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PRA III, LLC v. Capital One

July 23, 2009

PRA III, LLC, PLAINTIFF-RESPONDENT,
v.
CAPITAL ONE, N.A., SUCCESSOR BY MERGER TO NORTH FORK BANK, DEFENDANT-APPELLANT.



On appeal from Superior Court of New Jersey, Law Division, Hudson County, Docket No. L-1424-07.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued June 3, 2009

Before Judges Lyons and Kestin.

Defendant, Capital One, N.A., successor by merger to North Fork Bank, appeals from three orders: an April 25, 2008, order denying its cross-motion for summary judgment; an August 15, 2008, order denying its motion to vacate two turnover orders; and a September 3, 2008, order entering summary judgment in favor of plaintiff, PRA III, LLC. The judgment entered in this case arises from plaintiff's efforts to enforce two separate judgments that plaintiff had obtained against Dominick Badolato (Badolato) in two earlier Special Civil suits. The relevant factual and procedural history concerning these two judgments against Badolato and this case are as follows.

Judgment No. DJ-2278-04

On September 22, 2003, plaintiff obtained a final judgment against Badolato in Superior Court, Hudson County, Special Civil Part, in the amount of $14,754.06, plus costs. On January 5, 2004, the judgment was docketed as DJ-2278-04 in the amount of $15,206.37.

On June 30, 2004, a writ of general execution was issued to the Sheriff of Hudson County with respect to this judgment. The caption of the writ showed Badolato as the only defendant. According to this writ, judgment had been docketed in plaintiff's favor in the amount of $15,206.37, plus interest and costs. The sheriff was directed to satisfy the judgment out of personal property of the judgment debtor, Badolato, within Hudson County, or out of real property if sufficient personal property could not be found. On August 13, 2004, the sheriff, in an attempt to levy on the writ, served papers on a representative at defendant's location in Jersey City, but the affidavit of service was returned as "no account found."

On May 27, 2005, plaintiff's attorney wrote to the sheriff, asking him to relevy the writ on funds on deposit at defendant "in the name of Global Holding Commodities, Inc. under all account numbers." According to counsel: "That 'entity' does not exist. It was a corporation, but its charter was forfeited July 28, 2004." Plaintiff's counsel claimed, "[t]he bank account at [defendant] are [sic] actually those of [Badolato]. It is [Badolato] whose signature is on the check attached." Counsel attached a check drawn on Global Holding Commodities, Inc.'s (Global) account at defendant dated November 18, 2004, and apparently signed by Badolato.

On June 27, 2005, plaintiff's attorney wrote to defendant, advising it that the sheriff had not yet received a report "of the effect of the levy." In this letter, counsel advised defendant that "Global is not a corporate entity and is a pseudonym used by [Badolato]." Defendant returned the letter to plaintiff's counsel, with the following handwritten note on the bottom: "We are unable to honor the levy served upon us for this matter. If you claim there is an interest of the debtor [Badolato] in this acct [Global's account], we will require a ct order."

On July 18, 2005, plaintiff's attorney wrote to defendant again to put defendant on notice that Badolato was "operating the entity [Global] with whom [defendant] maintain[ed] a banking relationship under the name Global Holding Commodities." The attorney stated that Global's corporate charter had been forfeited in July 2004, and that Badolato was "the party responsible for controlling [Global's account]" and it was "clear this account exists." He noted defendant had earlier reported "no account found" in response to a levy on Badolato's accounts. The attorney asserted defendant would be held "responsible for any funds in the account [Global's] not appropriately debited as a result of the Sheriff's levy."

On March 20, 2006, plaintiff's attorney wrote to defendant's legal processing department in Mattituck, New York, advising defendant that suit would be instituted if $16,097.92 was not received by plaintiff. Defendant's office responded with a handwritten note dated March 22, 2006, advising plaintiff that "there is no account in the name of Dominick Badolato."

On March 27, 2006, plaintiff's attorney again wrote to defendant's Mattituck office, advising it that the account levied upon was in the name of Global. He stated Global "had no legal status," and that this account was used by Badolato.

On April 19, 2006, plaintiff moved for a turnover order in the Special Civil Part under this judgment number. Notice of the motion was mailed to defendant, Badolato, and Global. Notice to Global was not mailed to the address of the last designated registered agent of Global or its attorney, but to Badolato's home. According to the certification accompanying this motion, $16,097.92 remained owing on the writ.

