NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

PER CURIAM.

After a nine-day trial, a jury awarded plaintiff Vincent Pools, Inc. (Vincent Pools) $150,498.92 payable by defendants APS Contractors, Inc. (APS), Colonial Surety Company, Inc. (Colonial), and the City of Jersey City (Jersey City). Defendants stipulated prior to trial that if Vincent Pools prevailed against APS, it would prevail on the bond claim against Colonial.

Vincent Pools, a subcontractor, filed suit to collect the balance due for work performed on a municipal project in Jersey City. APS was the general construction contractor which had retained Vincent Pools, and Colonial was APS's surety.

The jury also awarded APS $502,966 on its cross-claim against Jersey City for the balance on the municipal contract and for additional change order work. The trial judge reduced APS's judgment to $352,467, the amount Jersey City had previously paid to APS for the portion of the contract due to Vincent Pools.

Pursuant to the offer-of-judgment rule, Rule 4:58-2, the trial judge entered judgment for Vincent Pools totaling $122,329.93 in attorney's fees and costs. APS and Colonial now appeal the award of attorney's fees and costs, and Jersey City appeals both the jury's verdict and the judge's award of fees.

Defendants claim Rule 4:58-2 does not apply to a single plaintiff's offer to multiple defendants in a contract case. Jersey City contends it was not responsible to Vincent Pools under the Municipal Mechanics Lien Law, N.J.S.A. 2A:44-125 to -142, because it earlier paid APS for Vincent Pools's work. Jersey City also contends that Vincent Pools's only remedy is found in the Bond Act, N.J.S.A. 2A:44-143 to -147, which required APS to furnish a bond to ensure payment to its project subcontractors. See N.J.S.A. 2A:44-143. Lastly, Jersey City argues in the alternative that Vincent Pools's recourse is through the Trust Fund Act, N.J.S.A. 2A:44-148, which creates a trust from monies paid by a public entity to a general contractor for obligations owed to unpaid laborers and materialmen.

As to the judgment in favor of APS, Jersey City argues the trial judge's jury charge regarding the change orders was plain error. Jersey City claims that APS should have been required to prove its case by clear and convincing evidence, and that the jury charge improperly implied that the burden of proof was by a preponderance of the evidence.

Vincent Pools cross-appeals. It contends the trial judge erred by denying its application for directed verdict.

I.

Jersey City hired APS to serve as the general contractor in the construction of a municipal pool complex for a total cost of approximately $4,884,000. Colonial provided the performance and payment bond guaranteeing prompt payment to any entity that directly contracted with APS to supply labor or material for the project.

APS subcontracted the installation of the plaster work for two swimming pools to Vincent Pools at a total cost of $780,000. Vincent Pools retained third-party defendant Poolside Plastering, Inc., to perform the work.

Shortly after installation, Joseph Javier, Jersey City's architect, notified Angel Stefanovik, APS's onsite project superintendent, of a problem with the plaster's condition. Javier and Brian Weller, the director of Jersey City's architecture division, wrote to Goce Boazeski, APS's president and owner, requesting that the defective plaster in both pools be removed and replaced.

On May 4, 2011, Weller wrote a second time to Boazeski demanding that the pools be replastered. That letter also stated that if APS did not guarantee the replastering would commence the following day, Weller would ask city council to declare APS in default.

Jersey City rejected APS's offer to acid wash the pool. Accordingly, on May 12, 2011, city council formally terminated APS's contract. Jersey City maintained that it paid for the work completed on the pools prior to APS's termination. In its reply brief on appeal, APS concedes that Jersey City paid for Vincent Pools's portion of the job, albeit inadvertently, as Jersey City was dissatisfied with the quality of the work. As a result of the dispute, Jersey City did not pay APS for certain outstanding change order charges, and APS in turn withheld $162,468.92 from Vincent Pools.

