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Engel v. Pedigree Puppies, Inc.

A-3593-01T3 (N.J. Super. App. Div. 2003) (Unpublished)

CORPORATIONS; VEIL PIERCING—Fundamental elements of due process preclude even a small claims court from piercing a corporate veil without supporting evidence.

A woman bought a puppy and in accordance with the New Jersey Administrative Code received a form advising her “that she would be entitled to a refund of her purchase price if a licensed veterinarian certified within six months that the dog was unfit for purchase due to a congenital or heredity cause or condition.” A few months later, the dog was having a hard time walking. The woman was told by a series of veterinarians that the dog had congenital bursitis in both shoulders. She returned the dog to the seller which refunded only a half of the purchase price. She was told that if she presented a letter from a veterinarian in accordance with the requirements of the New Jersey Administrative Code, the balance of the purchase price would be refunded. Eventually, she obtained a veterinarian’s letter opining that the dog had a congenital condition, but the letter was dated almost nine months after the date of purchase. The buyer filed suit, relying on the nine month old letter. The Small Claims Division disregarded “the fact that the letter did not state that the animal was unfit for purchase and did not say that the determination in that regard had been made within six months of purchase, and it proceeded to enter judgment for [the woman], telling her simply to produce an amended letter within fourteen days.” The Appellate Division reversed, pointing out that the Small Claims Division should either have dismissed the matter or granted a brief continuance to allow the woman to assemble the necessary evidence. Further, the Appellate Division took note that the Small Claims Division “disregarded entirely that [the seller was] a corporation and entered judgment not only against [the seller] but against [its owner] individually as well.” It found no basis for the lower court to pierce the corporate veil. In the view of the Appellate Division, although the Small Claims Division is “intended to provide a forum for quickly hearing controversies in which a lesser sum is in dispute,” the litigants are “nonetheless, entitled to fundamental elements of due process, including requiring the adversary to present the necessary elements of proof as well as having an opportunity to be heard.”

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