Michael Conley, Jr. v. Mona Guerrero(076928)
157 A.3d 416
| N.J. | 2017Background
- Buyers (Conley, Maurer) and Seller (Guerrero) used a standard, broker-prepared condominium purchase contract containing the mandatory three-business-day attorney-review clause from New Jersey State Bar Ass’n v. New Jersey Ass’n of Realtor Boards (Bar Ass’n).
- The contract required an attorney’s notice of disapproval to be sent to the broker/REALTOR(s) by certified mail, telegram, or personal delivery; names/addresses for notice were included.
- Seller’s attorney disapproved within the three-day window by e-mail and fax (copying the agent); the broker/agent and Buyers indisputably received actual notice during the period.
- Buyers sued for specific performance, arguing Seller’s notice was ineffective because it did not comply with the prescribed delivery methods (certified mail, telegram, or personal delivery).
- Trial court denied a TRO, granted defendants’ summary judgment; Appellate Division affirmed, and Buyers sought Supreme Court review.
- Supreme Court affirmed the Appellate Division but modified Bar Ass’n: accepted modern methods of notice and clarified the attorney-review mechanics.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether attorney-review notice must strictly follow the contract/regulatory methods (certified mail, telegram, personal delivery) | Conley: strict enforcement required; Seller’s noncompliant fax/email cannot void Buyers’ right to enforce the contract | Guerrero/Tanzi: substantial compliance & actual notice suffice; industry practice uses fax/email; strict rule causes injustice to innocent purchaser | Court: actual notice within 3 days by industry-standard means is valid; strict form enforcement would defeat purpose of attorney-review clause |
| Whether Court can modify Bar Ass’n notification methods | Conley: lower courts exceeded Court’s regulatory authority by relaxing Bar Ass’n | Defendants & amici: Court should update methods to reflect technology and practice | Court: exercises supervisory authority over practice of law and modifies allowable notice methods to include fax, e-mail, personal delivery, overnight mail (effective on mailing) |
| Effect of broker/dual agent receipt and identity of complaining party | Conley: broker was required recipient; failure to receive notice by prescribed method defeats disapproval | Defendants: broker/parties actually received notice; dual agent was copied so broker was informed | Court: because buyers (and agent) received actual notice within period and broker was not the complaining party, exigent formality would elevate form over purpose; upheld disapproval |
| Whether attorney-review period timing changes under new methods | Conley: ambiguous if timing changes with new methods | Defendants: industry methods should operate within same 3-business-day period | Court: attorney-review period remains three business days; overnight mail effective on mailing |
Key Cases Cited
- New Jersey State Bar Ass’n v. New Jersey Ass’n of Realtor Boards, 93 N.J. 470 (1983) (approved settlement requiring three-day attorney review and specified notice methods)
- New Jersey State Bar Ass’n v. New Jersey Ass’n of Realtor Bds., 94 N.J. 449 (1983) (modification allowing use of term REALTOR in attorney-review clause)
- State v. Bander, 56 N.J. 196 (1970) (background on unauthorized-practice-of-law issues leading to Bar Ass’n)
- Kutzin v. Pirnie, 124 N.J. 500 (1991) (noted, in dicta, failures to follow method-of-delivery provision in attorney-review context)
- Gaglia v. Kirchner, 317 N.J. Super. 292 (App. Div. 1999) (addressed substantial-compliance and the problem of a party trying to invoke attorney-review despite its own procedural deviations)
- Peterson v. Estate of Pursell, 339 N.J. Super. 268 (App. Div. 2001) (insisted on strict adherence to contractual timing for start of the three-day attorney-review period)