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PAYSTAFFING, LLC v. HORS D'OEUVRES UNLIMITED, A-1020-13T2. (2015)

Court: Superior Court of New Jersey Number: innjco20150116255 Visitors: 1
Filed: Jan. 16, 2015
Latest Update: Jan. 16, 2015
Summary: NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION PER CURIAM. Plaintiffs Paystaffing, LLC (Paystaffing) and Temporary Help Services, LLC (Temporary) appeal from the September 17, 2013 Law Division order, which granted summary judgment to defendants Hors D'Oeuvres Unlimited (HDU), Mama Mancini's, LLC, Appetizers Made Easy, Inc., and Joseph Epstein Food Enterprises, Inc., and dismissed the amended complaint with prejudice. We affirm. We derive the following facts from evidence
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NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

PER CURIAM.

Plaintiffs Paystaffing, LLC (Paystaffing) and Temporary Help Services, LLC (Temporary) appeal from the September 17, 2013 Law Division order, which granted summary judgment to defendants Hors D'Oeuvres Unlimited (HDU), Mama Mancini's, LLC, Appetizers Made Easy, Inc., and Joseph Epstein Food Enterprises, Inc., and dismissed the amended complaint with prejudice. We affirm.

We derive the following facts from evidence submitted by the parties in support of, and in opposition to, the summary judgment motion, viewed in the light most favorable to plaintiffs. Angland v. Mountain Creek Resort, Inc., 213 N.J. 573, 577 (2013) (citing Brill v. Guardian Life Ins. Co., 142 N.J. 520, 523 (1995)). Pursuant to a March 18, 2010 contract, Paystaffing supplied employees to HDU in exchange for a fee of $20 per hour per employee (the contract).2 The contract prohibited HDU from hiring those employees on a permanent basis until after they worked 600 hours for HDU.

On April 11, 2012, Paystaffing filed a complaint, alleging that HDU owed fees in the amount of $236,745.56 as of March 9, 2012, and that on March 12, 2012, HDU transported Paystaffing's employees to On Target Staffing, Inc. (On Target) to be hired by On Target and transported by On Target to work at HDU's warehouse. Paystaffing demanded damages on eight counts: (1) open book account (2) account stated; (3) reasonable value-quantum meruit; (4) breach of contract; (5) tortious interference with contractual advantage; (6) tortious interference with economic advantage; (7) unjust enrichment; and (8) conspiracy.3

There is no dispute that Paystaffing is a temporary help service firm (THSF) governed by the Private Employment Agency Act (Act), N.J.S.A. 34:8-43 to-66. See N.J.S.A. 34:8-43. The Act requires a THSF to be licensed or registered with the Attorney General as a condition precedent to an action for fees:

A person shall not bring or maintain an action in any court of this State for the collection of a fee, charge or commission for the performance of any of the activities regulated by this [A]ct without alleging and proving licensure or registration, as appropriate, at the time the alleged cause of action arose. [N.J.S.A. 34:8-45(b).]

The Act defines a "fee, charge or commission" as:

any payment of money, or promise to pay money to a person in consideration for performance of any service for which licensure or registration is required by this [A]ct, or the excess of money received by a person furnishing employment or job seekers over what he has paid for transportation, transfer of baggage or lodging for a job seeker. "Fee, charge or commission" shall also include the difference between the amount of money received by any person who either furnishes job seekers or performers for any entertainment, exhibition or performance, or who furnishes baby sitters for any occasion, and the amount paid by the person to the job seekers, performers or baby sitters. [N.J.S.A. 34:8-43 (emphasis added).]

The Act also requires a THSF to comply with N.J.S.A. 56:8-1.1, including annual registration with the Attorney General. N.J.S.A. 34:8-43. "[F]ailure to comply with the licensing and registration requirements of the Act bar[s] [a THSF] from pursuing any claim for compensation, whether couched as fees in contract or damages in tort." Data Informatics v. Amerisource Partners, 338 N.J.Super. 61, 80 (App. Div. 2001).

