MON-L-003142-20 11/24/2020 2:33:11 PM Pg 1 of 13 Trans ID: LCV20202139778

November 24, 2020

VIA ELECTRONIC FILING AND LAWYERS SERVICE

The Honorable Andrea I. Marshall,. J.S.C.
Superior Court of New Jersey, Law Division
Monmouth County Courthouse
71 Monmouth Park
3rd Floor
Freehold, New Jersey 07728

RE: Jay’s Bus Service. v. Red Bank Borough Board of Education

Docket No.: MON-L-003142-20
Return Date: December 11, 2020

Dear Judge Marshall:

This firm represents the Red Bank Borough Board of Education (“Red Bank”) Please

accept this correspondence in lieu of a more formal brief in opposition to the Orders to Show Cause

seeking Emergent Relief in the form of monetary damages filed by Plaintiff student transportation

companies Jay’s Bus Services, Inc. (“Jay’s”) and Seman-Tov, Inc. (“Seman-Tov”). For the

reasons set forth below, Plaintiffs have failed to satisfy the standard applicable to a request for

injunctive relief, and therefore the Orders to Show Cause must be denied.

FACTUAL BACKGROUND

Plaintiffs in this matter are seeking payment of taxpayer dollars for providing no services

to the public. The dispute in these matters arises from implementation of a recently amended

statute adopted during the COVID-19 pandemic providing for continued payments, in some

undetermined amount, to contract service providers who provided no services to public schools.

In this case the asserted claims are based upon Red Bank’s per diem student bussing contract with

Plaintiff Jay’s (Complaint at Exhibit A) and monthly student bussing contract with Plaintiff
 MON-L-003142-20 11/24/2020 2:33:11 PM Pg 2 of 13 Trans ID: LCV20202139778

Docket No. MON-L-003142-20

November 24, 2020
P age |2

Seman-Tov (Complaint at Exhibit A), respectively, with a term of September 5, 2019 through June

30, 3030. Following the State-ordered closure of public schools due to the COVID-19 pandemic,

the New Jersey Legislature enacted legislation, N.J.S.A. 18A:7F-9(e), which became effective

April 14, 2020. Specifically, the legislation pertained to the continued payment by school districts

of benefits, compensation, and emoluments, but not indirect costs, under services contracts when

the district’s schools are subject to a mandated health-related closure for a period longer than three

(3) consecutive school days despite the fact that no services had been rendered. The newly enacted

provisions of N.J.S.A. 18A:7F-9(e) mandated that a service provider who contracts with a school

district must: (1) use the payments to meet its payroll and fixed costs obligations; and (2) pay its

employees as if the school facilities had remained open and fully operating. The legislation further

requires school districts to make all reasonable efforts to renegotiate their contracts in good faith,

but the negotiations may not include indirect costs such as fuel or tolls. As a condition for such

negotiations, service providers are also required to disclose to the school district whether they have

any available insurance coverage for business interruptions covering work stoppages.

Pursuant to the new legislation, Red Bank sought to negotiate their bus transportation

contracts including those with Plaintiffs Despite the efforts by the school board to negotiate the

contracts in good faith, consistent with N.J.S.A. 18A:7F-9(e), Plaintiffs filed the instant Complaint

and Orders to Show Cause seeking Emergent Relief for payments under contracts that ended June

30, 2020, almost five months ago.

LEGAL STANDARD

A party who seeks preliminary injunctive relief must satisfy a “particularly heavy burden.”

Guaman v. Velez, 421 N.J. Super. 239, 247 (App. Div. 2011). The courts have recognized that
 MON-L-003142-20 11/24/2020 2:33:11 PM Pg 3 of 13 Trans ID: LCV20202139778

Docket No. MON-L-003142-20

November 24, 2020
P age |3

because injunctive relief constitutes a significant intrusion into the affairs of the parties, such relief

is an extraordinary remedy that must be granted sparingly, and only where the moving party has

demonstrated the clearest of factual circumstances and the most compelling equities. See Waste

Mgmt. of N.J., Inc. v. Union County Utilities Auth, 399 N.J. Super. 508, 538 (App. Div. 2008);

Mays v. Penza, 179 N.J. Super. 175, 180 (Law Div. 1980).

