June 24, 2011
TOWNSHIP OF MANTUA, A MUNICIPAL CORPORATION IN THE COUNTY OF GLOUCESTER, STATE OF NEW JERSEY, PLAINTIFF-APPELLANT,
568 LAMBS ROAD, BLOCK 254.01, LOTS 24 & 31, ASSESSED TO STRUTHERS-DUNN, INC., DEFENDANT.
On appeal from the Superior Court of New Jersey, Chancery Division, Gloucester County, Docket No. F-34893-09.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued May 23, 2011
Before Judges Lisa and Sabatino.
The Township of Mantua ("the Township") appeals the Law Division's October 6, 2010 order granting relief pursuant to Rule 4:50-1(d) to Lambs Road Associates ("LRA"). The order in question amended the Township's in rem foreclosure judgment as to certain real property, so as to recognize and give priority to a judgment and lien interest that LRA had previously obtained upon that same property. The order was based upon the trial court's finding that the Township had failed to give LRA proper notice of the foreclosure action and, in fact, had served a notice intended for LRA upon the wrong attorney.
For the reasons that follow, we reject the contentions of error raised by the Township and affirm the trial court's order.
The following facts and procedural history are relevant to the issues presented on appeal.
The real property in question consists of two adjacent lots that are located in the Township at 568 Lambs Road. The property, which was owned by Struthers-Dunn, Inc. ("Struthers"), borders developable land owned by LRA, a partnership.
In or about 1988, LRA's land was damaged because of groundwater contamination from the Struthers property. Litigation ensued and, on January 26, 1995, LRA obtained a default judgment against Struthers for $220,000. That judgment was docketed with the Superior Court, thereby creating a statewide lien on the property. John W. Trimble, Sr., ("Trimble, Sr."), an attorney who is now deceased, was listed on the judgment as LRA's counsel, with an office address in Blackwood, New Jersey.
Struthers failed to pay its real estate taxes to the Township in 1996 and 1998. The non-payment prompted the Township to conduct tax sales and to purchase two tax sale certificates for the property. The first certificate was acquired on June 5, 1997, and recorded on June 8, 1998. The second certificate was acquired on September 19, 2000, and recorded on January 2, 2001. Hence, both certificates were acquired and recorded well after the date of LRA's lien from 1995. At some point, Struthers abandoned the property.
Thereafter, representatives of the Township and LRA interacted on various matters involving the Struthers property and also concerning LRA's own land. Several of those matters concerned litigation in which both the Township and LRA were parties. These interactions bear upon the critical question ofwhether the Township knew or should have known who was representing LRA's interests during that time frame and whether the Township took reasonable measures to provide LRA with notice of the tax foreclosure action when it brought the action in 2009.
During 2002 and 2003, a third party attempted to foreclose on tax sale certificates that it held on the Struthers property. LRA, which was named as a defendant in that case, opposed the foreclosure by challenging the validity of the certificates. In particular, LRA asserted that the third party had failed to provide it with required notice. Subsequently, the third party abandoned its foreclosure action. During the course of that litigation, LRA's counsel of record in the case, Louis Giansante, Esq., sent a letter to the Township's counsel, identifying himself as LRA's attorney and informing the Township about LRA's challenge to the validity of the certificates.
In August 2006, another third party attempted to foreclose on tax sale certificates that it had purchased on a portion of the Struthers property. Both LRA and the Township were named as defendants in that case. Once again, LRA defended the action by challenging the validity of the certificates, and once again, Giansante and his law firm were identified as LRA's counsel. That lawsuit also was eventually resolved.
LRA and the Township also dealt with one another in connection with the sale of a portion of LRA's property as part of the Township's redevelopment plan. In particular, on July 3, 2007, LRA and the Township entered into a memorandum of understanding ("MOU"), under which LRA agreed to sell a portion of its land to the Township's redeveloper. The MOU listed Giansante's law firm as LRA's counsel. The MOU also specified that correspondence for LRA was to be sent c/o Thomas Finn, a partner in the LRA partnership, at his mailing address in Delaware. Reciprocally, the MOU listed an attorney with the Parker McCay law firm ("the first PM attorney") as the Township's "Special Counsel for Redevelopment."
