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NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
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 ...