In order to obtain the extraordinary remedy of injunctive relief, Plaintiffs must satisfy four

specific criteria, established by the Supreme Court in Crowe v. DeGioia, 90 N.J. 126 (1982).

Under the Crowe standard governing the issuance of injunctive relief, the court may not grant such

relief unless the plaintiff have established that each of the following prerequisites have been met:

(1) The requested relief is necessary to prevent irreparable harm;

(2) The legal right underlying the plaintiff’s claim is settled;

(3) The material facts are uncontroverted and the plaintiff has shown a
reasonable probability of ultimately prevailing on the merits; and

(4) When the interests of the parties are balanced, the plaintiff will suffer
greater hardship than the defendant if the requested relief is not
granted, and that the public interest will not be harmed.

Id. at 132-34.

If the moving party fails to establish any of above elements, the relief must be denied. Id.

The plaintiff must also demonstrate each and every Crowe factor by clear and convincing evidence,

and a failure to do so will preclude the Court from granting any injunctive relief. Guaman, supra,

421 N.J. Super. at 247-48; see also Brown v. City of Paterson, 424 N.J. Super. 176, 183 (App. Div.

2012) (each Crowe factor must be clearly and convincingly demonstrated); Dolan v. De Capua, 16

N.J. 599, 614 (requiring clear and convincing proof as a prerequisite for granting injunctive relief).

Furthermore, the plaintiff must also show that the public interest will not be harmed if the requested
 MON-L-003142-20 11/24/2020 2:33:11 PM Pg 4 of 13 Trans ID: LCV20202139778

Docket No. MON-L-003142-20

November 24, 2020
P age |4

relief were to be granted. Waste Mgmt., supra, 399 N.J. Super. at 520 (citing Crowe, supra, 90

N.J. at 132-34); Brown, supra, 424 N.J. Super at 183; J.H. Renarde, Inc. v. Sims, 312 N.J. Super.

195, 203 (Ch. Div. 1998).

APPLICABLE LAW

The April 2020 legislation relevant to this matter, N.J.S.A. 18A:7F-9(e)(3), amended the

statute governing the conditions for school districts’ receipt of State aid, provides, in pertinent part,

as follows:

If the schools of a school district are subject to a health-related

closure for a period longer than three consecutive school days,
which is the result of a declared state of emergency, declared public
health emergency, or a directive by the appropriate health agency or
officer, then the school district shall continue to make payments of
benefits, compensation, and emoluments pursuant to the terms of a
contract with a contracted service provider in effect on the date of
the closure as if the services for such benefits, compensation, and
emoluments had been provided, and as if the school facilities had
remained open. Payments received by a contracted service provider
pursuant to this paragraph shall be used to meet the payroll and fixed
costs obligations of the contracted service provider. A school district
shall make all reasonable efforts to renegotiate a contract in good
faith subject to this paragraph and may direct contracted service
providers, who are a party to a contract and receive payments from
the school district under this paragraph, to provide services on
behalf of the school district which may reasonably be provided and
are within the general expertise or service provision of the original
contract. Negotiations shall not include indirect costs such as fuel
or tolls. As a condition of negotiations, a contracted service provider
shall reveal to the school district whether the entity has insurance
coverage for business interruption covering work stoppages. A
school district shall not be liable for the payment of benefits,
compensation, and emoluments pursuant to the terms of a contract
with a contracted service provider under this paragraph for services
which otherwise would not have been provided had the school
facilities remained open. Nothing in this paragraph shall be
construed to require a school district to make payments to a party in
material breach of a contract with a contracted service provider if
the breach was not due to a closure resulting from a declared state
 MON-L-003142-20 11/24/2020 2:33:11 PM Pg 5 of 13 Trans ID: LCV20202139778

Docket No. MON-L-003142-20

November 24, 2020
P age |5

of emergency, declared public health emergency, or a directive by

the appropriate health agency or officer. (Emphasis added).

A review of the entirety of N.J.S.A. 18A:7F-9 reveals that the statute does not define any

of the terms and does not provide for any possible independent right of action by service providers

who contract with school districts, such as Plaintiffs. Specifically, the statutory language expressly

indicates that the payments described in N.J.S.A. 18A:7F-9(e)(e) are merely a condition of receipt

of State aid, as opposed to an absolute statutory obligation that must be followed regardless of

receipt of such aid.