On February 14, 2008, LRA and the Township entered into an agreement for the sale of a portion of LRA's land. The agreement listed Giansante and his law firm as LRA's counsel. It directed that correspondence to LRA be sent to its Delaware mailing address, with a copy to Giansante. The agreement also listed the Parker McCay firm and the first PM attorney as the Township's counsel.
From at least 2008 forward, the Township's tax assessor's office listed the contact information for LRA as: "c/o Thomas Finn," at his Delaware address. LRA's tax bills were thereafter mailed to Finn's Delaware address.
On November 10, 2008, the first PM attorney sent a letter to Giansante, noting that "[the Township] is looking forward to meeting with you and your client, Lambs Road Associates," to discuss LRA's possible role in a redevelopment project on the Struthers site. These discussions were not, however, successful.
The last matter in which the Township and LRA were mutually involved before the present tax foreclosure case was a condemnation action. Specifically, in June 2008, the Township's utility authority filed a condemnation action to obtain an easement over part of the property. The lawsuit named LRA and the Township as two of several potentially interested parties. Parker McCay and the first PM attorney acted as the utility authority's counsel in the litigation. Giansante was LRA's counsel in the case. LRA filed an answer, asserting the priority of its 1995 judgment on the property. When none of the other parties answered the complaint, LRA sought a default judgment and the award of any condemnation proceeds to it.
On March 6, 2009, LRA and the Township entered into a consent judgment in the condemnation action, agreeing to divide the condemnation proceeds evenly between them. The consent judgment established the priority of LRA's judgment lien and the Township's tax sale certificates over all other partiesinvolved. However, the consent judgment expressly left unresolved the question of whether LRA's lien had priority over the Township's certificates, or vice versa. The consent judgment was docketed and duly recorded on March 30, 2009. It was prepared and signed by the first PM attorney on behalf of the Township, and was executed by Giansante on behalf of LRA.
On the same day that the consent judgment was entered, March 6, 2009, the first PM attorney sent a letter to the Superior Court's Trust Fund Unit. The attorney's letter noted the resolution of the condemnation action involving the property, stating that the Township would send one-half of the condemnation award to LRA "via their attorney of record, Louis Giansante[.]"
On May 13, 2009, Giansante sent a letter to the first PM attorney. His letter advised her of a recent court decision that had invalidated a tax sale foreclosure because the tax sale certificates in that case had not complied with statutory notice provisions applicable to environmental contamination. In his letter, Giansante noted that the recent court decision involved "a similar argument that [he has] made in asserting the primacy of LRA's judgment lien over the tax sale certificates that post date the recording of LRA's lien" on the Struthers property.
The present litigation was instituted soon thereafter. On July 2, 2009, the Township filed a complaint in the Chancery Division, pursuant to the In Rem Tax Foreclosure Act, N.J.S.A. 54:5-104.29 to -104.75. The complaint sought in rem tax foreclosure on the two tax sale certificates that the Township held on the property. The Township's counsel of record in the case was another lawyer with the Parker McCay law firm ("the second PM attorney").
In September 2009, the Township provided general notice of the tax foreclosure lawsuit by publication in the Gloucester County Times and posting at four locations*fn1 in Mantua and at the Gloucester County Clerk's Office. Through Parker McCay, the Township obtained a judgment search report. That report listed LRA's 1995 judgment lien against Struthers for $220,000, indicating that LRA's counsel at that time in 1995 was "John W. Trimble." Because the search only covered the period from March 3, 1989 to March 3, 2009, the report did not list the March 6, 2009 consent judgment between LRA and the Township involving the Struthers property.
Acting on information provided in the judgment search report, the second PM attorney consulted the 2009 New Jersey Lawyer's Diary and Manual, from which she obtained the address of a lawyer named John W. Trimble, Jr. ("Trimble, Jr."), who is, in fact, the son of the late John W. Trimble, Sr. The notice of the foreclosure was then erroneously mailed to Trimble, Jr. Trimble, Jr.'s law office received the notice on September 10, 2009, but did not respond to it.
Additionally, the second PM attorney consulted the "Business Finder" feature of the LEXIS-NEXIS database, and determined that LRA's business address was located in Blackwood, New Jersey, although not at the same Blackwood address listed on LRA's 1995 judgment for Trimble, Sr.'s office. The Township mailed notice of the tax foreclosure action to LRA at that incorrect Blackwood address.*fn2
LRA did not file an answer to the foreclosure action. Consequently, on November 17, 2009, the Township obtained a final judgment in foreclosure on its two tax sale certificates on the Struthers property. The Township thus became the apparent titled owner of the property, seemingly free of any competing interests by other parties. The foreclosure judgment was recorded on December 11, 2009.
