CNJ CONSTRUCTION CORPORATION VS. AUTOBUILDERS GENERAL CONTRACTING SERVICES, INC. (L-1327-16, MORRIS COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.

SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-0362-18T1

CNJ CONSTRUCTION
CORPORATION,

Plaintiff-Respondent,

v.

AUTOBUILDERS GENERAL
CONTRACTING SERVICES, INC.,

Defendant-Appellant,

and

ARCH INSURANCE COMPANY,

Defendant.
___________________________________

Submitted October 31, 2019 – Decided January 31, 2020

Before Judges Nugent and DeAlmeida.

On appeal from the Superior Court of New Jersey, Law
Division, Morris County, Docket No. L-1327-16.

Scott Mark Yaffe, attorney for appellant.
 Hoagland Longo Moran Dunst & Doukas, attorneys for
respondent (Lawrence P. Powers, of counsel; Peter K.
Oliver, on the brief).

PER CURIAM

Defendant Autobuilders General Contracting Services, Inc.

(Autobuilders) appeals from the August 14, 2018 final judgment of the Law

Division awarding damages to plaintiff CNJ Construction Corporation (CNJ)

and dismissing Autobuilders's counterclaim in this construction contract

dispute. We affirm.

I.

The trial court found the following facts after trial. Autobuilders was the

general contractor responsible for the construction of a Maserati dealership in

Morris County (the Project). In 2014 and 2015, Autobuilders entered into four

subcontracts with CNJ relating to the Project. Under the subcontracts, CNJ was

responsible for demolition, concrete, steel, and site work. The provisions of the

four subcontracts at issue here are identical.

According to Article 9.1 of the subcontracts,

[i]f in the opinion of Autobuilders, [CNJ] shall at any
time: (1) refuse or fail to provide sufficient properly
skilled workmen or materials of the proper quality; (2)
fail in any respect to prosecute the work according to
the current schedule; (3) cause, by any action or
omission, the stoppage, or delay of or interference with

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 the work of Autobuilders or of any other builder or
subcontractor; (4) fail to comply with all provisions of
this Subcontract or the Contract Documents[;] or (5)
act, or fail to act, in any other way which significantly
and negatively impacts the timely completion of the
Project or otherwise negatively impacts the work in
general, then after serving three (3) days' written notice,
unless the condition(s) specified in such notice shall
have been alleviated within such three (3) days,
Autobuilders may, at its option: (a) . . . take such steps
as are necessary to overcome the condition, in which
case [CNJ] shall be liable to Autobuilders for the cost
thereof . . . or (b) terminate the Subcontract for default
[and] complete the work either by itself or through
others . . . .

....

Notwithstanding anything herein to the contrary, in the
event [CNJ] actually or effectively abandons its
contract work on the Project, or is otherwise aware of
its continuing non-performance or unacceptable work,
Autobuilders may exercise its options herein without
the requirement of any three[-]day written notice.

In the event of a termination for default under Article 9.1, if the amount paid by

Autobuilders to complete the subcontract exceeds the amount due to CNJ for the

work it performed prior to the termination CNJ is liable to Autobuilders for the

difference.

Article 24.1 of the subcontracts provides the methods for providing notice

to CNJ of alleged deficiencies under Article 9.1. Such notices must be sent to

the address or telephone number specified in the subcontract by fax, with written

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confirmation, nationally recognized overnight carrier, or registered mail, return

receipt requested.

Article 9.3 provides, "[i]f Autobuilders wrongfully exercises any option

under Article 9.1 . . . such exercise shall be deemed a [t]ermination for

[c]onvenience and [CNJ will be] compensated as provided for in Article 15" of

the subcontracts. Article 15.1 provides that after a termination for convenience,

CNJ "shall be paid the amount representing costs which are due . . . for its work

as provided in the" subcontracts without being responsible for the costs incurred

by Autobuilders after termination.

On September 16, 2015, an Autobuilders representative sent four letters

to CNJ, one for each subcontract, alleging deficiencies in CNJ's performance.

Although the letters listed verbatim the categories of deficiencies set forth in

Article 9.1, they did not identify with specificity any alleged deficiency in CNJ's

work. The letters stated Autobuilders

will accordingly exercise its right to supplement your
company's work for any further delays, omissions, lack
of materials, failure to follow the schedule, or any other
act or omission that relates to any of the above stated
issues. [CNJ] will be back charged for all related costs
and expenses.

The letters, which were not sent by any of the methods of delivery set forth in

Article 24.1, made no mention of a three-day cure period.

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 On the same day it received the September 16, 2015 notice, CNJ requested

in writing clarification of the nature of the deficiencies and an opportunity to

cure the deficiencies. CNJ also demanded payment for work it had completed

under the subcontracts.

On September 24, 2015, Autobuilders sent CNJ a letter specifying in

detail alleged deficiencies in CNJ's work. At the time it sent the September 24,

2015 letter, Autobuilders had already signed at least one subcontract to correct

the alleged deficiencies in CNJ's work and paid a subcontractor for that work.

