BERNICE PISACK, ETC. VS. B&C TOWING, INC. VS. THE CITY OF NEWARK EPTISAM PELLEGRINO, ETC. VS. NICK'S TOWING SERVICE, INC., A-5668-16T3 CHRISTOPHER WALKER, ETC. VS. ALL POINTS AUTOMOTIVE & TOWING, INC. (L-6501-13, L-1606-17 AND L-7929-13, MIDDLESEX AND BERGEN COUNTIES AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-2546-16T4
A-5399-16T3
A-5668-16T3

BERNICE PISACK, on behalf
of herself and all others
similarly situated,

Plaintiff-Appellant/
Cross-Respondent,
APPROVED FOR PUBLICATION
v.
June 14, 2018
B & C TOWING, INC.,
APPELLATE DIVISION
Defendant-Respondent/
Cross-Appellant,

and

MARIE J. CAVALCHIRE and ALAN
ANTHONY YOUNG,

Defendants,

and

B & C TOWING, INC.,

Defendant/Third-Party Plaintiff-
Respondent/Cross-Appellant,

v.

THE CITY OF NEWARK,

Third-Party Defendant-Respondent.
EPTISAM PELLEGRINO, on behalf
of herself and all others
similarly situated,

Plaintiff-Appellant,

v.

NICK'S TOWING SERVICE, INC.,

Defendant-Respondent,

and

NICHOLAS TESTA and SUSAN
TESTA,

Defendants.
_______________________________

CHRISTOPHER WALKER, on behalf
of himself and all others
similarly situated,

Plaintiff-Appellant,

v.

ALL POINTS AUTOMOTIVE & TOWING,
INC.,

Defendant-Respondent,

and

THOMAS LOCICERO,

Defendant.
_______________________________

Argued April 24, 2018 – Decided June 14, 2018

Before Judges Reisner, Hoffman, and Gilson.

2 A-2546-16T4
 On appeal from Superior Court of New Jersey,
Law Division, Middlesex County, Docket No.
L-6501-13, and Bergen County, Docket Nos.
L-1606-17 and L-7929-13.

Andrew R. Wolf argued the cause for
appellant/cross-respondent in A-2546-16 and
appellant in A-5668-16 (The Wolf Law Firm,
LLC, and Christopher J. McGinn, attorneys;
Matthew S. Oorbeek, on the briefs).

Andrew R. Wolf argued the cause for appellant
in A-5399-16 (The Wolf Law Firm, LLC, and
Edwyn D. Macelus, attorneys; Matthew S.
Oorbeek, on the briefs).

Gabriel H. Halpern argued the cause for
respondent/cross-appellant in A-2546-16
(Pinilis Halpern, LLP, attorneys; Gabriel H.
Halpern, of counsel and on the brief).

Steven F. Olivo, Assistant Corporation
Counsel, argued the cause for respondent in
A-2546-16 (Kenyatta K. Stewart, Corporation
Counsel, attorney; Steven F. Olivo, on the
brief).

Jeremy B. Stein argued the cause for
respondent in A-5399-16 (Hartmann Doherty Rosa
Berman & Bulbulia, LLC, attorneys; Paul S.
Doherty, III, and Jeremy B. Stein, on the
brief).

Brian T. Giblin, Sr., argued the cause for
respondent in A-5668-16 (Giblin & Gannaio,
attorneys; Brian T. Giblin, Sr., and Brian T.
Giblin, Jr., on the brief).

The opinion of the court was delivered by

GILSON, J.A.D.

These three appeals involve the non-consensual towing of

vehicles and raise questions concerning the Predatory Towing

3 A-2546-16T4
Prevention Act (Towing Act), N.J.S.A. 56:13-7 to -23, the Consumer

Fraud Act (CFA), N.J.S.A. 56:8-1 to -20, and the Truth-In-Consumer

Contract, Warranty and Notice Act (TCCWNA), N.J.S.A. 56:12-14 to

-18. Accordingly, we issue a consolidated opinion to address the

common questions presented by these appeals.

Having reviewed the language and legislative history of the

Towing Act and its implementing regulations, we hold that: (1) the

Towing Act does not require the exhaustion of administrative

remedies before the Division of Consumer Affairs (Division) or

dispute resolution procedures established by municipalities that

have towing ordinances; (2) the Tort Claims Act (TCA) does not

provide immunity against claims based on the fees companies charge

for non-consensual towing of vehicles; and (3) the Towing Act and

its regulations limit the services for which a towing company can

charge. We also hold that the TCCWNA applies to the non-consensual

towing of vehicles because the bills issued by towing companies

are contracts and notices within the definition of the TCCWNA.

Finally, we hold that class actions may, in the right

circumstances, be appropriate for claims under the Towing Act, the

CFA, and the TCCWNA.

Accordingly, we reverse the orders on appeal in each of these

three cases and remand for further proceedings. Specifically, in

Walker, we reverse a July 24, 2017 order granting summary judgment

4 A-2546-16T4
to defendants and remand for further proceedings; in Pisack, we

reverse a January 13, 2017 order denying plaintiff's motion to

certify a class and granting defendants' cross-motion for summary

judgment, and we remand for further proceedings; and in Pellegrino,

we reverse a June 5, 2017 order striking plaintiff's request to

certify a class action and remand to allow class discovery.

I.

Each of these appeals involves certain common facts. None

of the three named plaintiffs consented to the towing of their

vehicles. Instead, the vehicles were towed from public roads at

the direction of the police. Plaintiffs then were charged for the

non-consensual towing of their vehicles by privately-owned towing

companies that had contracts with the local municipalities to

provide such towing and storage services.

Beyond those common facts, the three cases arise out of

different factual backgrounds and involve different procedural

histories. Thus, we will summarize the relevant facts and

procedural history of each case to give context to the issues.

