                                 NOT FOR PUBLICATION WITHOUT THE
                                APPROVAL OF THE APPELLATE DIVISION
        This opinion shall not "constitute precedent or be binding upon any court ." Although it is posted on the
     internet, this opinion is binding only on the parties in the case and its use in other cases is limited . R. 1:36-3.




                                                         SUPERIOR COURT OF NEW JERSEY
                                                         APPELLATE DIVISION
                                                         DOCKET NO. A-2207-16T2

RICHARD PARKER,

          Plaintiff-Respondent/
          Cross-Appellant,

v.

STEVEN PARKER,

     Defendant-Appellant/
     Cross-Respondent.
_____________________________

                   Argued February 25, 2019 – Decided March 18, 2019

                   Before Judges Sabatino, Haas and Sumners.

                   On appeal from Superior Court of New Jersey,
                   Chancery Division, Union County, Docket No. C-
                   000108-13.

                   Arthur D. Grossman argued the cause for
                   appellant/cross-respondent (Mandelbaum Salsburg,
                   PC, attorneys; Stuart I. Gold, of counsel and on the
                   briefs; Barry M. Mandelbaum, Yale I. Lazris, and Mara
                   P. Codey, on the briefs).

                   Alan S. Pralgever argued the cause for
                   respondent/cross-appellant (Greenbaum, Rowe, Smith
            & Davis, LLP, attorneys; Alan S. Pralgever, of counsel
            and on the briefs; Gary L. Koenigsberg, on the briefs).

PER CURIAM

      This sprawling record on appeal and cross-appeal concerns disputes

between two brothers relating to the two closely held businesses they jointly

owned.   We affirm the final judgment, for substantially the same reasons

expressed in General Equity Judge Katherine R. Dupuis's thorough and

perceptive written opinion.

      In 1948, the brothers' parents founded a family wholesale flower and plant

business. The brothers eventually took over the business. Approximately thirty

years later, the brothers, plaintiff Richard Parker and defendant Steven Parker,

formed two corporations:      Parker Interior Plantscape ("PIP") and Parker

Wholesale Florist ("PWF"). Each brother had a fifty percent stock ownership

interest in both companies. Plaintiff Richard was the president of PIP, which he

operated. Defendant Steven respectively was the president of PWF, which he

operated.1 The brothers divided the activities of the family business between

PIP and PWF.




1
  We use the brothers' first names for clarity, but intend no disrespect in doing
so.
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                                       2
      Over the years, PIP developed into a successful interior landscaping

company, which was especially known for its elaborate holiday displays.

Meanwhile, PWF operated a wholesale and retail garden center. In general, each

of the two brothers ran his respective business independently, with little or no

involvement from the other brother.

      Over time, PIP became much more successful financially than PWF. PWF

was adversely affected by changes in the plant and flower business, and by the

market impact of large lawn and garden companies and national chains upon

smaller companies. Consequently, PWF needed regular cash infusions from PIP

to cover its persistent annual losses. In order to make up PWF's shortfall,

Steven, without obtaining permission in advance from Richard, directed the

controller who served both companies to transfer money to PWF from PIP's

accounts to make up the difference. The two brothers' compensation from the

companies was equalized after these transfers.

      Meanwhile, Richard was expanding the PIP business.          Among other

things, he began negotiations with a national media company to develop a joint

venture. In late 2013, PIP entered into a contract with the media company, in

which PIP agreed to provide the company with a prototype and other displays.

The displays were very expensive to create. It was hoped that the venture would


                                                                        A-2207-16T2
                                       3
result in large future profits for PIP. Unfortunately, the venture stalled, and the

media company ultimately paid a settlement in August 2016 to PIP to terminate

their relationship. According to Richard, that settlement amount was less than

the total costs that PIP expected to incur in performing its outstanding

obligations.2

      Richard filed suit in the Chancery Division against Steven in October

2013, alleging shareholder oppression under N.J.S.A. 14A:12-7(1)(c).             He

sought to buy out Steven's interest in PIP. Steven filed a counterclaim, making

reciprocal allegations of shareholder oppression against Richard.

