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In New Jesey business law, a person or business may personally guaranty the performance of a third party.  If the third party defaults on its obligations, the party which gave the personal guaranty (the “guarantor”) then becomes liable for the third party’s default.  Different states have different requirements for the enforcement of personal guarantees, however.  On December 2, 2025, thecourthouse-1223280__340-300x200 New Jersey Supreme Court issued an opinion in the case of Extech Building Materials, Inc. vs. E&N Construction, Inc., explaining the requirements of  an enforceable personal guaranty under New Jersey contract law.  The main element is that the guarantor must clearly and unambiguously express its intent to personally guarantee the third-party’s obligation.

Background

E&N Construction, Inc., a construction company, signed a two page agreement with Extech Building Materials, Inc. to purchase construction supplies.  They signed a two page, six paragraph agreement. The sixth paragraph provided:

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New Jersey business law provides that parties to a contract may agree that after closing one party, usually the seller, can have the right to match another offer which a party receives.  This is called a “right of first refusal.”  This most frequently occurs in contracts for the sale of a business or the sale of real estate, but also often occurs in leases and other contracts as well.  A New Jersey appeals court’s decision in the case of PMG New Jersey II, LLC vs Amrit Inc. examined the law regarding New Jersey law regarding contractual rights of first refusal.6-300x225

Amrit, Inc. Buys a Gas Station and a Decade Later Litigation Ensues

The decision explained that in 2012, the parties entered into a into a Motor Fuel Supply Agreement (MFSA) in connection with Amrit, Inc.’s purchase of a gas station in New Brunswick, New Jersey from PMG New Jersey II, LLC.  The MFSA was amended three years later in 2015 to include a provision which provided that if the purchaser received an offer to buy the gas station, PMG had 30 days to give notice that it was exercising its right to purchase the gas station on the same terms and conditions as the new offer; if not it waived this right of first refusal.  The MFSA was later amended to last through 2027.

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An appeals court recently issued an opinion in the case of Hand v. Borough of New Providence, examining the rights of New Jersey police officers facing discipline in non-civil service jurisdictions

Backgroundpaterson-pd-john-and-andrew-300x183

The opinion explained that Michael Hand was a corporal with the New Providence Police Department, with thirteen years of service.  On May 17, 2019, he was eating dinner with his wife at a diner during a meal break when a call came for him to respond to a domestic incident.  Another officer, Patrolman Lunch responded.  Plaintiff texted Lynch and his supervisor to see if they needed him but they did not respond, so he did not go.  The supervisor, Sergeant Diamond, who was not called, terminated a traffic stop to respond when he saw on GPS that Hand was not responding.  At the scene, a juvenile experienced a mental health crisis and the situation escalated; Diamond called Hand on the radio and Hand then responded 13 minutes after the original call.

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New Jersey construction law incorporates the damages provisions of the Consumer Fraud Act in residential home improvement construction projects.  A New Jersey appeals court recently analyzed the recovery of triple damages and attorneys fees in construction projects under the Consumer Fraud Act, and personal liability for contractors, in two construction law decisions.

Background

Philip Dattolo hired EMC Squared, LLC to construct a new single-family home in Boonton, New Jersey.  They signed a written contract.  Toward the end of the project, Dattolo selected severalhouse-225x300 additional items to be included.  A written change order to the original signed contract was drafted, but the change order was never signed.  In January 2020 the home passed final inspections, and EMC’s owner, Edward Morgan, advised Dattolo that he could not continue working on the project.  Dattolo refused to pay “one additional cent,” and complained that there were numerous construction defects which would cost him thousands of dollars to remediate.

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New Jersey’s whistleblower law was recently amended to further protect New Jersey private and public sector employees from being forced by their employers to sit through required “captive audience” meetings in an attempt to improperly coerce their employees from exercising their rights.

The Conscientious Employee Protection Actcapt-andrew-209x300

The Conscientious Employee Protection Act (CEPA) is New Jersey’s whistleblower law.  Considered one of the United States’s strongest whistleblower protection laws, it forbids employers from retaliating against their employees for disclosing, objecting to, reporting or refusing to participate in activities which they reasonably believe are illegal, fraudulent, constitute improper patient care, or violate established public policy.