Autobuilders refused to pay invoices submitted by CNJ for work it completed

on the Project prior to the September 16, 2015 letter. The parties ultimately

stipulated the amount sought by CNJ for completed work under the demolition,

concrete, and steel subcontracts totaled $110,052.15.

CNJ filed construction liens on the demolition, concrete, and steel

subcontracts for its outstanding invoices. It subsequently filed a complaint in

the Law Division alleging book account claims and claims under the

Construction Lien Law, N.J.S.A. 2A:44A-1 to -38, to recover what it alleges it

is due for work completed on the demolition, concrete, and steel subcontracts.

CNJ does not seek payment under the site work subcontract, as it concedes it

was paid for all work it performed under that agreement.

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 Autobuilders filed a counterclaim alleging under Article 9.1 CNJ is liable

for the costs Autobuilders incurred to complete the site work subcontract.

Autobuilders alleged the amount CNJ owes on the counterclaim offsets all

amounts Autobuilders owes CNJ, and results in a liability in favor of

Autobuilders of $145,107.82.

The matter was tried without a jury over two days before Judge Frank J.

DeAngelis. During trial, Autobuilders argued it provided notice and a three-day

cure period in conformity with Articles 9.1 and 24.1 and, alternatively, that CNJ

abandoned the Project after receipt of the September 16, 2015 letter.

On August 1, 2018, Judge DeAngelis issued a comprehensive oral opinion

in which he found Autobuilders provided no evidence that it complied with the

notice provisions of Articles 9.1 and 24.1, and failed to provide CNJ with a

three-day period in which to cure alleged deficiencies in its work. In addition,

Judge DeAngelis found the record contained no evidence CNJ abandoned the

Project after the September 16, 2015 notice, given its written request for

clarification of the alleged deficiencies on the same day it received the notice.

Thus, the judge concluded, Autobuilders terminated the site work subcontract

for convenience and is not entitled to recover from CNJ amounts spent after

termination of the site work subcontract. Finally, Judge DeAngelis found CNJ

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established its claim Autobuilders owed it $110,052.15 for work performed on

the demolition, cement, and steel subcontracts. In reaching his decisions, the

judge made specific credibility determinations based on the the testimony of the

witnesses.

On August 14, 2018, the court entered judgment awarding CNJ

$110,052.15 in damages and dismissing Autobuilders's counterclaim.

This appeal followed. Autobuilders makes the following arguments for

our consideration:

POINT I

THE TRIAL COURT ERRED IN MAKING AN
AWARD TO CNJ ON THE CONCRETE AND
STRUCTURAL STEEL SUBCONTRACTS AS CNJ
PROVIDED NO EVIDENCE OF ANY UNPAID
COSTS.

POINT II

THE TRIAL COURT ERRED IN NOT MAKING AN
AWARD TO AUTOBUILDERS ON ITS
COUNTERCLAIM AS AN OVERPAYMENT WAS
PROVEN PRIMA FACIE AND
UNCONTROVERTED.

II.

Our scope of review of the judge's findings in this nonjury case is limited.

We must defer to the judge's factual determinations, so long as they are

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supported by substantial credible evidence in the record. Rova Farms Resort,

Inc. v. Inv'rs Ins. Co. of Am., 65 N.J. 474, 483-84 (1974). This court's

"[a]ppellate review does not consist of weighing evidence anew and making

independent factual findings; rather, [this court's] function is to determine

whether there is adequate evidence to support the judgment rendered at trial."

Cannuscio v. Claridge Hotel & Casino, 319 N.J. Super. 342, 347 (App. Div.

1999) (citing State v. Johnson, 42 N.J. 146, 161 (1964)). We only review de

novo the court’s legal conclusions. Manalapan Realty, L.P. v. Twp. Comm.,

140 N.J. 366, 378 (1995).

In addition, this court "must give deference to those findings of the trial

judge which are substantially influenced by his or her opportunity to hear and

see the witnesses and have the 'feel' of the case, which [this court does] not enjoy

upon appellate review." State ex rel. D.M., 451 N.J. Super. 415, 424 (App. Div.

2017) (quoting State ex rel. S.B., 333 N.J. Super. 236, 241 (App. Div. 2000)).

There must be "deference to the trial court's credibility determinations[,]"

N.J. Div. of Youth & Family Servs. v. M.M., 189 N.J. 261, 279 (2007), "because

it 'hears the case, sees and observes the witnesses, and hears them testify,'

affording it 'a better perspective than a reviewing court in evaluating the veracity

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of a witness.'" City Council v. Edwards, 455 N.J. Super. 261, 272 (App. Div.

2018) (quoting Gnall v. Gnall, 222 N.J. 414, 428 (2015)).

Having carefully reviewed Autobuilders's arguments in light of the record

and applicable legal principles, we are satisfied there is substantial credible

evidence supporting Judge DeAngelis's findings of fact. We also agree with his

legal conclusions CNJ is entitled to recovery for the work it performed under

the demolition, concrete, and steel subcontracts, the amount due under those

subcontracts was agreed to by the parties and not controverted at trial, and

Autobuilders failed to establish its counterclaim. We therefore affirm the

August 14, 2018 final judgment for the reasons stated in Judge DeAngelis's

August 1, 2018 oral opinion.

Affirmed.

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