The provisions of the Act do not apply to:

Any [THSF] which does not: (1) Charge a fee or liquidated charge to any individual employed by the firm or in connection with employment by the firm; (2) Prevent or inhibit, by contract, any of the individuals it employs from becoming employed by any other person; (3) Knowingly send individuals it employs to, or knowingly continue to render services to, any plant or office where a strike or lockout is in progress for the purpose of replacing individuals who are striking or who are locked out. Any person conducting a temporary help service firm which knowingly sends its employed individuals to, or knowingly continues to render services to, a plant or office where a strike or lockout is in progress for the purpose of replacing those individuals who are striking or who are locked out or, directly or indirectly counsels, aids or abets that action shall be liable to a penalty of $1,000 upon each occurrence. The penalty shall be sued for, and received by and in the name of the Attorney General and shall be collected and enforced by summary proceedings pursuant to the penalty enforcement law [N.J.S.A. 2A:58-10 to -12]. [N.J.S.A. 34:8-46(h)(1)-(3) (internal quotation marks omitted).]

Defendants filed a motion for summary judgment,4 arguing that Paystaffing was not registered as a THSF and had not filed annual reports for two years when its alleged cause of action arose in March 2012. The motion record confirmed that Paystaffing's THSF registration was revoked prior to March 2012 and was not reinstated until July 1, 2012, and its certificate of incorporation was revoked on July 16, 2011, for "failure to pay annual reports" and was not reinstated until October 12, 2012. Defendants also argued that no exemption under N.J.S.A. 34:8-46(h) applied.

Plaintiffs conceded that Paystaffing was not registered as a THSF when its alleged cause of action arose. However, they argued that Paystaffing and Temporary merged on December 31, 2011, effective January 2, 2012, and Temporary was registered at that time.5 Plaintiffs also argued that Paystaffing was exempt from the Act pursuant to N.J.S.A. 34:8-46(h)(1) and (2) because it did not charge its employees a fee and it had no contract with its employees limiting them from obtaining other employment.

In a September 17, 2013 oral opinion, Judge Rachelle L. Harz found that because Paystaffing was not registered as a THSF and had not paid annual report fees for two years, it remained a separate entity that could not have legally merged with Temporary in January 2012. The judge also found that pursuant to N.J.S.A. 14A:10-4.1(2),6 Paystaffing and Temporary did not legally merge until the filing of the certificate of merger on October 25, 2012. The judge concluded that because there was no genuine issue of material fact that Paystaffing did not meet the Act's registration requirements when its alleged cause of action arose, it could not bring or maintain this action.

Relying on Data Informatics, supra, Judge Harz held that the N.J.S.A. 34:8-46(h)(1) and (2) exemptions did not apply because: (1) Paystaffing charged its employees a fee in connection with their employment with HDU, which was the difference between the amount of money it received from HDU and the amount it paid to its employees, plus the transportation costs; and (2) Paystaffing contractually prevented and inhibited its employees from becoming employed by HDU by prohibiting HDU from hiring those employees on a permanent unless and until the employee worked at least 600 hours for HDU. The judge granted summary judgment and dismissed the amended complaint in its entirety with prejudice. This appeal followed.

On appeal, plaintiffs raise the same arguments they raised before Judge Harz. They also argue the judge erred in dismissing the tort claims. All of these arguments lack merit.

We review rulings on summary judgment de novo. Manahawkin Convalescent v. O'Neill, 217 N.J. 99, 115 (2014). We apply "`the same standard governing the trial court,' and do not defer to the trial court's ... interpretation of `the meaning of a statute or the common law." Davis v. Brickman Landscaping, Ltd., 219 N.J. 395, 405 (2014) (quoting Murray v. Plainfield Rescue Squad, 210 N.J. 581, 584 (2012); Nicholas v. Mynster, 213 N.J. 463, 478 (2013)). Thus, we consider, as the motion judge did, whether "`the competent evidential materials presented, when viewed in the light most favorable to the non-moving party, are sufficient to permit a rational factfinder to resolve the alleged disputed issue in favor of the non-moving party.'" Town of Kearny v. Brandt, 214 N.J. 76, 91 (2013) (quoting Brill, supra, 142 N.J. at 540). If there is no genuine issue of material fact, we must then "`decide whether the trial court correctly interpreted the law.'" DepoLink Court Reporting & Litig. Servs. v. Rochman, 430 N.J.Super. 325, 333 (App. Div. 2013) (citation omitted). We review issues of law de novo and accord no deference to the trial judge's conclusions on issues of law. Nicholas, supra, 213 N.J. at 478.

