NOT FOR PUBLICATION WITHOUT THE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-4906-18T4
BERLIN CROSS KEYS
SHOPPING CENTER
ASSOCIATES, LLC,
Plaintiff,
v.
STEPHEN SAMOST, ESQUIRE
and LAW OFFICES OF
STEPHEN SAMOST,
Defendants,
and
SAMINVEST CO., LLC,
Defendant/Third-Party
Plaintiff-Respondent,
v.
WALMART STORES, INC.
and WALMART REAL
ESTATE BUSINESS TRUST,
Third-Party
Defendants-Appellants,
and
CARL FREEDMAN, MITCHELL
COHEN, SCOTT CIOCCO, and
MARK ARENCIBIA,
Third-Party Defendants.
_________________________________
Argued telephonically March 23, 2020 –
Decided July 22, 2020
Before Judges Rothstadt and Mitterhoff.
On appeal from the Superior Court of New Jersey, Law
Division, Camden County, Docket No. L-5114-12.
Donald A. Rea (Saul Ewing Arnstein & Lehr LLP) of
the Pennsylvania bar, admitted pro hac vice, argued the
cause for appellants (Donald A. Rea and Jordan D.
Rosenfeld of the Maryland bar, admitted pro hac vice,
and Amy L. Picolla, attorneys; Amy L. Piccola, Donald
A. Rea, and Jordan D. Rosenfeld, of counsel and on the
briefs).
Peter Jay Boyer argued the cause for respondent
(Hyland Levin Shapiro LLP, attorneys; Peter Jay
Boyer, of counsel and on the brief).
PER CURIAM
After a jury trial resulted in a $500,000 verdict against third-party
defendants Walmart Stores, Inc. and Walmart Real Business Trust (collectively,
Walmart), for making fraudulent misrepresentations, Walmart appealed from the
trial court's earlier denial of its motion for summary judgment and its motion for
A-4906-18T4
2
judgment under Rule 4:40-1.1 In that appeal, Walmart argued that "the trial
court erred in ruling that [third-party plaintiff Saminvest Co. LLC's (Saminvest)]
claim was not barred by the statute of limitations." Berlin Cross Keys Shopping
Ctr. Assocs., LLC v. Samost, No. A-3657-17 (Apr. 26, 2019) (Berlin I) (slip op.
at 3). We affirmed the denial of summary judgment but remanded the denial of
the motion for judgment. On remand, the trial court determined the issue and
entered an order on May 30, 2019, again denying Walmart's motion. Walmart
now appeals from that order.
On appeal, Walmart argues that Saminvest filed in 2016 its fraudulent
misrepresentation claim against Walmart outside of the six-year statute of
limitations applicable to fraud because Saminvest received a letter from
Walmart in March 2008 that should have put Saminvest on notice of its claim
against Walmart. We affirm, as we conclude from our de novo review that on
remand the trial court's determination of the factual issues about the letter was
supported by credible evidence and therefore its legal conclusion that the letter
did not put Saminvest on notice of a claim in 2008 was correct.
1
Although the parties referred to Walmart's motion for judgment as a motion
for a directed verdict, see R. 4:37-2(b), we consider it to have been made Rule
4:40-1 because it was made at the close of all the evidence. However, the
distinction is without any difference because the standard of review is the same .
A-4906-18T4
3
Saminvest's claims against Walmart arose out of a transaction that initially
contemplated that plaintiff Berlin Cross Keys Shopping Center Associates, LLC
(BCK) would purchase land owned by Saminvest in the Borough of Berlin,
develop a shopping center on the property, and then sell a portion to Walmart
for the construction of a store. However, when BCK could not go forward with
the project, the transaction morphed into a proposed direct sale of the subject
property by Saminvest to Walmart, which was never consummated.
The failed transactions resulted in BCK filing a complaint in 2012 against
Saminvest, its principal, defendant Stephen Samost, and his law firm, defendant
the Law Office of Stephen Samost. On November 20, 2014, Saminvest filed a
third-party complaint against Walmart and other parties. On May 26, 2016,
Saminvest amended its third-party complaint, adding new claims, including the
claim for fraudulent misrepresentation. By the time this matter was tried in
2018, the only claims that had to be resolved were those made by Saminvest
against Walmart.
