On appeal from the Superior Court, Chancery Division, Monmouth County.
Furman, Brody and Long. The opinion of the court was delivered by Furman, P.J.A.D.
Appeal is before us from summary judgment dismissing an action to vacate an in rem tax foreclosure judgment. The trial court applied the bar of N.J.S.A. 54:5-90, which limits to five years collateral attacks on in personam tax foreclosure judgments. At oral argument we were informed that the Borough of Red Bank has retained title to the subject property.
We reverse and remand. The applicable statute of limitations is not N.J.S.A. 54:5-90 but N.J.S.A. 54:5-104.67, within the In Rem Tax Foreclosure Act, N.J.S.A. 54:5-104.29 et seq. That statute provides:
No application shall be entertained to reopen such judgment after three months from the date of the recording thereof in the office of the county
recording officer, and then only upon the grounds of lack of jurisdiction or fraud in the conduct of the action.
As interpreted in New Shrewsbury Borough v. Block 115, Lot 4, 74 N.J. Super. 1, 9 (1962), the three month period of limitations in N.J.S.A. 54:5-104.67, "applies to all grounds other than 'lack of jurisdiction or fraud.'" A separate action, as here, to vacate an in rem tax foreclosure judgment on the ground of lack of jurisdiction should be brought within a reasonable time, cf. 4:50-2.
The facts asserted by plaintiffs on motion and cross-motion for summary judgment were not challenged below. According to plaintiffs, they acquired title to the subject property from Carmel Schiafone, widow and devisee of Eugene Schiafone, in 1984. The in rem tax foreclosure judgment was entered in 1981. The subject property, then Lot 1B, Block 84, first appeared on the tax rolls in 1976. At all times prior to the foreclosure judgment, the owner was listed as "unknown." Nevertheless, the Borough of Red Bank, as plaintiff in the in rem proceeding, attempted to serve notice on Carmel Schiafone, but at her address prior to 1969. The mailing was returned "undelivered, forwarding time expired."
The confused prior tax history of the subject property, drawn from the affidavits of Carmel Schiafone and of the president of a local title company, is as follows. By deed in 1947 Eugene Schiafone acquired title to property on both sides of Chapin Avenue, designated Tract One, containing Lots 2, 3 and 4, Block 84 and Tract Two, not then identified on the borough tax map by lot and block number. What was then designated as Tract Two is the subject of this litigation. It is on the west side of Chapin Avenue, a parcel about 50 feet by 172 feet, fronting on the Navesink River. Eugene Schiafone died in 1959. His widow Carmel received and paid tax bills from 1959 through 1969 on Lots 2, 3 and 4, which included a physical description of Tract Two in the 1947 deed. Lot 1B, Block 84 was shown on the 1967 borough tax map, for the first time identified by lot and block number.
Carmel Schiafone moved to another address within the borough in 1969. She continued to receive tax bills on Lots 2, 3 and 4 at her new address, but the description of the parcel 50 feet by 172 feet was deleted from her tax bills. The assessed valuation of her property on Chapin Avenue nevertheless remained the same and, in subsequent years, increased. In 1970, a minor subdivision was approved, listing her as the owner of Lot 1B, Block 84, with her correct current address. In 1971, Carmel Schiafone conveyed out Lots 3 and 4.
It is now settled law that a property owner is entitled to personal service or mailed notice of foreclosure as a requirement of constitutional due process of law, and that, without prior notice to him at his last known address, jurisdiction is lacking to enter an in rem tax foreclosure judgment against him. Township of Montville v. Block 69, Lot 10, 74 N.J. 1, 19-20 (1977), overruling City of Newark v. Yeskel, 5 N.J. 313 ...