According to Giansante, he and LRA were unaware of the Township's tax foreclosure action until January 2010, when the Township, during a discussion, "expressed its belief that all liens on the property it now possessed had been discharged via the foreclosure." Giansante asked for a copy of the Township's record of the foreclosure, but apparently had to file a public records request under the Open Public Records Act, N.J.S.A. 47:1A-1 to -13, before it was provided to him.
After receiving the tax foreclosure file, Giansante sent a letter to the second PM attorney on February 4, 2010, citing the lack of notice to him or to LRA. A different attorney with Parker McCay responded to Giansante, asserting that adequate notice had been provided to LRA. In a reply letter, Giansante noted that Trimble, Sr.'s name had appeared on the 1995 judgment; that Trimble, Sr., had died several years prior; and that Giansante's own law firm had been representing LRA since 2000. Giansante also noted that although Trimble, Sr.'s address had been in Blackwood, New Jersey, the foreclosure notice had been mailed to a different street address in that town. Giansante asserted that Trimble, Sr.'s son, Trimble Jr., did notrepresent LRA in any capacity. Nevertheless, Giansante's letter failed to yield any change in the Township's position.
On March 2, 2010, relying upon Rule 4:50-1, LRA filed a motion to amend the foreclosure judgment, in an effort to preserve its lien interest in the property. Specifically, LRA sought relief under Rule 4:50-1(c), contending that the Township had intentionally and fraudulently failed to provide notice to LRA, and alternatively under Rule 4:50-1(d), contending that the foreclosure judgment was void as to LRA because the Township had not provided actual notice to the partnership.
In opposing LRA's motion, the Township argued that LRA had received adequate notice of the foreclosure action by publication, by posting, and also by mailing the notice to Trimble, Jr. In support of its position, the Township presented a certification from its Economic Development Coordinator, Michelle Bruner. Bruner stated that Trimble, Jr., had appeared on behalf of LRA at meetings, which took place at her office in March 2006, concerning both the property and LRA's adjacent lands. Bruner described Trimble, Jr., as "the son of the late John W. Trimble, Sr., Esquire, and stepson of Evelyn Trimble, one of three partners comprising [LRA]." Bruner stated that her "main contacts" with Giansante had involved LRA's land and not the Struthers property.
Giansante filed a reply certification, explaining that, at the 2006 meetings described by Bruner, Trimble, Jr., had represented only the interests of his stepmother, Evelyn Trimble, in what was then an ongoing dispute among the LRA partners. According to Giansante, when the LRA partners ultimately reconciled, Trimble, Jr., stopped attending the meetings with Bruner. Giansante asserted that, therefore, he alone represented LRA at those meetings.
After hearing the initial oral argument on LRA's motion, the trial court entered an order and a written opinion on May 27, 2010, denying relief to LRA. Although the court's opinion recognized that LRA had brought its motion under both Rule 4:50-1(c) and (d), the court based its decision solely upon LRA's failure to substantiate fraud under Rule 4:50-1(c).
In its May 2010 decision, the trial court noted that LRA had not provided certifications either from Trimble, Jr., about whether he took any action to notify LRA after his office received the Township's notice, nor from any members of the LRA partnership, confirming that they had not received actual notice of the foreclosure action. The court stated that it "[would] not assume lack of actual notice under these circumstances[,]" and that "[a]bsent party or witness certifications, the circumstances do not support a claim of fraud or misconduct."
Moreover, the court observed that "LRA did not avail itself of the procedure set forth in the [In Rem Tax Foreclosure Act] statute to ensure that lien holders receive notice at their designated address." (Citing N.J.S.A. 54:5-104.48).*fn3
On June 16, 2010, LRA filed a motion for reconsideration, pointing out that the trial court had not addressed LRA's alternative argument for relief under Rule 4:50-1(d) based on lack of notice. LRA also argued that the court's initial decision denying LRA's fraud-based motion under Rule 4:50-1(c) was in error.
LRA provided two certifications in its supplemental motion papers. In one certification, Trimble, Jr., stated that: his office had accepted the Township's mailed notice in error; he never saw the notice and he assumed that it had been discarded by his office staff; and his office had not transmitted the notice to LRA or Giansante. In the other certification, Harry
A. Simeone, an LRA partner, indicated that neither LRA nor any of its authorized representatives had received notice of the Township's foreclosure action.