We described the facts surrounding the failed transactions in our earlier
opinion and incorporate them here by reference. See Berlin I, slip op. at 3-10.
We provide only the following summary of the facts and procedural history we
earlier found as they relate to the present appeal.
A-4906-18T4
4
At the end of discovery in this matter, Walmart moved for summary
judgment, arguing that New Jersey's six-year statute of limitations for fraud,
N.J.S.A. 2A:14-1, barred Saminvest's claims against Walmart. In denying that
motion, the trial court found that a reasonable jury could have concluded that
during a phone call between Walmart's representative Matt Sitton and Samost,
on behalf of Saminvest, after they exchanged certain letters in March 2008,
Sitton reaffirmed Walmart's agreement to purchase the property once certain
zoning issues were resolved. See Berlin I, slip op. at 10-11. The court also
concluded that based on revisions Walmart made to a letter it sent to the Berlin
Borough mayor, in March 2008, stating that "[a]t this time, Walmart will not be
moving forward with the project," a jury reasonably could find that Walmart's
letter was consistent with the terms of Sitton's oral promise on behalf of Walmart
because the purchase would have been contingent on the resolution of the zoning
appeals. Ibid.
During the ensuing trial, at the close of Saminvest's case, Walmart moved
for judgment, which the court denied. The court reiterated that a jury could
reasonably infer from the language Walmart used in a March 25, 2008 letter to
Samost, and from Sitton's phone call to Samost after the exchange of letters, that
Walmart was still abiding by Sitton's oral promise for Walmart to purchase the
A-4906-18T4
5
property once the zoning appeals were resolved. Id. at 11-12. Walmart renewed
its motion for judgment at the close of all of the evidence, and the trial court
again denied the motion without making any additional findings. Id. at 12.
Thereafter, the jury returned its verdict, the court entered judgment, and
Walmart appealed. Id. at 13.
On appeal, Walmart argued that the trial court erred in denying its motion
for summary judgment and its motion for judgment since Saminvest's claim for
fraudulent misrepresentation was barred by New Jersey's six-year statute of
limitations. Saminvest contended that the discovery rule tolled the statute of
limitations. Ibid. In response, we issued our opinion affirming the trial court's
denial of summary judgment, id. at 19, but remanded the matter after concluding
that the trial court should have made "a determination on the discovery rule, and
if necessary assess credibility, prior to the case being submitted to the jury for a
verdict," as if it had conducted a Lopez hearing,2 even though one was never
requested by any party. Id. at 20. We directed the trial court on remand "to
issue a ruling on when plaintiff's action accrued for purposes of the discovery
rule" and to "issue findings based upon the trial record, rather than holding a
new Lopez hearing on remand." Id. at 21.
2
Lopez v. Swyer, 62 N.J. 267 (1973)
A-4906-18T4
6
On remand, the trial court considered the matter and placed its
comprehensive oral decision on the record on May 30, 2019 before issuing the
order now under appeal. As part of its credibility findings, the court found Sitton
incredible and relied upon specific portions of his direct testimony and responses
to questions on cross-examination. Among them, the court noted that when
Sitton was shown one email, he confirmed telling Samost that the two had a
"verbal business agreement," but then testified that he understood such a
statement to be non-binding. The court also found that Sitton's testimony about
his presentation of the proposed deal with Saminvest to Walmart's real estate
committee was "evasive," and that his failure to disclose the committee's
rejection of the proposal to Samost undermined his credibility. The court also
found equally damaging to Sitton's credibility was his testimony implying "it
[was] permissible to be cavalier with the facts in all aspects of the real estate
industry."
The court found Samost's testimony was credible especially about how
Sitton confirmed to him that Walmart and Saminvest had a deal, provided that
the zoning issues were resolved, despite Walmart's March 25, 2008 letter,
because Walmart never stated in that letter that there was no deal. The court
added that Samost's testimony about the conversation he had with Sitton, when
A-4906-18T4
7
the promise for Walmart to buy the property from Saminvest was made, was
clear, consistent, and unwavering. Moreover, Samost's "continued efforts to
expend time, money, [and] resources" on appeals to preserve the zoning
approvals supported Samost's version of the facts.
