The Superior Grp. v. Deutsch, A-1107-21

CourtNew Jersey Superior Court – Appellate Division
Writing for the CourtPER CURIAM
PartiesTHE SUPERIOR GROUP, LLC, Plaintiff-Respondent, v. MENDEL DEUTSCH, Defendant-Appellant, and UNIVERSAL TITLE, LLC, Defendant-Respondent.
Docket NumberA-1107-21
Decision Date22 November 2022

THE SUPERIOR GROUP, LLC, Plaintiff-Respondent,
v.

MENDEL DEUTSCH, Defendant-Appellant,

and UNIVERSAL TITLE, LLC, Defendant-Respondent.

No. A-1107-21

Superior Court of New Jersey, Appellate Division

November 22, 2022


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.

Submitted October 11, 2022

On appeal from the Superior Court of New Jersey, Law Division, Union County, Docket No. L-2617-20.

Zachter PLLC, attorneys for appellant (Jeffrey Zachter and Rickin Desai, on the brief).

Giordano, Halleran &Ciesla, PC, attorneys for respondent The Superior Group, LLC (Michael J. Canning, of counsel and on the brief; Peter J. Guastella, on the brief).

Before Judges Sumners and Berdote Byrne.

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PER CURIAM

In a December 18, 2019 contract, plaintiff The Superior Group, LLC agreed to transfer ownership of 120 Mountain Avenue in Springfield (the property) for $2.4 million to defendant Mendel Deutsch. Per the contract, Deutsch deposited $500,000 with Universal Title, LLC (Universal) to hold in escrow towards the purchase. The contract gave Deutsch until January 17, 2020, to conduct "such inspections and investigations of the [property] as [Deutsch] deems necessary," including environmental inspections. The contract's time of the essence clause stated, "[u]nder no circumstances shall the Closing Date occur earlier than April 1, 2020 or later than April 15, 2020." [1]The contract also stated "[t]he Closing Date shall not be delayed as a result of [Deutsch]'s pursuit of financing and any risk of delay or postponement of the Closing Date due to [Deutsch]'s financing rests with [Deutsch]."

Deutsch was unable to close on April 15 (allegedly due to the COVID-19 pandemic), therefore Superior informed him by email that he was in default but afforded him a "one-time accommodation" to cure the default by extending

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the closing date to no later than 3:00 p.m. on April 23. After Deutsch failed to close again, the parties entered into an agreement on May 5, amending their contract of sale to provide a new outside closing date of June 15. In consideration for the amendment, Deutsch agreed to have Universal release $250,000 of the $500,000 escrow deposit to Superior.

On June 9, a private lender agreed to finance Deutsch's purchase. Three days later, Deutsch's attorney informed Superior the lender required Deutsch to provide a Phase 1 Environmental Report (environmental inspection) to finance the purchase and, therefore, closing could not be held until later in the week of June 15. For reasons that are unclear, Superior did not allow the environmental inspection to take place.

On June 22, Superior informed Deutsch he was in default because he did not close by June 15, and it would exercise its remedial rights under the contract if he did not present "a concrete proposal to cure [his] ongoing default immediately." On June 26, Deutsch's attorney reiterated to Superior that Deutsch could not close without access to the property for the environmental inspection. If the environmental inspection was permitted, counsel proposed Deutsch could close "within thirty days."

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Superior did not respond to the proposal. Instead, it terminated the contract on July 2, and demanded the $250,000 held in escrow as liquidated damages. Apparently, Universal did not release the money because Deutsch refused to consent to its release. Superior, in turn, sued Deutsch for breach of contract, fraudulent misrepresentation, and negligent misrepresentation.[2]Superior also made claims against Universal for breach of contract and breach of fiduciary duty for its failure to transfer the remaining escrow deposit.[3]Deutsch countersued Superior for specific performance, breach of contract, and unjust enrichment and cross-claimed against Universal for return of the remaining escrow due to Superior's breach of contract.

Prior to the close of discovery, Superior filed a motion for partial summary judgment. The trial court granted the motion, entering an order that terminated the contract of sale; divested Deutsch of his rights and interest in

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the property; and dismissed Deutsch's counterclaims with...

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