On appeal from the Superior Court of New Jersey, Chancery Division, Camden County, Docket No. F-18369-07.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued September 15, 2009
Before Judges Carchman, Lihotz and Ashrafi.
In Simon v. Cronecker, 189 N.J. 304 (2007), the Supreme Court held that "the Tax Sale Law does not prohibit a third-party investor from redeeming a tax sale certificate after the filing of a foreclosure action, provided that the investor timely intervenes in the action and pays the property owner more than nominal consideration for the property." Id. at 311. This appeal presents a variation of the issues addressed in Cronecker. A prospective intervenor, Saint Vincent DePaul Society (SVDP) appeals from an order of the general equity part denying its motion to intervene in a tax foreclosure proceeding involving plaintiff CCTS Tax Liens I, L.L.C. (CCTS), the holder of the certificate, and defendant Louise Gilbert, the property owner. SVDP purports to be not a third-party investor but a lender of funds to defendant for the limited purpose of redeeming the tax sale certificate. The motion judge denied intervention and permitted CCTS to foreclose. Unfortunately, because the application was determined on motion, the record is limited as to a presentation of all of the unique facts surrounding this matter. Accordingly, for the reasons set forth below, we reverse and remand for a plenary hearing to fully explore all of the circumstances of this transaction to the end that the judge has a full record on which to assess and adjudicate the respective rights of the parties.
We present an expansive review of the relevant facts as they were presented on motion. Defendant, disabled and receiving a monthly supplemental security income (SSI) grant, owns property located at 802 Brighton Road, Cherry Hill, a single family home (the property). The property, which was not her residence, was acquired by inheritance on June 6, 1994. It was damaged by a fire on November 24, 2004, rendering it uninhabitable. After a number of attempts to repair, Cherry Hill Township (the Township) advised defendant that if the property were not repaired, it would be deemed abandoned. Thereafter, the Township provided some maintenance of the property and forwarded bills to defendant.
In June 2006, plaintiff purchased a tax sale certificate, reflecting unpaid taxes assessed against the property, for $1,759.26 from the Township tax collector, and on July 24, 2007, plaintiff filed a tax foreclosure complaint seeking to foreclose on the certificate.
On October 31, 2007, defendant appeared in the Cherry Hill Township Municipal Court to pay a September 7, 2007 invoice for maintenance service to the property, specifically, grass cutting. A letter followed from the Township on November 15, 2007, declaring that "this property is abandoned under N.J.S.A. 40:48-2.3, et seq." Apparently, estimates for rehabilitation of the property exceeded a cost of $35,000.
Following the filing of the complaint, an order was entered fixing the redemption amount at $9,708.30 plus any taxes paid or interest accrued through June 27, 2008, the last day for redemption. The order permitted redemption "up until the entry of final judgment including the whole of the last day upon which judgment is entered."
While the foreclosure was pending, defendant was attempting to sell the property. Apparently, defendant, through counsel, was negotiating a contract with a potential buyer at a purchase price of $125,000 and another contract with a different purchaser at a purchase price of $130,000. Neither sale was consummated, and in one instance, the buyer refused to proceed because of its unwillingness to intervene in the foreclosure action.
According to a certification of Joseph M. Pinto, Esq., who was acting as defendant's attorney, in an effort to stave off the foreclosure, he arranged for a loan to defendant in the amount of $12,334.94 from SVDP, a New Jersey charitable nonprofit corporation. The purpose of the loan, which was approved on June 26, 2008, one day before the final date for redemption, was to provide the necessary funds to redeem the outstanding certificate. Defendant decided to borrow from SVDP for two reasons - the deadline to redeem was the next day, and Pinto sat as a trustee on the SVDP Board allowing for an expeditious resolution of the loan transaction. As we noted, SVDP agreed to lend the funds to defendant to redeem the outstanding tax sale certificate, and defendant agreed to execute a note and mortgage to secure the loan. Thereafter, SVDP's treasurer went to Cornerstone Bank, obtained a cashiers check in the requisite amount made payable to the Township and gave the check to defendant's attorney that night.
Pinto, representing both defendant and the lender, prepared a note and mortgage for defendant's signature, brought the documents to the motel where she resided and explained the terms to her. She reviewed both documents and executed them on June 26, 2008. The note provided for a loan of $12,337.94 (the redemption amount) with interest at six percent per annum payable in one year.
On the morning of Friday June 27, 2008, at 9:15 a.m., Pinto's paralegal, Deena Morales, appeared at the tax collector's office with a letter and cashiers check made payable to the Township in the proper redemption amount. Morales presented a cover letter to the tax collector. The letter read:
Please be advised that I represent Louise Gilbert, defendant in the above matter. Pursuant to the Court's Order Fixing Amount, Time and Place for Redemption dated May 14, 2008 setting June 27, 2008 for the date of redemption and our telephone conversation of yesterday in which you advised that the amount to redeem was $12,337.94, enclosed please find Cornerstone Bank treasurer's check number 010398 in the amount of $12,337.94 in redemption of the outstanding tax sale certificates referenced in the above case.
The remitter listed on the check was not defendant but SVDP. Noting that the funds were from a third-party, the tax collector refused to accept the funds as SVDP was not a party to the foreclosure action. As a result of the tax collector's action, defendant and SVDP filed a motion at 2:14 p.m. on June 27, 2008, seeking an order requiring the tax collector to accept the borrowed funds and permitting SVDP to intervene, "if required."
That same day, the motion was mailed to plaintiff's attorney and a copy was also sent by facsimile to his office at approximately 6:00 p.m. Claiming that he did not see a copy of the motion, on Monday, June 30, 2008, plaintiff's attorney hand- carried a final judgment to the Foreclosure Unit of the Superior Court Clerk's Office in Trenton. The judgment was entered that day. Plaintiff's attorney then faxed a copy of the final judgment to the defendant's counsel suggesting that the entry of the judgment rendered the pending motion moot.
In response, defendant filed an amended motion on July 2, 2008, seeking the following relief:
1. Granting SVDP permission to lend defendant $12,337.94;
2. Permitting SVDP the right to intervene in the matter, if necessary;
3. Extending the time for redemption of the tax sale certificates;
4. Vacating the Judgment entered on June 30, 2008, and staying the proceedings until ...