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Mogen David Casket Company, Inc. v. Gibbons

A-1096-04T2 (N.J. Super. App. Div. 2006) (Unpublished)

DISTRAINT; DAMAGES—Punitive damages in a distraint action are related to the conduct of the landlord with respect to the goods, not to how the landlord acts within the lawsuit.

A coffin manufacturer contracted with a woodworking company for completion of wooden caskets. The manufacturer ordered wood and had it shipped directly to the woodworking company. The woodworking company failed to deliver the caskets to the manufacturer. Then, the woodworking company’s landlord notified the manufacturer that the woodworking company had defaulted under its lease, had vacated the premises, and that the landlord had sold the remaining stock of wood to reduce the woodworking company’s rent obligations. The manufacturer brought an action against the landlord for replevin and damages for the value of its goods.

The manufacturer and the landlord reached an agreement wherein contractor’s landlord agreed to return the remaining caskets and wood to the manufacturer and the manufacturer’s attorney was to hold $4,500 in escrow to protect any counterclaims. As a result, the lower court ruled that continuing the suit despite reaching an agreement weighed against the awarding of punitive damages.

The Appellate Division held that the manufacturer’s action in continuing with the suit in spite of the agreement was irrelevant in deciding the issue of punitive damages. In its view, the focus should have been on the conduct of the contractor’s landlord or on the coffin manufacturer’s claim that the contractor’s landlord acted in a wantonly malicious manner. As a result, the Court remanded for further consideration of the punitive damages claim.

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