The trial court reviewed the history of the parties' transaction and noted
Walmart's repeated assurances to municipal officials, BCK, and Samost of its
intention to consummate the subject purchase even though there was never a
written agreement between Walmart and BCK or Saminvest. The court
concluded that April 2, 2009 was the earliest date that Saminvest's fraudulent
misrepresentation claim could have accrued given that it was not until then that
a Supreme Court decision resolved the zoning issues preventing the shopping
center's development.
The court found that the letter Walmart sent to the Borough's mayor in
late March 2008 did not, as Walmart argued, indicate that it had abandoned the
project, but rather served two purposes. First, it prevented Walmart from being
seen as a "stalking horse" by Berlin Borough or Camden County 3; and it did not
3
During the same period that Saminvest was pursuing the approvals and
defending them in court actions, Walmart was aware that in order to thwart the
project, the Borough and the County were contemplating a condemnation of
Saminvest's property. According to the trial court,
A-4906-18T4
8
"semantically" contradict Sitton's assurances to Samost that Walmart would
honor its deal with Saminvest if the zoning appeals were preserved. According
to the court, Walmart "was trying to keep peace with the Borough and . . . was
trying to get . . . Samost to continue to expend resources to preserve the land use
approvals." And, significantly, to that end, Walmart did not copy Saminvest
with the letter when it was sent as it had with other written communications
relating to the project.
Second, the letter did not refer to a transaction between Walmart and
Saminvest, rather it applied to the only transaction the mayor was aware of—
the one between BCK and Walmart. That conclusion was supported by revisions
made to a draft of the letter that deleted a reference to Walmart "no longer having
an intent to construct a store," and replacing it with Walmart not moving forward
with the project. The former was not true as Walmart still intended to construct
Walmart would [not] act as a stalking horse, in essence
being used to drive up the value of the land in any type
of condemnation proceeding that might possibly occur.
This was important to Walmart with respect to not only
Berlin Borough, but also with respect to Camden
County and the State of New Jersey as they wanted to
keep good relationships with these governing bodies
because they appear, do business in, seek approvals of,
[and] are regulated by, those governmental entities.
A-4906-18T4
9
a store after its purchase from Saminvest, and the latter was correct as to its
agreement with BCK. According to the trial court, Walmart did not "want to
make a misrepresentation about what they intended to do with . . . Samost" so it
could "have it both ways[,] trying to keep peace with the Borough and . . . trying
to get . . . Samost to continue to expend resources to preserve the land use
approvals."
Turning to Walmart's March 25, 2008 letter to Samost, which Walmart
asserted made clear its intention to not proceed with the Saminvest transaction,
the trial court found here too the letter made no reference to the purchase from
Saminvest and only related to the BCK agreement that was the subject of the
then-pending court action filed by objectors to the approvals granted for that
deal because the letter discussed notifying the court that the BCK purchase was
terminated.4 Similarly, the trial court found that Samost's reply to that letter,
4
The March 25, 2008 letter to Samost that Walmart contends triggered the
statute of limitations stated in relevant part:
As you are aware, Wal-Mart had the right to purchase
the property, or take an assignment of the right to
purchase the property, from [BCK]. It was Wal-Mart's
understanding that [BCK] had terminated its
contractual rights and Wal-Mart's contractual rights
regarding the property had terminated with [BCK's].
Accordingly, Wal-Mart believes that it has an
A-4906-18T4
10
which Walmart contends acknowledged that Walmart was not proceeding with
the direct purchase, only dealt with Walmart's purchase from BCK and not a
direct acquisition from Saminvest as that letter also referred only to the pro posal
that was the subject of the approvals being considered by the court.5 This appeal
followed.
obligation to inform the Court, and any interested
parties, that it no longer has a legal interest in the
property.