Therefore, to the extent that Plaintiffs seek to raise any claims relating to the impact of the

transportation contracts and the parties’ good faith renegotiation efforts upon the receipt of State

aid by Red Bank, such claims must be filed as an action before the Commissioner of Education

under N.J.S.A.18A:55-1 et seq. This Court lacks any jurisdiction over such an action, as it would

arise under the school laws pursuant to N.J.S.A. 18A:6-9 (“The commissioner shall have

jurisdiction to hear and determine, without cost to the parties, all controversies and disputes arising

under the school laws, excepting those governing higher education, or under the rules of the State

board or of the commissioner.”).

Moreover, N.J.S.A. 18A:19-3 requires that claims and demands for payment against school

districts verify that the subject services have been rendered and that the claim or demand is correct

in all particulars. The statute provides that all claims: “shall be verified by affidavit…to the effect

that the claims and demands are correct in all particulars [and] that articles have been furnished or

the services rendered as stated therein…”. Similarly, pursuant to N.J.S.A. 18A:19-2, unless an

exception applies as provided in N.J.S.A. 18A:19-4:

 MON-L-003142-20 11/24/2020 2:33:11 PM Pg 6 of 13 Trans ID: LCV20202139778

Docket No. MON-L-003142-20

November 24, 2020
P age |6

[A] claim or demand against a school district shall not be paid . . .

unless the claim or demand is authorized by law and the rules of the
board of education of the district, is fully itemized and verified, has
been duly audited as required by law, has been presented to, and
approved by, the board of education at a meeting thereof, or
presented to, and approved by, a person designated by the board of
education for that purpose, and the amount required to pay the claim
or demand is available for that purpose. (Emphasis added).

Further review of N.J.S.A. 18A:7F-9(e) establishes that the statutory provisions contain no

language such as “notwithstanding any other statute or regulation to the contrary” which might

negate the continued applicability of N.J.S.A. 18A:19-2 and N.J.S.A. 18A:19-3. Accordingly,

both of those statutes remain fully in effect and school districts are obligated to comply with them

notwithstanding the new legislation codified at N.J.S.A. 18A:7F-9(e)(3) providing for additional

conditions upon school districts’ receipt of State aid.

LEGAL ARGUMENT

After analyzing the facts in the context of the criteria prescribed by law, it will be clear that

the Orders to Show Cause filed by Plaintiff in the instant cases must be denied.

I. PLAINTIFFS CANNOT SHOW THAT THE FACTS ARE UNCONTROVERTED,

ANY REASONABLE PROBABILITY OF SUCCESS ON THE MERITS, OR ANY
SETTLED LEGAL RIGHT SUPPORTING THEIR CLAIMS.

In order to prevail on a request for injunctive relief, the plaintiff must show, by clear and

convincing evidence, that the material facts are uncontroverted and that it is reasonably likely to

prevail on the merits of the underlying claim. See Waste Management, supra, 399 N.J. Super. at

528-29 (“Plaintiffs failed to demonstrate by clear and convincing evidence a reasonable probability

of success” given that the present state of the law highly favored the defendant’s position and the

material facts advocated by the defendants were well-founded). Here, Plaintiffs fail to demonstrate
 MON-L-003142-20 11/24/2020 2:33:11 PM Pg 7 of 13 Trans ID: LCV20202139778

Docket No. MON-L-003142-20

November 24, 2020
P age |7

any reasonable likelihood of success on the causes of action continued in their Complaints,

warranting denial of the relief sought.

To state a claim for breach of contract, the plaintiff must show that: (1) the parties entered

into a contract stating certain terms; (2) the plaintiff did what the contract terms required it to do;

(3) the defendant did not do what the contract terms required it to do; and (4) plaintiff suffered

damages as a result. See Woytas v. Greenwood Tree Experts, Inc., 237 N.J. 501, 512 (2019).

Here, Plaintiffs’ breach of contract claims are also subject to the statutory requirements set forth

in N.J.S.A. 18A:7F-9(e)(3), which states that a condition for State aid, school districts shall engage

in good faith renegotiations of contracts, such as the transportation contracts at issue here.

