New Jersey Lemon Law Lawyer Blog

Repossession and Breach of the Peace

New Jersey Courts have analyzed what constitutes a breach of the peace.

“Breach of peace”, as used in the Code, should be construed according to the ordinary and usual meaning of the term, and ordinarily contemplates violence or the threat of violence. Slowinski v. Valley Nat. Bank, 264 N.J. Super. 172, 187, 624 A.2d 85, 93 (App. Div. 1993) emphasis added
The courts have determined that it is a question of facts as to whether there has been a wrongful repossession for a breach of the peace and that should be applied to this case. The plaintiff has alleged there was a threat of violence (arrest) to force the plaintiff to return the boat. It worked because the plaintiff returned the boat in order not to get arrested by what he thought was a Sheriff coming to arrest him and take him to jail. This is the type of conduct that creates a jury question on this issue.

The bank’s failure to sell the collateral and failure to send to auction creates a question as to whether the bank properly followed the repossession procedure. The “goods” were placed on the repossession company’s lot in Jackson New Jersey. There were no bids at the auction. The bank cannot prove that they properly advertised the auction or had a valid auctioneer conduct the auction. Moreover the goods were damaged on the repossession and ruined the collateral. There are serious doubts as to whether the repossession notices were even proper!!

Repossession Law in New Jersey

The basic concepts for the body of law underlying repossession, rights and remedies are encompassed in the Uniform Commercial Code. The UCC has established a multistep process and a list of requirements to be followed by creditors who have secured rights. The concept of repossession is not a single act of “repossession” collateral to enforce creditor rights BUT rather an entire process or 1) repossession 2) notice 3) sale and final resolution of the rights and relationships between the parties. The entire repossession process promulgated by the UCC ensures fluidity and predictability of 1) parties expectations 2) standard of conduct. Again, repossession is an entire process from self help acquisition to post notice sale and deficiency.

The following is the entire repossession process:

• 12A:9-607. Collection and Enforcement by Secured Party
• 12A:9-608. Application of Proceeds of Collection or Enforcement; Liability for Deficiency and Right to Surplus
• 12A:9-609. Secured Party's Right to Take Possession After Default
• 12A:9-610. Disposition of Collateral After Default
• 12A:9-611. Notification Before Disposition of Collateral
• 12A:9-612. Timeliness of Notification Before Disposition of Collateral
• 12A:9-613. Contents and Form of Notification Before Disposition of Collateral: General
• 12A:9-614. Contents and Form of Notification Before Disposition of Collateral: Consumer-Goods Transaction
• 12A:9-615. Application of Proceeds of Disposition; Liability for Deficiency and Right to Surplus
• 12A:9-616. Explanation of Calculation of Surplus or Deficiency

As to the application of the UCC the drafters have specifically left the courts with guidelines for interpretation and specifically rely thereon for their sound discretion. See N.J.S.A 12A:9-609, comment 3. As an example the following concepts have been established by the UCC, adopted and interpreted by New Jersey Courts: A breach of the peace in the repossession process violates the UCC and entitles the aggrieved party to statutory damages and actual damages. N.J.S.A. 12A:9-609(b) (3). See also Slowinski v. Valley Nat. Bank, 264 N.J.Super. 172, (App.Div 1993); The duty to repossess collateral is a non delegable duty which has been assigned to the creditor as a matter of public policy. DeMary v. Rieker, 302 N.J.Super. 208, 695 A.2d 294 (App.Div 1997). The question if there has been a breach of the peace is a question of fact for the jury. Slowinski v. Valley Nat. Bank, 264 N.J.Super. 172, (App.Div 1993); It is not necessary that the repossession of the collateral actually occurred. Slowinski v. Valley Nat. Bank, 264 N.J.Super. 172, (App.Div 1993); Lawful repossession exists where (1) there has been a default on a valid security agreement and (2) the repossession is executed without a breach of the peace. Slowinski v. Valley Nat. Bank, 264 N.J. Super. 172, 92 (App. Div. 1993); other jurisdictions have held that a wrongful repossession can give rise to an action for conversion. Slowinski v. Valley Nat. Bank, 264 N.J. Super. 172, 189-90, 94 (App. Div. 1993)

