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Manufacturers & Traders Trust Co. v. Green

January 4, 2008


On appeal from the Superior Court of New Jersey, Chancery Division, General Equity Part, Cape May County, Docket Nos. F-7783-02.

Per curiam.


Submitted December 3, 2007

Before Judges S. L. Reisner and Gilroy.

This is the first of four real property foreclosure appeals filed by defendant-mortgagors Audry E. Green and Shirley Green, husband and wife. The four appeals filed under Docket Nos. A-7120-03T5, A-1124-04T2, A-1556-06T2, and A-2349-06T2 were submitted back to back for our consideration. In this matter, defendants appeal from the July 14, 2004, judgment of foreclosure entered in the Chancery Division, General Equity Part, Cape May County, under Docket No. F-7783-02. We affirm.


On April 17, 1997, defendants executed a $45,000 promissory note and mortgage in favor of Parkway Mortgage, Inc. The note was for a term of twenty years and required defendants to repay the principal, together with interest at the rate of 10.99% per annum, by making monthly payments of $414.18 on the twenty-second day of each month, commencing on May 22, 1997. Both the note and mortgage contained a provision that permitted the note holder, on default, to accelerate the entire balance of principal and interest due under the note on a thirty-day written notice to defendants. The mortgage encumbered property at 303 East Wildwood Avenue, Middle Township. On May 6, 1997, the mortgage was recorded in the Office of the Cape May County Clerk in Book 2607 of Mortgages, Page 210.

On the same day that defendants executed the note and mortgage, Parkway assigned the note and mortgage to ContiMortgage Corporation. The assignment was recorded on April 30, 1998, in Book 265 of Assignments, Page 542. The assignment disclosed that Parkway had assigned the mortgage recorded in Book 2607 of Mortgages, Page 210, to ContiMortgage on April 17, 1997. That assignment, however, contained a different loan number (3970393) from that which appeared on the mortgage document (3970375), and a different loan amount ($42,000) from that recited in the mortgage ($45,000). Loan No. 3970393, in the amount of $42,000, referenced a different mortgage executed by defendants in favor of Parkway on April 17, 1997, encumbering property at 64 Tuckahoe Road, Woodbine. On June 12, 1997, ContiMortgage assigned the mortgage to plaintiff, Manufacturers & Traders Trust Company, Trustee for Securitization Series 1997-3, Agreement dated June 12, 1997. The assignment was recorded on April 30, 1998, in Book 265 of Assignments, Page 544. On August 1, 2000, Fairbanks Capital Corporation commenced servicing the loan for plaintiff.

Defendants defaulted on the loan when they failed to make payments on December 22, 2001, and January 22, 2002. On February 27, 2002, Fairbanks notified defendants that they were in default in the amount of $2,001.93, representing two months non-payment as well as other incurred charges. The letter advised defendants that they could reinstate the mortgage by paying all amounts due on or before March 29, 2002. In the interim, defendants paid the December 2001, payment in early February, 2002. On April 8, 2002, defendants tendered a check covering the January 2002 payment, which was cashed and placed into a "suspense activity" account. On April 23, 2002, defendants tendered a second check to cover the February 22, 2002, payment. The second check was returned to defendants because the account was in default status, and the amount of the check was less than the full amount due.

On April 12, 2002, plaintiff filed its complaint in foreclosure. Defendants denied that they had defaulted on the note and mortgage. Although a formal order was not entered, Judge Seltzer consolidated this matter with two other actions for purposes of discovery and trial. On May 27, 2003, plaintiff moved for summary judgment. On July 18, 2003, the court granted summary judgment, stating in relevant part:

[I]t's clear from the papers here that there is no dispute with respect to that mortgage. There was a default that was declared. There were checks that were required to be paid for 2000, 2001 and January and February of 2002. There were 26 checks which were required to be paid. In fact, there were only 25, one of which was paid in April [of 2002], some two months after the default was declared. Clearly the bank had, and there's no dispute with respect to the facts here, that the bank had the right to declare that default in February of 2002. As I say, it should have had 26 checks for January 2000 through February of 2002. In fact, there were only 24 [excepting] the check . . . that was written in April of 2002. And the balance is entitled to be accelerated. Notwithstanding his determination that defendants had defaulted on the note and mortgage, Judge Seltzer exercised his discretion and granted defendants additional time to reinstate the loan by paying all amounts due from the date of default through November 22, 2003, in a single payment:

Under the circumstances here it seems to me that given the confusion of these three accounts,*fn1 the application of at least three checks as we've seen during this period, that went from one account and one mortgage to another, I am not prepared to permit the plaintiff to obtain a judgment of foreclosure without giving Ms. Green an opportunity to redeem or to cure the default. I understand that this is a non-residential mortgage. But as I say, under my equitable powers, I think that it is appropriate to do that.

I will require Ms. Green to make the payments which were due from February 2002 to the date of payment, which I will calculate simply, without late fees, by multiplying the princip[al] and interest times the number of checks, number of months which will have elapsed. And I will permit her to make that payment no later than November 23rd 2003. If she makes that payment by November 23, 2003 this matter will be dismissed. If she fails to do so then the plaintiff may make application for the entry of judgment.

A confirming order was entered on August 18, 2003, granting plaintiff's motion for summary judgment, striking defendants' answer and defenses, and declaring defendants in default. Under the terms of the order, the matter was referred to the Foreclosure Unit of the Superior Court to proceed as an "uncontested foreclosure action." The order provided that defendants could reinstate the loan and mortgage by tendering a certified or bank cashier's check to plaintiff in the sum of: $8,819.42 if paid by August 22, 2003; $9,283.60 if paid by September 22, 2003; $9,747.78 if paid by October 22, 2003; or $10,211.96 if paid by November 22, 2003. Lastly, the order provided that if defendants failed to pay the amount due on or before November 22, 2003, that ...

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