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Prezant v. Jegou

A-1935-08T1 (N.J. Super. App. Div. 2010) (Unpublished)

CONSUMER FRAUD; ATTORNEYS FEES — Even though a consumer may not prove every damage aspect of its consumer fraud case against a vendor, where there is a violation of the Act, at least with respect to one element of damages, an award of fees and costs under the Act is proper.

Landowners who wished to build a home retained a designer to advise them on all phases of its construction. Pursuant to their agreement, the designer was to receive fifty percent of the profits from the construction. Once the owners moved into the home, the designer continued to provide services as an interior decorator. The owners relied on the designer to select furnishings for the home because she had a background in antiques and restoration work. The designer insisted the owners had to buy a particular dining room table because it was a very valuable antique. They purchased the table; however they never sufficiently recorded its value. There was an invoice showing that the owners paid $8,500, but yet the owners had no proofs supporting the invoice. The owners also never took steps to ascertain whether the furnishings they purchased actually were antiques. The designer assisted the owners in cataloguing the purchased furnishings for insurance appraisal purposes and signed the appraisal form.

Disputes arose between the parties about ownership of, and payment due for, the furnishings, as well as about payments for the construction work. An agreement was reached wherein the designer was to receive $44,000 relating to the construction work. However, the owners only paid $10,000.

After the designer filed suit, the owners retained an expert to appraise six items on the insurance appraisal list. The expert opined that the items, including the dining room table, were not of sufficient age to be antiques and thus were of lesser value. The case was tried in the lower court where a jury found that the owners had breached their agreement to pay $34,000 to the designer for construction work. As to the furnishings, the owners testified the loss of benefit to them equaled the difference between the value of the six items on the list and the value assigned to the items by their expert. The jury found the designer violated the New Jersey Consumer Fraud Act (CFA) by falsely representing the nature and value of the furnishings she had sold to the owners. The jurors awarded the owners $102,000 (triple damages of $34,000) for the violation of the CFA, plus about $30,000 for fees and costs.

On appeal, the Appellate Division vacated the damage award under the CFA, finding the owners had not presented adequate evidence to allow the jury a reasonable basis to quantify the owner’s loss. The Court said, with the exception of the dining room table, the owners failed to prove the designer had affirmatively misrepresented the furnishings as valuable antiques prior to purchase. The designer may have represented the value of the items in connection with the preparation of the insurance appraisal form; however, this occurred after the furnishings were purchased. As to the table, the Court said the owner failed to establish an ascertainable loss useable by a jury to qualify as a damage award. The evidence at trial was inadequate to prove a difference between the amount paid for the table and its fair market value. The owners did not demonstrate the designer represented a specific value beyond the price – only that the table was incredibly valuable.

The Court, however, concluded that an award of fees and costs under the CFA was proper. According to the Court, a violation (affirmative misrepresentation) was proven as to the table and the jury could have concluded the table’s purchase price of $8,500 was sufficient to demonstrate an ascertainable loss. Therefore, the Court remanded the matter to the lower court to reassess the award of fees and costs in light that the damage award was vacated.


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