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Hurdleston v. New Century Financial Services

June 29, 2009


The opinion of the court was delivered by: Irenas, Senior District Judge


Presently before the Court are Defendants' Motion for Summary Judgment (Docket No. 22), Defendants' Motion for Sanctions (Docket No. 26), and Plaintiffs' Motion for Summary Judgment on Liability Only (Docket No. 30). The Court has reviewed the submissions of the parties, and for the reasons set forth below, Defendants' Motion for Summary Judgment will be granted, and Defendants' Motion for Sanctions and Plaintiff's Motion for Summary Judgment on Liability only will be denied.*fn1


Plaintiff, Norman Hurdleston ("Norman"), is a 47 year old man. He was diagnosed at an early age with mild cerebral palsy and organic brain syndrome/organic cerebral dysfunction. (Pl. Ex. A.) Norman attended the Bancroft School, which is a school for children with developmental disabilities. (Pl. Ex. D.) Norman also attended the Elwyn Institute, which provides "education and care for individuals with special challenges and disadvantages." (Pl. Ex. F.) According to the report of Kenneth Goldberg, Ph.D., dated March 1, 2003, Norman "is a mentally deficient individual who attended specialized schools for the developmentally disabled," and is only capable of reading at a 3rd grade level. (Pl. Ex. G at 3-4.) While, he lives by himself and cares for his two cats, Norman sends all bills and other seemingly important documents to his family members. (Id., Pl. Ex. FF.)

This case arises out of events that transpired in a collection action brought in the Superior Court of New Jersey, Law Division, by Defendant New Century Financial Services Inc. ("NCFSI"), through its counsel, Defendant Pressler & Pressler, LLP ("Pressler"), against Norman. The collection action was a result of a default on Norman's Citibank credit card, due to unpaid charges and fees totaling $1,845.60. (Sombers Aff. ¶ 4.) NCFSI purchased the defaulted Citibank account and referred it to Pressler for collection. (Id. at ¶ 5.)

On March 16, 2005, Pressler sent a notification to Norman pursuant to the Fair Debt Collection Practices Act, 11 U.S.C. § 1692g, encouraging him to contact Pressler to make arrangements to pay the debt. (Pressler Aff. Ex. 21.) On August 22, 2005, Pressler filed suit against Norman in the Superior Court of New Jersey, Law Division, Camden County, Special Civil Part under docket number DC-010592-05. (Pressler Aff. ¶ 2.) Service was effected on August 25, 2005, by the clerk mailing copies by certified and regular mail to Norman. (Hurdleston Br. Ex. I.)*fn2

On September 12, 2005, Norman's brother, Christopher Hurdleston ("Christopher"), filed a letter entitled "Answer to Complaint of Summons." (Pressler Aff. Ex. 1.) In the letter, Christopher stated, among other things, that on behalf of his brother he was filing a response of "Not Guilty" and that he wanted the court to hold a hearing, that Norman was "mentally handicapped and has been so for his 43 years of life," that Norman had minimal personal property and his sole source of income is Social Security Disability, for which Christopher was the representative payee, and therefore, Pressler's chances of recovering anything from Norman were "very poor, at best." (Id.) In response, James Padgett, a representative of Pressler, wrote a letter to Norman on September 16, 2005, requesting that he contact Pressler's office to discuss a possible resolution.*fn3

(Id. at Ex. 2.)

On September 20, 2005, Pressler moved to strike Christopher's answer because Christopher was neither an attorney, a person qualified to appear in court, nor a real party in interest, and enter default in the case. (Id. at Ex. 3.) The motion to strike was unopposed and on October 11, 2005, the Hon. Lee B. Laskin, J.S.C., granted the motion, striking the answer and entering default. (Id. at Ex. 4.)

