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Appellate Division Affirms Order Relating to Doctrine of Res Judicata

By Melissa A. Volet

Northgate Tenants Corporation v. Tsai, App. Div. (per curiam)

On June 22, 2010, the Appellate Division affirmed the trial court's order, finding that the trial judge properly applied the doctrine of res judicata to bar relitigation of the validity of a sublease fee imposed by a co-operative, which was determined valid and enforceable in a prior litigation.

 

The plaintiff is a nonprofit corporation responsible for the administration, maintenance and operation of a community of residential cooperative units (the 'Corporation'). The defendant is a shareholder of the corporation, holding a proprietary lease to a residential unit.

 

The Corporation's Board adopted a resolution that imposed a monthly sublease fee on all unit owners who rented their units (the 'Sublease Fee'). The defendant refused to pay the Sublease Fee on the grounds that he felt it was unfair and discriminatory. The plaintiff filed a complaint against defendant for unpaid Sublease Fees, late fees and attorneys' fees and costs incurred in the collection of the Sublease Fee.

 

Following a bench trial, the trial court found the Sublease Fee fair and properly adopted and entered judgment against the defendant. Rather than appeal the judgment, the defendant satisfied the judgment and then refused to pay any further Sublease Fees. The plaintiff filed a second complaint against the defendant for unpaid Sublease Fees, late fees and attorneys' fees and costs incurred in the collection of the Sublease Fee. The defendant filed an Answer and Counterclaim again challenging the Sublease Fee as being unfair and discriminatory. The Court granted the plaintiff's motion to dismiss the defendant's pleadings on grounds of res judicata, and subsequently granted the plaintiff summary judgment for unpaid Sublease Fees, late fees and attorneys' fees and costs.  

The defendant appealed the order granting summary judgment to the plaintiff. On June 22, 2010, the appellate panel affirmed the order, finding that the trial judge properly applied the doctrine of res judicata to bar relitigation of issues determined in the prior litigation.

Full post as published by New Jersey Law Blog on August 03, 2010 (boomark / email).