                        NOT FOR PUBLICATION WITHOUT THE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-0711-15T3



WILLARD F. WEIKEL, CPA,

        Plaintiff-Respondent,

v.

LISA HARRIS, n/k/a,
LISA BAILEY,

        Defendant/Third-Party
        Plaintiff-Appellant,

v.

ROBERT HARRIS,

        Third-Party Defendant.

________________________________________

              Submitted December 22, 2016 – Decided June 6, 2017

              Before Judges O'Connor and Whipple.

              On appeal from Superior Court of New Jersey,
              Law Division, Special Civil Part, Camden
              County, Docket No. DC-5195-15.

              Obermayer Rebmann Maxwell & Hippel, LLP,
              attorneys for appellant (Shari B. Veisblatt
              and Amanda W. Figland, on the brief).
          Garofalo & O'Neill, P.A., attorneys for
          respondent (William S. Ruggierio, on the
          brief).

PER CURIAM

    Defendant Lisa Bailey appeals from a Special Civil Part

judgment entered against her and in favor of plaintiff Willard

F. Weikel, C.P.A., in the amount of $11,155.            Following our

review of the record and applicable legal principles, we affirm

in part, reverse in part, and remand for further proceedings.

                                  I

    We derive the following from the record and the evidence

adduced during the bench trial.       In April 2015, after over

twenty years of marriage, Bailey and third-party defendant

Robert Harris divorced.   During the course of their marriage,

Harris was the owner and president of a Subchapter S corporation

known as Family Limousine, II, Inc. (Limo).      Although Bailey was

at times an employee of Limo, there is no evidence she was ever

an officer or shareholder of this entity.

    In 2009, plaintiff, a certified public accountant,

commenced providing accounting services for the business, as

well as for Bailey and Harris (couple) personally.      By that

time, the business had failed to file income tax returns and

other essential documents with the taxing authorities for three

years.   Plaintiff prepared the necessary documents for Limo to
                                 2
                                                             A-0711-15T3
file.   Limo then closed in January 2010, but, in an ongoing

effort to straighten out Limo's accounting and file the

appropriate documents with both the IRS and the State of New

Jersey, plaintiff provided services for Limo's benefit through

2014.   Plaintiff also prepared the couple's and their two adult

children's income tax returns for calendar years 2009 through

2013.   Although he periodically provided invoices to Limo and

the couple, plaintiff's bill went unpaid.

     In 2014, Bailey filed a complaint for divorce.   Aware the

couple was divorcing, plaintiff pressed Bailey and Harris

separately for payment, billing each one-half of the total fees

both Limo and the couple owed to him.   Plaintiff settled with

Harris for an undisclosed amount.   However, unsuccessful in

obtaining any payment from Bailey, plaintiff filed a complaint

against her in the Special Civil Part seeking the recovery of

his entire bill against Limo and the couple.   The bill was

$19,400.1

     In his complaint, among other things, plaintiff alleged

breach of contract.   It is undisputed plaintiff and Bailey did

not enter a written contract, but plaintiff testified he entered


1
    Despite seeking $19,400 from Bailey, in his complaint,
plaintiff acknowledged he could not recover more the $15,000
monetary limit permitted in the Special Civil Part. See R. 6:1-
2(a)(1).
                                3
                                                          A-0711-15T3
into a verbal agreement with the couple to provide accounting

services.    In the alternative, he sought the recovery of his

fees under the equitable theory of quantum meruit.   In turn,

Bailey filed a third-party complaint against Harris, seeking

indemnification in the event she were found liable to plaintiff.

    During the trial, plaintiff acknowledged that, on May 14,

2010, both Limo and the couple filed for bankruptcy relief; the

debts of both Limo and the couple were ultimately discharged.

Plaintiff clarified he sought to recover only those fees for

services provided to Limo and the couple after May 14, 2010; in

the aggregate, those fees were $12,595.   In his invoices,

plaintiff did not completely separate the fees he charged Limo

from those he charged the couple.

    Plaintiff testified Bailey had been employed as a

bookkeeper for Limo in 2007 and 2008, and that Harris was the

president.    Although he was the accountant for Limo, plaintiff

did not identify who the shareholder or shareholders were to

this Subchapter S corporation.

    Harris testified it was he who requested plaintiff to

provide "accounting services" for Limo, including that he

prepare "returns" for Limo and "satisfy corporate filings."

Harris did not testify about his relationship to Limo, but noted

Bailey worked in the business as a bookkeeper and driver, as
                                4
                                                          A-0711-15T3
well as "a little bit of everything."      Harris did not testify

Bailey was a shareholder in the corporation.

