On appeal from Superior Court, Chancery Division, Hunterdon County.
Petrella, Bilder and Brochin. The opinion of the court was delivered by Petrella, P.J.A.D.
Defendant law firm, Gern, Dunetz, Davison & Weinstein, P.C., appeals from a judgment in a quiet title action that declared that its judgment, against their former client in a matrimonial action, did not constitute a lien on property that client sold after entry of the judgment. The judgment was docketed by the Clerk of the Superior Court in Trenton after the purchase by plaintiffs of the judgment debtor's home, although it had been filed and entered as a judgment in Essex County prior to the purchase. There is no dispute that the plaintiffs were good faith purchasers for value, without actual notice of the judgment.
The facts are not disputed. Indeed, the case was submitted to the trial court on an agreed statement of facts. On July 17, 1989, defendant obtained a judgment against Steven T. Francesco which was signed and filed by a judge in Essex County where the law firm had instituted suit to collect their fee in a matrimonial action. The judgment against Francesco was in the amount of $9,191.64, which represented $6,000 in principal for legal fees owed, plus $3,191.64 in prejudgment interest to June 9, 1989. The judgment was apparently received in the Essex County Clerk's office for processing on or about July 21, 1989, or at least the judgment was placed into the computer records of Essex County on that date. On July 24, 1989, the judgment was entered in the Essex County docket book by the County Clerk and was then sent to the Superior Court Clerk's office in Trenton.
During this time, Francesco was in the process of selling his Hunterdon County home to the plaintiffs. The attorney for plaintiffs ordered a title search through General Land Abstract Company in connection with the purchase from Francesco. On July 27, 1989, plaintiffs' attorney filed a "notice of settlement with the Hunterdon County Clerk" to memorialize a mortgage commitment and a contract of sale pursuant to N.J.S.A. 46:16A-1 et seq. The closing took place on August 4, 1989, and
the deed, as well as a mortgage in favor of First Fidelity Bank, N.A., were recorded by the Hunterdon County Clerk on that date. The judgment of the Gern, Dunetz, Davison & Weinstein law firm against Francesco was stamped "recorded as a lien 08-22-89" by the Superior Court Clerk in Trenton and, for the first time, was assigned a "J" docket number,*fn1 i.e., J-69042-89, which was distinct from the Law Division docket number. A subsequent judgment search showed that the judgment was "entered" by the Clerk of the Superior Court on August 22, 1989.
The parties stipulated that the defendant law firm had no knowledge of Francesco's activities in negotiating the sale of his property or of the conveyance to the plaintiffs until well after the closing. In addition, it was stipulated that the plaintiffs had no knowledge of the Essex County proceedings against Francesco, nor were they put on actual notice that a judgment had been entered against Francesco until after the August 4 closing.
The defendant law firm argues that the motion judge erred in ruling that its judgment did not create a lien upon the premises conveyed to plaintiffs as bona fide purchasers. The judge determined that the judgment would not constitute a lien until it was docketed or "entered" by the Clerk of the Superior Court in Trenton. Since the judgment was not so entered until August 22, 1989, which was after the date that plaintiffs took title, the trial judge concluded that the judgment did not constitute a lien on the property.
The defendant contends that the judgment should be considered a valid lien on the Hunterdon County property then owned by Francesco upon its entry on the Essex County Court's minutes and records by the Essex County Clerk (acting as a Deputy Clerk of the Superior Court) on July 24, 1989. They recognize that the lien is a creature of statute, but rely, in
an innovative argument, on the Supreme Court's relaxation of the court rules by a November 28, 1988 order designating Essex County as a "Local Filing Project." This direct filing designation allowed all papers in lawsuits pending in the county to be filed solely with the county clerk, thus obviating the previous duplicate filing requirement which involved the original papers being maintained by the Clerk's office in Trenton and a copy being held in the county. Defendant also relies on the concomitant amendment to R. 4:47 which deals with the entry of judgments.
The lien given a judgment creditor is purely statutory. Joseph Harris & Sons, Inc. v. Van Loan, 23 N.J. 466, 470, 129 A.2d 571 (1957). Any lien that attaches to the lands of a judgment debtor does so solely by virtue of a statute. Ibid. Real property may be levied upon and sold by ...