Vincent Pools had earlier noticed Colonial of its claim, as a result of APS's failure to pay, on the labor and material payment bond. That same day, January 18, 2011, Vincent Pools filed a Municipal Mechanic's Lien asserting a valid lien against project funds due and owing to APS.

Thereafter, Vincent Pools filed suit against: (1) APS for breach of contract; (2) Colonial for failure to make payment on its bond; and (3) Jersey City on a municipal lien claim. APS counterclaimed and cross-claimed for breach of contract against Vincent Pools1 and Jersey City. Jersey City counterclaimed for negligence against Vincent Pools and breach of contract against APS. Vincent Pools then joined Poolside2 as an additional defendant.

The parties stipulated that the trial court would determine the disposition of the Municipal Mechanics' Lien claim under N.J.S.A. 2A:44-140.

At trial, APS pursued its cause of action seeking payment for the change orders. Ryan Pisano, APS's project manager, testified that those sums totaled $319,768. Additionally, APS sought $49,725 for completed work, $231,723 as a contract balance, and a $104,233 retainage fee. APS took the position that it had completed approximately ninety-five percent of the work remaining under the contract.

Jersey City's principal witness, Javier, testified that the plastering in one of the pools was materially defective due to crazing and rough spots. Jersey City terminated the contract because APS failed to correct the problem, and hired another company to re-plaster the pool for $134,820. Additional subcontractors were retained to complete other aspects of the project APS left unfinished, such as landscaping and fence reinforcement.

According to Javier, when a change order was submitted, he would negotiate a price with the contractor. The negotiated price would then be submitted to his supervisor, Weller, for finalization. If the price exceeded a certain amount, Weller would have to obtain city council's approval. On cross-examination, Javier agreed that many of the change orders would have been approved had the contract not been terminated.

Jersey City also presented the testimony of an expert in construction engineering and construction management, Walker Konon. He opined that the crazing and cracks in the pool plaster work were more than merely cosmetic defects. On the basis of that opinion and other testimony, the judge denied Vincent Pools's motion for directed verdict. We more fully describe her rationale for doing so later in this opinion.

When on October 8, 2013, the jury rendered the $150,498.92 verdict in favor of Vincent Pools, it also awarded APS $502,975.32, allocated at $217,698.26 for Jersey City's breach of its written contract, and $285,277.06 for breach of an implied contract. In order to address Jersey City's concerns regarding double recovery, APS consented to the reduction of its verdict for the amount the jury awarded Vincent Pools.

After judgment was entered, Vincent Pools filed its Rule 4:58 motion for $162,007.61 in attorney's fees, all costs of suit, and litigation expenses. APS and Jersey City opposed the application, arguing the fees were unreasonable, excessive, and duplicative.

On January 7, 2014, the trial court issued a written decision granting Vincent Pools's petition for counsel fees. The judge reduced the amount of attorney's fees, however, from $162,007.61 to $122,329.93. On appeal, no substantial challenge is made to her calculations. With regard to the offer of judgment rule, the judge said only that "since both defendants were in a position to settle the matter with the movant at any time prior to trial and neither did so, both defendants are equally responsible for the reasonable attorneys' fees associated with the trial[.]" She did not award interest. See R. 4:42-11.

On appeal, Jersey City raises the following points:

APS and Colonial raise the following point:

Vincent Pools raises one point on cross-appeal:

II.

A.

Jersey City contends because it already paid APS the funds appropriated for the construction of the municipal pool complex, it should not be required to pay anything to Vincent Pools under the Municipal Mechanics' Lien Law, and that if compelled to do so, it would pay the same bill twice. Furthermore, Jersey City argues Vincent Pools's only recourse is to seek relief from APS under the Trust Fund Act, N.J.S.A. 2A:44-148.