      The dispute was tried over thirty-four intermittent days before Judge

Dupuis between November 2015 and June 2016. In addition to numerous fact

witnesses, Judge Dupuis heard expert testimony from two valuation experts,

Steven Chait for Richard and Henry Fuentes for Steven. Both Chait and Fuentes

were certified public accountants.




2
  The terms of the agreements and of the settlement with the media company
were confidential, but were made known by necessity to the trial judge. The
case was tried in open court, see Rule 1:2-1, and the trial judge's opinion was
not sealed. Counsel for plaintiff has represented to this court that the
confidentiality provisions between PIP and the media company do not preclude
us from discussing the contents of the trial court's opinion.
                                                                           A-2207-16T2
                                        4
      The experts agreed that PWF had no positive value and therefore they

focused solely on PIP's value. The trial court ordered a valuation date for PIP

of October 23, 2013, two days after the complaint was filed, and the experts

complied.

      Chait used a "capitalization of net income" valuation method, as permitted

by IRS Revenue Ruling 59-60. Chait calculated a valuation of PIP at $1.356

million, which was reduced further to $864,450 for a twenty-five percent

"marketability" discount. Under Chait's calculations, Steven's half-interest in

PIP was $432,225.

      Conversely, Steven's expert Fuentes initially calculated a value of PIP of

$4.887 million, which factored in the alleged anticipated profits from the joint

venture. Fuentes later recalculated that figure at $1.789 million, omitting the

potential upside of the joint venture, based on the judge's decision to exclude

the joint venture from the calculations of PIP's business value. Fuentes also

made an alternate calculation of PIP's value using a net asset value method. That

alternative calculation produced a value for PIP of $3.15 million.

      After considering what can be fairly described as oceans of evidence, the

judge concluded that Richard had proven shareholder oppression by Steven, in

violation of N.J.S.A. 14A:12-7(1)(c), essentially by his conduct in repeatedly


                                                                         A-2207-16T2
                                       5
transferring money out of PIP to PWF without Richard's consent. As a remedy

under N.J.S.A. 14A:12-7(a), the judge ordered a buy-out of Steven's half interest

in PIP.

      In her forty-one-page detailed written opinion issued on December 22,

2016, the judge made a number of critical findings. In particular, she found that

"Steven Parker hired excess help, ordered excess product, failed to regularly

take inventory and refused to change the way he did business." The judge

further concluded that Richard was an oppressed shareholder and Steven was

not. The judge rejected Steven's argument that a co-owner of an equally-owned

corporation cannot, as a matter of law, be liable for oppressive conduct. Indeed,

the case law is to the contrary. See, e.g., Bonavita v. Corbo, 300 N.J. Super.

179, 187-89 (Ch. Div. 1996) (finding a fifty percent shareholder to be the

oppressed minority owner for purposes of the statute).

      As a remedy, Judge Dupuis concluded that Richard was entitled to buy

out Steven's interest in PIP.     The judge mainly adopted the valuation of

plaintiff's expert Chait and rejected that of the defense expert, Fuentes. As the

judge explained in her opinion:

                  The court believes Mr. Chait's discounted cash
            flow method based on the years 2009 to 2013 to be the
            most appropriate method to value the business. The
            court believes Mr. Fuentes['s] calculation using the

                                                                         A-2207-16T2
                                       6
            years 2013-2018 to be inappropriate where there is
            historical data and where the business is facing
            potential declines as a result of market uncertainly, in
            particular the decline of its most profitable business in
            Atlantic City.