Wrongful Repossession/Non-Delegable Duty

The law in the State of New Jersey is if a repossession agent repossesses a vehicle in an improper fashion which has been previously addressed, it is the non-delegable duty of the finance company that might have initially authorized a repossession, to make sure that the repossession happens without a breach of the peace.

New Jersey Courts have determined that it is a public policy that the repossession agents not breach the peace when repossessing a vehicle. The Courts have also determined that it is ultimately the obligation of the finance company to make sure that this does not happen in an improper manner. This is called a non-delegable duty. This means that it is ultimately the responsibility and the obligation of the finance company who authorized a repossession to make sure the repossession is done in a proper manner consistent with the New Jersey law. It does not matter whether it was with violence as an impersonation of a law enforcement officer or some other improper and illegal manner. This is the obligation of the finance company with regard to ultimate liability.

What this means as a practical matter for someone who owns or operates a vehicle is that if there is an improper act with regard to repossession of an automobile regardless of who this person is, where they are or why they did what they did, it is ultimately the liability of the finance company in this regard. This means that you can sue the finance company if a repossession agent engaged in illegal or wrongful repossession or breach of the peace or did some other inappropriate or wrongful action. The public policy is that the Courts insist they will not permit a finance company to put their head in the sand while or types of improper or illegal actions are occurring with regard to repossession. This is why it is a non-delegable duty, this is why it is the responsibility of the finance company to make sure it is done properly and this is why the finance company has insurance and/or the repossession agent is required to carry insurance by the finance company.

Self-Help Repossession

Usually, the agreement will permit the finance company or bank to take the vehicle by self-help repossession without any further definition. The Uniform Commercial Code also permits a secured party to take a piece of collateral or the vehicle by self-help repossession. Again, self-help repossession is not specifically defined, however, must be deemed obvious in light of the relationship between the parties.

Self-help repossession is where the finance company ‘helps themselves’ to take the vehicle back.
One common question is whether or not there needs to be a notice to the owner of the vehicle prior to the ‘self-help repossession’. There is no requirement under the Uniform Commercial Code and there is usually no requirement under the written agreement between the parties. However, if the written agreement between the parties indicates there must be a type of pre-repossession notice, they must conduct same. If there are various calls between the parties with regard to late payments, this is not deemed and cannot be deemed a requirement but rather an attempt by the finance company to have the lessee or driver of the vehicle make payments.

Repossession law in the State of New Jersey

REPOSSESSION LAWS IN THE STATE OF NEW JERSEY

The laws in the State of New Jersey on repossession are based on two things: There is common law and statutory law addressing the relationship between the parties. Statutory law for repossession of the automobile or collateral is based on the Uniform Commercial Code. The Uniform Commercial Code specifically states when a vehicle or a piece of collateral may be repossessed.

The primary event to which the code references is a ‘default.’ Obviously, a default would refer to the written agreement between the parties to determine when there is in fact a default. This means that if the payments are due on the first of the month and the payments are not made, this would be ordinarily deemed a default of the agreement between the parties.
The legal significance of the default is addressed by the Uniform Commercial Code and permits the finance company or the party not in default to take appropriate action. The actions permitted to be taken by the finance company are also contained in the agreement between the parties. Usually, the agreement will make reference to self-help repossession or replevin. These terms and conditions are also addressed by the Uniform Commercial Code.

Repossession law in New Jersey

HVAC, Air Conditioning Complaints: What to do?

There are many rules and regulations pertaining to the installation of an HVAC system.

The failure to install a system properly will properly result in a system that 1) does not work 2) cost a lot of money to operate.