On December 8, 2005, Pressler filed a motion for the entry of default judgment. (Id. at Ex. 5.) The Certification of Proof that accompanied the motion states that "no defendant is an infant or mentally incapacitated person."*fn4 (Id.) On December 27, 2005, Judge Laskin granted the motion and entered judgment in favor of NCFSI in the amount of $2801.60, plus costs. (Id. at Ex. 6.) After three failed attempts to deliver a certified copy of the judgment to Norman's address, on January 13, 18, and 28, 2006, it was returned by the Unites States Postal Service as "unclaimed" on February 2, 2006. (Id.)

On January 20, 2006, Pressler sent Norman, by regular and certified mail, an "Information Subpoena" and a questionnaire in order to ascertain what assets he might have to satisfy the default judgment. (Id. at Ex. 7.) The Information Subpoena informs the recipient that "If this judgment has resulted from a default, you may have the right to have this default judgment vacated by making an appropriate motion to the court." (Id.) Christopher telephoned Pressler in response to the information subpoena on January 27, 2006, but was informed that no one from Pressler could discuss the matter with him without Norman's written authorization. (Id. at Ex. 22.) On January 31, 2006, Christopher faxed Pressler a signed power of attorney for Norman.*fn5 (Id. at Ex. 8.) Christopher confirmed that Pressler received the authorization on February 2, 2006, (Id. at Ex. 23), and later that day returned the questionnaire to Pressler. (Id. at Ex. 9.) On the questionnaire, Christopher indicated that Norman had a bank account with Wachovia, and personal property valued at less than $500. (Id.)

On February 6, 2006, Pressler sent Norman a letter indicating that a question on the form regarding exempt funds had not been answered. (Id. at Ex. 10.) Christopher answered the question, indicating that Norman received $986 per month in Social Security Benefits, and faxed the form back to Pressler on February 15, 2006. (Id. at Ex. 11.) However, Christopher failed to attach the required copies of the bank statements indicating that Norman's bank account indeed contained only the Social Security funds. (Id.)

On February 7, 2006, Pressler requested that the court execute a levy against Norman's bank account and personal property. (Pressler Aff. at ¶ 15.) On February 21, 2006, the Superior Court issued a writ of execution for a court officer to levy on Norman's Wachovia bank account and the possessions in his home. (Pressler Aff. Exs. 13, 14.) On March 6, 2006, Court Officer George Cook ("Cook") "visited Norman's apartment and viewed his belongings and determined they were not worth levying upon." (Id. at Ex. 16 at ¶ 4.) Cook returned the writ noting that there were insufficient funds in Norman's bank account and that the furniture in his apartment was not worth levying, and informed Pressler that he intended to return the writ as unsatisfied in 30 days. He also indicated that he left a "Goods & Chattel notice."*fn6 (Id. at Ex. 13.) The following day, Cook returned the writ marked as "Unsatisfied."*fn7 (Id. at Ex. 14.) At no point was any property or money of Norman's actually taken.

On December 27, 2006, Christopher filed a motion seeking appointment as Norman's guardian ad litem and to vacate the state court judgment. The motion was granted on January 9, 2007. (Pressler Aff. ¶¶ 20-21.) After a period of discovery, the collection case ultimately went to trial on September 11, 2007. (Id. at ¶ 22.) At trial, both parties were represented by counsel. (Id.) Judge Laskin found that Norman did have the requisite mental capacity to enter into a credit card agreement with Citibank, and therefore entered judgment for $1,845.60 in favor of NCFSI.*fn8 (Id. at ¶ 23; Pressler Aff. Ex. 19 at 170-172.)

Norman, through his guardian ad litem, Christopher, filed the Complaint in the instant case on July 17, 2007, after the original state court judgment was vacated, but before the trial on the merits was held. Count I of the Complaint alleges that Pressler and NCFSI violated of 42 U.S.C. § 1983 by failing to provide proper notice or process prior to seeking the default judgment against Norman in state court or "attempting" to seize his assets. Count II alleges that the same conduct deprived Norman of substantive rights in violation of the New Jersey Civil Rights Act ("NJCRA"), N.J. Stat. Ann. § 10:6-1, et seq. Counts III and IV allege common law fraud and negligent ...

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