Walker

In the early morning hours of December 29, 2012, Christopher

Walker was driving his vehicle in River Edge when he was stopped

by a police officer. The officer observed the vehicle was not

registered. Thus, the officer issued Walker a summons and directed

5 A-2546-16T4
that the vehicle be towed and held until Walker registered the

vehicle. Defendant All Points Automotive & Towing, Inc. (All

Points Towing), which had a contract with River Edge, towed

Walker's vehicle.

Walker registered the vehicle later that same day, which was

a Saturday, and tried to pick up the vehicle from All Points Towing

before it closed for business at 1 p.m. Walker contends that the

police authorized the release of his vehicle on December 29, 2012,

but All Points Towing refused to release the vehicle to him because

they were closing for the remainder of the weekend. In contrast,

All Points Towing maintains that the police did not authorize the

release of the vehicle until the following Monday, December 31,

2012.

On December 31, 2012, Walker retrieved his vehicle, and All

Points Towing charged him $290.85. Walker was given a bill that

listed the charges as: Towing Charge $125; Storage $120; "Admin"

$35; Tax $10.85; and Total $290.85. Walker paid the bill in cash

without disputing the charges.

In October 2013, Walker filed a complaint on behalf of himself

and similarly situated individuals against All Points Towing and

its owner. Walker alleged that the Towing Act did not permit an

administrative charge for the non-consensual towing of a vehicle

that was not involved in an accident. Walker contended that the

6 A-2546-16T4
administrative charge violated the Towing Act, the CFA, and the

TCCWNA. Walker also asserted that All Points Towing unlawfully

failed to release his vehicle after normal business hours as

required by the Towing Act and its regulations. Thus, Walker

asserted that a class action should be certified.

The case effectively was stayed while Walker was on active

military service. See R. 1:13-6. Following the completion of

discovery, defendants moved for summary judgment. Walker had not

filed a motion to certify the class. The trial court heard oral

argument and, on July 24, 2017, issued a written opinion and

entered an order granting defendants summary judgment.

In Walker's case, the court granted defendants summary

judgment on two grounds. First, the court found that Walker had

failed to administratively resolve his dispute. In that regard,

the court held that the Towing Act regulations required vehicle

owners who disputed charges imposed by a towing company for

non-consensual towing services to use good faith efforts to resolve

the dispute before filing a lawsuit. The court also held that if

those good faith efforts failed, the vehicle owner then must either

go to the Division to seek reimbursement of the disputed amount,

or avail himself or herself of the dispute resolution mechanisms

established by the municipality. Second, the court reasoned that

7 A-2546-16T4
the administrative fee was allowed by the River Edge towing

ordinance and, therefore, was a permitted fee.

The trial court never addressed Walker's claim that defendant

unlawfully failed to release his vehicle after hours. The trial

court also did not clarify whether Walker could refile his lawsuit

after he exhausted his administrative remedies.

Pisack

On June 25, 2013, the son of Bernice Pisack illegally parked

her car on a public street in Newark. The Newark Police contacted

B & C Towing, Inc. (B&C Towing) and directed it to tow Pisack's

vehicle to its lot. B&C Towing had a contract with Newark to

provide such towing services.

Later that day, Pisack's son went to B&C Towing's lot and

retrieved the vehicle. He was given a bill for $152.45, which

listed the charges as: Towing $65; Labor (recovery) $25;

Administrative Fee $50; Storage $10; and Tax $2.45. Under B&C

Towing's contract with Newark, B&C Towing retained $25 of the

administrative fee and remitted the remaining $25 to Newark. The

son paid the bill without contesting the charges.

In October 2013, Bernice Pisack filed a proposed class action

against B&C Towing and its owners, alleging violations of the

Towing Act, the CFA, and the TCCWNA. Specifically, Pisack

challenged the labor charge and the administrative fee.

8 A-2546-16T4
 B&C Towing moved to dismiss the complaint, but in an order

entered on March 28, 2014, the trial court denied that motion.

B&C Towing then filed an answer and asserted a third-party

complaint against Newark. Thereafter, the claims against Newark

were severed and transferred to another vicinage.

Following discovery, Pisack filed a motion to certify the

class, and B&C Towing cross-moved for summary judgment. After

hearing oral argument on the motions, the trial court entered an

order on January 13, 2017, granting summary judgment to defendants

and denying plaintiff's motion as "moot."

The court explained its reasons on the record and identified

four grounds for its decision: (1) the TCCWNA was inapplicable

because there was no contract between Pisack and B&C Towing; (2)

Pisack failed to exhaust administrative remedies before pursuing

a court action; (3) the fees charged by B&C Towing were permitted

under Newark's towing ordinance; and (4) B&C Towing was entitled

to derivative immunity under the TCA because the towing was

performed at the direction of the police.

Pellegrino

On November 28, 2015, Eptisam Pellegrino was involved in a

motor vehicle accident in East Rutherford. At the direction of

the East Rutherford Police, Nick's Towing Service, Inc. (Nick's

Towing), towed Pellegrino's vehicle. Three days later, Pellegrino

9 A-2546-16T4
contacted Nick's Towing to inquire about the charges related to

the towing and storage services. She was informed that the charges

totaled $448.36, and she authorized Nick's Towing to charge her

credit card.

Thereafter, Nick's Towing sent Pellegrino an itemized bill,

which listed the charges as: Flatbed/Towing $125; Yard Charge $40;

Crash/Collision Wrap $60; Credit Card Surcharge $13.06;

Administrative Charge $40; Sweep Roadway/Cleanup $30; Storage Fee

$120; and Sales Tax $20.30.