There are numerous ways that the HVAC company can ruin a system or install a system that does not work.

Load calculations
Obtain proper permits
Use the proper equipment
Test the system properly
Submit proper plans to authorities
Taking shortcuts
Not installing what was promised
Improperly trained staff

If you have and questions please call Carton and Rudnick 732-842-2070

C.L.U.E. - Comprehensive Loss Underwriting Exchange

If you think that you car has been in an accident you might be able to access the prior damage by asking for a C.L.U.E. report. The instructions are simple and you can have access to this massive data base that CAR FAX does not have access to at all. This information is kept by insurance companies and IS NOT REPORTED to CAR FAX

DEALER, HAS A DUTY TO INSPECT THE PLAINTIFF’S CAR AND MAKE RELEVANT DISCLOSURES

The general rule in American Jurisprudence is that used car dealers are required to exercise reasonable care in making an inspection for the purposes of discovering defects which would make the vehicle a menace to the highway or dangerous to use. See 7A Am Jur2d. Automobiles and HighwayTraffic § 730. This general proposition has been adopted by the New Jersey Supreme Court and implemented by the New Jersey Legislature. In Realmutto v. Straubb Motors, 65 N.J. 336, 444 (1974) the Supreme Court held: a used car dealer has the duty of reasonable inspection, testing and warning of any defects, as well as that of reasonable care with respect to any repairs or replacements he may make to the vehicle.

The reasons seem obvious but are worth repeating. The used car dealer is in a better position, by reason of his opportunity, than his average customer, to discover what defects might exist in any particular car to make it a menace to the public. It is not too harsh a rule to require these dealers to use reasonable care in inspecting used cars before resale to discover defects, which the customer often cannot discover until too late. Gaidry Motors v. Brannon, 268 S.W.2d. 627,628 (Ken. 1953). A seller's duty to disclose information concerning the condition of a product arises from its superior knowledge of the product. The courts considering the issues have recognized that used cars are more likely to have mechanical defects than new ones and that used car dealers are in a better position to discover these defects than their average customer. See Patton v. McHone, 822 S.W. 2d. 608, 613-614 (Tenn.1991). A car salesman cannot close his eyes to the truth. Nieto v. Pence, 578 F.2d. 640, 642 (1978).

Claims under the Consumer Fraud Act, N.J.S.A. 56:8-2, do not require the plaintiff to demonstrate intent, which exist in the current case, but any claims of civil fraud require proof of intent. Foont-Freedenfield v. Electro-Protective, 126 N.J.Super. 254, 259 (App.Div1973). The plaintiff need not prove that the defendant possessed actual knowledge but may prove constructive knowledge to satisfy the intent requirement. A widely accepted rule of fraudulent intent is that civil liability may be imposed where it is proved that a defendant's statements were made recklessly or carelessly, without knowledge of their truth or falsity, or without reasonable grounds for belief in their truth, especially in a case where

(1) the defendant was under a duty to have the knowledge in question,
(2) a relation of trust or expert reliance existed,
(3) a statement was made to induce a business arrangement, or
(4) the knowledge or information in question was within the special province of the defendant. Such conditions being met, it does not matter whether or not the declarant actually believed the statement (or statements) in question to be true. Jones v. Ford, 427 F.Supp. 1328 (D.C.Conn. 1977).

The plaintiff’s rights under the New Jersey Consumer Fraud Act are in addition to any other common law or statutory rights.

The rights provided under the New Jersey Consumer Fraud Act are in addition to any other statutory or common law rights. N.J.S.A. 56:8-2.3 provides as follows:

“The rights, remedies and prohibition accorded by the provisions of this Act are hereby declared to be in addition to and cumulative above any other rights, remedies or prohibition accorded by the common law or statutes of this State, and nothing contained herein shall be construed to deny, abrogate, or impair any such common law or statutory right, redress or prohibition.”

