Anthony D'agostino v. Ricardo Maldonado (068940)
216 N.J. 168
| N.J. | 2013Background
- The Court applies the New Jersey Consumer Fraud Act (CFA) to a foreclosure rescue plan involving the D’Agostinos and Maldonado.
- Maldonado obtained title to the home for ten dollars, with the Plaintiffs retaining a one-year option to regain title for $400,000 and Denise D’Agostino remaining personally liable on the mortgage.
- Foreclosure was filed in 2007; by January 2008 the property's fair market value was about $480,000.
- Anthony D’Agostino sought Maldonado’s help; five documents created a trust with Maldonado as Trustee and a conveyance of the property to him, with the option to repurchase.
- The quitclaim transferred full ownership to Maldonado in March 2008; Maldonado spent about $49,615 on improvements and mortgage-related expenses.
- The trial court found an unconscionable CFA violation and voided the deed, awarding treble damages and fees; Appellate Division reversed on damages/ascertainable loss, then this Court reversed in part, reinstating damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does CFA apply to the foreclosure-rescue transaction? | D’Agostino: transaction constitutes sale of services; falls within ‘merchandise’ under CFA. | Maldonado: transaction is exempt or outside CFA as a unique real estate arrangement with no public sale. | Yes, CFA applies; transaction is within ‘sale’ of ‘merchandise’ and constitutes unconscionable practice. |
| Was there an ascertainable loss given the court voided the deed? | Loss equals lost equity ($120,000) reduced by defendant’s improvements; remain entitled to treble damages. | Voidting the transfer restored equity, so no ascertainable loss. | There was an ascertainable loss despite restoration; damages and treble damages properly awarded. |
| Is the trial court's damages calculation, including set-off for improvements, proper? | Treble damages based on loss; no improper deduction for defendant’s improvements. | Improvements should offset damages and reduce treble. | Calculation proper; set-off permitted; treble damages awarded consistent with CFA. |
| May equitable relief be awarded in CFA cases alongside treble damages? | Equitable relief (voiding transfer) complements CFA remedies; not mutually exclusive. | Remedy resembles rescission; might preclude treble damages. | Equitable relief can accompany treble damages under CFA; not precluded. |
| Is equitable estoppel a bar to CFA relief here? | No equitable estoppel given misrepresentations by the defendant and lack of reliance by plaintiffs. | Delays and credibility issues support estoppel. | Equitable estoppel does not bar CFA relief. |
Key Cases Cited
- Bosland v. Womack Dodge, Inc., 197 N.J. 543 (2009) (ascertainable loss as threshold for CFA standing)
- Weinberg v. Sprint Corp., 173 N.J. 233 (2002) (treble damages and attorneys' fees; remedial purpose)
- Thiedemann v. Mercedes-Benz USA, LLC, 183 N.J. 234 (2005) (ascertainable loss as threshold; replacement value concept)
- Furst v. Einstein Moomjy, Inc., 182 N.J. 1 (2004) (measure of damages; replacement value and trebling)
- Cox v. Sears Roebuck & Co., 138 N.J. 2 (1994) (contract-damage principles applied to CFA; treble damages)
- Meshinsky v. Nichols Yacht Sales, Inc., 110 N.J. 464 (1988) (ascertainable loss tied to expected benefit of bargain)
- Lettenmaier v. Lube Connection, Inc., 162 N.J. 134 (1999) (CFA purposes and treble damages rationale)
- Real v. Radir Wheels, Inc., 198 N.J. 511 (2009) (unconscionable practices in sale of merchandise)
- Lemelledo v. Beneficial Mgmt. Corp. of Am., 150 N.J. 255 (1997) (broad interpretation of ‘merchandise’)