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Marcel Landscaping, Inc. v. Singhal

A-1604-98T2 (N.J. Super. App. Div. 1999) (Unpublished)

CONSUMER FRAUD ACT; INTEREST—An award of prejudgment interest for a Consumer Fraud Act claim is not avoided by honest dispute over legal liability.

A homeowner contracted with a landscaping company to perform 17 tasks. The work to be done and the price to be paid were memorialized in a series of scribbled, unsigned handwritten notes. No document indicated when the work would start or when it was expected to be completed. No document contained a detailed description of the work to be done. These shortcomings violated the regulations promulgated pursuant to the Consumer Fraud Act governing home improvement contracts. After the work was done, the homeowner refused to pay anything other than its initial deposit. In response to the landscaping company’s suit for the balance, the homeowner alleged that violations of the Act voided the contract. The Court held that all of the work had been done and that both parties understood what the total price of the work was to be and what the balance due on the contract was to be. The only question left, therefore, was whether a violation of the Consumer Fraud Act required that the landscaper go uncompensated and that treble damages and attorney’s fees be paid by the landscaper to the homeowner. The lower court refused to void the contract “because to do so would be inequitable in view of [the homeowner’s] failure to prove an ascertainable loss.” It further believed that the indebtedness grew out of the work done by the contractor and that the homeowner was unable to demonstrate that the work was done defectively or without proper skill and reasonable workmanship. The lower court did, however, award the homeowner its reasonable attorney’s fees, and also awarded the landscaper considerable prejudgment interest. The Appellate Division agreed with the lower court’s findings of fact concerning the existence of the contract and the absence of any proof of ascertainable loss attributable to the violation of the regulations governing home improvement contracts. In addition, the Court upheld the award of prejudgment interest as being within the sound discretion of the trial court acting in accordance with equitable principles. In doing so, it held that interest could be awarded even when a defendant has in good faith contested the validity of an adverse claim. “An award of prejudgment interest ‘is not avoided by honest disputation over legal liability.’”


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