In March 2017, Pellegrino filed a complaint on behalf of

herself and similarly situated individuals against Nick's Towing

and its owners. Pellegrino alleged that the yard charge, the

credit card surcharge, the administrative charge, and the storage

fee violated the Towing Act, the CFA, and the TCCWNA.

Without engaging in discovery, defendants filed a motion to

dismiss Pellegrino's complaint. Alternatively, defendants sought

to deny class certification. The trial court heard oral argument

and, on June 5, 2017, issued a written opinion and entered an

order ruling that Pellegrino could pursue her claims only in her

individual capacity and not on behalf of a class. The court also

denied the remainder of the motion to dismiss.

The court found that Pellegrino could not satisfy the standard

for class certification because the questions of law and fact

10 A-2546-16T4
affecting the class did not predominate over those affecting

individual members of the proposed class. We granted plaintiff's

motion for leave to appeal the interlocutory order of June 5,

2017.

II.

To summarize, plaintiffs appeal from three orders. Walker

appeals from a July 24, 2017 order granting summary judgment to

defendants. Pisack appeals from a January 13, 2017 order denying

class certification and granting summary judgment to defendants.

On leave granted, Pellegrino appeals from a June 5, 2017

interlocutory order denying her request to certify a class and

allowing her to proceed only on her individual claims.

Collectively, the appeals raise four legal issues: (1)

whether the Towing Act requires the exhaustion of administrative

remedies and dispute resolution procedures before a civil suit can

be filed in court; (2) whether towing companies that engage in

non-consensual towing at the direction of the police are immune

from liability under the TCA for claims related to the fees they

charge; (3) whether the Towing Act limits the types of services

for which a towing company can charge a fee for the non-consensual

towing of a vehicle; and (4) whether the TCCWNA applies to the

non-consensual towing of vehicles. The appeals also raise a fifth

fact-based issue of whether certain claims for violations of the

11 A-2546-16T4
Towing Act, the CFA, and the TCCWNA can be pursued as class

actions.

To put these issues in context, we will start with an overview

of the relevant statutes, which include the Towing Act, the CFA,

and the TCCWNA. We will then address the four legal issues.

Thereafter, we will analyze the class action issue. Finally, we

will apply our holdings to each case and also discuss any issues

specific to the individual cases.

A. The Relevant Statutes

1. The Towing Act

When enacting the Towing Act in 2008, the Legislature declared

that it was "in the public interest to create a coordinated,

comprehensive framework to establish and enforce minimum standards

for tow truck operators." N.J.S.A. 56:13-8(e). The Legislature

also declared that the purpose of the Towing Act was to prevent

predatory towing practices, which included "charging unwarranted

or excessive fees, . . . or overcharging consumers for towing

services provided under circumstances where the consumer has no

meaningful opportunity to withhold consent[.]" N.J.S.A.

56:13-8(b).

The Towing Act primarily focuses on the towing of motor

vehicles from private property and the non-consensual towing of

motor vehicles from public roadways. See N.J.S.A. 56:13-9. The

12 A-2546-16T4
Towing Act defines "non[-]consensual towing" as "the towing of a

motor vehicle without the consent of the owner or operator of the

vehicle." Ibid. The Towing Act's regulations add that

"'[n]on-consensual towing' includes towing a motor vehicle when

law enforcement orders the vehicle to be towed whether or not the

owner or operator consents." N.J.A.C. 13:45A-31.2. These appeals

involve non-consensual towing of vehicles from public roadways.

The Towing Act requires the Director of the Division of

Consumer Affairs (Director) to establish, by regulation, a

schedule of the services for which a towing company can charge

fees in connection with the non-consensual towing of a motor

vehicle. N.J.S.A. 56:13-14(a). The Towing Act also provides that

the fees charged "shall be reasonable and not excessive" and

defines "presumptively unreasonable and excessive" fees. N.J.S.A.

56:13-14(b). A fee is presumed to be unreasonable if it is more

than twenty-five percent greater than fees charged to consumers

who consent to the tow, or more than fifty percent higher than

fees charged by towing companies in the municipality from which

the vehicle was towed. Ibid.; N.J.A.C. 13:45A-31.5(a)(1) to (2).

The Director has promulgated regulations establishing a

schedule of permitted services for non-consensual towing and

storage. Under the regulations, a towing company can charge fees

for two types of tows: (1) a basic tow, and (2) a tow following

13 A-2546-16T4
an accident. N.J.A.C. 13:45A-31.4(a). A "[b]asic tow" is defined

as the non-consensual towing of a vehicle that has not been

involved in an accident and all "ancillary services," such as

hooking up the vehicle to the tow truck, transporting the vehicle,

and issuing documents for the release of the vehicle. N.J.A.C.

13:45A-31.2. Towing companies can charge only a flat fee for a

basic tow. N.J.A.C. 13:45A-31.4(a)(1).

When towing a vehicle involved in an accident, companies can

charge for additional services listed in the regulations, provided

that those services are "actually performed." N.J.A.C.

13:45A-31.4(a)(2). For example, a company can charge a flat

"administrative fee" if the company's employees have to make more

than three trips to the stored vehicle. N.J.A.C.

13:45A-31.4(a)(2)(xii).

The Towing Act then declares that

[i]t shall be an unlawful practice for any
. . . towing company that provides
non-consensual towing services: . . . (1) [t]o
charge a fee for a . . . towing or related
storage service not listed on the schedule of
services for which a fee may be charged as
established by the [D]irector except as may
be permitted by the [D]irector by regulation;
or (2) [t]o charge an unreasonable or
excessive fee[.]

[N.J.S.A. 56:13-16(f).]

14 A-2546-16T4
 The Towing Act also states that any violation of its

provisions "is an unlawful practice and a violation of [the CFA]."