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In a recent New Jersey employment law decision regarding disability discrimination and employer’s duty to provide reasonable accommodations for disabled employees, a New Jersey appeals court explained in the case of Gould v. New Jersey Department of Transportation the requirement for employers to engage in a good faith “interactive process” with their disabled employees to determine what reasonable accommodations can be provided to allow the employee to continue working.6-300x225

Background

Leroy Gould worked for the New Jersey Department of Transportation from 2001 until he retired in 2021.  He was a transit planner and coordinator, coordinating bus and rail service.  In 2012, Gould was diagnosed with prostate cancer, undergoing surgery and radiation which caused incontinence.  As a result, he usually had to go to the restroom immediately upon arrival to work.  He drove to a main parking lot, then took an employee van to his office building; the drop-off point was only a two-minute walk, which worked fine.  He was allowed to wear jeans because the fabric soaked up urine quickly and prevented rashes, and he received a standup desk because of vascular issues.

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New Jersey real estate law received a significant change in the fees charged to buyers and sellers in NJ real estate transactions.

On June 30, 2025, New Jersey enacted P.L. 2025, c. 69, which amends the so-called “MansionJennifer C. Meusel Tax”.  Pursuant to the prior legislation, adopted in 2004, residential properties and certain commercial properties which sold for over $1 million in New Jersey were subject to a “Mansion Tax” which required the buyers of the real estate to pay 1 percent of the purchase price to the State of New Jersey.

Under the new law, a buyer no longer has to pay the 1% “Mansion Tax” and as of July 10, 2025, sellers will pay a progressive fee for properties sold for more than $1 million. The fee on sales between $1 million and $2 million remains set at 1 percent.  For a sale price over $2 million but below $2.5 million, seller will pay 2 percent of the sales price and fee—which roughly translates to an additional $40,000 expense. Properties over $3.5 million would see sellers facing a fee hike of up to 3.5 percent.

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New Jersey civil service law and education law provide that employee disciplinary charges can be settled.  This applies to New Jersey governmental jurisdictions which are not covered by civil service or education law as well.  One of the tools which are sometimes used for these settlements are “last chance agreements.”courthouse-1223280__340-300x200

Last Chance Agreements

A last chance agreement is essentially a settlement agreement which suspends disciplinary proceedings for a specified time frame, essentially a probationary period, which gives the employee a “last chance” to improve her performance. Thus, if the employee violates the last chance agreement during the specified period the employer may impose the suspended discipline or other discipline as appropriate.  The agreement is to be construed under the normal rules for contract interpretation.  The New Jersey Supreme Court and Appellate Division of the Superior Court of New Jersey have addressed last chance agreements in separate decisions in the case of Horace Watson vs City of East Orange.  The Appellate Division also addressed the matter in the case of A.D.P. v. ExxonMobil Research and Engineering Company, in which the court examined last chance agreements and their application in private sector employment.

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Restrictive Covenants and Non-Compete Agreements

Restrictive covenants are clauses in contracts where the parties agree that one or both of the parties agree to restrict their ability to act in certain ways during or after the term of the contract.  There are a variety of restrictive covenants, such as “non-poaching” agreements, were a party agrees not to employ the other party’s employees; non-disclosure agreements, or NDAs, where the parties agree not to disclose the other’s confidential information or trade secrets; and non-solicitation agreements, where one or more of the parties agree not to solicit or do business with thesupreme-court-building-1209701__340-300x200 other party’s customers or clients after the expiration of the contract.

In the employment context, the most common restrictive covenant is a non-competition agreement, in which an employee agrees that during or after their employment with the other party, they agree not to compete against it.  Restrictive covenants are enforceable under New Jersey employment law, provided they meet certain requirements.  The Appellate Division of the Superior Court of New Jersey recently addressed when an employee may challenge the validity of a non-compete agreement in court in the case of Ondik vs. Princeton Eye and Ear, LLC.

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A recent New Jersey employment law decision found that even where harassment is not by a co-employee, her employer may still be liable if the victim worked closely with the harasser in her workplace.

Background

Kristine Bodner was a certified alcohol and drug counselor employed by the Center for Family Services (the “Center”), a private nonprofit social services provider. The Center is a “provider agency” for the New Jersey Department of Child Protection and Permanency (the “Department”).  She was assigned to work at the Burlington office of the Department, a department of New Jersey state4-225x300 government.  She worked closely with the Department’s supervisors.  Clients were sent by Department to the Center.  The Center would assign clients to Bodner.  She assessed clients to see if they had substance abuse issues and if so to recommend the appropriate level of care, and report them to the case workers.  She would conference cases with Department case workers.

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