In response, the Township argued that LRA's reconsideration motion was improper because it included certifications that had not been part of the record on LRA's original motion to amend the foreclosure judgment.
LRA then provided the court with a reply brief and two reply certifications. One of those certifications was from Giansante himself, who advised the court that he was a partner in LRA. Giansante asserted that his earlier certification on the motion should therefore be viewed as a certification by an LRA partner, and should thereby be treated as competent proof that LRA had not received actual notice of the foreclosure. The other reply certification was from Dennis M. Tull, a representative of a title insurance company. According to Tull, if the Township had been reasonably diligent in the search of the county's land records prior to the tax sale foreclosure, the Township would have discovered the consent judgment that it had entered into with LRA on March 6, 2009, and which was recorded on March 30, 2009.
The Township argued that the March 6, 2009 consent judgment was irrelevant and that it was recorded after the Township had received the title search for the property. In this regard, the Township's counsel noted that "[s]aid title search was issued on March 5, 2009, and its records had an effective date good through February 20, 2009."*fn4
After hearing oral argument on LRA's reconsideration motion, the trial court entered an order and an opinion on October 6, 2010. The order denied LRA's motion with respect to Rule 4:50-1(c), but granted LRA relief under the voidness provision in Rule 4:50-1(d). That order is now the subject of the Township's present appeal.
In denying reconsideration of its earlier determination rejecting LRA's fraud-based claim under Rule 4:50-1(c), the court noted that LRA had originally failed to provide sufficient affidavits to establish such fraud. Having already adjudicated the fraud issue in May 2010, the court ruled that it would be improper to allow LRA to supplement the record with new certifications on a reconsideration motion. In particular, the court rejected as untimely Giansante's attempt to "retroactively convert his attorney certification into a party certification" asserting LRA's lack of actual notice.
By contrast, in granting reconsideration of LRA's argument under Rule 4:50-1(d), based on voidness and lack of notice, the trial judge explicitly recognized that the "court did not address subsection (d) relief in its [original] opinion of May 27, 2010." Because the Rule 4:50-1(d) aspect of LRA's application was being addressed by the trial court for the first time, the court determined that LRA's "late-filed certifications" properly should be considered on that unresolved aspect of the motion.
Upon examining the proofs, the trial court concluded that the Township had not provided, and LRA had not received, actual notice of the tax sale foreclosure action. The court determined that the Township should have provided actual notice of the foreclosure action to LRA and that "LRA's address for notice was easily ascertainable through Mantua's tax office." Additionally, the court found that the Township's attempt to provide LRA with constructive notice through publication and posting was insufficient to satisfy the requirements of due process. Thus, the court concluded that the foreclosure judgment was void as to LRA, and that the Township's title to the property is, in fact, subject to LRA's judgment lien.
In now appealing the trial court's October 6, 2010 order granting relief to LRA, the Township contends that: (1) LRA's motion for reconsideration was improperly used as an opportunity to bolster its original motion submissions to the court; and (2) the trial court's original order denying relief from the foreclosure judgment was correct because the Township did, in fact, give adequate notice to LRA. In connection with that latter argument, the Township contends that the trial court's final disposition violates the public policies underlying the In Rem Tax Foreclosure Act, by imposing an "overly strict" condition requiring actual notice to LRA as a judgment creditor. These arguments are unpersuasive.
We first address the threshold procedural question of whether the trial court acted improperly by allowing LRA, through a motion for reconsideration, to supplement its submissions concerning voidness under Rule 4:50-1(d). It did not.
A fundamental misconception of the Township's procedural argument is its treatment of the trial court's Rule 4:50-1(d) ruling as an order "reconsidering" a prior ruling on that discrete subsection of the Rule. In actuality, the trial court never addressed the subsection (d) voidness issue in its first disposition of LRA's motion in May 2010. The first disposition only addressed LRA's claim under subsection (c) of Rule 4:50-1,
i.e., that the Township had allegedly engaged in fraud in its dealings with LRA. The first disposition did not reach LRA's argument under subsection (d) of the Rule respecting voidness.