                   Mr. Chait values the business at $1,356,000. The
            court agrees. The court believes a marketability
            discount should be applied. The actions of defendant
            were the cause of the lawsuit. He cannot be rewarded
            by not applying this discount. In cases where the
            oppressing shareholder instigates the problems, as in
            this case, fairness dictates that the oppressing
            shareholder should not benefit at the expense of the
            oppressed. [Balsamides v. Protameen] Chems., 160
            N.J. 352, 382 (1999). The potential buyer base for
            Richard Parker will remain illiquid because it is not
            publicly traded and public information about it is not
            widely disseminated moving forward. Id. at 378. In
            this matter, Steven Parker's wrongful act caused an
            extraordinary circumstance which requires this court to
            apply a marketability discount. Steven Parker, the
            oppressing shareholder, cannot receive a windfall as a
            result of his actions, [so] the marketability discount will
            be applied.

      The judge then found that the value of Steven's one-half interest in PIP

"must be reduced by 25% representing the marketability discount." Steven was

to sell his shares to Richard on that basis. The judge found that no "minority

discount" should be applied. She also declined to adjust the value further by the

distribution to Steven shown on the 2013 books but which had been paid in 2014.




                                                                          A-2207-16T2
                                        7
      These various calculations, after certain adjustments made in a subsequent

order, led the judge to conclude that the value of Steven's interest in PIP was

$508,500. She ordered Richard to pay that amount to Steven to buy out his

interest. The judge rejected all other claims. The judge also declined Richard's

request for compensatory damages, punitive damages, and counsel fees.

      This appeal and cross-appeal ensued.

      In his appeal, Steven argues that the trial court erred in: (1) finding it was

him, rather than Richard, who committed shareholder oppression; (2) applying

a marketability discount to the fair value of Steven's interest in PIP; (3) setting

the valuation date; (4) choosing the wrong valuation method; and (5) excluding

evidence of PIP's post-trial settlement with the media company.

      In his cross-appeal, Richard contends that the trial court erred in: (1)

denying him compensatory and punitive damages and an award of counsel fees

from Steven; (2) excluding from evidence certain pre-2013 consultant reports

about PWF's business; and (3) excluding evidence of the parties' settlement

discussions.

      We review these contentions mindful of the governing standards of

appellate review. In general, "[f]inal determinations made by the trial court

sitting in a non-jury case are subject to a limited and well-established scope of


                                                                            A-2207-16T2
                                         8
review[.]" Seidman v. Clifton Sav. Bank, 205 N.J. 150, 169 (2011). "'[W]e do

not disturb the factual findings and legal conclusions of the trial judge unless

we are convinced that they are so manifestly unsupported by or inconsistent with

the competent, relevant and reasonably credible evidence as to offend the

interests of justice[.]'" In re Trust Created By Agreement Dated December 20,

1961, 194 N.J. 276, 284 (2008) (quoting Rova Farms Resort, Inc. v. Investors

Ins. Co. of Am., 65 N.J. 474, 484 (1974)). The court's findings of fact are

"binding on appeal when supported by adequate, substantial, credible evidence."

Cesare v. Cesare, 154 N.J. 394, 411-12 (1998); see also Brunson v. Affinity Fed.

Credit Union, 199 N.J. 381, 397 (2009).

      That said, we review rulings on pure questions of law de novo. Manalapan

Realty, LP v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1993). However,

findings that "may be regarded as mixed resolutions of law and fact" generally

receive deference on appeal, with review "limited to determining whether there

is sufficient credible evidence in the record to support these findings." P.T. &

L. Constr. Co. v. State, Dep't of Transp., 108 N.J. 539, 560 (1987).

      In the present context of a shareholder oppression case, we also must

recognize that claims for relief under N.J.S.A. 14A:12-7(1)(c) "are very fact-

sensitive." Brenner v. Berkowitz, 134 N.J. 488, 516 (1993). The standard of


                                                                        A-2207-16T2
                                       9
review for a finding that a corporate official or shareholder acted oppressively

for purposes of that statute is whether "there is substantial credible evidence in

the record as a whole which reasonably warrants the findings and conclusions

of the trial court." Walensky v. Jonathan Royce Int'l, Inc., 264 N.J. Super. 276,

279 (App. Div. 1993).       A reviewing court must accept the trial court's

determinations unless it finds an abuse of discretion. Ibid. (citing Leimgruber

v. Claridge Assocs., Ltd., 73 N.J. 450, 455-56 (1977)).