5
Samost's March 26, 2008 letter in response stated, in pertinent part, the
following:
I am in receipt of your letter of March 25, 2008. For a
number of reasons, I do not think it is necessary for you
to contact the Court. As various representatives of
Walmart can attest, given their presence at the hearings
that were held before the Berlin Borough Planning
Board with respect to the development application, the
record is replete with statements and letters from me—
as well as correspondence from Walmart itself—that
Walmart did not have an agreement to acquire the
property.
....
If, as I have stated, and as Walmart has previously set
forth in correspondence to the Berlin Borough Planning
Board, Walmart did not have an agreement to acquire
the property, but rather might do so in the future, then
there is nothing different today than there was when this
matter was before the Berlin Borough Planning Board.
A-4906-18T4
11
In our review of a denial of a motion for judgment under Rule 4:40-1, we
apply the same standard of review as the trial court. Frugis v. Bracigliano, 177
N.J. 250, 269 (2003). The standard for deciding a motion for involuntary
dismissal under Rule 4:37-2(b), applies to a motion for judgment at trial. R.
4:40-1. A motion for judgment shall be granted if, after presenting its proofs,
plaintiff "has shown no right to relief." R. 4:37-2(b); see also R. 4:40-1. The
motion must be denied "if the evidence, together with the legitimate inferences
therefrom, could sustain a judgment in plaintiff's favor." R. 4:37-2(b); see also
R. 4:40-1.
Where the issue raised by the motion relates to a statute of limitation
barring a claim, we review de novo the trial court's legal determination about
when a cause of action accrued, applying the same standards as the trial court.
Henry v. N.J. Dep't of Human Servs., 204 N.J. 320, 328 (2010); see also Lopez,
62 N.J. at 272. "[A]ccrual occurs when a plaintiff knows or, through the exercise
of reasonable diligence, should know of the basis for a cause of action against
an identifiable defendant." Palisades at Fort Lee Condo. Ass'n v. 100 Old
Palisade, LLC, 230 N.J. 427, 447 (2017).
The court's determination of the date of accrual "is highly fact-sensitive,
and will 'vary from case to case, and . . . from type of case to type of case.'"
A-4906-18T4
12
Catena v. Raytheon Co., 447 N.J. Super. 43, 54 (App. Div. 2016) (alteration in
original) (quoting Vispisiano v. Ashland Chem. Co., 107 N.J. 416, 434 (1987)).
For that reason, we are bound by the trial court's findings of fact "when
supported by adequate, substantial and credible evidence." Rova Farms Resort,
Inc. v. Inv'rs Ins. of Am., 65 N.J. 474, 484 (1974).
"[W]e do not disturb the factual findings and legal conclusions of the trial
judge unless we are convinced that they are so manifestly unsupported by or
inconsistent with the competent, relevant and reasonably credible evidence as to
offend the interests of justice[.]" Seidman v. Clifton Sav. Bank, S.L.A., 205
N.J. 150, 169 (2011) (second alteration in original) (quoting In re Trust Created
by Agreement Dated Dec. 20, 1961, 194 N.J. 276, 284 (2008)). We give
particular deference to the trial judge's factual findings when the evidence is
largely testimonial and involves credibility determinations. See In re Return of
Weapons to J.W.D., 149 N.J. 108, 117 (1997); see also Lopez, 62 N.J at 275
(noting that the resolution of discovery issues may rest on witness credibility).
On appeal, Walmart argues that (1) Saminvest's claim expired before it was
filed, (2) under our holding in Miller v. Bank of Am. Home Loan Servicing,
L.P., 439 N.J. Super. 540, 550-51 (App. Div. 2015) (addressing the sufficiency
of evidence needed to defeat summary judgment), Samost's testimony at trial
A-4906-18T4
13
did not create a genuine issue of material fact, and (3) the discovery rule does
not save Saminvest's claims. Specifically, Walmart argues that the March 25,
2008 letter Walmart sent to Saminvest informing it that Walmart no longer had
"any legal interest in the property," which Samost acknowledged in his response
the next day, established March 26, 2008 as the accrual date for Saminvest's
cause of action. We disagree.