Any person that contracts with a public entity for the construction of public works or improvements is afforded three statutory forms of security for the payment of the value of labor performed or materials furnished in connection with such contract. Wilson v. Robert A. Stretch, Inc., 44 N.J.Super. 52, 54 (Ch. Div. 1957). These three statutes are "in pari materia and are to be construed together." See Morris Cnty. Indus. Park v. Thomas Nicol Co., 35 N.J. 522, 526-27 (1961).

The first such security, the Municipal Mechanics' Lien Law, imposes a lien in favor of those who contract with a public agency "for the value of the labor or materials, or both, upon the moneys due or to grow due under the contract ... to the full value of the claim or demand." N.J.S.A. 2A:44-128(a). The lien "attaches to funds appropriated for the payment of such public work and still in the hands of the public agency." Wilson, supra, 44 N.J. Super. at 55.

The extent of protection is limited to the amount the public agency owes "to the prime contractor at the time the notice of lien claim is filed or thereafter becoming due." Hiller & Skoglund, Inc. v. Atl. Creosoting Co., 40 N.J. 6, 12 (1963). Thus, the public agency "cannot be liable for more than the total amount of the prime contract, provided it pays the prime contractor in accordance with the terms thereof and withholds a sum sufficient to cover lien claims filed, and satisfaction of the claim cannot be had out of the public property which is the subject of the project." Ibid.

The second form of security, the Bond Act, requires the general contractor for a public agency contracting out public-works projects to furnish a bond. N.J.S.A. 2A:44-143. Such a bond ensures:

Under this statute, a party who performs labor or furnishes materials "has, for his security, recourse on the bond which the prime contractor is obliged to file." Wilson, supra, 44 N.J. Super. at 55.

Finally, the Trust Fund Act, N.J.S.A. 2A:44-148, directs that when payments are made to a general contractor, those sums shall constitute a trust fund in favor of unpaid materialmen and laborers. The trust attaches to monies paid by the public agency in the hands of the general contractor. Wilson, supra, 44 N.J. Super. at 56.

Jersey City bases its argument on the section of the Municipal Mechanics' Lien Law, N.J.S.A. 2A:44-128(a), that states: "no public agency shall be required to pay a greater amount than the contract price of the labor performed and materials furnished[.]" Ibid. Jersey City interprets this section to mean that once a payment of the written contract price is advanced to a general contractor, a government agency is thereby relieved from any further liability. That reading, however, makes the subcontractor's lien rights meaningless.

To the contrary, the Mechanics' Lien Law protects an unpaid subcontractor by enabling it to claim against monies due to the general contractor payable by the public agency. Read within context, the words of the statute refer to the contract price as a whole, not the price for a specific portion of the contract. N.J.S.A. 2A:44-128(a) is meant to prevent the public entity from having to pay more than its total contractual obligation for the entire project while protecting subcontractors.

An illustration of the statute's import can be found in Johnson v. Fred L. Emmons, 115 N.J. Eq. 335 (Ch. Div. 1934), aff'd, 119 N.J. Eq. 88 (E. & A. 1935). In Johnson, the town of Montclair hired a general contractor for the construction of a building at a total cost of $52,495. Id. at 335-36. Prior to the general contractor abandoning the project, the town paid him $35,154.30. Id. at 336. The town then bid the completion of the project, entering into an agreement with a new general contractor for $18,485. Ibid. Before any payments were made, however, a subcontractor under the original contract filed a lien claim on the remaining $17,340.70 of the original contract for the work it performed. Ibid.

The Johnson court held that the subcontractor's lien attached, upon the filing of the statutory notice, to the remainder of the money allocated on the original contract still in the government entity's coffers. Id. at 337. In other words, the subcontractor in Johnson was entitled to payment on the lien because the money left over from the original contract allocation was still under the town's control when the lien was filed. Id. at 337-38.

Jersey City's argument that it has been required to pay Vincent Pools twice is without basis. Saliently, post-verdict, the judge reduced the award to reflect the payment. It is literally impossible for Jersey City to pay APS an amount in excess of the original contract plus work change orders. It is not paying twice for Vincent Pools's work.

