Bosland v. Warnock Dodge, Inc.
964 A.2d 741, 197 A.2d 741, 197 N.J. 543 (2009)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
A consumer is not required to seek a refund from a merchant as a prerequisite to filing a lawsuit under the New Jersey Consumer Fraud Act (CFA). A quantifiable overcharge constitutes an "ascertainable loss" under the statute at the moment it is paid.
Facts:
- On March 13, 2003, Rhonda Bosland purchased a new 2003 Jeep Grand Cherokee from Warnock Dodge, Inc.
- Bosland paid the full purchase price listed on the Retail Buyer's Order.
- The buyer's order included a line item for a $117 "Registration Fee."
- Bosland later discovered that the applicable state-mandated title and registration fees were substantially less than the $117 she was charged, amounting to either $77 or $97.
- Bosland concluded that the overcharge of $20 to $40 constituted an undisclosed documentary service fee in violation of state regulations.
- Without first demanding a refund of the overcharge from Warnock Dodge, Bosland initiated a lawsuit.
Procedural Posture:
- Rhonda Bosland filed a class action complaint against Warnock Dodge, Inc. in the Law Division (New Jersey's trial court of first instance).
- The trial court granted Warnock Dodge's motion to dismiss, reasoning that Bosland's failure to complain or request a refund was fatal to her CFA claim.
- Bosland, as appellant, appealed to the Appellate Division of the Superior Court of New Jersey (an intermediate appellate court).
- The Appellate Division reversed the trial court's dismissal of the CFA claim, holding that a pre-suit demand for a refund is not required.
- Warnock Dodge, Inc., as petitioner, was granted certification to appeal to the Supreme Court of New Jersey (the state's highest court).
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does the New Jersey Consumer Fraud Act (CFA) require a plaintiff to first request a refund of a claimed overcharge from a merchant before instituting litigation?
Opinions:
Majority - Justice Hoens
No. The New Jersey Consumer Fraud Act (CFA) does not require a plaintiff to first request a refund from an allegedly offending merchant before filing a lawsuit. The plain language of the statute, N.J.S.A. 56:8-19, sets forth only three required elements for a private cause of action: 1) unlawful conduct by the defendant; 2) an ascertainable loss by the plaintiff; and 3) a causal relationship between the conduct and the loss. An overcharge, even a small one, is a quantifiable and measurable loss—an "ascertainable loss"—at the moment it is paid by the consumer. The fact that a consumer could have potentially secured a refund does not negate the fact that a loss was sustained. Imposing a pre-suit demand requirement would undermine the CFA's broad remedial purpose by creating a 'safe harbor' for merchants to engage in unlawful practices, allowing them to refund overcharges only to the few consumers who notice and complain, while retaining the profits from all others. Such a requirement is absent from the statutory text, and any public policy concerns about its absence are matters for the Legislature, not the Court, to address.
Analysis:
This decision solidifies the New Jersey Consumer Fraud Act as a potent consumer protection statute by removing a potential procedural barrier to litigation. It confirms that the elements for a prima facie case are strictly limited to those enumerated in the statute itself. The ruling prevents merchants from adopting a 'refund-on-request' policy to escape liability for systematic unlawful practices, thereby strengthening the CFA's deterrent effect, particularly for class actions involving small, widespread overcharges. Future CFA defendants cannot use a plaintiff's failure to seek an informal resolution as a defense, ensuring that the courthouse doors remain open for consumers who have suffered any quantifiable loss.
