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Arboretum Gardens & Landscaping, LLC v. Glazer

A-5530-08T3 (N.J. Super. App. Div. 2010) (Unpublished)

CONTRACTS — Even if a party made a unilateral mistake about its obligations under a contract, such a mistake does not negate a breach of contract on its part.

A landscaper contracted to perform work on a home. The homeowner withheld the final payment, claiming the work had not been properly completed in accordance with the contract. The landscaper filed suit for the outstanding balance, and the homeowner responded with a breach of contract claim and also that the contractor had violated the New Jersey Consumer Fraud Act. The parties entered into a settlement agreement to resolve all outstanding issues. Under the agreement, the landscaper agreed to perform further landscaping. The settlement agreement provided that in the event the landscaper breached the agreement and the homeowner then filed, the homeowner would be entitled to recover all costs and reasonable attorneys fees if an order providing relief or damages was awarded.

The project did not go forward as planned because the landscaper discovered unanticipated excavation work that would have increased its cost over what was agreed under the settlement. The homeowner moved to enforce the settlement agreement and for attorneys fees related to its motion. The lower court enforced the settlement agreement, but denied the fees, finding that this was a legitimate dispute over the terms of the settlement agreement and did not amount to a breach of the agreement. The homeowner appealed.

The Appellate Division reversed and remanded for the entry of attorneys fees and costs to the homeowner, finding the language of the settlement agreement was clear that attorneys fees were recoverable where the landscaper breached the agreement and enforcement of the agreement was sought. The Court found that the landscaper failed to understand the scope of its obligations under the agreement and this was neither a misunderstanding caused by the language in the settlement agreement, or a mutual mistake of fact. It held that even if the landscaper had made a unilateral mistake about the required excavation work, such a mistake would not have negated its breach of contract.

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