Opinion
DOCKET NO. A-2283-14T3
04-28-2017
WELLS FARGO BANK, N.A. successor-by-merger to WACHOVIA BANK, N.A., Plaintiff-Respondent, v. TAREK ELHADIDI, Defendant-Appellant.
John T. Ambrosio argued the cause for appellant (Ambrosio & Tomczak, attorneys; Mr. Ambrosio, on the brief). Peter A. Ragone argued the cause for respondent (Rosner Nocera & Ragone, attorneys; Mr. Ragone and Anthony L. Cotroneo, on the brief).
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION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. Before Judges Yannotti and Gilson. On appeal from Superior Court of New Jersey, Chancery Division, Somerset County, Docket No. L-283-12. John T. Ambrosio argued the cause for appellant (Ambrosio & Tomczak, attorneys; Mr. Ambrosio, on the brief). Peter A. Ragone argued the cause for respondent (Rosner Nocera & Ragone, attorneys; Mr. Ragone and Anthony L. Cotroneo, on the brief). PER CURIAM
Defendant Tarek Elhadidi appeals from a November 21, 2014 order and judgment, which granted summary judgment to plaintiff Wells Fargo Bank, N.A. (Wells Fargo), awarded Wells Fargo $181,394.87 on a promissory note, and dismissed his counterclaims. We affirm.
I
In 2005, defendant considered purchasing properties in Myrtle Beach, South Carolina, from developer Intracoastal Land Sales, Inc. (Intracoastal). Intracoastal arranged for defendant to visit the properties. During that visit, defendant spoke with several lenders, including a representative from Wachovia Bank, N.A. (Wachovia).
Thereafter, defendant decided to purchase two properties from Intracoastal. One of the properties is the subject of this appeal. Defendant purchased that property for $189,800. He financed the purchase by borrowing just over $170,000 from Wachovia. Defendant planned to build a home on the property and replace the original loan with a construction loan. Accordingly, the original loan from Wachovia was a three-year, interest-only loan. Before making that loan, Wachovia conducted an independent appraisal of the property and that appraisal valued the property at $190,000.
The water and sewerage infrastructure on the property, however, was not completed on time. Consequently, defendant could not move forward with the home construction based on his original timetable. Moreover, when the water and sewerage infrastructure was completed in 2007, market conditions had changed and thus defendant did not obtain construction financing. Instead, defendant executed a new promissory note with Wachovia in 2008, extending his original loan. Thereafter, defendant defaulted on the payments on that 2008 note.
In February 2011, defendant filed a suit in the federal court in South Carolina against Intracoastal. Defendant asserted claims of fraud and consumer fraud. Specifically, he claimed that Intracoastal had misrepresented the status of the water and sewerage infrastructure on the property. Ultimately, Intracoastal and defendant negotiated a settlement and that case was dismissed in 2014. Tarek El Hadidi v. Intracostal Land Sales, Inc., Civil Action No.: 4:12-cv-535.
Meanwhile, in March 2010, Wachovia filed a lawsuit in New Jersey against defendant seeking the monies due under the 2008 promissory note. In August 2011, Wachovia merged with Wells Fargo and, thereafter, Wells Fargo prosecuted the action against defendant.
In the action in New Jersey, defendant filed an amended answer and counterclaims, asserting a claim of negligent misrepresentation and a violation of the New Jersey Consumer Fraud Act, N.J.S.A. 56:8-1 to -20. Defendant claimed that Intracoastal and Wachovia had made misrepresentations to him when he agreed to purchase the property and obtain a loan in 2005.
Wells Fargo moved for summary judgment in 2014. After hearing oral argument, the trial court granted Well Fargo's motion, issued a written opinion, and entered an order and judgment on November 21, 2014. The trial court found that there was no dispute that defendant executed the promissory note in 2008, and that defendant had defaulted on the note. The question was whether defendant could assert his counterclaims. The court found that South Carolina law applied, and, thus, defendant could not assert a claim under the New Jersey Consumer Fraud Act.
Turning to the negligent misrepresentation claim, the court found that under South Carolina law, the three-year statute of limitations had run, but found that there were disputed issues of material fact concerning when the discovery period was triggered. The court therefore analyzed the merits of the misrepresentation claim and determined that defendant failed to establish any of the alleged statements made by Wachovia were false. The court also found defendant had not offered any evidence that Wachovia knew or should have known that Intracoastal was making misrepresentations. Thus, the trial court granted Well Fargo's motion for summary judgment, entered a judgment on the promissory note, and dismissed defendant's counterclaims.