Counsel's certification in support of the motion is exceedingly sparse. It identifies the date the judgment was docketed and the amount. It advises that there is a report of the recent levy on the account of "defendant[s]." The report is simply a Hudson County Sheriff Officer's Process Service Order, which indicates that the levy was served on defendant. It does not show the return of service in which the bank advised it had no accounts in the name of Badolato. The certification goes on to state merely that the amount of the judgment is currently $16,097.92. The certification never mentions that plaintiff is asserting that the monies in the Global account belongs to Badolato and, hence, should be applied to satisfy Badolato's debt to plaintiff. Nor does the certification at any time make reference to the fact that defendant objected to the assertion by plaintiff's counsel that Global's account belongs outright to Badolato and should be used to satisfy the judgment against Badolato. The certification makes no reference to any accounts whatsoever, other than a vague reference to "the account of the defendant[s]."

Also accompanying the motion was proof of "Notice to Debtor," pursuant to Rule 4:59-1(g), the date of which is not clear. On this notice, only Badolato was named as a defendant in the caption, but Global's name and address was typed below the caption underneath Badolato's name. The notice advised in pertinent part as follows:

Your bank account has been levied upon . . . to satisfy in whole or in part the judgment against you in the above matter. . . .

The bank has already been notified to place a hold on your account. However, the funds will not be taken from your account until the court so orders.

The certification attached to this notice indicates that it was mailed to "the defendant[s]." The only defendant listed, however, is Badolato.

On May 12, 2006, the court entered an order stating merely "[o]rdered, that North Fork Bank, turn over to Sheriff Joseph T. Cassidy, the sum of $16,097.92." The order makes no reference to any account held by defendant and makes no reference whatsoever to Global. The caption in the order showed only Badolato as a defendant. The order noted that the motion had been unopposed.

Judgment No. DJ-222032-04

On July 12, 2004, plaintiff obtained another final judgment against Badolato in Superior Court, Hudson County, Special Civil Part, in the apparent amount of $17,474.30, plus costs. On August 11 or August 19, 2004, the judgment was docketed as DJ-222032-04 in the amount of $15,821.68.

On October 27, 2004, a writ of general execution was issued to the Hudson County Sheriff with respect to this judgment. This writ showed Badolato as the only defendant. According to this writ, judgment had been docketed in plaintiff's favor in the amount of $15,821.68, plus costs, on August 19, 2004. The sheriff was directed to satisfy the judgment out of personal property of the judgment debtor within Hudson County, or out of real property if sufficient personal property could not be found. On June 28, 2005, the sheriff, in an attempt to levy on the writ, served papers on a representative at defendant's location in Jersey City, but the affidavit of service was returned as "no record of account."

The record also contains a cover letter from the Hudson County Sheriff to defendant dated July 6, 2005, to which a writ of execution was attached. The caption on the letter lists plaintiff as plaintiff and Badolato as defendant. The letter states the writ of execution is to be attached to "Defendant's Bank Account at your institution." The account number shown, though, was Global's. The letter also lists, below the account number, a social security number which was Badolato's.

A handwritten note on the bottom of this notice, from defendant, North Fork, indicated that the following notice had been sent to plaintiff's attorney: "We are unable to honor the levy served upon us for this matter. If a claim is being made that the debtor [Badolato] has an interest in the corp acct [Global], we will require a court order."

On September 20, 2005, plaintiff moved for a turnover order in the Special Civil Part under this judgment number. Notice of the motion was mailed to defendant, Badolato, and Global. Notice to Global was not mailed to the address of the last designated registered agent of Global or its attorney, but to Badolato's home. Plaintiff's attorney certified that $16,097.92 remained owing on the writ. The attorney's certification submitted in support of the motion again made no reference to any accounts in the name of Global, which plaintiff's counsel asserted to be the property of Badolato. It made no mention of the bank's position regarding that issue and did not attach a copy of the initial return on the levy which showed there were "no accounts."

On October 21, 2005, the court entered an order that stated, "[o]rdered, that North Fork Bank, turn over to Sheriff Joseph T. Cassidy, the sum of $16,097.92." No accounts were referenced in the order nor was Global. The caption of this order showed only Badolato as a defendant. The order noted that the motion had been unopposed.

The Instant Litigation

On March 19, 2007, plaintiff filed suit against defendant in Superior Court, Law Division, Hudson County, alleging that defendant had failed to comply with both turnover orders. Defendant answered the complaint, contending that it never held any bank accounts in Badolato's name, and that ...


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