N.J.S.A. 56:13-21(a). The Towing Act further provides:

In addition to any penalties or other remedies
provided in [the CFA], the [D]irector may
order a towing company that has billed a
consumer for any non[-]consensual towing or
related storage an amount determined by the
[D]irector to be unreasonable to reimburse the
consumer for the excess cost with interest.

[N.J.S.A. 56:13-21(b).]

Finally, the Towing Act imposes several requirements on

towing companies. Those requirements include: (1) prescribed

business hours for storage facilities so that owners can pick up

their vehicles, including "reasonable accommodations for

after-hours release of stored motor vehicles," N.J.S.A.

56:13-15(a)(1), (b); (2) record-keeping and making those records

available to the Division, N.J.S.A. 56:13-17; and (3) maintaining

minimum levels of liability insurance, N.J.S.A. 56:13-12.

(a) The Amendment to the Powers of Municipalities to
Regulate Towing

Before the enactment of the Towing Act, municipalities had

authority to adopt ordinances or resolutions to regulate towing

companies. N.J.S.A. 40:48-2.49 to -2.54. Municipalities were

authorized to: (1) establish "schedule[s] of fees or other charges"

that towing companies could charge, N.J.S.A. 40:48-2.49(a); (2)

15 A-2546-16T4
designate a municipal officer or agency to enforce the ordinance

or resolution, N.J.S.A. 40:48-2.49(c); and (3) adopt a procedure

to receive complaints and resolve disputes arising from the towing

and storage of motor vehicles, N.J.S.A. 40:48-2.54(b).

When the Legislature enacted the Towing Act, it also amended

the statutory authority of municipalities to regulate towing of

motor vehicles. N.J.S.A. 40:48-2.49. Specifically, that

amendment clarified that the Towing Act applied to all municipal

towing ordinances and regulations. Ibid. In addition, the

amendment stated that the charges for towing services established

by municipalities were limited by the schedule of towing and

storage services established by the Director under the Towing Act.

Ibid. In that regard, N.J.S.A. 40:48-2.49 was amended to include

the following provision:

Nothing in this section shall be construed to
authorize a municipality to establish charges
for services that are not included in the
schedule of towing and storage services for
which a towing company may charge a service
fee established by the Director of [the
Division of] Consumer Affairs pursuant to [the
Towing Act]. Nothing in this section shall
be construed to exempt an operator from
complying with the requirements of [the Towing
Act].

16 A-2546-16T4
 2. The CFA

As already noted, the Towing Act expressly states that any

violation of that Act "is an unlawful practice and a violation of

[the CFA]." N.J.S.A. 56:13-21(a).

The CFA "provides relief to consumers from 'fraudulent

practices in the market place.'" Lee v. Carter-Reed Co., 203 N.J.

496, 521 (2010) (quoting Furst v. Einstein Moomjy, Inc., 182 N.J.

1, 11 (2004)). It affords a consumer legal relief, equitable

relief, treble damages, and counsel fees. N.J.S.A. 56:8-19. To

proceed with a private cause of action under the CFA, a consumer

must "show that the merchant engaged in an 'unlawful

practice,' . . . and that [he or] she 'suffer[ed] [an]

ascertainable loss . . . as a result of the use or employment' of

the unlawful practice." Lee, 203 N.J. at 521 (quoting N.J.S.A.

56:8-2, -19). Thus, to obtain relief under the CFA, a consumer

must prove: "1) unlawful conduct by defendant; 2) an ascertainable

loss by plaintiff; and 3) a causal relationship between the

unlawful conduct and the ascertainable loss." Manahawkin

Convalescent, LP v. O'Neill, 217 N.J. 99, 121 (2014) (quoting

Bosland v. Warnock Dodge, Inc., 197 N.J. 543, 557 (2009)); see

also Dugan v. TGI Fridays, Inc., 231 N.J. 24, 51 (2017) ("An

'unlawful practice' contravening the CFA may arise from (1) an

17 A-2546-16T4
affirmative act; (2) a knowing omission; or (3) a violation of an

administrative regulation.").

An "ascertainable loss" is one that is "quantifiable or

measurable" and not "hypothetical or illusory." Lee, 203 N.J. at

522 (quoting Thiedemann v. Mercedes-Benz, USA, LLC, 183 N.J. 234,

248 (2005)). Finally, the consumer need not prove reliance to

establish causation under the CFA. Instead, "a consumer merely

needs to demonstrate that he or she suffered an ascertainable loss

'as a result of' the unlawful practice." Ibid. (quoting N.J.S.A.

56:8-19).

3. The TCCWNA

The TCCWNA applies to contracts, warranties, notices, and

signs between a consumer and a "seller, lessor, creditor, lender

or bailee." N.J.S.A. 56:12-15. Its purpose "is to prevent

deceptive practices in consumer contracts by prohibiting the use

of illegal terms or warranties in consumer contracts." Kent Motor

Cars, Inc. v. Reynolds & Reynolds, Co., 207 N.J. 428, 457 (2011).

In enacting the TCCWNA, the Legislature "did not recognize any new

consumer rights but merely imposed an obligation on sellers to

acknowledge clearly established consumer rights and provided

remedies for posting or inserting provisions contrary to law."

Dugan, 231 N.J. at 68 (citation omitted); see also Shelton v.

Restaurant.com, Inc., 214 N.J. 419, 432 (2013) (explaining that

18 A-2546-16T4
the TCCWNA's purpose was to strengthen the provisions of the CFA).

A plaintiff bringing a claim under the TCCWNA must establish that

he or she is an "aggrieved consumer," and the defendant violated

a "clearly established legal right" or "responsibility." N.J.S.A.

56:12-15, -17; Dugan, 231 N.J. at 69.

B. The Legal Issues

Our standard of review of legal issues is de novo. Verry v.

