Porter & Ripa Associates, Inc. v. 200 Madison Ave. Real Estate Group

• Decision Date: 24 April 1978
• Citation: 387 A.2d 1248,159 N.J.Super. 317
• Parties: PORTER AND RIPA ASSOCIATES, INC., a corporation of the State of New Jersey, Plaintiff, v. 200 MADISON AVENUE REAL ESTATE GROUP, a Limited Partnership, Louis C. Ripa, General Partner, Defendant.
• Court: New Jersey Superior Court

Page 317

159 N.J.Super. 317

387 A.2d 1248

PORTER AND RIPA ASSOCIATES, INC., a corporation of the State of New Jersey, Plaintiff, v. 200 MADISON AVENUE REAL ESTATE GROUP, a Limited Partnership Louis C. Ripa, General Partner, Defendant.

Superior Court of New Jersey,Chancery Division.

April 24, 1978.

David N. Ravin, West Orange, for plaintiff (Ravin & Kesselhaut, West Orange, attorneys).

Edwin C. Landis, Jr., Newark, for defendant (Meyner, Landis & Verdon, Newark, attorneys).

POLOW, J. S. C.

Plaintiff Porter and Ripa Associates, Inc. (PAR), an architectural and engineering firm, as tenant under a 15-year lease dated July 24, 1970, occupied premises in Morris Township owned by defendant 200 Madison Avenue Real Estate Group (200 Madison). Article I of this lease has been amended to increase the monthly rent, but otherwise the lease remains in its original form. Article X provides, in pertinent part, as follows:

In the event of the non-payment of said rent, or any installment thereof, at the times and in the manner above provided * * * the landlord or its agents shall have the right to and may enter the Demised Premises * * * without being liable for any prosecution or damages therefore. * * * Such re-entry by the landlord shall not operate to release the Tenant from any rent to be paid or covenants to be performed hereunder during the full term of this lease. * * * in any such event the landlord shall have the right, as agent of the tenant, to take possession of any furniture, fixtures or other personal property of the tenant found in or about the Demised Premises and sell the same at public or private sale and to apply the proceeds thereof to the payment of any monies becoming due under this lease * * *.

Article XXII of the lease provides:

In case of violation by the Tenant of any of the covenants, agreements, terms and conditions of this lease, and upon failure to discontinue such violation within ten (10) days after written notice thereof given to the Tenant, this lease shall thenceforth, at the option of the Landlord, become null and void, and the Landlord may reenter without further notice or demand * * *.

At the time of execution of this lease in 1970 distress procedure similar to that provided by the lease in Article X was generally assumed to be available to landlords with or without such contract language, pursuant to N.J.S.A. 2A:33-1 et seq. Notice was not required before re-entry and seizure under our distress statute when this lease was executed.

It is established by appropriate sworn documentation on these cross-applications that the landlord resorted to what its counsel describes in his brief as "Self-Help Possession," that is, the landlord took possession of all PAR's property in the demised premises and locked the tenant out on January 9, 1978 because of nonpayment of two months rent those installments due on December 1, 1977 and January 1, 1978. Although there had been discussions about the rent due and demands made for payment, no notice of re-entry nor of the intent to take possession of the tenant's property was given. PAR then initiated this action for recovery of its property, damages, punitive damages and termination of the lease on the ground that the landlord "wrongfully and illegally" seized the premises.

Defendant landlord now moves for summary judgment in its favor, asserting that its acts were all taken in strict compliance with what it calls the "clear and unambiguous" language of Article X of the leasing agreement. Plaintiff PAR moves for partial summary judgment in its favor, declaring that seizure of its property without notice violates the specific terms of the lease as well as constitutional due process requirements.

To support its due process argument PAR relies substantially on the rationale of Judge Greenberg's decision in Van Ness Industries v. Claremont Painting, 129 N.J.Super. 507, 324 A.2d 102 (Ch. Div. 1974), which holds that

* * * insofar as chapter 33 of Title 2A authorized distress for rents by landlords, the chapter is unconstitutional, and since the common law substantive right of distraint is governed by invalid procedural methods it may not be exercised in New Jersey. (at 515, 324 A.2d at 106)

Judge Greenberg thus found the distraint procedure in New Jersey violative of the Due Process Clause of the 14th amendment of the United States Constitution because of its failure to require notice to the tenant prior to seizure of the leased premises and the tenant's property located therein. PAR argues that here, also, the landlord's seizure of the premises was unconstitutional without prior notice and an opportunity to be heard before seizure of its property for nonpayment of rent. In any event, says PAR, notice was intended by the parties to the lease as a requirement before seizure.