    Bailey testified she had last worked for Limo in 2003, but

on cross-examination admitted she received unemployment

compensation in 2010 for having been laid-off from Limo.

However, she never stated or provided any evidence she had been

a shareholder of the corporation.   She did testify Harris was

the "owner" of Limo, and that it was he who retained plaintiff

to provide accounting services for Limo.

    Although the trial court explicitly stated it did not know

the "ownership status" of or who was a shareholder in Limo, the

court nevertheless found Bailey responsible for the services

plaintiff provided to Limo, because this entity was a small,

family-run business.   The court stated:

         This was a closely-held Sub-S corporation.
         Nobody told me what the ownership status was
         or who was a shareholder, who wasn't a
         shareholder, but it was a family op – it was
         – well, it was called, "Family Limo"; I
         mean, it's kind of what you refer to as a,
         "Mom-and-Pop Operation."      It's a small
         business with, you know, few employees with,
         you know, the people apparently [Bailey and
         Harris] doing the work.

         And I don't know what [Bailey's] stated
         ownership interest in it was, but in this
         type of closely-held situation -- it's not
         like we're doing corporate returns for, you
         know, IBM or – or any, you know, major
         company;  this   is  a  small   closely-held
                              5
                                                            A-0711-15T3
          company – even if Mr. Harris is a hundred-
          percent shareholder, that's not the way it's
          going down, you know, in terms of how
          they're actually dealing with the matter.

    Without expressing employing the term "quantum meruit," the

court essentially applied this doctrine and found Bailey

responsible for the services plaintiff rendered to Bailey and

Harris for their personal financial matters.    The court stated:

          [A] lot of work [was] done on joint returns
          . . . .   And, not only that, every year on
          the joint returns when the whole package is
          put together, nobody – Ms. – Ms. Bailey
          never told me, "I didn't sign [the return];
          I refused to sign it because I didn't hire
          this guy; I didn't want him doing the work;
          he was charging too much; I didn't want it
          to happen." She never said that.

    For reasons not relevant to any issue on appeal, the court

deducted $1440 from the $12,595 plaintiff sought in damages, and

concluded the amount owed to him was $11,155.   The court entered

a judgment for this amount against Bailey and in plaintiff's

favor.   The court also dismissed Bailey's third-party complaint

against Harris without prejudice, finding the allocation of this

marital debt between Bailey and Harris should be handled by the

Family Part.

                                II

    On appeal, Bailey contends the trial court erred by finding

(1) she was responsible for Limo's debts; (2) there was a

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                                                           A-0711-15T3
binding contract between her and plaintiff to pay for all of his

fees; and (3) she was responsible for plaintiff's fees on a

theory of quantum meruit.         Bailey also claims the court erred by

dismissing her third-party complaint against Harris.

       Factual findings of the trial court are granted deference

unless    "they   are   so   wholly     insupportable    as    to   result    in   a

denial of justice[.]"           Rova Farms Resort, Inc. v. Inv'rs Ins.

Co.,     65   N.J.   474,    483-84      (1974)     (quoting    Greenfield         v.

Dusseault, 60 N.J. Super. 436, 444 (App. Div.), aff'd o.b., 33

N.J. 78 (1960)).        Thus, an "appellate court should exercise its

[] fact finding jurisdiction sparingly and in none but a clear

case where there is no doubt about the matter."                     Id. at 484.

However, "[a] trial court's interpretation of the law and the

legal    consequences    that    flow    from   established     facts   are    not

entitled to any special deference," and are reviewed de novo.

Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366,

378 (1995).

       We readily dispose of the contention the court erred when

it found there was a binding contract between her and plaintiff.

The court did not make this finding.              After determining Bailey

was responsible for Limo's debts on the ground Limo was a small,

family-run operation, the court found plaintiff entitled to


                                         7
                                                                        A-0711-15T3
recover his fee from Bailey on the theory of quantum meruit, not

breach of contract.

    We turn to what we view as the principal contention,

whether Bailey is responsible for Limo's debts.    Our Supreme

Court has recognized it is a "fundamental proposition[] that a

corporation is a separate entity from its shareholders, and that

a primary reason for incorporation is the insulation of

shareholders from the liabilities of the corporate enterprise."

State Dep't of Envtl. Prot. v. Ventron Corp., 94 N.J. 473, 500

(1983) (citing Lyon v. Barrett, 89 N.J. 294, 300 (1982)).      In

order to overcome the separation of a corporation from its

shareholders or members for purposes of imposing liability,

there must be proof the "corporate veil" should be pierced "to

prevent an independent corporation from being used to defeat the

ends of justice, to perpetrate fraud, to accomplish a crime, or

otherwise to evade the law."   Ibid. (citations omitted).