The clear intent of the New Jersey Consumer Fraud Act was to provide consumers with additional and cumulative remedies and no way curtail their remedial opportunities for the redress of fraud and other unconscionable practices afforded by any other statute or common law. Cybul v. Atrium Palace Syndicate, 272 N.J. Super. 330, 335 (App. Div. 1994). In Cybul, the Appellate Division held that the plaintiff could maintain a cause of action under an administrative scheme wherein there was no direct provision for a cause of action to the plaintiff. In Lemelledo v. Beneficial Management, 150 N.J. 255 (1997), a watershed case, the New Jersey Supreme Court held that the plaintiff could maintain a private cause of action in addition to, a statutory scheme which provided the plaintiff only a return of premiums paid under the policy. The New Jersey Supreme Court held that: “The CFA simply complements those statutes, allowing for regulation by the Division of Consumer Affairs and a private cause of action to recover damages. The damages cause of action in no way inhibits enforcement of other statutes, because a Court can assess damages in addition to any other penalty to which a defendant is subject.”

THERE IS NO PRIVITY REQUIREMENT TO MAINTAIN A CAUSE OF ACTION UNDER THE NEW JERSEY CONSUMER FRAUD ACT.

You have a right of action against those up the stream of commerce. An indirect seller.

There is no privity requirement to maintain a cause of action under the New Jersey Consumer Fraud Act. In Alloway v. General Marine Ind., 149 N.J. 620 (1997), the Supreme Court held that the New Jersey Consumer Fraud Act does not require privity to maintain a cause of action. In Alloway, the plaintiff purchased a defective boat, which was built by the (manufacturer) defendant. The plaintiff instituted suit against the manufacturer and other defendants for tort (negligence) and warranty claims. The Court dismissed the tort claims and permitted the plaintiff to proceed on the warranty claims, holding that privity was required for tort claims, but not for warranty type claims. The underpinnings of the decision were that the plaintiff had statutory avenues of remedy including, but not limited to, the Uniform Commercial Code (UCC) and the New Jersey Consumer Fraud Act to address economic injuries to property. Id. at 639 - 640. The Court specifically left unanswered whether or not tort or contract law applies to a product that poses a risk of causing personal injuries or property damage, but has caused only economic loss to the product itself.
The trend in the application of the Consumer Fraud Act has been to expand liability to those “upstream, in the chain of commerce”, including but not limited to remote suppliers of component parts whose products are passed on to a buyer and its representations are made to, or intended to be conveyed to the ultimate purchaser. Perth Amboy Iron Works v. Amhouse, 226 N.J. Super 200, 211 (App. Div. 1998).

INDIVIDUALS ARE SPECIFICALLY AUTHORIZED TO ACT AS PRIVATE ATTORNEY GENERAL.

Individuals are specifically authorized to act as private attorney generals. The New Jersey Consumer Fraud Act’s provisions authorizing consumers to bring their own private actions is integral to fulfilling the legislative purposes, and those purposes are advanced as well by Court’s affording the Attorney General the broadest kind of power to act in the interest of the consumer public. The empowerment of citizens to act as private attorneys general reflects an apparent Legislative intent to enlarge fraud fighting authority and to delegate the authority among the various governmental and non-governmental agencies, each exercising different forms of remedial power. That Legislative intent is readily inferable from the on-going need for consumer protection and the salutary benefits to be achieved by expanding enforcement, authority and enhancing remedial address. When a remedial power is concentrated in one agency, under-enforcement may result because of lack of resources, concentration of agency responsibilities, lack of expertise, agency captured by regulated parties, or a particular ideological bent by an agency decision-maker. See, E.G. Arcadia v. Ohio Power Co., 498 U.S. 73, 87-88, 111 S.Ct. 415, 423-24, (1990); (Stevens J. concurring).