Franklin Fire Dist. No. 1, 230 N.J. 285, 294 (2017). Moreover,

in Walker and Pisack, where the trial court granted summary

judgment motions, we conduct a de novo review, using the same

standard as the trial courts. Davis v. Brickman Landscaping,

Ltd., 219 N.J. 395, 405 (2014). Accordingly, we determine whether,

viewing the facts in the light most favorable to the non-moving

party, the moving party has demonstrated that there are no genuine

disputes as to any material facts and, therefore, is entitled to

judgment as a matter of law. R. 4:46-2(c); Davis, 219 N.J. at

405-06 (citing Brill v. Guardian Life Ins. Co. of Am., 142 N.J.

520, 540 (1995)).

1. Whether the Towing Act Requires the Exhaustion of
Administrative Remedies

Defendants contend that before a vehicle owner can pursue a

claim in court, he or she must exhaust his or her administrative

remedies. Defendants then argue that the Towing Act authorizes

19 A-2546-16T4
the Director to order towing companies to reimburse consumers for

unreasonable or excessive fees and costs. N.J.S.A. 56:13-21.

Defendants also argue that the Towing Act authorizes the Director

to establish regulations. Further, in those regulations the

Director requires the parties to use "good faith efforts" to

resolve a dispute, and if the parties are unable to reach a

resolution, the Director may determine whether unreasonable fees

were charged and order the towing company to reimburse the consumer

with interest. N.J.A.C. 13:45A-31.4(f). In Walker and Pisack,

the trial courts accepted that argument and held that plaintiffs

had failed to exhaust their administrative remedies and,

therefore, defendants were entitled to summary judgment. Neither

court stated whether plaintiffs could refile their complaints

after they exhausted the administrative remedies.

The Towing Act does not mandate administrative remedies. The

Towing Act itself uses only the word "may." N.J.S.A. 56:13-21(b).

Specifically, the provision defining "unlawful practice" states:

In addition to any penalties or other remedies
provided in [the CFA], the [D]irector may
order a towing company that has billed a
consumer for any non[-]consensual towing or
related storage an amount determined by the
[D]irector to be unreasonable to reimburse the
consumer for the excess cost with interest.

[N.J.S.A. 56:13-21(b).]

20 A-2546-16T4
That language is permissive. Moreover, that is not the type of

language the Legislature uses to require the exhaustion of

administrative remedies before filing suit. See Jersey Cent.

Power & Light Co. v. Melcar Util. Co., 212 N.J. 576, 588 (2013)

(finding that the Legislature created two categories of disputes

under an act by using the word "shall" to indicate mandatory

alternative dispute resolution and "may" for permissive).

Without specific statutory authority, the Director cannot

create an administrative remedy that would foreclose plaintiff

from pursuing a claim in court. See Circus Liquors, Inc. v.

Governing Body of Middletown Twp., 199 N.J. 1, 12-13 (2009)

(explaining that the head of an administrative agency "may exercise

powers that are expressly granted by statute" and that, there, the

Legislature granted the agency head "express authority to revoke,

or to suspend, licenses").

Furthermore, the regulations under the Towing Act do not

create mandatory administrative remedies. At one point in the

regulations, the Director uses the word "shall," but later uses

the word "may." N.J.A.C. 13:45A-31.4(f). Read in full context,

that provision does not create mandatory administrative remedies.

Instead, the regulatory provision encourages the parties to act

in good faith to resolve any dispute and gives the Director the

authority to order a towing company to reimburse the consumer for

21 A-2546-16T4
any unreasonable or excessive fees or charges. Specifically, the

regulations provide:

If a towing company charges a consumer a fee
for a private property or other non-consensual
towing service that is disputed by the
consumer, the parties shall use good faith
efforts to resolve the dispute. If the
parties are unable to resolve the dispute and
the Director determines the fee to be
unreasonable under N.J.A.C. 13:45A-31.5, the
Director may order the towing company to
reimburse the consumer for an amount equal to
the difference between the charged fee and a
reasonable fee, plus interest, as calculated
pursuant to [these regulations].

[N.J.A.C. 13:45A-31.4(f).]

That regulatory language does not create administrative

remedies that preclude an aggrieved vehicle owner from pursuing a

claim in court. The word "shall" is used in connection with the

direction that the vehicle owner and towing company use good faith

efforts to try to resolve a dispute. There is no mandatory

language requiring further administrative dispute resolution

efforts. See Jersey Cent. Power & Light, 212 N.J. at 588 (quoting

Aponte-Correa v. Allstate Ins. Co., 162 N.J. 318, 325 (2000),

"Where a statutory provision contains both the words 'may' and

'shall,' it is presumed that the lawmaker intended to distinguish

between them, 'shall' being construed as mandatory and 'may' as

permissive.").

22 A-2546-16T4
 In addition, the statutory provision that gives the Director

the permissive –– "may" –– authority to order a reimbursement also

states that it "is an unlawful practice and a violation of [the

CFA]" to violate any provision of the Towing Act. N.J.S.A.

56:13-21(a). That statutory provision further provides that the

Director's authority to order a reimbursement is "[i]n addition

to any penalties or other remedies provided in [the CFA]."

N.J.S.A. 56:13-21(b). Consequently, the Legislature contemplated

that vehicle owners could file their CFA claims in court, and

nothing in the Towing Act or its regulations limits that right.

2. Whether Towing Companies Have Derivative Immunity
Under the TCA

In Pisack, the trial court held that the towing company and

its manager and owner had derivative immunity under the TCA. The

court reasoned that because the towing company was directed by the

Newark Police to tow plaintiff's illegally parked car, the towing

company was effectively "deputized under the law" to perform a

governmental function and, therefore, was afforded immunity under

the TCA. We disagree.

The TCA creates certain limited exceptions to the sovereign

immunity enjoyed by governmental entities. Vanchieri v. N.J.