At the outset, we will not consider Walmart's contention challenging the
denial of summary judgment by asserting there were genuine issues as to
material facts because we affirmed that determination in our earlier opinion.
There, we stated "we detect no error in the trial court's denial of Walmart's
motion for summary judgment and [its] decision to proceed to trial." Berlin I,
slip op. at 20. We will not revisit that final determination, especially because
the trial court's and our earlier decisions were based upon the record evidence at
the time of the motion and not upon testimony at the later trial. We are
constrained to review the trial court's decision disposing of the summary
judgment motion "based only on the case as it unfolded to the point of the
motion, including evidential materials submitted on that motion." Lebron v.
Sanchez, 407 N.J. Super. 204, 213 (App. Div. 2009) (citing Bilotti v. Accurate
Forming Corp., 39 N.J. 184, 188 (1963)).
A-4906-18T4
14
Turning to the discovery rule, we hew to our explanation of the rule as set
forth in our prior opinion and our reliance on the Court's holding in Lopez and
its progeny. See Berlin I, slip op. at 17-19; see also Palisades at Fort Lee Condo.
Ass'n, 230 N.J at 443-47. We add the following observations.
"In case of fraud the period of limitation, in equity, begins to run only
from the discovery of the fraud or the time when, by reasonable diligence, it
could have been discovered." Lopez, 62 N.J. at 275 n.2. "The [discovery] rule
thus prevents the defendant from benefiting from his own deceit," Catena, 447
N.J. Super. at 54, and it strikes a balance between "the need to protect injured
persons unaware that they have a cause of action [and] the injustice of
compelling a defendant to defend against a stale claim," Kendall v. Hoffman–
La Roche, Inc., 209 N.J. 173, 193 (2012). "[S]omething different [is] needed in
the case of fraud, where a defendant's deceptive conduct may prevent a plaintiff
from even knowing that he or she has been defrauded. Otherwise, 'the law which
was designed to prevent fraud' could become 'the means by which it is made
successful and secure.'" Catena, 447 N.J. Super. at 54 (second alteration in
original) (quoting Merck & Co. v. Reynolds, 559 U.S. 633, 644 (2010)).
"Whether the discovery rule applies depends on 'whether the facts
presented would alert a reasonable person, exercising ordinary diligence that he
A-4906-18T4
15
or she was injured due to the fault of another.'" Ben Elazar v. Macrietta
Cleaners, Inc., 230 N.J. 123, 134 (2017) (quoting Caravaggio v. D'Agostini, 166
N.J. 237, 246 (2001)). "The standard is basically an objective one—whether
plaintiff 'knew or should have known' of sufficient facts to start the statute of
limitations running." Ibid. (quoting Caravaggio, 166 N.J. at 246). "[L]egal and
medical certainty are not required for a claim to accrue." Kendall, 209 N.J. at
193. In fraud cases, "[t]he date of discovery, therefore, is when the fraud was
or reasonably should have been discovered." Catena, 447 N.J. Super. at 55.
The trial court here made specific findings of fact about the parties' actions
and their intentions, and it explained in detail why the March 25, 2008 letter did
not even refer to the Saminvest sale to Walmart. We conclude that those
findings were well supported by sufficient evidence in the record in light of the
trial court's credibility findings about Samost and Sitton, which we have no
cause to disturb.
Applying those facts to the Lopez considerations, see Berlin I, slip op. at
18 (quoting Lopez, 62 N.J. at 275-76), compels our affirming the trial court's
decision, substantially for the reasons stated by the trial court in its thorough
oral decision as we too conclude that Saminvest's cause of action did not accrue
until April 2, 2009. Suffice it to say, the March 25, 2008 letter did not make
A-4906-18T4
16
Saminvest aware of facts indicating Sitton "knew [his statements about going
forward with the transaction were] false, and intended [Saminvest] to rely on
[their] falsity." Catena, 447 N.J. Super. at 55-56 (citing Merck & Co., 559 U.S.
at 649 (stating that it would "frustrate the very purpose of the discovery rule" if
the limitations period commenced "regardless of whether a plaintiff had
discovered any facts suggesting scienter.")).
Affirmed.
A-4906-18T4
17