Under-enforcement by an administrative agency may be even more likely where, as in this case, the regulated party is a relatively powerful business entity, while the class protected by the regulation tends to consist of low income persons with scant resources, lack of knowledge about their rights, inexperience in a regulated area, and an insufficient understanding of the prohibited practice. The primary risk of under- enforcement – the victimization of the protected class – can be greatly reduced by allocating enforcement responsibilities among the various agencies, among the members of the consuming public in the forms of judicial and administrative proceedings, and in private causes of action. Lemelledo v. Beneficial Management Co., 150 N.J. 255, 269-270.

NEW JERSEY LAW PERMITS DISCOVERY TO DEMONSTRATE THE DEFENDANTS’ INTENT AND OTHER OF THE PLAINTIFFS DEMAND REASONABLY CALCULATED TO LEAD TO ADMISSIBLE EVIDENCE

New Jersey Court Rules provide that parties may obtain discovery regarding any matter, not privileged, which is relevant to the subject matter involved in the pending action, whether it relates to the claim or defense of the party seeking discovery or to the claim or defense of any other party, including the existence, description, nature, custody, condition and location of books, documents or other tangible things and the identity and location of persons having knowledge of any discoverable matter. It is not grounds for objection that the information sought will be admissible at trial if the information sought appears reasonably calculated to lead to the discovery of admissible evidence. See, Rule 4:10-2. The public policies of expeditious handling of cases, avoiding stale evidence, and providing uniformity, predictability and security in the conduct of litigation is the policy underlining the New Jersey Discovery Rules. See, Abtrax Pharmaceuticals v. Elkinssinn, Inc., 139 N.J. 499, 512 (1995). The effect of the discovery rules cite that in effect, the discovery rules were designed to eliminate, as far as possible, concealment and surprise in the trial of law suits to the end that judgments rest upon the real merits of the causes and not upon the skill and maneuvering of counsel. See, Payton v. NJ Turnipike Authority, 148 N.J. 524 (1997).

Discovery, however, is intended to lead to facts supporting or opposing an asserted legal theory; it is not designed to lead to formulation of a legal theory. Energy Rec. v. Dept. of Environmental Protection, 320 N.J. Super 59, 64 (App. Div. 1999). The relevant standard of the Court Rules does not relate only to matters which would necessarily be admissible in evidence, but includes information reasonably calculated to lead to admissible evidence respecting the cause of action or a defense. See Comments to New Jersey Court Rules 2000, R. 4:10-2, Comment 2, Page 1203.

This analysis was conducted by the Supreme Court in Wilson v. Hess, 168 N.J. 236 (2001), where the trial Judge’s decision to limit the plaintiff discovery requests was overturned by the Appellate Division.

In Wilson, the plaintiffs alleged that the intentionally set gas prices to drive them out of business in violation of the Uniform Commercial Code, Sections N.J.S.A. 12A:2-103 (1)(b). The Court specifically held that

“it has been recognized that one’s state of mind is seldom capable of direct proof and ordinarily must be inferred from circumstances properly presented and capable of being considered by the Court . . . when a person’s intentions were not the proof from what he said, but they may be inferred from all that he did and said and from all the surrounding circumstances of the situation under investigation.” Id. at 246.

Courts have also held that:

In fraud cases the plaintiff is afforded considerably wider latitude in the discovery process than in other cases, in order to meet the heavy burden of proof require in a fraud claim. Pate v. Grady Buick 678 So. 2d. 762 (Ala. 1996). See also Wilson v. Hess, 168 N.J. 236 (2001).

New Jersey Open Public Records Act

New Jersey has developed a body of law which was codified by the legislature in the Open Public Records Act. This act permits members of the public to access ‘public’ records that are, in essence, kept in the regular course of business.

There are many, many exceptions to what the public is entitled to review. However, many common documents, traffic tickets, traffic records, Division of Motor Vehicle records and other records are considered public documents. This would include all of the court filings both in the Appellate Division and in the Supreme Court as well as the Superior Court for which the public could have accessed. There are various notations on what is subject to and what is not subject to public review but it is very complicated.

