MSB MOVING & STORAGE VS. FIVE STAR INSTALLATION,ET AL.(L-5145-12, MIDDLESEX COUNTY AND STATEWIDE)
A-2336-14T2
| N.J. Super. Ct. App. Div. | Jun 6, 2017Background
- MSB Moving & Storage (Brewer) provided moving services to Five Star Installation/Patriot Shipping (collectively Five Star) under an invoicing/payment arrangement; Five Star fell behind on payments and MSB continued work.
- MSB sued in 2012 alleging breach of contract and sought $250,017; bench trial occurred August 2014; initial judgment was amended and ultimately reduced to $56,706 (Dec. 2014).
- Key disputed items at trial: (1) MSB sold outstanding Five Star invoices to a factor (Quantam) and sought the unpaid balance (~$22,977) from Five Star; (2) credits/setoffs claimed by Five Star on the Mt. Sinai project (invoices including #1946); and (3) the Johnson & Johnson job where MSB kept $20,000 though Five Star performed the work.
- Trial court credited Brewer on several points, awarded the factoring balance, denied most of Five Star’s setoffs for lack of documentary proof or inconsistent testimony, and calculated net damages (later reduced by $4,000 for a calculation error).
- After appeal was filed, a check for $7,977.20 paying invoice 1946 was added to the record; MSB conceded that amount should be deducted; court affirmed judgment except for ordering remand to reduce judgment by $7,977.20.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Enforceability of Five Star promise to pay factor shortfall | MSB: Five Star confirmed invoices to factor and promised to pay remaining balance; promise is enforceable | Five Star: Statute of Frauds (N.J.S.A. 25:1-15) requires signed writing for guaranty to pay another's debt | Held: Promise enforceable — court found promisor's primary purpose served its own interest so Statute of Frauds inapplicable; trial credibility findings upheld |
| Recovery for factored invoices balance | MSB: Entitled to unpaid balance (~$22,977) after factoring; Quantam transaction occurred with Five Star’s knowledge | Five Star: Denies promise; disputes some invoices (e.g., "New York" debtor) and contends lack of written guaranty | Held: Court credited Brewer, awarded factoring balance; denied untimely challenges to specific invoice after trial |
| Mt. Sinai project setoffs/credits (including invoice 1946) | Five Star: Entitled to credits/setoffs for work it performed or payments to MSB by DS&D | MSB: Performed or otherwise entitled to payment; Five Star failed to produce agreement assigning payment responsibility | Held: Court denied most setoffs for lack of agreement/documentary proof; later supplemented record with $7,977.20 check and judgment reduced by that amount (conceded by MSB) |
| Johnson & Johnson job accounting ($20,000 retention) | Five Star: MSB retained $20,000 and that should offset judgment (won't be double-counted) | MSB: Kept $20,000 as credit for Five Star's debt; court should account for prior credits/payments | Held: Court credited MSB's testimony regarding underlying debt; calculations adjusted for some credits (and a $4,000 correction), and appellate court deferred to trial calculations |
Key Cases Cited
- Rova Farms Resort, Inc. v. Inv'rs Ins. Co., 65 N.J. 474 (reasonableness of deference to trial factfindings in non-jury cases)
- Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366 (trial court's legal conclusions reviewed de novo)
- Lane v. Oil Delivery, 216 N.J. Super. 413 (damages need not be exact; reasonable estimate permitted)
- Totaro, Duffy, Cannova and Co., L.L.C. v. Lane, Middleton & Co., L.L.C., 191 N.J. 1 (alternate measures of damages and proof standards)
- Walder, Sondak, Berkeley & Brogan v. Lipari, 300 N.J. Super. 67 (Statute of Frauds does not apply when promisor’s primary purpose serves own interest)
- Schoor Assoc. v. Holmdel Heights Constr. Co., 68 N.J. 95 (principles on guaranties and Statute of Frauds)
- Kozlowski v. Kozlowski, 80 N.J. 378 (courts will fashion a remedy where proof of damages is inexact)