    Here, there is no dispute Limo was a corporation, albeit a

Subchapter S corporation, a kind of corporation "formed to take

advantage of the tax treatment provided by Subchapter S of the

Internal Revenue Code, 26 U.S.C. § 1361 et seq."   Carter v.

Anderson (In re Carter), 182 F.3d 1027, 1028 n.1 (9th Cir.

1999).   However, "[w]hile an S corporation is treated

differently for taxation purposes, it remains a corporation in
                                8
                                                            A-0711-15T3
all other ways, and it and its shareholders are separate

entities."   Smith Setzer & Sons v. S.C. Procurement Review

Panel, 20 F.3d 1311, 1318 (4th Cir. 1994).

     A Subchapter S corporation's similarity to a corporation

includes that a Subchapter S shareholder is not at risk for

being responsible for corporate debt.   "Subchapter S permits

small businesses, or S corporations, to receive the 'non-tax

advantages of incorporation such as . . . insulation from

personal liability[.]'"   Tarrant v. Dep't of Taxes, 733 A.2d

733, 737 (Vt. 1999) (quoting Cohen v. Colo. Dep't of Revenue,

593 P.2d 957, 959 (Colo. 1979)).   A shareholder's insulation

from the debts of a corporation is not in any way affected if a

corporation is organized in compliance with the provisions of

Subchapter S.   Stock v. Stock, 693 So. 2d 1080, 1086 (Fla.

1997).

    Here, there is no evidence Bailey was a shareholder, let

alone a finding it was necessary to pierce the corporate veil to

hold her accountable as a shareholder for a wrong committed.

At best, Bailey was an employee, and there is no contention her

status as employee created liability for Limo's debts."

Therefore, that portion of the judgment attributable to the fees

plaintiff charged to provide services to Limo are not Bailey's

responsibility.   Because the evidence does not enable us to
                                 9
                                                           A-0711-15T3
determine which part of the judgment is for fees incurred to

provide services to Limo, we must vacate the judgment and remand

this matter to the trial court so that it can make this finding

and enter an amended judgment.

    We find no error in the trial court's finding Bailey is

liable to plaintiff for the fees he charged to provide services

for her and Harris in connection with their personal finances.

The court properly applied the doctrine of quantum meruit to

this matter.   To recover under this doctrine, a claimant must

show proof of "(1) the performance of services in good faith,

(2) the acceptance of the services by the person to whom they

are rendered, (3) an expectation of compensation therefor, and

(4) the reasonable value of the services."    Starkey v. Estate of

Nicolaysen, 172 N.J. 60, 68 (2002) (quoting Longo v. Shore &

Reich, Ltd., 25 F.3d 94, 98 (2d Cir. 1994) (citations omitted)).

    Plaintiff has met this test.   There is no question he

performed accounting services for Bailey (and Harris) with

respect to their personal finances in good faith; Bailey

accepted these services; and these services were rendered in the

expectation plaintiff would be compensated.   Finally, Bailey

does not challenge the value of the services rendered.

    Last, we are in accord with the trial court's decision to

dismiss without prejudice Bailey's third-party complaint.     Most,
                               10
                                                           A-0711-15T3
if not all, of the subject debt was incurred during the

marriage.   At the time of divorce, not only are the parties'

assets subject to equitable distribution, but their debts are

subject to allocation.    See Monte v. Monte, 212 N.J. Super. 557,

567 (App. Div. 1986).    We are informed neither Bailey nor Harris

included plaintiff's debt on the Case Information Statements

each filed in the divorce action, and neither considered such

debt when they settled that matter.   How the debt to plaintiff

is to be allocated between Bailey and Harris must be handled in

the Family Part.   See R. 5:1-2(a) ("[A]ctions in which the

principal claim is unique to and arises out of a family or

family-type relationship shall be brought in the Family Part.").

    In summary, the judgment for $11,155 is vacated and this

matter is remanded to the trial court for further proceedings to

determine what fees are attributable to the services plaintiff

rendered to Limo, including but not limited to preparing the

general ledgers for the corporation and any tax returns or other

documents filed with the taxing authorities.    Those fees for

services plaintiff rendered to Bailey and Harris with respect to

their personal finances shall then be reduced to a judgment.

Finally, plaintiff's motion to strike Bailey's brief and

appendix, and to impose sanctions, is denied.


                                 11
                                                           A-0711-15T3
    Affirmed in part, reversed in part, and remanded for

further proceedings in conformance with this opinion.   We do not

retain jurisdiction.




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                                                         A-0711-15T3