Sports & Exposition Auth., 104 N.J. 80, 85-86 (1986). Accordingly,

the TCA applies to governmental entities and their employees. It

23 A-2546-16T4
expressly excludes "independent contractors" from the definition

of employees. N.J.S.A. 59:1-3. The TCA applies to private

entities in limited circumstances only where those private

entities act under the control and supervision of a public entity

to perform a governmental service. Vanchieri, 104 N.J. at 86;

Crystal Ice-Bridgeton, LLC v. City of Bridgeton, 428 N.J. Super.

576, 586 (App. Div. 2012).

Here, Pisack is not complaining about the authority of the

police to move her illegally parked car. Instead, she complains

about certain of the towing charges. The police did not supervise

the towing charges. Moreover, the municipal ordinance allowing

towing and storage charges does not insulate from challenge a

towing company's actual charges. Indeed, the statute that

authorizes municipalities to regulate towing services requires

each municipality to provide a dispute resolution procedure,

effectively recognizing that towing companies will sometimes

overcharge or charge for services that are not permitted. N.J.S.A.

40:48-2.54. Furthermore, Pisack did not sue Newark. She sued a

privately-owned towing company that charged her for towing her

car.1

1
As previously noted, B&C Towing's third-party complaint against
Newark was severed. Hence, the order on appeal did not address
that complaint, and did not address the $25 administrative fee

24 A-2546-16T4
 In the Towing Act, the Legislature expressly stated that a

violation of that Act "is an unlawful practice and a violation of

[the CFA]." N.J.S.A. 56:13-21(a). Accordingly, the Legislature

recognized that vehicle owners could pursue claims for violations

of the Towing Act. The Legislature did not address sovereign

immunity or the TCA in the Towing Act. To accept the argument

that towers are protected by sovereign immunity would render the

Towing Act inapplicable any time the police directed a vehicle to

be towed. Such a construction would be inconsistent with the

plain language of the Towing Act and undermine its purpose, and

is not required by the TCA. Thus, we hold that there is no

derivative immunity under the TCA for alleged violations of the

Towing Act committed by a privately-owned towing company.

3. Whether the Towing Act Limits the Types of Services
for Which a Towing Company Can Charge a Fee

As already noted, the Towing Act requires the Director to

establish a "schedule" of towing and related storage services for

which a towing company may charge a fee in connection with

non-consensual towing. N.J.S.A. 56:13-14. The Towing Act then

provides that it is an "unlawful practice" for any towing company

that B&C Towing collected on behalf of Newark, as opposed to the
fee the company collected as its own charge. Hence, we also do
not address Newark's administrative fee, an issue not before us.

25 A-2546-16T4
to charge a fee "not listed on the schedule of services"

established by the Director. N.J.S.A. 56:13-16(f)(1).

The Director has issued a schedule of permitted services.

N.J.A.C. 13:45A-31.4. That schedule provides:

(a) A towing company that engages in . . .
non-consensual towing may charge fees for the
following services:

1. Basic tow, which shall be a flat
fee; and

2. In the case of a motor vehicle
involved in an accident the following
additional services, if actually
performed:

i. Waiting time in excess of 15
minutes, which shall be calculated
based upon each 15 minutes spent at
the site from which a motor vehicle
will be towed, with fewer than 15
minutes rounded up to 15;

ii. Brush cleaning, including
collection of debris that can be
picked up by hand, which shall be a
flat fee;

iii. Site clean-up, which shall be
calculated based upon the number of
bags of absorbent used;

iv. Winching, which shall be based
upon each one-half hour spent
performing winching;

v. The use of window wrap, which
shall be a flat fee;

vi. Tarping, which shall be a flat
fee;

26 A-2546-16T4
 vii. Transmission disconnect, a
flat fee, which shall be charged
only if a motor vehicle is locked
and the towing company is unable to
obtain the keys for the motor
vehicle;

viii. Use of a flat bed tow truck,
a flat fee, which shall be charged
if a motor vehicle can be
transported only by a flat bed tow
truck;

ix. Use of special equipment other
than the first tow truck to recover
a motor vehicle that cannot be
recovered by winching or pieces of
a motor vehicle that cannot be moved
by hand, which may be both a labor
and an equipment charge billed in
half-hour increments;

x. Decoupling;

xi. Storage at a towing company's
storage facility;

xii. More than three trips to the
motor vehicle in storage, which may
be invoiced as an administrative
fee, which shall be a flat fee; and

xiii. Releasing a motor vehicle from
a towing company's storage facility
after normal business hours or on
weekends, which shall be a flat fee.

[N.J.A.C. 13:45A-31.4(a).]

The regulations also provide that a towing company may charge

for "tolls it incurs driving to the site from which a motor vehicle

will be towed and while towing the motor vehicle from that site

27 A-2546-16T4
to the towing company's storage facility." N.J.A.C.

13:45A-31.4(c). Finally, the regulations state that "[a] towing

company shall not charge any fee for . . . non[-]consensual towing

and related storage services not included in [the schedule] above."

N.J.A.C. 13:45A-31.4(e).

In short, if a service is not listed on the Director's

schedule, a towing company cannot charge for that service. In

addition, any fee for a permitted service must be charged

consistent with the requirements and limitations in the Towing Act

and its regulations.

4. Whether Plaintiffs Can Pursue Claims Under the TCCWNA

The parties dispute whether the vehicle owners were consumers

within the meaning of the TCCWNA. The parties also dispute whether

the bills issued by defendants constitute a "consumer contract"

under the TCCWNA.

A "consumer" is defined under the TCCWNA as "any individual

who buys, leases, borrows, or bails any money, property or service

which is primarily for personal, family or household purposes."