To be sure, the court's initial omission was affected by the exclusive focus of LRA's counsel at the May 2010 oral argument upon the subsection (c) fraud contention. Once that discrete question of fraud was resolved in the Township's favor, it still left open the possibility that LRA would nonetheless be entitled to relief under subsection (d). That separate issue under subsection (d) was not resolved by the court until the later motion hearing in July 2010, after LRA had renewed its application. Although the second round of motion practice did provide LRA with a chance to submit additional papers addressing voidness and the related notice issues, the trial court did not misapply its authority in allowing and considering those further submissions.*fn5 The Township was afforded a fair opportunity to respond to LRA's further submissions, both on paper and at oral argument in July 2010. The judge fairly entertained both parties' contentions and, for the reasons we explain in Part II (B) of this opinion, correctly decided the voidness issue on the merits. None of that process was procedurally unfair, nor was it a misuse of the trial court's authority.
Even if we were to treat the scenario here as falling within the ambit of a motion for reconsideration, the trial court acted well within its discretion in entertaining LRA's application to be reheard. Under Rule 4:49-2, a litigant may move for "rehearing or reconsideration" of an order or judgment within twenty days of its entry. Such a motion must include "a statement of the matters or controlling decisions which counsel believes the court has overlooked or as to which it has erred." Ibid. The proper object of such a motion is to correct a court's error or oversight, and not to "re-argue [a] motion that has already been heard for the purpose of taking the proverbial second bite of the apple." State v. Fitzsimmons, 286 N.J. Super. 141, 147 (App. Div. 1995), certif. granted, remanded on other grounds, 143 N.J. 482 (1996).
The present scenario is not one in which LRA unfairly received such a "second bite of the apple" because, as we have noted, the trial court never addressed the voidness arguments under Rule 4:50-1(d) at the first motion hearing in May 2010.
The voidness issue was simply "overlooked," thereby fulfilling a predicate for rehearing under Rule 4:49-2. Under the circumstances, the trial court conscientiously turned to and ruled upon that unresolved issue when LRA renewed its application for relief. See, e.g., Calcaterra v. Calcaterra, 206 N.J. Super. 398, 403-04 (App. Div. 1986) (noting the propriety of reconsideration as a device to address issues that were briefed but not addressed in a motion judge's initial decision).
Even though the additional motion practice did give LRA a chance to fortify its original submissions, we discern no injustice resulting from that circumstance, as the Township was given a fair and reciprocal opportunity to respond. Indeed, the trial court would have had the discretion to permit supplemental submissions from the parties, either before the original return date in May 2010, or even after the May 2010 oral argument, before rendering a decision.
In short, the trial judge endeavored in a fair manner to reach a correct decision on the merits. Her allowance of supplemental papers and arguments after the original motion hearing in May 2010 was manifestly justified. We therefore sustain the trial court's procedural handling of this matter.
We now turn to the substantive question of whether the trial court erred in amending the Township's foreclosure judgment to recognize the priority of LRA's earlier judgment lien. In particular, we examine the trial court's conclusion that the foreclosure judgment with respect to LRA was flawed because of lack of notice.
"A motion under Rule 4:50-1 is addressed to the sound discretion of the trial court, which should be guided by equitable principles in determining whether relief should be granted or denied." Hous. Auth. of Morristown v. Little, 135 N.J. 274, 283 (1994). In general, and subject to errors of law, "[t]he decision granting or denying an application to open a judgment will be left undisturbed unless it represents a clear abuse of discretion." Ibid.
The trial court reasoned that a judgment creditor, such as LRA in this case, has a protected lien interest, and that due process requires that the deprivation of such a protected interest through state action requires notice and an opportunity to be heard. Relying on New Brunswick Savings Bank v. Markouski, 123 N.J. 402, 419, 426 (1991), the trial court further reasoned that constructive notice through publication and posting did not satisfy the requirements of due process.
Instead, the Township was required to provide notice of the foreclosure action to judgment creditors whose names and addresses were reasonably ascertainable. Because LRA's mailing address was easily ascertainable from the Township's tax assessor, and because the Township had not provided actual notice to LRA, the court concluded that the notice was deficient on due process grounds. Consequently, the foreclosure judgment was void insofar as it purported to extinguish LRA's judgment lien.