Plaintiffs cannot show a reasonable likelihood of success on the merits of their claims

because their causes of action for quantum meruit and promissory estoppel are barred by virtue of

the express contracts between the parties. In their own Complaint, Plaintiffs assert that the legal

rights underlying the claim are not unsettled and that “this is a simple breach of contract.” (See

Complaint, ¶35). It is not. It is a claim under a newly adopted statute for statutory payments in

some undefined, unspecified amount. While Plaintiffs also allege that Red Bank “promised to pay

and did not do so,” this allegation is refused by the parties’ course of negotiations pursuant to

N.J.S.A. 18A:7F-9(e)(3), and Red Bank’s proffer of payment (Complaint, ¶15) demonstrating that

the material facts are controverted. Because injunctive relief cannot issue where the plaintiff fails

to establish that all material facts underlying its application are uncontroverted, the Court must

deny the Orders to Show Cause.

It is well established that “the existence of an express contract excludes the awarding of

relief regarding the same subject matter based on quantum meruit.” Kas Oriental Rugs, Inc. v.
 MON-L-003142-20 11/24/2020 2:33:11 PM Pg 8 of 13 Trans ID: LCV20202139778

Docket No. MON-L-003142-20

November 24, 2020
P age |8

Ellman, 394 N.J. Super. 278, 286 (App. Div. 2007). Furthermore, in order to obtain a recovery

under a quantum meruit claim, the plaintiff must establish that it actually performed services for

the defendant, and that the defendant benefited from the plaintiff’s performance. See Weichert

Co. Realtors v. Ryan, 128 N.J. 427, 438 (1992); Woodlands Cmty. Ass’n, Inc. v. Mitchell, 450

N.J. Super. 310, 318 (App. Div. 2017).

A cause of action for promissory estoppel requires: (1) a clear and definite promise; (2)

made with the expectation that the promise will rely upon it; (3) reasonable reliance upon the

promise; (4) which results in definite and substantial detriment. Lobiondo v. O’Callaghan, 357

N.J. Super. 488, 499 (App. Div. 2003). However, a promissory estoppel claim must fail “where a

valid contract fully defines the parties’ respective rights and obligations.” Zydus Worldwide

DMCC v. Teva API Inc., 2020 WL 2570043, at *15 (D.N.J., May 20, 2020). The existence of an

express contract precludes quasi-contractual causes of action such as promissory estoppel. Moser

v. Miler Hotels, 6 N.J. 278, 280 (1951).; C.B. Snyder Realty Co. v. Nat’l Newark & Essex Banking

Co. of Newark; 14 N.J. 146, 162-163 (1954); Fernandes v. Deutsche Bank Nat’l Trust Co., 157

F.Supp.3d 383, 387 (D.N.J. 2015). Stated differently, there can be no grounds for imposing an

additional obligation where there is a governing contract between the parties. Shalita v. Twp. of

Washington, 270 N.J. Super. 84, 90-91 (App. Div. 1994).

Plaintiffs have failed to present any clear and convincing evidence that Red Bank: (1) made

any clear and definite promises to pay the amounts sought, given that statutory payments were the

subject of renegotiations pursuant to N.J.S.A. 18A:7F-9(e)(3); or (2) benefitted from Plaintiffs’

performance of transportation services, in view of the suspension of transportation services during

the Spring of 2020 due to the State-ordered school closure. Rather, Red Bank sought to comply
 MON-L-003142-20 11/24/2020 2:33:11 PM Pg 9 of 13 Trans ID: LCV20202139778

Docket No. MON-L-003142-20

November 24, 2020
P age |9

with the provisions of N.J.S.A. 18A:7F-9(e)(3) regarding payment made pursuant to a contract for

services, in order to protect their eligibility for State aid, despite the absence of actual services

rendered.

Based upon the allegations of fact asserted by the Plaintiffs themselves, as well as the

relevant law underlying the claims set forth the Complaints, Plaintiffs cannot demonstrate any

reasonable likelihood that they will prevail on the merits on their underlying claims. Similarly,

the Court is compelled to deny injunctive relief based on the second factor of the Crowe standard,

as Plaintiffs also cannot demonstrate the existence of any settled legal right that supports its claim.

Accordingly, the Court should deny the relief sought in the Orders to Show Cause.

II. A BALANCING OF THE PARTIES’ INTERESTS ESTABLISHES THAT

PLAINTIFFS WILL NOT SUFFER GREATER HARDSHIP THAN THE BOARD
IF THE RELIEF SOUGHT IS NOT GRANTED.

