New Jersey has one of the most liberal consumer protection statutes in the nation, the New Jersey Consumer Fraud Act. Notwithstanding the same, on Thursday, November 18, 2004, the Appellate Division found that a consumer may only be awarded attorney fees if he can demonstrate an “ascertainable loss” caused by the violation of the Consumer Fraud Act.
The case entitled, Pron v. Carlton Pools, Inc., involved a dispute relating to the construction of a swimming pool. According to the Plaintiff, defendant, Carlton Pools, Inc. misrepresented that it did not use any subcontractors for the construction of its pools. It was shown at trial that Carlton Pools subcontracted an electrician and plumber for the job. Notwithstanding, the alleged misrepresentation, the Plaintiff was unable to prove that he suffered any damages as a result of the defendant’s statement that it did not subcontract. The alleged loss was not caused by subcontracting out the work. It related to a portion of the job which was not subcontracted. As a result of the same, the Appellate Division reserved the trial court’s finding that the Consumer Fraud Act was violated. The Appellate Division held that attorneys’ fees, tremble damages and costs may only be awarded if a consumer can demonstrate that it suffered an ascertainable loss which was caused by the misrepresentation.
The Pron decision is extremely important to both businesses and consumers because it limits damages unless a consumer can show a causal connection between the misrepresentation and the ascertainable loss.