      Having applied these principles, we reject the arguments the parties have

presented on the appeal and cross-appeal. We affirm the trial court's final

judgment for the cogent reasons expressed in Judge Dupuis's comprehensive

written opinion and in her various rulings preceding, during, and after the trial.

There is substantial credible evidence in the record to support the judge's factual

findings. Her analysis was consistent with sound legal principles and she did

not misapply her discretion. We add only a few amplifying comments.

      The judge had a well-reasoned basis for regarding PIP's future venture

with the media company as "inchoate" as of the 2013 valuation date, and in

declining to allow the potential yet-to-be-realized advantages of that venture to

serve as a positive factor in the valuation of PIP. Although the nascent venture

had the potential to generate more revenue for PIP, the venture was only in the


                                                                           A-2207-16T2
                                       10
incipient stage, and there was little certainty it would be profitable and

sustainable. As it turned out, the project aborted rather quickly, and it was

expensive for PIP to perform the various contractual obligations it incurred

pursuant to the venture. The judge did not misapply her authority and her

considerable discretion in reaching a valuation figure by excluding this venture

and PIP's settlement with the media company from the calculus.

      The judge also did not manifestly err in her determination of PIP's value.

Although the parties quibble in opposite directions over certain aspects of her

calculations, the calculations were adequately supported by the expert testimony

and logical reasoning.

      The judge had the prerogative to find the expert opinions of CPA Chait

generally more credible than those of CPA Fuentes. City of Long Branch v. Liu,

203 N.J. 464, 491-92 (2010); Angel v. Rand Express Lines, Inc., 66 N.J. Super.

77, 85-86 (App. Div. 1961) (recognizing the trier of fact's ability to accept, in

full or in part, the testimony of one expert over another). The marketability

discount was justified to avoid allowing Steven to depart PIP on the same terms

as if his shares were fully liquid. Brown v. Brown, 348 N.J. Super. 466, 484-86

(App. Div. 2002). Moreover, the court's selection of the valuation date was

equitable under the circumstances presented. N.J.S.A. 14A:12-7(8)(a); Musto


                                                                         A-2207-16T2
                                      11
v. Vidas, 281 N.J. Super. 548, 561 (App. Div. 1995) (noting the discretion of

the court to use the date of the complaint as the valuation date or such earlier or

later date as the court may find equitable).

      The judge presented ample reasons grounded in the evidence for finding

Richard to be an oppressed shareholder and Steven to be the oppressor. We are

unpersuaded by Steven's argument that Richard had the unilateral power as a

half-owner of the two companies to prevent Steven from draining funds from

PIP to pay PWF's deficits. There is also ample proof that Richard complained

about Steven's failed business practices and the inter-company transfers, and

that Steven did not cease the conduct.

      We likewise reject Richard's contention that the trial judge was obligated

to award him the additional relief of money damages and counsel fees. Those

remedies are discretionary under the applicable statutes and case law. See, e.g.,

Willis v. Ashby, 353 N.J. Super. 104, 112 (App. Div. 2002) (as to compensatory

damages); Maul v. Kirkman, 270 N.J. Super. 596, 619-20 (App. Div. 1994) (as

to punitive damages); Torres v. Schripps, Inc., 342 N.J. Super. 419, 438 (App.

Div. 2001) (as to counsel fees). The trial judge certainly had a "feel for the

case," which equally applies to the relief that she denied as well as the relief she

chose to grant.


                                                                            A-2207-16T2
                                         12
      All other arguments raised in this appeal and the cross-appeal, to the

extent we have not addressed them, are without sufficient merit to be discussed.

R. 2:11-3(e)(1)(E). There is simply no reason to set aside or modify the judge's

decision, or to remand this protracted litigation for even more proceedings.

      Affirmed.




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                                      13
