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PNC Bank v. Kemenash

November 14, 2000

PNC BANK, N.A., SUCCESSOR TO MIDLANTIC BANK, N.A. AND MIDLANTIC NATIONAL BANK, PLAINTIFF-RESPONDENT/CROSS-APPELLANT,
v.
DAVID KEMENASH, DEFENDANT-APPELLANT/CROSS-RESPONDENT.



Before Judges Havey, Cuff and Lefelt.

The opinion of the court was delivered by: Cuff, J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued: September 11, 2000

On appeal from Superior Court of New Jersey, Law Division, Atlantic County.

In this appeal we must determine whether a default judgment entered against defendant is either void or voidable because plaintiff failed to file an affidavit of non-military service at the time it applied for default judgment. It is undisputed that defendant never served in the military. We hold that the absence of the affidavit renders the judgment voidable and not void, and the judgment should not have been vacated because defendant was not in the military. We also affirm the order granting plaintiff's motion for summary judgment.

On June 9, 1995, Midlantic Bank, the predecessor bank of plaintiff PNC Bank (the Bank), filed a complaint seeking a money judgment on a promissory note executed by defendant David Kemenash (Kemenash). The complaint also sought a judgment for payment of the Bank's share of a restitution order entered in United States District Court as part of the sentence imposed on Kemenash for bank fraud and bribery. On June 15, 1995, Kemenash was personally served with the summons and complaint at the federal corrections facility at Fort Dix. Defendant filed no answer. The court entered a default, and eventually a default judgment in the amount of $3,954,912.71 plus interest against Kemenash.

Sometime after Kemenash's release from prison, the Bank commenced efforts to collect its judgment. On May 10, 1999, Kemenash filed a motion to vacate the default judgment. He asserted that he had no recollection of being served with the summons and complaint in 1995, was unaware of the judgment until "in the Fall of 1998, the Bank suddenly began pursuing [him] on account of this Default Judgment...," had never had an opportunity "to vindicate [his] claims against the Bank," and the Bank had failed to file an affidavit of non-military service when it applied for the default judgment.

On May 28, 1999, the motion judge vacated the default judgment and Kemenash filed an answer and counterclaim on June 8, 1999. The Bank filed a motion for reconsideration of the order vacating the default judgment and a motion for summary judgment. Although the motion for reconsideration was denied, the motion judge granted the Bank's motion for summary judgment. Kemenash appeals from the summary judgment order; the Bank has filed a cross-appeal of the order vacating the default judgment. We address the cross-appeal first.

In granting Kemenash's motion to vacate the default judgment, the motion judge focused solely on the absence of the affidavit of non- military service required by R. 1:5-7. In his oral opinion the judge held that the requirement to demonstrate that the defendant was not in the military was a mandatory, non-waivable precondition to the entry of a default judgment. Therefore, he concluded the judgment was void and vacated the default judgment. We disagree.

R. 1:5-7 provides

[a]n affidavit of non-military service of each defendant, male or female, when required by law, shall be filed before entry of judgment by default against such defendant. Such affidavit may be included as part of the affidavit of proof.

The rule is grounded in federal and state law. The federal Soldiers' and Sailors' Civil Relief Act, 50 U.S.C.A. §§ 501 to 591, provides In any action or proceeding commenced in any court, if there shall be a default of any appearance by the defendant, the plaintiff, before entering judgment shall file in the court an affidavit setting forth facts showing that the defendant is not in military service. [50 U.S.C.A. § 520(1).]

The statute was enacted "to provide for, strengthen and expedite the national defense under emergent conditions." 50 U.S.C.A. § 510. The statute further provides the suspension of a litigant's ability to prosecute a civil action against a person in military service is designed to allow military personnel to devote their entire energy to the defense of the nation. Ibid.

This state has a similar statute, N.J.S.A. 38:23C-4, which provides In any civil action or proceeding commenced in any court, if there shall be a default of an appearance by the defendant, and plaintiff, within 20 days before the entry of judgment or final order, shall file in the court an ...


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