That other potential remedies, such as the Trust Fund Act, are available does not negate Jersey City's exposure under the Mechanics' Lien Law. The statutes must be read cumulatively, but the ability to recover under one statute does not preclude recovery under another. See Wilson, supra, 44 N.J. Super. at 58 (recognizing that failure to qualify for relief under one statute, does not automatically result in the ineligibility for relief under the others).

Moreover, Jersey City waived its defenses to Vincent Pools's Municipal Mechanics' Lien claim as part of the parties' pre-trial stipulation.3 The stipulation provides in relevant part: "Vincent Pools is a proper claimant under the New Jersey Municipal Mechanic[s'] Lien Act and has, with the exception of the aforementioned claims of defects in the installation of the plaster that are in dispute between the parties, met all conditions required for payment under the statute." Stipulations made in a judicial proceeding "are binding upon those who make them and those whom they lawfully represent, and also upon the trial and appellate courts, in the absence of any valid ground or reason for refusing enforcement." Stalford v. Barkalow, 31 N.J.Super. 193, 199 (App. Div. 1954) (quoting 50 Am. Jur. 610 § 9).

B.

APS, Colonial, and Jersey City argue that the offer-of-judgment rule is inapplicable and therefore the decision to award attorneys' fees and costs was erroneous. "The offer-of-judgment rule is `designed particularly as a mechanism to encourage, promote, and stimulate early out-of-court settlement of negligence and unliquidated damages claims that in justice and reason ought to be settled without trial.'" Schettino v. Roizman Dev., Inc., 158 N.J. 476, 482 (1999) (quoting Cudrup v. Marrera, 57 N.J. 353, 361 (1971)). Rule 4:58-2 was intended to penalize "a party who rejects a settlement offer that turns out to be more favorable than the ultimate judgment." Ibid. A strategic decision to reject an offer of judgment is not a valid ground to avoid application of the rule. Negron v. Melchiorre, Inc., 389 N.J.Super. 70, 94-95 (App. Div. 2006), certif. denied, 190 N.J. 256 (2007). Under the rule, when a pretrial offer is rejected, and the monetary award exceeds 120 percent of the offer, the offeror is allowed reasonable costs, prejudgment interest under defined circumstances, and "a reasonable attorney's fees for such subsequent services as are compelled by the nonacceptance." "The rule is cast in mandatory and not exhortatory terms, and, thus, accords judges no discretion regarding whether or not to award attorney's fees and costs of suit in an offer of judgment case." Wiese v. Dedhia, 188 N.J. 587, 592 (2006) ("Weise II"); see also, McMahon v. N.J. Mfrs. Ins. Co., 364 N.J.Super. 188, 194 (App. Div. 2003) (stating that "the consequences of non-acceptance of a plaintiff's offer under R. 4:58-2 are mandatory").

Jersey City contends that since it already paid APS for the work performed by Vincent Pools, to compel it to pay counsel fees in addition would be the equivalent of a government agency lending money to a private entity for private use. We consider the argument to be so lacking in merit as to not warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).

APS and Colonial argue that the rule does not apply because the offer of judgment did not resolve all claims against all defendants in the case. Had they accepted the offer, they would have nonetheless been compelled to continue the litigation against Jersey City for the balances owed on the contract and change orders. APS and Colonial further rely on Wiese v. Dedhia, 354 N.J.Super. 256 (App. Div. 2002), certif. denied, 175 N.J. 546 (2003) ("Wiese I") and Schettino to argue that the rule should not be applied in cases with multiple defendants. These arguments are unconvincing.

In Wiese I, the husband and wife plaintiffs made a joint offer of judgment to a single defendant in an automobile negligence action. Wiese I, supra, 354 N.J. Super. at 589-59. The defendant neither accepted the offer, nor requested that it be broken down individually between the two plaintiffs. Id. at 259. Following trial, the jury awarded each plaintiff a sum that when combined exceeded 120% of the plaintiffs' pre-trial offer of judgment. Id. at 259-60. The trial court denied the plaintiffs' motion for attorney's fees and costs under Rule 4:58-2. Id. at 260.