The Court Rule that specifically governs in rem tax foreclosures, Rule 4:64-7, details in subsection (c) the manner by which notice of such a foreclosure action must be provided to parties with a cognizable interest in the property in question. See also Pressler & Verniero, Current N.J. Court Rules, comment 2 on R. 4:64-7 (2011). The service provision has been fashioned in a manner to comport with constitutional norms of due process. See Sonderman v. Remington Constr. Co., 127 N.J. 96, 102-03 (1992); Twp. of Montville v. Block 69, Lot 10, 74 N.J. 1, 15-19 (1977); see also Mennonite Bd. of Missions v. Adams, 462 U.S. 791, 800, 103 S. Ct. 2706, 2712, 77 L. Ed. 2d 180, 188 (1983) (holding that "[n]notice by mail or other means as certain to ensure actual notice is a minimum constitutional precondition to a proceeding which will adversely affect the liberty or propertyinterests of any party, whether unlettered or well versed in commercial practice, if its name and address are reasonably ascertainable"). In particular, Rule 4:64-7(c) requires that:
The plaintiff shall, within 7 days after the date of publication of the notice of foreclosure, serve a copy thereof in the manner hereinafter provided on each person whose name appears as an owner in the tax foreclosure list at his or her last known address as it appears on the last municipal tax duplicate. The plaintiff shall also make such service upon all other persons having an ownership or lien interest recorded in the office of the Superior Court Clerk or the county recording officer on the date of the filing of the complaint and upon all other persons who, pursuant to N.J.S.A. 54:5-104.48, as amended, have filed a notice with the tax collector specifying a title, lien, claim or interest in any of the lands sought to be affected by said complaint.
Such service shall be made in the manner provided by R. 4:4-4(a)(1) or (c) or by simultaneously mailing to the last known address by registered or certified mail, return receipt requested, and by ordinary mail. In addition to the foregoing, the plaintiff shall mail a copy of the notice of foreclosure, by ordinary mail, to the Attorney General. [Emphasis added.]
LRA, as a creditor with a docketed judgment against Struthers, clearly had a recorded "lien interest" entitling it to notice of the foreclosure. See ibid. That recorded lien interest undisputedly existed "on the date of the filing of the complaint." See ibid. Under the Rule, the Township wasobligated to serve LRA with individualized notice of the foreclosure actions, either in the manner called for under Rule 4:4-4(a)(1) (personal service) or Rule 4:4-4(c) (optional mailed service), or "by simultaneously mailing [the notice] to the [lienor's] last known address by registered or certified mail, return receipt requested, and by ordinary mail." R. 4:64-7(c).*fn6
Upon considering each of these service methods within Rule 4:64-7(c) in the context of the present case, it is clear that the Township did not meet the requirements of any of those alternative methods. Because LRA is a partnership and not an individual, personal service under Rule 4:4-4(a)(1) was not applicable.*fn7 Optional mailed service under Rule 4:4-4(c), even if it had actually been received by LRA or its appropriate representatives, was ineffective because LRA did not answer the complaint or appear in response to it. See ibid.
In addition, by mailing LRA's notice to Trimble, Jr., the Township did not satisfy the alternative service requirements of Rule 4:64-7(c), which require that service be mailed to the recipient's "last known address." The law office of Trimble, Jr. had no association with LRA and could not reasonably have been considered, in light of the record before us, to be LRA's "last known address" under Rule 4:64-7(c). The Township and its representatives should have been aware that Giansante -- not Trimble, Jr., nor Trimble, Sr. --- was counsel of record for LRA when the foreclosure complaint was filed in 2010. The Township also possessed in its tax records the mailing address in Delaware for the LRA partnership, however it failed to mail a notice to LRA at that known address. In sum, the service requirements of Rule 4:64-7(c) were simply not fulfilled as to LRA in this case.
The Township argues that due process does not require that actual notice be served on a judgment creditor in these circumstances. In making this argument, the Township principally relies on Caput Mortuum, L.L.C. v. S & S Crown Servs., Ltd., 366 N.J. Super. 323 (App. Div. 2004). In that case, a holder of a tax sale certificate filed an in personam tax foreclosure complaint, seeking to foreclose all equity of redemption in the property. Id. at 329. A judgment creditor sought to redeem the certificate under the equitable subrogation doctrine, but the trial court in Caput Mortuum, supra, determined that the doctrine was inapplicable. Id. at 329-30. The trial court also determined that a 1994 amendment to N.J.S.A. 54:5-54, which had eliminated the right of redemption of "other person[s] having an interest in land sold for municipal liens," meant that any right of redemption that the judgment creditor may have had was statutorily precluded. Id. at 330-31, 337-39. The creditor appealed, and we affirmed the trial court's disposition. Id. at 341.
