03-26-09 539 Absecon Boulevard, LLC v. Shan Enterprises, et al.
A-2250-06T1
Plaintiffs purchased from defendants an operating 204-room
motel business, along with the land on which the seven-story
motel building was situated and an adjacent parcel. Plaintiffs
contended that the sellers violated the Consumer Fraud Act
("CFA"), N.J.S.A. 56:8-1 to -106, by misrepresenting to them the
sources and amounts of the past operating revenues for the
motel. After a bench trial, the Law Division granted plaintiffs
relief under the CFA, but dismissed their separate common-law
claims.
We reverse the judgment because we hold that the CFA does
not apply to this transaction, which was predominantly for the
sale of an ongoing business, and where the alleged fraud
concerned the business's revenues rather than misrepresentations
about the real estate.