The Order to Show Cause should be denied because when the interests of the parties are

balanced, there is no basis for any claim that Plaintiffs will suffer greater hardship than the Board

if the requested relief is not granted. Moreover, Plaintiffs have not addressed the fact that the

public interest would certainly suffer harm if the Court were to order the relief they seek.

Courts will not issue injunctive relief unless it has been established that the hardship to the

plaintiff, if the relief sought is not granted, would greatly outweigh the harm to the defendant if it

is granted. J.H. Renarde, 312 N.J. Super. at 204-05. If the plaintiff merely shows that its hardship

if the injunction does not issue would be in equipoise to the harm to the defendant if the injunction

is issued, then the court must deny injunctive relief. Sherman v. Sherman, 330 N.J. Super. 638,

653-654 (Ch. Div. 1999). The plaintiff must demonstrate that “the inconvenienced or loss to the
 MON-L-003142-20 11/24/2020 2:33:11 PM Pg 10 of 13 Trans ID: LCV20202139778

Docket No. MON-L-003142-20

November 24, 2020
P a g e | 10

opposing party will be minimal” if the court grants the requested relief. Zoning Bd. of Adjustment

of Sparta v. Service Elec. Cable Television, Inc., 198 N.J. Super. 370, 379 (App. Div. 1985).

Plaintiffs have failed to show that they would suffer any substantial, immediate, and

irreparable harm if the Court denies their applications. In fact, this action was brought almost five

months following the close of the contract term for which payment is sought. In contrast, however,

Red Bank would suffer substantial, immediate, and irreparable harm, as their statutorily prescribed

renegotiation efforts designed to avoid the loss of State aid would be impaired and derailed by an

order directing them to make immediate payment for services not actually received, and would be

placed in a position of having been court-ordered to violate its obligations under N.J.S.A. 18A:19-

3 to ensure that payment is only made for services actually rendered. This is especially true in

light of the dire needs in school district during the pandemic as documented by the New Jersey

State Legislature. (See, New Jersey Senate Education Hearing, June 8, 2020,

https://www.njleg.state.nj.us/media/mp.asp?M=V/2020/SED/0608-1000AM-M0-

1.mp4&S=2020)

More specifically, N.J.S.A. 18A:7F-9(e)(3) requires that services providers use school

district payments for payroll and fixed costs. Despite those statutory requirements, however, the

relief sought by Plaintiffs would compel Red Bank to advance payment of taxpayer dollars despite

the governing and conflicting statutory conditions. Plaintiffs’ harms, if any, from the denial of the

restraints sought does not outweigh the severe harm, as opposed to minimal inconvenience, that

would be incurred by Red Bank if the restraints were to be granted. Accordingly, the equities and

the relative hardships of the parties abundantly favor denying Plaintiffs’ applications.
 MON-L-003142-20 11/24/2020 2:33:11 PM Pg 11 of 13 Trans ID: LCV20202139778

Docket No. MON-L-003142-20

November 24, 2020
P a g e | 11

In view of the foregoing, the relief Plaintiffs seeks should be denied because when the

parties’ interests are balanced, the Board and the students and taxpayers it serves would suffer

greater injury than Plaintiffs would if the relief sought were granted. Thus, as a result of Plaintiffs’

failure to establish that a balancing of the respective interests of the parties supports any of its

demands for relief, the Court should deny the Order to Show Cause.

III. THE RELIEF PLAINTIFFS SEEK IS NOT NECESSARY TO PREVENT ANY

IRREPARABLE HARM AND PLAINTIFFS FAIL TO SHOW THAT THE PUBLIC
INTEREST WILL NOT BE HARMED.

Plaintiffs are unable to demonstrate that the Court must issue an Order granting their

requested relief in order to prevent irreparable harm. In the absence of a showing that such harm

will occur if the relief Plaintiffs seeks is denied, there is no basis for granting the Orders to Show

Cause, as it is well established that a party must satisfy each and every one of the four requirements

articulated in Crowe v. DeGioia in order to prevail on an application for emergent relief.

Moreover, Plaintiffs have failed to demonstrate by clear and convincing evidence that the public

interest will not be harmed if the Court were to grant their applications. See Waste Mgmt., 399

N.J. Super. at 520.

