Know Your Way Around the NJ Consumer Fraud Act

DEFINITION

Know the enemy.  In order to protect yourself, it is crucial that you know this much.  If you are a consumer in the state of New Jersey, your protection stems from the NJ Consumer Fraud Act (the “CFA”) and an attorney properly equipped to wield it.

What is consumer fraud? The CFA defines it as “any unconscionable commercial practice, deception, fraud, false pretense, false promise or misrepresentation” in connection with the sale of goods, services or real estate.  It is important to note that this definition does not limit the term to traditional transactions involving goods or services. The mention of real estate includes rental or lease agreements, for apartments or office space.

There are a few forms fraud under the CFA:

• Affirmative Misrepresentation:  An example is a boldfaced lie.  If the party doing business makes an untrue statement, knowingly or not, the party is making an affirmative misrepresentation.  A misrepresentation can be merely negligent rather than intentional, but it is a misrepresentation nonetheless.
• Knowing Omission:  Failing to tell the truth is still lying.  Whether this fits your personal ideology or not, the CFA states that the “knowing concealment, suppression or omission of any material fact” is considered fraud in the eyes of the law.  If the other party knew a detail was integral to the transaction and failed to disclose that fact, he or she can be liable under the CFA.
• Violation of the Law:  Did you notice that we have yet to even mention any of the specific statutes contained within the CFA?  That is because they cover over 40 topics, and we only have so much room.  Just know that the CFA addresses frequent offenders such as home improvement contractors and auto repair shops, as well as more obscure or specific issues such as whether food being sold is kosher or not.  These violations are also known as “per se violations” or strict liability offenses under the CFA.  

HISTORY

Fifty-six years ago, at the dawn of the Sixties, the New Jersey Consumer Fraud Act was born.  This led to New Jersey earning the reputation of being one of the most consumer friendly states.  Two-hundred subsections and dozens of other rules and regulations later, the CFA can be daunting, to say the least.

A little over a decade after its inception, the CFA was revisited and retooled to include broader definitions of consumer fraud and increased penalties.  The most significant amendment led to the creation of the Division of Consumer Affairs.  The idea was to protect the consumer at all costs, but it should come as no surprise that the lens of the law is focused on the consumer.

TERMINOLOGY

In order to even approach the CFA, it helps to have a basic familiarity with some key terminology. Anything more than a rudimentary understanding certainly warrants making an appointment with an experienced attorney in the area of consumer law.  For now, if you wish to know your way around the CFA, it will help to know these terms:

• Ascertainable loss:  The court will want to see plainly and clearly that you have suffered damage that can be quantified or measured.
• Treble damages:  Whatever damages you are owed, the court will require the other party to pay triple that amount, if it is found that the other party is liable under the CFA.
• Advertisement:  Ads are part of the fabric of daily life.  How complicated could the definition be?  Do not ask that question.  The CFA defines an advertisement as “the attempt directly or indirectly by publication, dissemination, solicitation, indorsement or circulation or in any other way to induce directly or indirectly any person to enter or not enter into any obligation or acquire any title or interest in any merchandise.”
• Merchandise:  The definition of merchandise is far more what you would expect than the one for “advertisement.”  According to the CFA, merchandise is any objects, wares, goods, commodities, services or anything offered, directly or indirectly to the public for sale.”
• Person:  Reading the legal definition of a person is precisely the experience you are dreading. We will spare you.  In the name of business, the inclusion of non-human entities simply must be done.  So yes, trusts,  companies, associations and partnerships are included as “persons.”
• Sale:  This one encompasses three related terms:  sale, rental and distribution.  Any one of the three along with any offer or attempt at any of those three is covered. 

If you have questions regarding a potential consumer law matter or the CFA in general, contact the Law Office of H. Benjamin Sharlin LLC for an initial free consultation.

Please be advised that this blog is for informational purposes only, is not legal advice and does not create an attorney-client relationship.