January 10, 2008
BANK OF NEW YORK, AS TRUSTEE FOR FIRST CITY CAPITAL HOME EQUITY LOAN TRUST 1998-2, UNDER THE POOLING AND SERVICING AGREEMENT DATED NOVEMBER 1, 1998, PLAINTIFF-RESPONDENT,
SHIRLEY GREEN AND AUDRY E. GREEN, DEFENDANTS-APPELLANTS.
On appeal from the Superior Court of New Jersey, Chancery Division, General Equity Part, Cape May County, Docket No. F-10766-04.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted December 3, 2007
Before Judges S. L. Reisner and Gilroy.
This is the last of four real property foreclosure appeals filed by defendant-mortgagors, Shirley Green and Audry E. Green, her husband. The four appeals filed under Docket Nos. A-7120-03T5, A-1124-04T2, A-1156-06T2, and A-2349-06T2 were submitted back to back for our consideration. In this matter, defendants appeal from the November 16, 2006, judgment of foreclosure entered in the Chancery Division, General Equity Part, Cape May County, under Docket No. F-10766-04. We affirm.
On September 30, 1998, defendants executed a $53,250 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 10.5% per annum, by making monthly payments of $531.64 on the fifth day of each month, commencing November 5, 1998. The mortgage encumbered property at 19 East Lena Street, Middle Township. 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. On October 7, 1998, the mortgage was recorded in the Office of the Cape May County Clerk, in Book 2728 of Mortgages, Page 185. On the same day that defendants executed the note and mortgage, Parkway assigned the note and mortgage to plaintiff. The assignment was recorded on May 25, 1999, in Book 273 of Assignments, Page 576. The servicing rights for the mortgage were subsequently transferred from Advantage Mortgage Corp. to Fairbanks Capital Corporation.
On April 2, 2004, Fairbanks sent defendants a "notice of intention to foreclose," advising that the note and mortgage were in default "because we have not received the installments due for the months of April 2001, through March 2004." The notice advised defendants of their right to cure the default by paying the amounts due within thirty days from the date of the letter. On June 17, 2004, plaintiff filed its complaint in foreclosure, alleging that defendants were in default for failing to pay their monthly payments and property taxes.*fn1 On or about July 30, 2004, defendants filed an answer and counterclaim. On August 30, 2004, defendants filed a motion for change of venue and to amend their counterclaim. On September 21, 2004, plaintiff cross-moved for summary judgment.
Following oral argument on November 12, 2004, Judge Seltzer: 1) granted plaintiff's motion for summary judgment; 2) denied defendants' motion to change venue and to amend the counterclaim; 3) struck defendants' answer and defenses, and declared them to be in default; 4) dismissed the counterclaim; and 5) referred the matter to the Foreclosure Unit of the Superior Court to proceed as an uncontested action.
A confirming order was entered on November 29, 2004. On January 28, 2005, defendants' motion for reconsideration was denied.
On February 14, 2005, defendants filed a Chapter 13 bankruptcy petition. On November 1, 2005, the Bankruptcy Court entered an order granting plaintiff relief from the automatic stay. On May 5, 2006, the trial court denied plaintiff's request to certify the November 29, 2004, order as final for purposes of appeal. On August 31, 2006, plaintiff moved for entry of judgment. Defendants objected and cross-moved "for entry of mortgage servicing fraud," asserting that Fairbanks had caused the mortgage loan default. Following an October 12, 2006, hearing, the trial court dismissed defendants' objections and cross-motion, and directed the Foreclosure Unit to proceed with the motion for entry of final judgment. A confirming order was entered the same day. A final judgment was entered on November 16, 2006.
On appeal, defendants argue:
THE TRIAL JUDGE ERRED IN GRANTING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT.
A. THE TRIAL JUDGE ERRED IN DETERMINING THAT PLAINTIFF WAS THE PROPER ASSIGNEE OF THE MORTGAGE.
B. THE TRIAL JUDGE ERRED IN DETERMINING THAT DEFENDANTS HAD DEFAULTED IN MAKING PAYMENTS ON THE PROMISSORY NOTE, JUSTIFYING THE ACCELERATION OF THE AMOUNT OF PRINCIPAL AND INTEREST DUE ON THE NOTE AND MORTGAGE.
THE FORECLOSURE ACTION WAS BARRED BECAUSE THE EARLIER FORECLOSURE ACTION, PERTAINING TO THE PROPERTY, HAD BEEN DISMISSED WITH PREJUDICE.
PLAINTIFF WAS NOT ENTITLED TO SUMMARY JUDGMENT BECAUSE: 1) FAIRBANKS CREATED DEFENDANTS' MORTGAGE DEFAULT THROUGH IMPROPER AND ABUSIVE MORTGAGE LOAN SERVICING, RESULTING IN DEFENDANTS BEING CHARGED UNCONSCIONABLE AND UNWARRANTED LATE FEES AND THE COST OF PLACED INSURANCE COVERING THE MORTGAGED PREMISES.*fn2
A trial court will grant summary judgment to the moving party "if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact challenged and that the moving party is entitled to a judgment or order as a matter of law." R. 4:46-2(c); see also Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 523 (1995). "An issue of fact is genuine only if, considering the burden of persuasion at trial, the evidence submitted by the parties on the motion, together with all legitimate inferences therefrom favoring the non-moving party, would require submission of the issue to the trier of fact." R. 4:46-2(c).
On appeal, "the propriety of the trial court's order is a legal, not a factual, question." Pressler, Current N.J. Court Rules, comment 3.2.1 on R. 2:10-2 (2008). "We employ the same standard that governs trial courts in reviewing summary judgment orders." Prudential Prop. & Cas. Ins. Co. v. Boylan, 307 N.J. Super. 162, 167 (App. Div.), certif. denied, 154 N.J. 608 (1998).
We have considered defendants' arguments in light of the record and applicable law. We are not persuaded by any of the arguments presented. We affirm substantially for the reasons expressed by Judge Seltzer in his oral decision of November 12, 2004. R. 2:11-3(e)(1)(A). Nevertheless, we add the following comments.
We determine defendants' argument that they had not defaulted on their payments on the note and mortgage is meritless. With the exception of the June 12, 2001, payment of $558.22, which was subsequently reversed and returned to defendants on September 27, 2002, and the February 24, 2004, transfer of the two payments from the 508 Main Street account, defendants did not make any other payments after April 5, 2001. The complaint was not filed until June 17, 2004. Moreover, defendants were in default for failing to pay municipal taxes. The mortgage placed an obligation upon defendants to "pay all taxes, assessments, charges, fines and impositions attributable to the Property which may attain priority over . . . the mortgage." Here, defendants failed to pay land taxes for the years 2000 through 2003. Lastly, the trial judge granted defendants additional time to cure the default by paying the amount due from April 2001 into court, but defendants failed to deposit the monies as directed when they filed their motion for reconsideration.
In Point II, defendants argue that the foreclosure action should have been dismissed because the first foreclosure action had been dismissed with prejudice. We disagree.
The earlier complaint, filed on May 21, 2001, alleged a default as of February 5, 2001. However, the June 17, 2004, complaint, initiating the instant foreclosure action, as amended on August 23, 2004, alleged a default as of April 5, 2001. While the dismissal of an earlier foreclosure complaint with prejudice would preclude a mortgagee's recovery from the default alleged in that complaint, that dismissal does not grant a mortgagor the liberty, without consequence, to default with respect to future mortgage payments and taxes. Stated differently, a new foreclosure action based upon a new default is not barred. To the extent not addressed here, defendants' remaining arguments are without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).