N.J.S.A. 56:12-15. "[New Jersey] courts have examined the

interaction between the parties and the nature of the contract or

other writing in order to determine whether a plaintiff is entitled

to relief under the TCCWNA." Dugan, 231 N.J. at 69.

28 A-2546-16T4
 Here, the vehicle owners meet the definition of a consumer.

The Legislature defined a vehicle owner under the Towing Act as a

"consumer." See N.J.S.A. 56:13-9 ("'Consumer' means a natural

person. . . . 'Towing' means the moving or removing . . . of a

consumer's motor vehicle that is damaged as a result of an accident

or . . . is parked illegally or otherwise without authorization

. . . ."); N.J.S.A. 56:13-21(b) (authorizing the Director to order

a towing company to reimburse a "consumer" for unreasonable towing

charges). Like the Towing Act, the TCCWNA is remedial legislation

intended to protect consumers. It is therefore logical to give a

consistent construction to terms used in both statutes.

Accordingly, if vehicle owners are consumers under the Towing Act,

they also should be considered consumers under the TCCWNA.

Furthermore, the word "bails" is applicable to a vehicle

owner. A bailment is "a delivery of personal property by one

person (the bailor) to another (the bailee)." Black's Law

Dictionary 136 (7th ed. 1999). In addition, a "bailee" is someone

"who receives personal property from another as a bailment." Ibid.

While a bailment is generally established by a contract, a bailment

can be created without a formal written contract. See McGlynn v.

Parking Auth. of Newark, 86 N.J. 551, 556-59 (1981) (discussing

bailments and reasoning that the better approach is to focus on

the relationship of the parties in defining the rights and duties

29 A-2546-16T4
of the parties). Consequently, when towing companies take a

vehicle, they are doing so as bailees and vehicle owners are

consumers as defined by the TCCWNA.

The TCCWNA does not define "consumer contract." Our Supreme

Court, however, has looked to the Plain Language Act, N.J.S.A.

56:12-1 to -13, for an applicable definition. Shelton, 214 N.J.

at 438. Under the Plain Language Act, a "[c]onsumer contract"

includes "a written agreement in which an individual . . .

[c]ontracts for services including professional services . . .

[or] [e]nters into a service contract . . . for cash or on credit

and the money, property or services are obtained for personal,

family or household purposes." N.J.S.A. 56:12-1. Significantly,

that definition "includes writings required to complete the

consumer transaction." Ibid.

The TCCWNA is "entitled to a broad interpretation to

facilitate its stated purpose." Shelton, 214 N.J. at 442.

Accordingly, the writing need not be formally labeled as a

contract, warranty, notice, or sign to fall within the TCCWNA's

ambit. In Shelton, the Court considered whether "a printed

announcement" on restaurant gift certificates relating to "the use

of the certificates" brought "the transaction within the scope of

the TCCWNA." Id. at 441-42. In that regard, the Court concluded

30 A-2546-16T4
that the printed announcement was a "notice" as contemplated by

the TCCWNA. Id. at 442.

The bills issued by the towing companies are consumer

contracts and notices within the meaning of the TCCWNA. The

regulations to the Towing Act assume that towing companies will

issue a "bill" for non-consensual towing services, and that bill

"shall include a list of all services provided." N.J.A.C.

13:45A-31.4(i) to (k). Moreover, the regulations require towing

companies to keep "[i]nvoices . . . for non-consensual towing

services" for three years. N.J.A.C. 13:45A-31.9(a)(1).

Accordingly, those bills and invoices act as the "writings required

to complete the consumer transaction." N.J.S.A. 56:12-1. Indeed,

a vehicle owner given such a bill will rely on that bill as the

justification for the services charged.

The inclusion of prohibited charges in the bill "deceives a

consumer into thinking that they are enforceable." Dugan, 231

N.J. at 68 (citation omitted). Charges not permitted by the Towing

Act violate a "clearly established legal right" or

"responsibility." Finally, if the vehicle owner paid for

unauthorized services, the owner has suffered an ascertainable

loss. Accordingly, towing bills with prohibited charges are the

type of deceptive consumer transaction that the Legislature aimed

to prevent under the TCCWNA.

31 A-2546-16T4
 5. Whether Plaintiffs Have Asserted Certain Claims That
Can Be Pursued As Class Actions

Rule 4:32-1 sets forth the requirements for class

certification. New Jersey courts have "consistently held that the

class action rule should be liberally construed." Dugan, 231 N.J.

at 46 (quoting Lee, 203 N.J. at 518). To certify a class, there

are "four initial requirements, frequently termed 'numerosity,

commonality, typicality and adequacy of representation.'" Id. at

47 (quoting Lee, 203 N.J. at 519). Specifically, Rule 4:32-1(a)

provides:

One or more members of a class may sue or be
sued as representative parties on behalf of
all only if (1) the class is so numerous that
joinder of all members is impracticable, (2)
there are questions of law or fact common to
the class, (3) the claims or defenses of the
representative parties are typical of the
claims or defenses of the class, and (4) the
representative parties will fairly and
adequately protect the interests of the class.

If those initial requirements are satisfied, the court then

considers whether "the questions of law or fact common to the

members of the class predominate over any questions affecting only

individual members, and that a class action is superior to other

available methods for the fair and efficient adjudication of the

controversy." R. 4:32-1(b)(3).

Predominance exists if "the proposed class is 'sufficiently

cohesive to warrant adjudication by representation.'" Dugan, 231

32 A-2546-16T4
N.J. at 48 (quoting Iliadis v. Wal-Mart Stores, Inc., 191 N.J. 88,

108 (2007)). To establish predominance, however, a "plaintiff

does not have to show that there is an 'absence of individual

issues or that the common issues dispose of the entire dispute,'

or 'that all issues [are] identical among class members or that

each class member [is] affected in precisely the same manner.'"