There is an excellent link and forms can be completed online and there are various strict requirements for which the public entity must comply with, otherwise they could be subject to litigation.

New Jersey Lemon Law Unit

If you are interested in filing a lemon law claim whether with or without an attorney, the site that you might want to review is the Department of Consumer Affairs. This website gives all the appropriate instructions on how to file a lemon law claim and all the requirements. The forms are also listed on this page and make it easier for a person to represent themselves in the process of filing a lemon law claim.

All of the forms might be simple. The law and the legal principles underlying a lemon law claim are in fact quite contrary.

Researching a history of a vehicle is imperative in the process of litigating a lemon law claim. One of the more interesting things contained on this website is a list of buybacks which have been ordered and/or processed through the administrative courts. It appears as though the list of these buybacks begin from the early days of the lemon law unit up until the current days.
So, as an example, if you have a car which has various defects, you might want to check the New Jersey Lemon Law Unit buyback site to determine if your complaints and/or concerns have been contained in any other complaints which might be filed.

This is a two-step process. You must look to see the year, make and model of the vehicle and see if there is any buyback. After that, you need to petition the lemon law unit through an OPRA request, Open Public Records Act, to determine the complaints that were made and the underlying documentation pertaining to the buyback. This will corroborate or support your claim if the manufacturer is claiming that the vehicle is operating properly or could not duplicate any complaints. I strongly recommend the site and it should be a starting point for any lemon law research.

US Supreme Court Decision on Arbitration

Recently, the US Supreme Court decided a significant arbitration case. The issue is whether or not the Federal Arbitration Act permitted the waiver of class action claims in a consumer contract. At the state level under the state laws, the states were divided as to whether or not a consumer could waive the right to a class action. Specifically under New Jersey Law, the Supreme Court had held that the waiver of class action claims under certain circumstances were unconscionable. Thus, even if a selling dealer or manufacturer had a class action provision in the contract prohibiting the plaintiff to participate in a class action, this “clause” was not enforceable as part of the contract. There are specifically two cases which were entitled Delta Funding and Mohammad.

The US Supreme Court held however that the policy underlying the Federal Arbitration Act and the expeditious resolution of disputes took precedence over the public policy behind class actions. In addition, the Court held that class actions could not be appropriately handled in the arbitration contacts. As an example, if there was an arbitration clause but no waiver of class action, various attorneys could potentially or were within the right to file a class action in the arbitration forum. JAMS and AAA had their specific provisions for arbitrating class actions. The Supreme Court held that the risks of mistakes were too great and thus determined that class actions could not be arbitrated.

In essence, the class action in the context of a Consumer Agreement is a thing of the past unless there is contrary legislation. The Supreme Court in essence felt that the policy underlying arbitration was sufficient to warrant the waiver of class actions, however, not ready to say that the arbitration forums are ready to handle class action arbitration.

Although I do a significant amount of auto fraud litigation, the concept does not change with regard to the sale of any goods such as houses, or any other consumer good. Again, if you know the purchaser of the good would make a different decision and you fail to disclose and you know this, this would be deemed fraud.

This is particularly applicable to dealers in auto fraud litigation. In many, many cases which I litigate, it is alleged that the dealer knew that a vehicle had been damaged in transit or otherwise whether the vehicle be new or used. You would be surprised of the number of cases where new cars were sold with transit damage. Clearly, if a new car has any damage, in my opinion, it must be disclosed since it is material to the transaction.

Once a vehicle has damage, I would consider this a used car rather than a new car. Although the law determines that a used car is one which had been titled, however, based on the use, I would submit that the vehicle would now be a used vehicle. In addition, on used vehicles, dealers are required to inspect them for safety under the law and especially the certified used vehicles undergo an extensive process. When the dealership sells one of its cars and they know they were damaged and fail to disclose them to the purchasing public, they commit an act of either fraud or consumer fraud.