The Township contends, under its reading of Caput Mortuum, supra, that because a judgment creditor such as LRA has no right to redeem a property at a tax sale foreclosure, such creditors do not have an interest that requires actual notice of a foreclosure action. We disagree.
Caput Mortuum, supra, is distinguishable from this case for several reasons. The foreclosure action involved in Caput Mortuum, supra, was an in personam action filed under N.J.S.A. 54:5-1 to -104 ("Tax Sale Law"), while the present case involves an in rem action filed under the In Rem Tax Foreclosure Act. Caput Mortuum, supra, dealt with notice of an initial tax lien sale, while the notice issue in the present case involves notice of a foreclosure action. The notice statute involved in that case, N.J.S.A. 54:5-26 of the Tax Sale Law, is distinct from the controlling authorities dealing with notice in the present case, i.e., Rule 4:64-7 and N.J.S.A. 54:5-104.42 of the In Rem Tax Foreclosure Act.
As the Supreme Court held in New Brunswick Savings, supra, 123 N.J. at 422-23, a judgment lien is a property interest subject to due process protections. Consequently, "a levying creditor must provide actual notice of an execution sale to [nonlevying] judgment creditors whose names and addresses are reasonably ascertainable." Id. at 426. Those general principles similarly and logically apply to this foreclosure action. Caput Mortuum, supra, a lien sale case, does not hold to the contrary.
Apart from these due process considerations, we perceive nothing in the public policies underlying the In Rem Tax Foreclosure Act that would abrogate the need to provide actual notice of a tax foreclosure action upon a judgment creditor. Although such cases are to be handled expeditiously, see Lakewood Township v. Block 251, Parcel 34, 48 N.J. Super. 581, 586 (App. Div. 1958), such an expeditious disposition would not have been unduly hampered by providing LRA with proper notice to its proper address and its correct attorney.
The Township argues that the notice it provided to LRA was sufficient because it allegedly made a "reasonably diligent effort" to provide notice and that the notice was "reasonably calculated" to reach LRA. The trial court rejected that contention, and so do we.
The Township asserted that it mailed notices to "approximately 25 lien holders/judgment creditors or their attorneys of record, including Mr. John Trimble, Jr." However, Trimble, Jr., was not listed on LRA's 1995 judgment as LRA's counsel. To the contrary, his father, Trimble, Sr., was listed. Trimble, Jr., was not LRA's attorney of record. The Township's failure to recognize the difference between the deceased attorney and his son undermines its assertion of reasonable diligence.
The trial court also appropriately recognized that there was a long-standing background of interaction between the Township and LRA. Given that background, the Township should have been aware of both LRA's mailing address as well as the identity of its present counsel, i.e., Giansante and his law firm. This is especially true considering the comparative recency of the consent judgment of March 6, 2009, which specifically involved LRA's judgment lien on the Struthers property. The Township does not explain why that consent judgment, which was entered into just a few months before this foreclosure action was filed, did not trigger awareness on its part that Giansante was LRA's counsel in matters concerning the Struthers property.
Nor does the Township explain why its judgment search report that covered a period that ended on March 3, 2009 -- just three days before the consent judgment was entered into and twenty-seven days before it was recorded -- was not thereafter updated. See R. 4:64-7(c) (requiring notice to parties with "recorded ownership or lien interest . . . on the date of the filing of the complaint"). The ensuing interval of six months -- until September 2009 when the Township provided notice of the foreclosure action by publication, posting, and mailing -- has not been justified. The Township's efforts to provide notice were not reasonably diligent and were not reasonably calculated to reach the parties that could be affected by the foreclosure.
Lastly, we note that the certifications from LRA's representatives attesting that LRA did not, in fact, receive actual notice of the foreclosure action are unrebutted. Those certifications support an ultimate finding that due process was not achieved in this case and that the service requirements of Rule 4:64-7(c) were not met.
In sum, the trial court did not abuse its discretion in granting LRA relief under Rule 4:50-1(d). Rather, the court acted consistent with the applicable law and in the interests of justice when it granted that aspect of LRA's motion.
The order of October 6, 2010 is accordingly affirmed.