We reversed, holding that the combined award qualified as being in excess of 120 percent of the offer. Id. at 261. The effectiveness of the rule would be otherwise undermined, if it were construed to require spousal plaintiffs with interrelated claims to submit separate offers of judgment. Id. at 262. In similar cases with multiple defendants, the rule has been interpreted to permit a plaintiff to make an offer in respect of the total judgment, rather than in pro rata shares payable by individual defendants. Id. at 263. That is what occurred here.

In Schettino, the plaintiff alleged multiple defendants were jointly and severally liable for a real estate broker's commission despite the absence of any writing regarding the claimed obligation. 158 N.J. at 478. One defendant offered to settle its share of the liability for a nominal amount, which offer the plaintiff rejected. Ibid. The trial court granted that defendant's motion for summary judgment and awarded attorney's fees under the rule. Ibid. The Supreme Court disagreed, holding that a plaintiff who asserted multiple defendants are jointly and severally liable is not subject to the financial consequences of rejecting an offer by a single defendant for only partial settlement. Ibid. The decision in Schettino, however, largely turned on the nature of joint and several liability. Id. at 484. That is not the nature of the claim in this case.

Vincent Pools demanded the same amount from the two defendants. Where a plaintiff is not asserting a claim for joint and several liability, the rationale in Schettino is simply inapplicable.

Vincent Pools pursued the matter based on three separate causes of action: breach of contract, breach of the payment bond, and a municipal mechanics' lien claim. Any combination of these defendants could have been found liable.

Had APS accepted the offer, it would have resolved all Vincent Pools's claims against each defendant. Any remaining issues that APS may have had with Jersey City concerned other aspects of the contract, as well as work change orders, and did not pertain to Vincent Pools's demand. APS could have separately pursued its claims against Jersey City and obtained a judgment for the balance owed even if Vincent Pools was no longer involved in the litigation.

APS had been paid the full amount for the Vincent Pools portion of the contract. APS's causes of action for payment of additional sums was for the unpaid balance of the contract plus "extras."

Jersey City's dispute with payment to Vincent Pools related to its position that it had already paid APS for the work. It too could have resolved that issue by settling with Vincent Pools and seeking reimbursement from APS.

Thus we cannot say the rule's somewhat inflexible application resulted in "a disagreeable outcome" in this case. See Negron, supra, 389 N.J. Super. at 96. Both Jersey City and APS had options available that would not have precluded their claims against each other. Although APS and Colonial argued that the trial court should have employed Rule 1:1-2(a) to relax the strict application of the offer-of-judgment rule, there is no unfairness in this case.

Rule 1:1-2(a) is not intended "as a safe harbor for the dilatory; its `catch-all' nature is not intended to serve as a cure-all. Proponents seeking relief under the relaxation provisions of Rule 1:1-2 bear a heavy burden, as ... relief under that Rule will be granted only sparingly[.]" Romagnola v. Gillespie, Inc., 194 N.J. 596, 606 (2008).

APS and Colonial do not identify any injustice or inequity that would have resulted had they accepted Vincent Pools's offer of judgment. Rather, APS and Colonial admit that they rejected the offer as a matter of strategy. That strategic decision is one they were entitled to make, but they must also live with the consequences. Jersey City was also in a position to have settled with Vincent Pools while pursuing APS. The rule exists to induce settlements, a goal that may at times conflict with an individual litigant's trial strategy. See Best v. C&M Door Controls, Inc., 200 N.J. 348, 356 (2009). Negron, supra, 389 N.J. Super. at 94-95. Hence the trial judge's award of attorney's fees was not error.

C.

