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Coletta v. Camp-Out, Inc.

A-3688-04T1 (N.J. Super. App. Div. 2006) (Unpublished)

CONSUMER FRAUD—Where a repair company fails to give its customer a written estimate, the monetary damage experienced by the customer by reason of such a violation of the Consumer Fraud Act is the difference between what the customer had to pay and the amount of the verbal estimate.

A customer had a service facility install a trailer hitch and brake control system on his motor vehicle. Apparently, the installation was defective, or, at least in the view of the lower court, it was. The lower court calculated the damages incurred by the vehicle owner and then found that because the service facility had not given a written estimate for the repairs in the first place, a violation of the Consumer Fraud Act (CFA) had occurred. As a consequence, the lower court trebled the money damages under the Act and also awarded attorney’s fees. The service facility appealed.

The Appellate Division found no disagreement with the lower court’s finding of the underlying damages. On the other hand, it disagreed with the way the lower court calculated “ascertainable damages.” “Unlawful practices [under the CFA] fall into three general categories: affirmative acts, knowing omissions, and regulation violations.” An aggrieved party may recover if it “demonstrates that he or she suffered an ‘ascertainable loss’ and that the [seller] committed an unlawful practice.” To prove such a private claim, a “plaintiff must [establish] each of three elements: (1) unlawful conduct by the defendant[]; (2) an ascertainable loss on the part of the plaintiff; and (3) a causal relationship between the defendant[‘s] unlawful conduct and plaintiff’s ascertainable loss.” If such an ascertainable loss is proven, the private plaintiff is entitled to treble damages based on the ascertainable loss and is also entitled to attorney’s fees. Consequently, “treble damages are not awarded unless the private plaintiff can show that he or she suffered an ascertainable loss as a result of the unlawful conduct.”

The Court did not agree with the lower court’s determination that, “by failing to provide [its customer] with a written estimate of the costs of the repairs,” the customer was damaged. This was because it disagreed with the lower court’s “that the improper installation work was caused by [the service facility’s] failure to comply with the administrative regulation.” “Not all acts of negligent repair or breach of contract fall under the umbrella of the CFA.” Here, the service company “did not perform any work on the automobile that was not authorized ... under the verbal authorization” given by the customer. The only damage the customer incurred “as a result of the regulatory violation [was] the of paying more for the authorized work than verbally advised ... before the commencement of the work.” Therefore, the ascertainable loss was only that excess amount and not even the amount of money the customer spent to repair the improper installation. The full award of attorney’s fees was left undisturbed.


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