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Consumer Protection - Treble Damages and Reimbursement of Attorneys’ Fees and Costs Awarded Against a Builder for Violating New Jersey’s Consumer Fraud Act

March 22, 2016

Michael J. Rankin reports a recent case dealing with a builder’s omission of material facts in the sale of new homes and whether the omission was a violation of New Jersey’s Consumer Fraud Act (“CFA”).    The builder in this case designed and promoted homes with two car garages in a new development.  The Plaintiffs ended up purchasing model homes in the development.  However, after the closing, the Plaintiffs discovered that a platform and steps impaired the ability to fit a car into the left garage bay of their respective homes.  Plaintiffs brought suit against the builder and prevailed on their claims under the CFA.   The trial court found that the builder knew of the problem but knowingly omitted this material fact during their disclosures to Plaintiffs and awarded damages, which were trebled pursuant to the CFA, and also awarded attorneys’ fees and costs.  The trial court’s decision was upheld on appeal. 

To negate violating the CFA, construction firms need to be completely forthcoming in their marketing and performance of their contracts, including making all proper disclosures.  In this matter, the Appellate Division found that a reasonable person would attach importance in purchasing a house to whether its garage bay could practically fit a normal-sized sedan; the CFA did not require the violation of a building code before the omission of material information constituted consumer fraud; and that the average home-buyer lacked the expertise to recognize that the left bay was too short to accommodate a vehicle despite being given the architectural plans for the home. 

Please contact Michael J. Rankin if you have any questions or need any assistance in connection to this subject.