Hanlon Niemann Blog | A Freehold, New Jersey Law Firm

By Fredrick P. Niemann, Esq., a NJ Contracts Attorney

 A large number of employers and employees throughout New Jersey are having signed an employment contract. Unfortunately, employees often do not read the contracts before they sign them, seeing it as too complicated or simply because they are too lazy. What many of these employees do not realize is that the language of the contract will bind both them and their employer once both parties have signed it. This makes it crucial that one reads and understands their employment contract prior to signing it. An employee cannot claim a defense based on the fact that they did not read the contract despite the fact that they signed it. Your signature, unless fraudulently obtained, indicates that you agree to the terms of the contract and will abide by it.

 NJ Contract law dictates that all signed contracts will bind both of the parties to the language included in the contract. This means that all employers and employees, once they sign the employment contract, must abide by the terms included in it or they will be considered in breach of the contract. If a dispute arises between an employer and employee, the first thing the Courts will look to is the employment contract signed by the parties. 

 One recent employment dispute arose between a doctor seeking to leave her practice and the partners she worked with in this practice in order to set up her own office. As is often the case, the parties disagreed about how much the departing doctor would be paid for her percentage of ownership in the practice and what remaining doctors would be purchasing her ownership percentage. The Courts refused to take any factors into consideration other than the employment contract between the parties. The contract states the price to be paid to the departing doctor and who would pay it in exchange for her ownership percentage in the practice. This is a typical example of why it is imperative that you read and understand the employment contract you are signing. 

 Contact me personally to discuss your NJ Contracts matter. I am easy to talk to, very approachable and can offer you practical, legal ways to handle your concerns. You can reach me toll free at (855) 376-5291 or email me at fniemann@hnlawfirm.com.

By Fredrick P. Niemann, Esq., a NJ Consumer Fraud Attorney

 
The Consumer Fraud Act (CFA) provides protection for many NJ consumers when dealing with the sales of real estate and merchandise. The Act provides broad protections for both individuals and corporations involved in these two types of sales, allowing them to bring claims against fraud perpetrators when other types of claims may fail. However, it is important to note that the Consumer Fraud Act, while covering a large number of consumer contracts, does not cover every single contract entered into by corporations.

New Jersey Courts were recently called upon to determine whether or not the Consumer Fraud Act applied to a complex installation of a computer software system. The case involved a corporation seeking to upgrade its computer system and the company it chose to do the upgrades. The defendant claimed that the case did not fall under the CFA because the installation was “not available to the public” and therefore did not qualify as the “sale of merchandise”, a requirement for the CFA to be applicable.

The NJ Court agreed with the defendant, citing numerous factors in determining that although the defendant may offer some services to the public, this particular transaction was not one that was offered to the public and therefore the CFA did not apply. The Court noted that the transaction was not a simple sale of software to the general public, but rather was an individualized installation that the plaintiff had sought through various proposals by different computer companies. After the plaintiff had received the defendant’s proposal, there were over two years of evaluations done by the defendant and the contract between the parties used such evaluations to determine a custom-built system specified specifically for the defendant. The contract for the installation of the software was also the product of lengthy negotiations between the parties. These factors all added up to show the installation was not available to the public and thus not considered the “sale of merchandise”, thereby making the Consumer Fraud Act inapplicable.

Contact me personally to discuss your NJ Consumer Fraud matter. I am easy to talk to, very approachable and can offer you practical, legal ways to handle your concerns. You can reach me toll free at (855) 376-5291 or email me at fniemann@hnlawfirm.com.

By Fredrick P. Niemann, Esq. a New Jersey LLC Attorney

  Limited Liability Companies have become increasingly popular in New Jersey throughout the last decade. This is often the preferred business form for the majority of business owners throughout not only New Jersey, but the entire country. Many of these companies have multiple owners that have a say in the direction, transactions, and other matters concerning the business. While many LLCs operate smoothly and have owners that always agree on company matters, there are undoubtedly numerous LLCs that have owners who simply cannot agree on business decisions. In these companies, the power structure is determined by who owns the most shares or the largest piece of the company. Obviously, the person with the largest ownership percentage is able to dictate all business-related decisions. This does not include, however, the right to make business decisions that benefit the majority owner at the expense of the minority owners.