Lee, 203 N.J. at 520 (alterations in original) (quoting Iliadis,

191 N.J. at 108-09).

Depending on the facts developed after discovery, violations

of the Towing Act, as well as the related claims under the CFA and

the TCCWNA, may be appropriate for class certification. For

example, claims against a towing company that uniformly charges a

relatively modest fee for a service or services not permitted

under the Towing Act and its regulations, may be well suited for

class certification. One consumer may not think it worthwhile to

pursue such a claim, but if there are hundreds of such aggrieved

consumers, a class may be appropriate. See, e.g., Bosland, 197

N.J. at 560-61 (explaining that the CFA affords a remedy for

plaintiffs of a class with "nominal" claims that otherwise "might

go unvindicated").

33 A-2546-16T4
 C. The Application of Our Holdings to Each Case

1. Walker

In Walker, the trial court granted summary judgment to

defendants on the grounds that plaintiff failed to exhaust his

administrative remedies and failed to use the dispute resolution

procedures afforded by the Director or the municipality. Since

we hold that those administrative procedures are not mandatory,

we reverse the July 24, 2017 order granting summary judgment to

defendants. We remand for further proceedings.

The trial court also held that the $35 administrative fee,

challenged by plaintiff, was permissible under the municipality's

towing ordinance. Walker's vehicle was not involved in an

accident; rather, his vehicle was towed after he was stopped and

the police observed that his vehicle was not registered. Under

the Towing Act's regulations, an administrative fee is only

permitted if a vehicle is towed after an accident and then only

if employees of the towing company make more than three trips to

the vehicle in storage. N.J.A.C. 13:45A-31.4(a)(2)(xii).

Moreover, a municipality does not have the authority to allow

charges for services that are not listed under the Towing Act's

regulations. See N.J.S.A. 40:48-2.49.

Thus, defendants were not permitted to charge an

administrative fee, and that charge violated the Towing Act, the

34 A-2546-16T4
CFA, and the TCCWNA. On remand, we direct that summary judgment

be granted in favor of plaintiff on those individual claims.

Walker also asserted that defendants unlawfully failed to release

his vehicle after normal business hours as required by the Towing

Act and its regulations. The trial court did not address that

issue; it shall address the merits on remand. We further direct

that Walker be permitted to file a motion to certify a class.

Since no record was developed on that issue, we do not address

whether a class should be certified.

2. Pisack

In Pisack, the trial court granted summary judgment to

defendants on four grounds: (1) the TCCWNA was inapplicable because

there was no contract between Pisack and B&C Towing; (2) Pisack

failed to exhaust administrative remedies before pursuing a court

action; (3) the fees charged by B&C Towing were permitted under

Newark's towing ordinance; and (4) B&C Towing was entitled to

derivative immunity under the TCA. We reverse the January 13,

2017 order granting summary judgment to defendants.

We hold that the TCCWNA is applicable and plaintiff can pursue

a claim under that Act. We also hold that plaintiff did not have

to exhaust administrative remedies and that B&C Towing and its

owners were not entitled to derivative immunity under the TCA. We

35 A-2546-16T4
also reverse the trial court's decision that the fees charged by

B&C Towing were permitted under Newark's towing ordinance.

With regard to the fees charged, Pisack challenged the

administrative fee and labor charge. The Towing Act and its

regulations only permit a labor charge for a tow following an

accident, in which "special equipment" was used to tow the vehicle,

or the vehicle was not able to be "recovered by winching."

N.J.A.C. 13:45A-31.4(a)(2)(ix). Further, as already noted, the

Towing Act's regulations permit an administrative fee only if a

vehicle is towed after an accident. Pisack's vehicle was towed

because it was parked illegally. Thus, both the labor charge and

the administrative fee were charged in violation of the Towing

Act, the CFA, and the TCCWNA. Moreover, Newark, as a municipality,

does not have the authority to allow a charge for services that

are not listed under the Towing Act's regulations. N.J.S.A.

40:48-2.49. We, therefore, remand with the direction that summary

judgment be entered in favor of Pisack on those individual claims.

The trial court in Pisack never addressed the question of

class certification. Instead, the court denied plaintiff's motion

as "moot" because the court had granted summary judgment to

defendants. We, therefore, also remand this matter with the

direction that the court address plaintiff's motion for class

36 A-2546-16T4
certification on the merits. As that issue was not addressed, we

express no view as to whether a class should be certified.

3. Pellegrino

In Pellegrino, the trial court entered an order holding that

plaintiff could pursue her claims only in her individual capacity

and not on behalf of a class. Because that decision was made

before Pellegrino was permitted to take any discovery, including

class-related discovery, we reverse the portion of the June 5,

2017 order dismissing plaintiff's claims for a class action. We

remand with the direction that the court permit class-related

discovery and then allow Pellegrino to file a motion for class

certification. Again, because no record was developed, we do not

decide whether a class should be certified.

Because we are remanding the claims in Pellegrino, we give

some guidance on the disputed charges. Plaintiff challenges the

yard charge, credit card surcharge, administrative fee, and

storage fee overcharge. The Towing Act and its regulations do not

permit a "yard charge" or a "credit card surcharge." Thus, those

charges are violations of the Towing Act, the CFA, and the TCCWNA.

Pellegrino was involved in an accident, and thus an

administrative fee and storage fee can be charged, provided the

services were "actually performed" in compliance with the Towing

Act's regulations. N.J.A.C. 13:45A-31.4(a)(2). Accordingly, on

37 A-2546-16T4
remand the parties will need to engage in discovery concerning

those fees.

In summary, all three orders on appeal are reversed and the

matters are remanded for further proceedings consistent with this

opinion. We do not retain jurisdiction.

38 A-2546-16T4