Simply stated, denying the requested relief will not cause irreparable harm, since Plaintiffs’

have made no supportable demonstration on irreparable harm and only say that they expended

funds “ in keeping [themselves] ready, willing, and able to provide” the contracted services.”

(Complaint ¶ 13). Plaintiffs have also failed to show that the alleged harm is in any way genuinely

“irreparable,” since all of the harm they claim they will suffer if the Court denies their request

relief is entirely monetary in nature. An abundance of well-settled case law holds that a plaintiff

cannot satisfy the “irreparable harm” requirement if monetary relief would be capable of
 MON-L-003142-20 11/24/2020 2:33:11 PM Pg 12 of 13 Trans ID: LCV20202139778

Docket No. MON-L-003142-20

November 24, 2020
P a g e | 12

adequately addressing the alleged harm. See Crowe, supra, 90 N.J. at 132-33 (“Harm is generally

considered irreparable in equity if it cannot be redressed adequately by monetary damages”);

McNeil v. Legislative Apportionment Comm’n of N.J., 176 N.J. 484, 486 (2003) (“Harm is not

irreparable if it can be remedied with monetary relief”); Princeton Ins. Co. v. 349 Assocs., L.L.C.,

147 N.J. 337, 340 (1997) (recognizing that where “money damages would be adequate” to address

the alleged harm if plaintiff ultimately prevails, a motion for preliminary injunctive relief should

be denied). “In other words, plaintiff must have no adequate remedy at law.” Subcarrier

Communications, Inc. v. Day, 299 N.J. Super. 634, 638 (App. Div. 1997). The plaintiff must show

that a preliminary injunction is the only means of obtaining protection from the alleged harm, and

that a monetary award at a later date will not be capable of adequately addressing the injury.

Here, Plaintiffs readily admit in their pleadings that “this is a simple breach of contract,”

and that the Defendants “promised to pay and did not do so.” Plaintiffs have failed to present any

clear and convincing evidence that they have suffered or will suffer any damages that cannot be

redressed through a monetary remedy. As strictly monetary damages cannot possibly be

considered to constitute “irreparable harm,” injunctive relief is precluded under the Crowe

standard and the Court should fully deny the Orders to Show Cause.

Furthermore, Plaintiffs have not established by any clear and convincing evidence that the

public interest will not be harmed if the Court grants the relief they seek, that is, providing public

funds for no services rendered. The remedies sought by Plaintiffs would not only disrupt the

statutorily prescribed contract negotiations pursuant to N.J.S.A. 18A:7F-9(e), which are required

in order to preserve a school district’s eligibility for State aid, but would also release public funds

in violation of N.J.S.A. 18A:19-3. It cannot be disputed that both of these outcomes would be
 MON-L-003142-20 11/24/2020 2:33:11 PM Pg 13 of 13 Trans ID: LCV20202139778

Docket No. MON-L-003142-20

November 24, 2020
P a g e | 13

highly harmful the public interest, warranting the denial of Plaintiffs’ applications for relief. See,

e.g., Williams v. Deptford Twp. Bd. of Educ., 192 N.J. Super. 31, 42 (App. Div. 1983), aff’d, 98

N.J. 319 (1985) (holding that erroneous payment of public funds by a school district inures to the

detriment of the taxpayers of the district).

In summary, the Court should deny Plaintiffs’ Orders to Show Cause as a result of their

inability to establish any of the prerequisites for granting injunctive relief on an emergent basis.

Although a plaintiff’s failure to meet even one of the factors set forth in the Crowe v. DeGioia

standard will preclude the Court from granting an Order to Show Cause, here, Plaintiffs do not

satisfy any of those factors, warranting the complete denial of their requested relief.

CONCLUSION

For the foregoing reasons, Plaintiffs have failed to demonstrate that the Court should grant

the requested relief, and as a result, the Order to Show Cause must be denied.

Respectfully submitted,

THE BUSCH LAW GROUP LLC

Hope R. Blackburn, Esq.

Partner

HRB:anc

cc: Dr. Dr. Jared Rumage Superintendent (via email)

Eileen Gorga, Business. Admin./Board Secretary (via email)
Michael I. Inzelbuch, Esq. (via eFile)