Applying the above standards, we discern no reason to disturb Judge Harz's sound rulings. We are satisfied the competent evidential materials presented, when viewed in the light most favorable to plaintiffs, unequivocally established that defendants were entitled to summary judgment as a matter of law. When its cause of action arose, Paystaffing was not registered and its certificate of incorporation was revoked for failing to pay annual fees. Paystaffing could not rely on Temporary's THSF because the two companies did not legally merge until October 25, 2012. Because there was no question that Paystaffing did not meet the Act's registration requirements at the time its alleged cause of action arose in March 2012, it is barred from bringing or maintaining this action. N.J.S.A. 34:8-45(b). This bar includes plaintiffs' tort and contract claims. Data Informatics, supra, 338 N.J. Super. at 80.

In addition, Data Informatics supports Judge Harz's determination that no exemption applies. In Data Informatics, the defendant, AmeriSOURCE, an employment agency, employed Balawat, a computer programmer. Data Informatics, supra, 338 N.J. Super. at 64. AmeriSOURCE supplied Balawat to the plaintiff pursuant to a master service agreement between the two entities. Ibid. The master service contract contained a restrictive covenant prohibiting AmeriSOURCE from contracting with the plaintiff's clients to supply employees that AmeriSOURCE had supplied to the plaintiff. Id. at 64-65. The plaintiff then supplied Balawat to its client, Alliance Funding Company, to perform computer programming services. Id. at 64. The plaintiff charged Alliance a fee for Balawat's services. Id. at 66. Alliance paid the plaintiff, who then retained a portion of the fees and forwarded the remainder to AmeriSOURCE. Ibid. AmeriSOURCE retained its share of the fee and then paid Balawat pursuant to her employment agreement. Ibid.

AmeriSOURCE released Balawat from her employment contract and placed her directly at Alliance. Id. at 66-67. The plaintiff filed a complaint against AmeriSOURCE and Balawat, seeking contract and tort damages, among other things. Ibid. Rejecting the plaintiff's claim it was a THSF, we held it was an employment agency subject to the licensing requirements of the Act, and because it failed to comply with the Act's licensing requirements, its tort and contract claims were barred. Id. at 64.

We also held that even if the plaintiff was a THSF, its tort and contract claims were barred because it failed to register. Id. at 78. We determined that the N.J.S.A. 34:8-46(h)(1) and (2) exemptions did not apply because the plaintiff charged a fee in connection with Balawat's employment and inhibited her from becoming employed by Alliance by virtue of the master service contract. Id. at 78.

Here, Paystaffing charged a "fee" in connection with its employment of the employees it supplied to HDU, which, according to N.J.S.A. 34:8-43, is the difference between the amount of money Paystaffing received from HDU and the amount Paystaffing paid the employees it supplied to HDU. In addition, the contract between Paystaffing and HDU clearly prohibited Paystaffing's employees from becoming employed by HDU by virtue of the contract. Accordingly, Judge Harz properly granted summary judgment and dismissed the complaint in its entirety with prejudice.

Affirmed.

FootNotes


1. Improperly pled as On Target Staffing, LLC.
2. The record contains no other contract between the parties.
3. On September 28, 2012, Paystaffing filed an amended complaint adding Temporary as a plaintiff and On Target as a defendant. On Target did not file an answer and default was entered against it.
4. Defendants had previously filed a motion for summary judgment, which the court denied without prejudice pending the completion of discovery.
5. Plaintiffs' statement that the Attorney General's Office said Paystaffing could operate under Temporary's THSF registration as of January 2, 2012 constitutes inadmissible hearsay that cannot defeat summary judgment. See El-Sioufi v. St. Peter's Univ. Hosp., 382 N.J.Super. 145, 164 (App. Div. 2005) (holding that only admissible evidence may form the factual basis for summary judgment.)
6. N.J.S.A. 14A:10-4.1(2) provides, in pertinent part, that "[t]he executed original and a copy of the certificate shall be filed in the office of the Secretary of State and the merger or consolidation shall become effective upon the date of the filing or at a later time, not to exceed 90 days after the date of filing, as may be set forth in the certificate." (Emphasis added).
Source:  Leagle

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