II
On appeal, defendant argues that the trial court erroneously dismissed his counterclaims because he presented sufficient evidence under South Carolina law to show that Wachovia conspired with Intracoastal to fraudulently induce him into purchasing the property. Defendant also argues that Wells Fargo should be barred from any relief because of Wachovia's unclean hands. We reject both of these arguments because they are not supported by evidence and certain of the arguments were not raised before the trial court.
In reviewing a summary judgment order, we use a de novo standard of review and apply the same standard employed by the trial court. Davis v. Brickman Landscaping, Ltd., 219 N.J. 395, 405 (2014). Accordingly, we determine whether the moving party has demonstrated there were no genuine disputes as to material facts and, if so, whether the facts, viewed in the light most favorable to the non-moving party, entitle the moving party to a judgment as a matter of law. Id. at 405-06; Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995); R. 4:46.
After reviewing the record under this standard, we conclude that summary judgment was properly granted. We will analyze each of defendant's claims in turn. A. Negligent Misrepresentation
Under South Carolina law, to prove a claim of negligent misrepresentation, defendant is required to establish the following elements:
(1) the [plaintiff] made a false representation to the [defendant]; (2) the [plaintiff] had a pecuniary interest in making the statement; (3) the [plaintiff] owed a duty of care to see that he communicated truthful information to the [defendant]; (4) the [plaintiff] breached that duty by failing to exercise due care; (5) the [defendant] justifiably relied on the representation; and (6) the [defendant] suffered a pecuniary loss as the proximate result of his reliance on the representation.
[Quail Hill, LLC v. County of Richland, 387 S.C. 223, 240 (quoting West v. Gladney, 341 S.C. 127 (Ct. App. 2000)).]
Here, the trial court correctly found that defendant failed to establish a counterclaim of misrepresentation. In its written opinion, the court concluded that defendant "failed to establish any of the alleged statements made by Wachovia were false at the time they were made." Further, defendant failed to proffer any evidence that Wachovia knew or should have known Intracoastal was making misrepresentations.
On appeal, defendant now argues that since South Carolina does not recognize the tort theory of "aiding and abetting fraud," the court should have considered civil conspiracy. We reject defendant's contention.
Defendant did not present civil conspiracy as one of his counterclaims for the trial court to consider. Defendant now claims that Wachovia actively participated in Intracoastal's sale presentation by offering a "Development Lot Loan Program," which misled the buyers into thinking Wachovia had conducted independent investigation into Intracoastal's development project. Defendant also alleges that Wachovia hired inexperienced appraisers to conduct appraisals and the appraised value of the property was highly inflated.
There is, however, no evidence in the record to support a claim of civil conspiracy. "A civil conspiracy is a combination of two or more persons joining for the purpose of injuring and causing special damage to [another]." Cricket Cove Ventures, LLC v. Gilland, 390 S.C. 312, 324 (Ct. App. 2010) (quoting McMillan v. Oconee Mem'l Hosp., Inc., 367 S.C. 559, 564 (2006)). Further, "[i]n a civil conspiracy claim, one must plead acts in furtherance of the conspiracy that are separate and independent from other wrongful acts alleged in the complaint, and the failure to properly plead such acts will merit the dismissal of the claim." Id. at 324-25.
Despite defendant's allegations against Wachovia, there is nothing in the record suggesting Wachovia knew or should have known Intracoastal was making misrepresentations. Without knowledge, Wachovia could not have engage in acts that were in furtherance of a conspiracy with Intracoastal. Thus, because defendant has not presented any evidence of a concerted effort by Wells Fargo and Intracoastal to harm him, defendant cannot prove a claim of civil conspiracy.
B. Unclean Hands
We decline to address defendant's arguments under the unclean hands doctrine because he did not raise the issue before the trial court. "Generally, issues not raised [before the trial court] . . . will not ordinarily be considered on appeal unless they are jurisdictional in nature or substantially implicate public interest." Paff v. Ocean County Prosecutor's Office, 446 N.J. Super. 163, 190 (App. Div.) (first alteration in original) (quoting State v. Walker, 385 N.J. Super. 388, 410 (App. Div.), certif. denied, 81 N.J. 290 (1979)), certif. granted, ___ N.J. ___ (2016). If "[a]n issue not raised below . . . meets the plain error standard or is otherwise of special significance to the litigant, to the public, or to achieving substantial justice, and the record is sufficiently complete to permit adjudication[,]" this court may consider it. Ibid. (alteration in original) (quoting Walker, supra, 385 N.J. Super. at 410); R. 2:6-2. Here, the plain error standard has not been met nor does the case implicate an issue of public interest. As such, we decline to address the unclean hands argument.
Affirmed. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION