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Toppi v. Federal National Mortgage Association

January 9, 2008


On appeal from the Superior Court of New Jersey, Chancery Division, Camden County, F-3608-02.

Per curiam.


Submitted December 12, 2007

Before Judges Cuff and Lisa.

Following the recording of a sheriff's deed resulting from a mortgage foreclosure action against them, plaintiffs, John D. Toppi, Jr. and Regina Toppi, initiated this action seeking a stay of their eviction and an order compelling defendant, Federal National Mortgage Association (Fannie Mae), to convey the property back to them pursuant to an alleged agreement. Judge Freeman entered an order on March 2, 2007 denying the requested relief. Plaintiffs argue, for the first time on appeal, that the sheriff wrongfully rejected their attempt to redeem the property before the sheriff's deed was recorded. They further argue that the trial judge erred in failing to grant them relief under principles of equitable estoppel or specific performance. We reject these arguments and affirm.

In connection with the purchase of their home in Gloucester Township in 1998, plaintiffs executed a purchase money mortgage in favor of Columbia National, Inc. Plaintiffs ceased making payments on the monthly installments due in September 2001. Columbia National filed a foreclosure action on February 15, 2002. In efforts to avoid foreclosure of their home, plaintiffs filed bankruptcy petitions in November 2003, May 2005, June 2006, and July 2006. Although these filings significantly protracted the foreclosure proceedings, Columbia National obtained final judgment on February 28, 2005, with the amount required to redeem set at $210,077.25, plus interest, costs and counsel fees. A writ of execution was ultimately issued and, after two statutory adjournments and an additional stay, the sheriff's sale was held on September 6, 2006. In the absence of other bidders, Columbia National was the successful bidder, purchasing the property for a nominal amount. Columbia National assigned its bid to Fannie Mae. The sheriff executed a deed to Fannie Mae on September 18, 2006. Although the record does not disclose the date of delivery of the deed, it was recorded on October 31, 2006.

On November 17, 2006, Fannie Mae's counsel, Fei F. Lam, served plaintiffs with a notice of eviction, to take place on December 13, 2006. On December 11, 2006, plaintiffs sought a hardship stay, supported by Regina Toppi's certification, which stated:

I have a mother on hospice living with me and my three children in school. I have made arrangements to purchase the property back. However the law firm [representing Fannie Mae] is denying me to do that. I have a person who will purchase my house with all fees [and] late charges in full on my behalf if I could have sometime to make arrangements if the court decided to evict me and my family. I will need a few weeks. Thank you.

Judge Vogelson entered an order on December 12, 2006 staying the eviction until January 12, 2007. Despite ordering that there would be no further adjournments, he later extended the stay to February 12, 2007. The eviction was ultimately scheduled for February 16, 2007.

On February 15, 2007, plaintiffs commenced this action by filing a verified complaint and order to show cause seeking a stay of the eviction and an order compelling Fannie Mae to convey the property to them pursuant to an alleged agreement. The complaint alleged breach of contract, violation of the covenant of good faith and fair dealing, negligent misrepresentation, and promissory and equitable estoppel. In support of the estoppel claims, plaintiffs alleged that they directed their attorney to negotiate with Lam regarding the possible repurchase of the property and that Fannie Mae "agreed to sell the property to plaintiffs once plaintiffs secured financing and once National Future Mortgage issued plaintiffs a mortgage commitment to purchase the property." Plaintiffs contended that they secured a mortgage commitment in early 2007 and, even though Fannie Mae expressed a willingness to cooperate with them, Lam refused to deal with plaintiffs and would pursue their eviction.

Lam certified that she first spoke with Regina Toppi on October 3, 2006, and advised her to present any repurchase proposal in writing, which Lam would present to Fannie Mae. However, Lam certified that she "advised her that there was no guarantee that Fannie Mae would consider the proposal." Lam further certified that she had received from the Toppis a mortgage commitment on November 13, 2006, but it was deficient and unacceptable for consideration of any possible repurchase, which she explained to plaintiffs and their attorney. Plaintiffs' attorney acknowledged the discussion, certifying that "Ms. Lam advised me that plaintiff[s] should submit a mortgage commitment in plaintiffs' name(s) only and if the agreement met with Ms. Lam's principal[']s approval, that defendant would relinquish defendant's interest in the property to plaintiff[s]." Plaintiffs secured a mortgage commitment on January 4, 2007, but did not submit it to Lam until February 15, 2007, the day they filed this action.

Judge Freeman heard oral argument on February 26, 2007. He rejected plaintiffs' argument that an agreement existed between plaintiffs and Fannie Mae for reconveyance of the property. He concluded that at best there were discussions and negotiations regarding the possibility of such an agreement. He therefore denied plaintiffs' application to compel specific performance because there was insufficient evidence of a binding agreement between the parties. The judge stayed the eviction until March 27, 2007. Plaintiffs vacated the property prior to that date. This appeal followed.

For the first time on appeal, plaintiffs argue that they attempted to redeem their property within the time prescribed by Rule 4:65-5, and they were wrongfully precluded from doing so. They argue in their appellate brief that "[a]lthough there is no proof as to the precise date [they] tendered the funds to the sheriff in an effort to exercise their right of redemption, the record discloses it was prior to the date the sheriff's deed was recorded." Thus, relying on Mercury Capital Corp. v. Freehold Office Park, Ltd., 363 N.J. Super. 235 (Ch. Div. 2003), plaintiffs argue that they were entitled to relief. We reject plaintiffs' argument on two grounds.

First, plaintiffs failed to raise this issue in the trial court. Their verified complaint did not allege an unsuccessful attempt to tender to the sheriff payment of the full amount required to redeem. Plaintiffs' certification did not set forth any specific steps taken to exercise the right of redemption. Plaintiffs produced no evidence and presented no oral argument concerning the issue. Appellate courts "will decline to consider questions or issues not properly presented to the trial court when an opportunity for such a presentation is available 'unless the questions so raised on appeal go to the jurisdiction of the trial court or concern matters of great public interest.'" Nieder v. Royal Indem. Ins. Co., 62 N.J. 229, ...

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