     In a recent case handled by our office, we petitioned the Court to void the tax foreclosure judgment and to permit our clients to payoff or redeem the tax sale certificate on the basis that the plaintiff tax investor did not properly serve the Complaint o

New Jersey has strict rules when it comes to home improvement contracts in excess of $500, the overriding purpose of which is to protect consumers from unscrupulous contractors.  The New Jersey Administrative Code § 13:45A-16.2(12)(i)-(vi) sets forth the requirements necessary in a home improvement contract.  A violation of these written requirements is a violation of the statute. N.J.A.C. 13:45A-16.2(12) states in pertinent part:  All home improvement contracts for a purchase price in excess of $500, and all changes in the terms and conditions thereof shall be in writing.  Home improvement contracts which are required by this subsection to be in writing, and all changes in the terms and conditions thereof, shall be signed by all parties thereto, and shall clearly and accurately set forth in legible form and in understandable language all terms and conditions of the contract, including but not limited to, the following: The legal name and business address of the s

In an unpublished decision issued on May 21, 2013, a New Jersey appeals court held that a landlord was not entitled to evict his residential tenant, an 89-year old blind man with diabetes, because of the tenant's refusal to sign a new lease.  Ochieng v. Bloss, Superior Court of New Jersey, Appellate Division, Docket No. A-0703-12T2 . This decision reversed the trial court's ruling which was in favor of the landlord. The appeals court concluded that the landlord failed to follow the required notice procedures under the New Jersey Anti-Eviction Act, and that therefore the trial court lacked jurisdiction to hear the case.  The appellate reversal is a bittersweet victory for the tenant though, because the landlord can re-file a new complaint once he has issued the proper pre-lawsuit notices. Walter Bloss, the tenant in this case, is a disabled veteran suffering from diabetes and heart problems. He is also legally blind, and was 89-years old at the time his landlord fi

I couldn't find a better example to illustrate the problem with our judicial system.  In a recently unpublished decision of the New Jersey Appellate Division,   Hernandez v. North Jersey Neurosurgical Associates , Superior Court of New Jersey, Docket No. A-0890-12T2, the appeals court reversed a Hudson County trial judge's decision to enter default against a medical doctor whose attorney was unavailable to appear for the trial call because he was scheduled to be on trial in another case in Monmouth County, NJ . Demonstrating a rigid approach to justice, the trial court refused to postpone a trial date in this medical malpractice case due to the unavailability of one of the defendant doctor's attorneys, preferring instead to punish the doctor by entering default against him and essentially leaving the doctor in no-man's land. In this case, the attorney had designated himself as the doctor's trial attorney in accordance with NJ Court Rule 4:25-4 , meaning that

  It is not too difficult to Imagine the following scenario.  There is bitter litigation between 2 or more parties that has dragged on for several years.  Each side is represented by legal counsel, and each has spent thousands of dollars in legal fees trying to posture the case in their favor.  A trial is approaching shortly.   The parties are each growing weary of the case; it has become too time consuming and expensive, and the law of diminishing returns has set in for all involved. This is why the overwhelming majority of civil disputes ultimately settle before trial.  Lawyers know it, and so to the clients and judges.    In fact, our court system is designed to encourage and foster settlements .   In the Superior Court of New Jersey, Law Division,, all contract and business law disputes are generally subject to mandatory mediation with a court-appointed mediator who agrees to volunteer up to 2 hours of his/her time trying to foster settlement of the c

    In an unpublished decision issued on January 11, 2013, a NJ appeals court upheld the firing of a first-grade teacher in the Paterson school district who called her students "future criminals" in a Facebook post.   In the Matter of the Tenure Hearing of Jennifer O'Brien , Superior Court of New Jersey, Appellate Division, Docket No. A-2452-11T4 .  This case represents another example of the consequences of misusing popular social media sites.      In this case a two-judge appeals panel ruled that the teacher's derogatory Facebook posting was not protected speech under the First Amendment of the U.S. Constitution, and that her "right to express those comments was outweighed by the district's interest in the efficient operation of its schools."  The teacher, Jennifer O'Brien, employed as a Paterson teacher since 1998, was assigned to teach a first grade class of 23 students.  Almost all of her first graders were 6 years old ,