 Majority owners of all New Jersey LLCs are held responsible to what the legal profession refers to as the “Fiduciary Duty of Loyalty”. This duty is placed on all majority shareholders and majority owners of LLCs throughout New Jersey. It requires them to act in the best interests of the company with ALL business decisions. If a transaction will benefit the majority owner at the detriment of the minority owners, the majority owner is prohibited from completing that transaction. If a minority owner is a victim of a breach of the Fiduciary Duty of Loyalty, they may bring a claim in New Jersey Courts against the majority owner of the LLC. The Courts will look to see if the company action meets an objective fairness test. Any action that does not stand up to this test will be considered a breach of the fiduciary duty and subject the majority owner to damages. Courts may even issue an injunction in certain cases if the company action being disputed has yet to occur. The injunction will forbid the LLC from moving forward with the transaction or business decision.

 Just because you are a minority owner of a LLC does not mean the majority shareholder/owner can take advantage of you. All company decisions must be objectively fair, meaning the majority owner cannot act in a manner that benefits themselves at the detriment of the minority owners/shareholders. If you have any questions regarding New Jersey LLCs or the Fiduciary Duty of Loyalty, please don’t hesitate to contact Fredrick P. Niemann, Esq., an experienced NJ LLC attorney today. He can be reached toll-free at 855-376-5291 or by email at fniemann@hnlawfirm.com. Please call today.

By Fredrick P. Niemann, Esq. a New Jersey Condemnation Lawyer

When a municipality, county or the state government of New Jersey takes aim at private property to be taken for some public purpose, more often than not any resulting litigation is a contest over the fair market value of the property and how much the property owner should be paid, rather than whether the exercise of the power of eminent domain was appropriate in the first place.

From the landowner’s standpoint, it is important to realize that adequate compensation is not determined simply on the basis of the current use of the property. Instead, the landowner is entitled to the value of the property based on its “ highest and best” use (whether that use already exists or is only in the eye of a developer), so long as such a potential use is not too speculative or otherwise foreclosed by applicable laws and regulations.

The importance to a New Jersey property owner of negotiating compensation on the basis of a best-case, but realistic, development scenario for the property is illustrated by a recent case in which the owner of a vacant, 22,000-square-foot lot settled with a town for compensation in an amount that was about 20 times higher than the amount initially offered by the town.

The lot was zoned for residential use, although at the time of the condemnation action the owner had no building or development plans. Appraisers hired by the town offered an opinion that the vacant lot’s best use was only as open space, or as a buffer for an abutting lot. They reasoned that compliance with the town’s lot area and frontage requirements, as well as with its road standards for improving the dirt road on which the lot was located, would be so burdensome as to make any development of the property prohibitively expensive. They also indicated that extensive development costs would preclude development even if the lot was considered to have grandfathered status that would protect it from certain town requirements.

For its part, the landowner retained experts who opined that the lot was, in fact, suitable for residential purposes and should be valued as such when arriving at a compensation figure for the taking. As the town’s experts had noted, there were various requirements on the books that, in theory, could be costly to comply with. However, an examination of past rulings by the town’s zoning and conservation officials showed that the lot was likely to be exempted from some of the requirements. Moreover, improvement of the dirt road, which would have been an especially big-ticket item, was not likely to be required.

Both sides were necessarily looking into the future to some extent, but the landowner was able to depict a scenario for the lot that was optimistic enough to bring about a favorable monetary settlement
with the town.