The difference between fraud and consumer fraud is the burden of proof. Under consumer fraud, the plaintiff only has to demonstrate preponderance of the evidence and under fraud, clear and convincing. It is a significant difference. The legislator has chosen to deter this conduct by lowering the proof level on certain cases.

Can you commit fraud by maintaining silence?

The simple answer to this is yes. Under New Jersey law, you can commit fraud or consumer fraud when there is a fact which a seller of a good knows will be relevant to the purchaser’s decision, and as a material fact to the transaction, failure to disclose same will be considered fraud if the claimant can prove intent.

In simple words, if you know something is important and do not tell the other person and their decision on the particular transaction would change based on that information, it is fraud assuming it was done intentionally.

There are many examples of both in and out of state cases where the failure to disclose certain information was considered fraud. As an example, failure to disclose a car had sustained damage in accident, failure to disclose engine damage, failure to disclose defective brakes, failure to disclose a new had been damaged in transit and repaired, failure to disclose that the vehicle had been used as a racing vehicle, failure to disclose MSRP, failure to disclose odometer was inaccurate, failure to disclose mileage properly under a circumstance that required dealer know about the discrepancy, statements made recklessly or carelessly with any reasonable ground for a belief and truth as to the mileage constitutes intent to defraud. These cases are from Massachusetts, Texas, Illinois, Washington, Pennsylvania and Connecticut.

Nonetheless, the concept is simple. If something is important, it would make a difference as to the nature of the transaction one must disclose this information.

Jury Trials and questions

This is a list of questions that a jury might have to answer at the end of a trial


1. Do you find by a preponderance of the evidence that Defendant committed any unconscionable commercial practice, deception, fraud, false pretense, false promise or misrepresentation as I have defined in connection with the transaction involving the sale of the subject vehicle?

YES _______ NO _______ VOTE ________

2. Do you find by a preponderance of the evidence that Defendant knowingly concealed, suppressed or omitted any material fact as I have defined those terms in connection with the transaction involving the sale the vehicle, with the intent to deceive Plaintiff?

3. YES _______ NO _______ VOTE ________

If 1 AND 2 were answered no please stop.
If you answered yes to 1 OR 2 please go to # 4

4. Did Defendant’s conduct proximately cause any damages to Plaintiff’s?

YES _______ NO _______ VOTE ________

If your answer is “YES”, proceed to the next question. If you answer is “NO”, proceed to question 6.
5. What amount of money, if any, wills fairly compensation Plaintiff for ascertainable losses resulting from defendant’s conduct?

$___________ VOTE ___________

Please go to # 6 and continue the deliberations.

6. Do you find that the Plaintiff has established by clear and convincing evidence that:

a. Defendant made a false representation to the plaintiff?

YES _______ NO _______ VOTE ________

If your answer is “YES”, proceed to the next question. If no stop deliberations.

b. Defendant knew or believed the representation to be false?

YES _______ NO _______ VOTE ________

If your answer is “YES”, proceed to the next question. If no stop deliberations.

c. Defendant intended to deceive Plaintiff?

YES _______ NO _______ VOTE ________

If your answer is “YES”, proceed to the next question.
If no stop deliberations.

d. Plaintiff believed and justifiably relied upon the statement and was induced by it to proceed with the transaction involving the purchase of the vehicle.

YES _______ NO _______ VOTE ________

If your answer is “YES”, proceed to the next question. If no stop deliberations.

e. Did the false misrepresentation by Defendant proximately cause any damages to Plaintiff?

YES _______ NO _______ VOTE ________

If your answer is “YES”, proceed to the next question. If no stop deliberations.

7. NOTE: answer this question only if you answered “YES” to all of the questions 6 (a)-(e) above.

What amount of money, if any, will fairly compensate Plaintiff for losses proximately caused by Defendant’s fraudulent misrepresentations?

$ ____________ VOTE __________

Please return Jury verdict sheet now.

