Hervey S. Moore, Jr., J.s.c.
On April 14, 1982 plaintiff Pinkerton's Inc. obtained a judgment against defendant John A. Roebling Steel Company (JARSCO) for the sum of $31,583.73 which remains unpaid. On April 22, 1982 the Sheriff of Burlington County served a writ of execution on Roebling Wire Co. (Wire), JARSCO's tenant, and levied on all monies due from Wire to JARSCO by virtue of Wire's present and future monetary obligations.
Plaintiff filed this notice of motion to direct payment of $31,583.73 by Wire to the Sheriff as a result of the judgment and levy. Specifically, plaintiff seeks to obtain monies due from Wire to JARSCO on three promissory notes dated September 23, 1981 and from rents due under Wire's lease of JARSCO's property located in Roebling, New Jersey. Plaintiff gave notice to the Economic Development Administration of the Department of Commerce (EDA) and consented to EDA's intervening and filing a brief in opposition.
On May 14, 1979 EDA entered into guaranty agreements with the Marine Midland Bank (bank) guaranteeing two loans made by the bank to JARSCO in the aggregate amount of $17 million. Security for these notes consisted, in part,
1. A first security interest in JARSCO'S instruments and general intangibles, including after-acquired property in the foregoing categories, created by a Security Agreement dated May 11, 1979, executed and delivered by JARSCO to the Bank. The Bank perfected its security interest by filing UCC Financing Statements on May 11, 1979.
2. A mortgage on JARSCO'S real estate situated in the Township of Roebling, Burlington County, New Jersey and recorded in Book 1479, page 1.
In addition, EDA made a $2 million direct loan to JARSCO, evidenced by a note dated January 30, 1980 in the principal amount of $2 million. This note was executed and delivered by
JARSCO to EDA and secured in part by a second mortgage on JARSCO's land, buildings and improvements.
On September 23, 1981 Wire endorsed over to JARSCO three promissory notes in the aggregate amount of $2,350.00. On receipt of the three promissory notes from Wire, JARSCO endorsed them over to the bank as required by the security agreements. The bank and JARSCO entered into three pledge security agreements dated September 23, 1981.
JARSCO defaulted on the loans to the bank. On February 8, 1982 EDA purchased the notes evidencing the $17 million loans and the collateral under the provisions of the guaranty agreements. The bank executed an assignment and filed a UCC-3 statement, listing EDA as the secured party. The bank also executed an assignment of mortgage to EDA. On April 27, 1982 the bank assigned to EDA all of its rights under the pledge security agreements and endorsed the notes over to EDA. JARSCO also defaulted on the EDA direct loan.
EDA opposes plaintiff's motion, urging that the three promissory notes Wire endorsed over to JARSCO are covered under the after-acquired clause in the May 11, 1979 security agreement and that it holds a security ...