Contact me personally today to discuss your condemnation matter.  I am easy to talk to, very approachable and can offer you practical, legal ways to handle your concerns.  You can reach me toll free at (855) 376-5291 or e-mail me at fniemann@hnlawfirm.com

By Fredrick P. Niemann, Esq., a NJ Landlord/Tenant Attorney

 Unfortunately, disputes arise every day between landlords and tenants. Sometimes these disputes escalate to the point where the landlord no longer wishes to rent the property out to the tenant. New Jersey law states that landlords must have sufficient grounds to evict tenants from the property. The law lists a number of instances that qualify as these sufficient grounds. If the landlord is justified in evicting the tenant, the Courts will enforce the evictions. However, if the eviction is not in accordance with New Jersey law, the Courts will protect the tenant’s rights.

 One of the sufficient grounds listed in the New Jersey statute is when tenancy is based on the condition of the tenant also being the superintendent of the building while they are living there. A NJ Court case involving this situation was recently decided. A landlord sought to evict a family after the husband and father of the family ceased from being superintendent of the landlord’s property. The family disputed the eviction, stating that the wife had lived there for three years prior to the husband becoming the superintendent of the building and therefore, despite her husband no longer being superintendent, she thus had the right to remain a tenant.

 The Courts looked at the leases signed between the parties and the overall situation that was presented to them. Citing the fact that the wife had lived at the apartment prior to the husband’s superintendent responsibilities, the Court found that this was not a condition of the family’s tenancy. They found that since none of the leases that the wife signed made any comments about her tenancy being directly related to the husband’s employment as superintendent, there existed no good cause to evict her and the family. The Court thus held that the landlord did not have a sufficient reason to evict the family.

 Landlord/Tenant law in New Jersey can be complicated and complex. As a tenant, you have many rights, including the right not to be evicted without sufficient reasoning. Please call Fredrick P. Niemann, an experienced NJ Landlord/Tenant Attorney today. He can be reached toll-free at 855-376-5291 or by email at fniemann@hnlawfirm.com. Mr. Niemann would be more than happy to answer any questions you may have regarding Landlord/Tenant law in New Jersey.

By Fredrick P. Niemann, Esq., a NJ Corporate Attorney

 
New Jersey is home to numerous “Closely-Held” corporations, or corporations consisting of a small number of shareholders or owners. Many times, these corporations encompass family members or close friends who have gone into business together. While everyone would like to think that nothing could ever go wrong with their closely-held corporation, trouble does arise and shareholders do find themselves disagreeing with others on certain business decisions. The final call in these decisions ultimately is left up to the majority shareholder, since they own the most shares in the business.

It does not follow however, that majority shareholders may make decisions for their own benefit and at the expense of the minority shareholders. New Jersey law protects minority shareholders by requiring all majority shareholders to act with what is called the “Fiduciary Duty of Loyalty”. This is a legal duty, enforceable by the Courts, that requires all majority shareholders to act in the best interests of the corporation at all times. Obviously, minority shareholders are part of the corporation, meaning the majority shareholders owe this duty to them.

When a minority shareholder challenges the actions of the majority shareholder in Court, the NJ Courts will look to see if the business decision meets a test of objective fairness. If the Court considers the transaction or decision not to be objectively fair, they will find a breach of the Fiduciary Duty of Loyalty. Under this circumstance, the minority shareholders will be allowed to collect damages based on the majority shareholders breach. If it isn’t too late, Courts may even sometimes tell the majority shareholder that they are forbidden from completing the business decision or transaction that is in violation of the duty.

Just because you own a minority of the shares in a closely-held corporation does not mean that you have no rights. The majority shareholder is not allowed to violate the fiduciary duty of loyalty at your expense. NJ Courts wills always uphold this duty and afford minority shareholders protection in this manner. Please contact Fredrick P. Niemann, Esq., a qualified New Jersey Corporate Attorney today, toll-free at 855-376-5291 or email him at fniemann@hnlawfirm.com if you have any concerns related to Minority Shareholder rights or NJ Corporations. Mr. Niemann would be more than willing to discuss this matter with you. Please call today.