EXCESSIVE AND WOULD EFFECTIVELY PROHIBIT THE PLAINTIFF FROM PURSUING HER STATUTORY AND COMMON LAW CLAIMS.

The fees associated with the National Arbitration Forum are excessive and would effectively prohibit the plaintiff from pursuing her statutory and common law claims. The United States Supreme Court in Green Tree Financial v. Larketta Randolph 531 U.S. (2000) held that excessive arbitration costs form a basis to challenge the enforceability of an arbitration clause. The Court did, however, hold that it is the plaintiff’s burden to demonstrate this fact. The Supreme Court did not undertake such an analysis in Green Tree because no such facts were presented to the Court.

The costs associated with arbitrating a case consistent with National Arbitration Forum guidelines would require the plaintiff to pay excessive fees which are unconscionable in light of the plaintiff’s financial condition. The plaintiff brings home approximately $372.00 per week working as an operator for Verizon. The plaintiff’s expenses are approximately $1,500.00 per month. The plaintiff is a single mother and resides with her mother and daughter in South River, New Jersey. The plaintiff has $1,600.00 in the bank between checking and savings accounts. The National Arbitration Forum fees and costs demonstrate the cost structure associated with filing a claim. There are four types of hearings: Document Hearings, Telephone Participatory Hearings, On-Line Participatory Hearings, and In-Person Participatory Hearings. There are also filing fees ranging from $150.00 to $14,252.00. The minimum hearing fee for an In-Person Participatory Hearing is $500.00 for the initial session plus $450.00 for each additional session. This is for hearings where the amount in dispute ranges from $15,000 to $25,000. Claims which range from $250,000 to $500,000 cost $3,000.00 for the initial session and $2,000 for each additional session.

The plaintiff has made numerous claims pursuant to Federal and State statutory law as well as New Jersey Common Law. The plaintiff has also made a demand for punitive damages for the statutory and common law violations alleged. New Jersey Law permits the plaintiff to recover up to $350,000 in punitive damages or five times compensatory damages whichever is greater. Moreover, the plaintiff is entitled to punitive damages under the Fair Credit Reporting Act or the Equal Credit Opportunity Act. Under any of these statutory schemes, including the New Jersey Consumer Fraud Act, the plaintiff is entitled to attorneys’ fees and costs of the action. The New Jersey Consumer Fraud Act’s rights and remedies are cumulative and in addition to any other claims that the plaintiff might have under either Federal or State Law. Therefore, if the plaintiff is successful under the New Jersey Consumer Fraud Act she would not be prohibited from collecting damages either Truth In Lending, Equal Credit Opportunity Act or the Fair Credit Reporting Act.

Therefore, it is not unreasonable to assume that the plaintiff will be seeking an amount from $250,000 to $500,000 which requires a $3,000.00 fee for the initial session and $2,000.00 for each additional session. This would be in addition to any fees and costs which are charged by National Arbitration Forum for amendments, subpoenas, discovery orders, continuances and time waivers. Simply put, the fee structure associated with the National Arbitration Forum is excessive in light of the plaintiff’s salary. Assuming the plaintiff had no expenses, with her take home pay at $372.00 per week it would be unreasonable to assume that the plaintiff could proceed with the In-Person Participatory Hearing. Clearly, the fact that there are less expensive methods, document hearings, telephone participatory hearings and on-line participatory hearings, is of no consequence. Nonetheless, the fees for these hearings in the $250,000 to $500,000 range are excessive. A document hearing in this range is $5,000.00. A telephone participatory hearing in this range is $1,750.00 for the initial session and $1,250.00 for each additional session. The fee for the on-line participatory hearing is $2,500.00 for the initial session and $1,500.00 for each additional session. This is in addition to the $1,000.00 filing fee. This cannot be the effective vindication of the plaintiff’s rights as envisioned by the United States Supreme Court in Green Tree v. Randolph.