Clausen Miller Secures Summary Judgment After Court Upholds Auction Agreement Between Client and Seller
Andrew Turkish and Carl Perri obtained summary judgment in the New Jersey Chancery Division, Passaic County in a professional liability claim against our client broker and his auction company. Our client broker was retained to represent the seller of commercial property in an online auction sale. The property involved a parcel of land in Paterson, New Jersey which was advertised as having approvals for 90 residential units with commercial space. The auction agreement contained a minimum auction bid price of $1.7 million plus commission. Our client later learned that the property’s approvals had expired and corrected its advertising to reflect this. At that time, the seller allegedly instructed our client to postpone the auction or cancel it, but our client proceeded based on the auction agreement which gave him the exclusive right to continue with the auction and sell the property as long as the minimum bid price of $1.7 million was obtained. At the auction, there was one successful bidder at the minimum bid price. Thereafter, the seller refused to execute a contract of sale and the buyer moved for specific performance. The seller counterclaimed and filed a third-party complaint against our client for Breach of Contract, Consumer Fraud, Common Law Fraud and Misrepresentation. After discovery concluded, we moved for summary judgment arguing that the Court should uphold the Auction Agreement which governed the contractual relationship between our client and the seller, that there was no fraud or violation of the Consumer Fraud Act since there were no unconscionable commercial practices and no evidence of ascertainable damages, and that any perceived misrepresentation involving property approvals was corrected prior to the auction. The Court agreed with our position and dismissed all claims against our client with prejudice which avoids what would have been a lengthy trial starting in early November 2023.