By Fredrick P. Niemann, Esq. a New Jersey Contract Lawyer

Contacting an NJ Contract Lawyer will definitely help save you from a lot of trouble in the future. Always make it a point for them to look at any document that you need to sign because there may be certain considerations that needs to be pondered before you go ahead and put your signature to these types of documents.

The Purpose of the Contract
Many individuals forget about the purpose of the contract which they are about to sign. A NJ Contract Lawyer will not minimize this important aspect to be pushed aside. Informing them of the goal of the contract will definitely give your attorney a heads-up on what to analyze in the document you have brought before them.

The Compensation
This must be absolutely clear to all parties to the contract; otherwise you will likely encounter a complicated issue in the future. Let an NJ Contract Attorney look into this matter and discuss it with the other party if there are any portions which you need to be amended.

Clarity of Contract Terms
Any vague and ambiguous terms should be clarified in the contract. This can become very crucial in the interpretation of your contract so make sure this is clear, especially with your chosen NJ Contract Attorney. Any legal terminologies or payment methods which are not fully established should be spelled-out so Statute of Frauds can be eliminated.

Guarantee that all of these factors have been made clear because once it has been signed by both parties then there is much less that your NJ Contract Attorney can do. Be a responsible party to a contract and anticipate the potential issues your draft contract may bring. Never forget the importance of an NJ Contract Lawyer and maintain a regular professional relationship with them to free yourself from legal inconveniences in the future.

Contact me personally today to discuss your contract matter.  I am easy to talk to, very approachable and can offer you practical, legal ways to handle your concerns.  You can reach me toll free at (855) 376-5291 or e-mail me at fniemann@hnlawfirm.com.

By Fredrick P. Niemann, a NJ Fraud Attorney

One of the most important laws in New Jersey businesses is that which is known as the “implied covenant of good faith and fair dealing”. This law states that all parties involved in New Jersey commerce are obligated to act in good faith and fair dealing in business transactions. This obligation pertains to all business dealings and covers a wide range of illegal activity, including defrauding the other party, lying, withholding key information, etc.

Why is this law necessary when there are multiple other avenues of litigation that one can pursue if they are defrauded, such as breach of contract and theft just to name a couple? Basically speaking, the implied covenant of good faith and fair dealing is in place as a general fallback option for those who are defrauded yet cannot pursue action through another claim. Legislatures have intended for it to cover a broad range of fraudulent activities to give consumers confidence in business transactions and to help ensure that criminals will not be able to get away with crimes due to loopholes in the law. The typical situation in which the implied covenant of good faith and fair dealing is relied upon involves one party seeking to take advantage of another party in a transaction based upon a technicality in the contract or by taking advantage of the other party based on their lack of the knowledge on the subject matter.  With the implied covenant of good faith and fair dealing, consumers can rest easy that they will not be taken advantage of based on a loophole in their contract.

To show a violation of the implied covenant of good faith and fair dealing, a New Jersey consumer must be able to prove either bad motive or wrongful intention on the part of the defendant. While this may seem easy, it can often be a daunting task. A recent New Jersey court cause found a defendant not guilty of fraud or violating the implied covenant of good faith and fair dealing, despite the fact that they sold land to the plaintiff, the majority of which was non-developable. The Court held that even though the plaintiff contracted to buy the land with the intention of building on it, the defendant did not know the land could not be developed when they sold it to the plaintiff. The Court held therefore that without a bad motive or wrongful intent on the part of the defendant, they could not be found to have violated the implied covenant of good faith and fair dealing.