For the first time on appeal, Jersey City contends the trial judge's instruction regarding the burden of proof was incorrect. Jersey City asserts that the jury charge implied that the burden of proof was by a preponderance of the evidence, and that the correct burden of proof was by clear and convincing evidence. Since it did not object to the court's jury instructions at trial, we analyze the issue employing the plain error standard. See R. 2:10-2. The question is whether the error "led the jury to a result it otherwise might not have reached." State v. Macon, 57 N.J. 325, 336 (1971). In civil cases, relief under the plain error rule "is discretionary and should be sparingly employed." Cavuoti v. N.J. Transit Corp., 161 N.J. 107, 129 (1999) (internal quotation marks and citation omitted). Bldg. Materials Corp. of Am. v. Allstate Ins. Co., 424 N.J.Super. 448, 487 n.14 (App. Div.), certif. denied, 212 N.J. 198 (2012).

In the charge, the judge specifically stated:

A contract provision requiring modification by writing "may be expressly or impliedly waived by the clear conduct or agreement of the parties or their duly authorized representatives." Home Owners Constr. Co. v. Borough of Glen Rock, 34 N.J. 305, 316 (1961); Lewis v. Travelers Ins. Co., 51 N.J. 244, 253 (1968). "An offeree may manifest assent to terms of an offer through words, creating an express contract, or by conduct, creating a contract implied-in-fact." Weichert Co. Realtors v. Ryan, 128 N.J. 427, 436-37 (1992) (citing Restatement (Second) of Contracts § 19(1) (1981)). Clear and convincing evidence is required to prove waiver of a requirement reduced to writing. Home Owners, supra, 34 N.J. at 317.

We cannot say, however, that the judge's charge could have led the jury to a result it might not otherwise have reached. During trial, Javier testified that the balance of the contract and the majority of APS's change orders would have been approved by Jersey City if the contract had not been terminated because of the plastering dispute. Thus whether under the standard of preponderance of the evidence, or by clear and convincing evidence, the testimony and proof of the completion of the work and work change orders, supported the jury's award. The jury would not have reached another result had the charge been different. Macon, supra, 57 N.J. at 336. No relief is warranted on this point.

III.

Lastly, we address Vincent Pools's cross-appeal that the court should have granted its motion for a directed verdict. Vincent Pools contends that Jersey City offered no evidence, outside of its own employees' observations, regarding the condition of the plaster. Thus, Vincent Pools argues, no reasonable jury could have concluded that the installation was deficient.

In denying Vincent Pools's motion for a directed verdict, however, the trial judge said:

In reviewing an order granting or denying a motion for a directed verdict, "we apply the same standard that governs the trial courts." Frugis v. Bracigliano, 177 N.J. 250, 269 (2003). The trial court must accept as true all evidence that supports the non-moving party's position and all favorable legitimate inferences therefrom to determine whether the moving party is entitled to judgment as a matter of law. Dolson v. Anastasia, 55 N.J. 2, 5 (1969). The court must deny the motion so long as "reasonable minds could differ," Johnson v. Salem Corp., 97 N.J. 78, 92 (1984), to ensure that any legitimate dispute of material fact be left to the jury, Lewis v. Am. Cyanamid Co., 155 N.J. 544, 567 (1998).

Jersey City did present a witness found to be qualified as an expert in construction engineering and construction management. Although Konon was precluded from testifying as to causation4 of the defects in this case, he did testify regarding defects in the plaster work. Even on cross-examination, Konon said that the crazing and cracks at issue were more than merely cosmetic deficiencies and required replacement. That evidence, coupled with Jersey City's other witnesses who described the unsatisfactory appearance of the plaster, sufficed to allow a reasonable juror to decide that the plaster workmanship was deficient. Thus, since reasonable minds could differ with regard to the quality of Vincent Pools's installation of plaster work, the judge properly denied the application. The question raised was one of material fact best left to the jury.

Affirmed.