Defendant 200 Madison argues that Article X of the lease makes no reference to notice and thus "clearly and unambiguously" authorizes physical repossession and seizure without notice upon nonpayment of rent. Furthermore, it says the Van Ness requirement of prior notice should not be applied here because by executing the instant lease "clearly" providing for "self-help" without notice. PAR has waived any right to notice if it otherwise exists. And, in any event asserts the lessor, this court is not bound to follow the law set forth by a court of coordinate jurisdiction. Van Ness, the landlord maintains, should not be followed because it was based on inapplicable authority and there is no such constitutional right to notice with regard to premises leased solely for nonresidential use. Finally, defendant maintains that due process requirements are inapplicable to the present case because there is a total absence of any state involvement in the lockout and seizure of property by defendant.

I am satisfied that the constitutional right to due process by way of notice is subject to waiver, as the landlord asserts. Indeed, the United States Supreme Court observed in National Equipment Rental, Ltd. v. Szukhent, 375 U.S. 311, 315-316, 84 S.Ct. 411, 414, 11 L.Ed.2d 354 (1964), that (I)t is settled * * * that parties to a contract may agree in advance to submit to the jurisdiction of a given court, to permit notice to be served by the opposing party, or even to waive notice altogether. (Emphasis supplied)

See also, D. H. Overmyer Co. v. Frick Co., 405 U.S. 174, 185-186, 92 S.Ct. 775, 31 L.Ed.2d 124 (1972); Boddie v. Connecticut, 401 U.S. 371, 378-379, 91 S.Ct. 780, 28 L.Ed.2d 113 (1970), and Williams v. Trans World Airlines, 149 N.J.Super. 585, 589, 374 A.2d 486 (Ch.Div.1977).

However, it is just as firmly established that "every reasonable presumption should be indulged against * * * waiver" of a constitutional right. Hodges v. Easton, 106 U.S. 408, 412, 1 S.Ct. 307, 27 L.Ed. 169 (1882). The vast majority of cases concerning waiver of constitutional rights deal with criminal proceedings wherein the courts repeatedly stress that there must be "an intentional relinquishment or abandonment of a known right or privilege." Johnson v. Zerbst, 304 U.S. 458, 464, 58 S.Ct. 1019, 1023, 82 L.Ed. 1461 (1938); Brady v. United States, 397 U.S. 742, 748, 90 S.Ct. 1463, 25 L.Ed.2d 747 (1970); Miranda v. Arizona, 384 U.S. 436, 444, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966); United States v. Corbitt, 541 F.2d 146, 149 (3 Cir. 1976), and State v. Green, 129 N.J.Super. 157, 161, 322 A.2d 495 (App.Div.1974). In Schneckloth v. Bustamonte, 412 U.S. 218, 93 S.Ct. 2041, 36 L.Ed.2d 854 (1973), the Supreme Court noted that:

With respect to procedural due process * * * the Court has acknowledged that waiver is possible, while explicitly leaving open the question whether a "knowing and intelligent" waiver need by shown. (at 235, 93 S.Ct. at 2052)

Our Appellate Division, in State v. Morgenstein, 147 N.J.Super. 234, 371 A.2d 96 (App.Div.1977) has observed that in New Jersey:

Even within the setting of a civil controversy it must affirmatively appear that the party charged with waiver knew his rights and deliberately intended to relinquish them. (at 238, 371 A.2d at 98; emphasis supplied.)

In this case the parties executed the lease in 1970. At that time the operative statute, N.J.S.A. 2A:33-1 et seq., required no prior notice in distress proceedings. A tenant executing a lease in this State would have been unaware of a right to notice not required by the statute until Van Ness was decided in 1974. Hence, plaintiff may not be said, as of 1970, to have freely, voluntarily and understandingly waived a constitutional right to notice which had not yet been judicially determined to exist. As stated in Muniz v. Beto, 434 F.2d 697, 704 (5 Cir. 1970), "the courts have repeatedly ruled that one cannot waive a constitutional right prior to the time such a right is declared to exist." See also, e. g. United States v. Summa, 362 F.Supp. 1177, 1180 (D.Conn.1972); Gee v. United States, 319 F.Supp. 581, 584-585 (S.D.Tex.1970), and United States v. Rosenson, 291 F.Supp. 874, 877-878 (E.D.La.1968).

The basis for this principle can be traced to Grosso v. United States, 390 U.S. 62, 88 S.Ct. 709, 19 L.Ed.2d 906 (1968), and Marchetti v. United States, 390 U.S. 39, 88 S.Ct. 697, 19 L.Ed.2d 889 (1968). Marchetti concerned the appeal of a defendant who was convicted for willfully failing to pay an occupational tax for engaging in the business of accepting wagers. Defendant argued that these statutory obligations violated his Fifth Amendment right against self-incrimination because engaging in such activities was violative of several criminal statutes. The Court of Appeals, at 352 F.2d 848 (2 Cir.), had rejected this argument relying primarily on Lewis v. United States, 348 U.S. 419, 422, 75 S.Ct. 415, 418, 99 L.Ed. 475 (1955), which had declared that "there is nothing violative of the Fifth Amendment" under such circumstances. In Marchetti and Grosso the Supreme Court overruled Lewis and held that such occupational taxes could not be...