Courts will require you to show specific evidence in order to prove your case alleging a violation of the implied covenant of good faith and fair dealing.  A skilled New Jersey fraud attorney knows just what to look for and can assist you in bringing the best claim possible. Please contact Fredrick P. Niemann, an experienced NJ Fraud attorney, if you have any questions regarding New Jersey Fraud laws or the implied covenant of good faith and fair dealing. He can be reached toll-free at 855-376-5291 or by email at fniemann@hnlawfirm.com. Mr. Niemann would be more than happy to discuss your case with you.

By Fredrick P. Niemann, Esq. New Jersey Business Lawyer

What actions can be brought against a management employee and officer of a corporation who secretly forms a competing business while employed by the corporation?

ANSWER
New Jersey courts have found that if a management employee secretly forms a competing corporation, then the management employee may be liable for a breach of duty of loyalty to the employer which can also be imputed to the newly formed competing corporation.

In a recent case, a vice president/director and his wife formed two businesses while still employed at Vibra-Tech. One of these businesses was in direct competition for the same customer base. The other business sold equipment to Vibra-Tech. Vibra-Tech had no knowledge that one of their own executives was competing with the corporation. A suit was brought against the defendants for unfair competition and breach of fiduciary duty. The defendants moved for summary judgment, arguing that there were no fiduciary duties that the two companies owed Vibra-Tech.

The court discussed earlier New Jersey case law on fiduciary duty and stated that “A hallmark of a fiduciary relationship is one party’s placement of “trust and confidence in another.” This relationship is generally one of unequal terms, where one party is dependent on the advice and care of another. This is the duty that management and directors customarily owe their employees. Directors and officers of a corporation also have both a duty of care and/or a duty of loyalty to the best interests of the business entity. Competitors of a business entity contract in their own self interest and have no such fiduciary duty.

The attorney for the defendants argued that the two businesses of the defendant had no fiduciary duty since they had no direct relationship with the plaintiff.

The court agreed that there was no direct fiduciary duty between the businesses, but found that New Jersey courts had in similar cases,” imputed the individual defendants’ conduct to the corporation and held it liable for breach of the fiduciary duty of loyalty.”   Since the proof of a breach of imputed fiduciary duty of loyalty involves an intensive inquiry into the facts, and an inquiry as to whether the individual utilized the corporate veil to facilitate a breach of duties, the court denied summary judgment, since the facts before the court were either missing or disputed.

Contact me personally today to discuss your business law matter.  I am easy to talk to, very approachable and can offer you practical, legal ways to handle your concerns.  You can reach me toll free at (855) 376-5291 or e-mail me at fniemann@hnlawfirm.com.

By Fredrick P. Niemann, Esq. a New Jersey Partnership Attorney

Partnership Disputes are fairly common in the world of business. Trade secrets, embezzlement, conversion and business disparagement are some of the most common causes of partnership disputes. If you suspect that something like that has occurred in your business, you should consult with a qualified partnership dispute attorney in New Jersey.

If you suspect that one of your partners has engaged in some form of wrongdoing, it is important that you investigate immediately. If you fail to do so, this can lead to a more serious dispute. Your partner may be profiting while your business is losing money. That is why is it important for you to consider litigation so that your business is protected from further loss.

A qualified partnership dispute attorney can help your business in several ways. He or she will provide the legal representation that you need to protect your business’s investments and profits. First, the attorney will investigate the breach so that the rights and integrity of your business are protected. After the investigation is complete, he or she will file a claim on your behalf. In order to make sure that your claim will have a successful outcome, the attorney will enlist the help of private investigators, accountants and financial experts. If you decide to dissolve your partnership, he or she will be there to assist you with that. Additionally, an attorney will also be able to help your business recover its losses.

If you suspect that suspicious activity is going on within your partnership, you do not want to wait around because your business could be losing money. Call a qualified partnership dispute attorney in New Jersey so that this issue can be resolved right away.  Contact me personally today to discuss your partnership dispute matter.  I am easy to talk to, very approachable and can offer you practical, legal ways to handle your concerns.  You can reach me toll free at (855) 376-5291 or e-mail me at fniemann@hnlawfirm.com.