November 21, 2011
THE LAW OFFICES OF CLIFFORD G. KLEINBAUM, PLAINTIFF-RESPONDENT,
ARNOLD G. SHURKIN, ESQ., DEFENDANT-APPELLANT.
On appeal from the Superior Court of New Jersey, Law Division, Passaic County, Docket No. DJ-240290-10.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued October 19, 2011
Before Judges Cuff, Lihotz and Waugh.
Defendant, Arnold G. Shurkin, retained plaintiff, The Law Offices of Clifford G. Kleinbaum, to represent him in an action commenced in New York against him and others. When defendant failed to pay the balance due for fees incurred in that matter, plaintiff sued defendant in New York. Plaintiff obtained summary judgment in its favor and commenced proceedings to enforce that judgment in New York pursuant to New York law. Plaintiff domesticated the New York judgment in New Jersey, and defendant sought an order in New Jersey for a stay of execution of the New York judgment and permission to commence a plenary action against Valley National Bank (Valley). Defendant appeals from the order denying this relief. We affirm.
The issues in this appeal center on plaintiff's efforts to collect the judgment obtained in New York; therefore, our discussion is confined to the post-judgment period. On July 2, 2010, the $12,088.28 judgment against defendant was entered in the docket of the Westchester County, New York Clerk's Office. Plaintiff served defendant's New York attorneys with a copy of the judgment with a Notice of Settlement. Defendant filed a notice of appeal; plaintiff received it on July 6, 2010. Defendant never obtained a stay of the judgment pending appeal; therefore, plaintiff sought to collect the judgment in the State of New York.
Defendant maintained several accounts at Valley. Plaintiff served an Information Subpoena and Restraining Notice on a branch office of Valley in New York and instructed the New York County Sheriff to levy on the accounts maintained by defendant at Valley by serving an execution and levy on the New York branch of Valley. Plaintiff prepared and submitted to defendant a Notice to Judgment Debtor or Obligor to notify him of the levy as required by New York law. Valley also provided notice to defendant of the execution and turned over funds from defendant's accounts to the New York County Sheriff, who remitted the funds, less fees, to plaintiff.*fn1
The levy did not fully satisfy the judgment; therefore, plaintiff domesticated the judgment in this State pursuant to the Uniform Enforcement of Foreign Judgments Act (UEFJA), N.J.S.A. 2A:49A-25 to -33. Defendant filed a motion in the Superior Court seeking not only a stay of enforcement of the New York judgment, but also permission to file a complaint against Valley. Defendant alleged that Valley unlawfully received a levy at a New York branch office and executed on accounts maintained in a New Jersey branch office. In denying relief from the judgment, Judge DeLuccia held that the domesticated judgment could not be collaterally attacked or its enforcement stayed because New York had personal jurisdiction of defendant, and any legal challenge to the procedure utilized in New York to enforce this New York judgment should be brought in New York.
On appeal, defendant argues that a New York court has no authority over bank accounts in New Jersey. He also contends that plaintiff and Valley violated his due process rights. Plaintiff responds that defendant received all of the process to which he was entitled in the proceedings that produced the New York judgment, and that enforcement of the New York judgment cannot be denied on grounds unrelated to the validity of the judgment. In addition, plaintiff emphasizes that defendant did not comply with the statutory requirements to obtain stay of enforcement of a foreign judgment. In addition, Valley contends that its actions fully comported with New York law.
A party who obtains a judgment in another state may domesticate that judgment in New Jersey to facilitate its enforcement. N.J.S.A. 2A:49A-25 to -33. Through this procedure, this State discharges its constitutional obligation*fn2 to give full faith and credit to judgments entered in other states. Singh v. Sidana, 387 N.J. Super. 380, 382 (App. Div. 2006), certif. denied, 189 N.J. 428 (2007). Domestication of a foreign judgment, however, is not an opportunity to collaterally attack the foreign judgment, except in very limited circumstances, such as the denial of due process in the state issuing the judgment. McKesson Corp. v. Hackensack Med. Imaging, 197 N.J. 262, 275 (2009); James v. Francesco, 61 N.J. 480, 485 (1972); State of Maine v. SeKap, S.A. Greek Coop Cigarette Mfg. Co., 392 N.J. Super. 227, 235 (App. Div. 2007). To do otherwise would contravene the fundamental principle that foreign judgments are entitled to full faith and credit. Maine, supra, 393 N.J. Super. at 235.
A denial of due process occurs when the state that issued the judgment did not have personal jurisdiction of the judgment debtor, lacked subject matter jurisdiction, or failed to provide the judgment debtor with adequate notice to permit it to be heard. McKesson, supra, 197 N.J. at 275; Sonntag Reporting Serv., Ltd. v. Ciccarelli, 374 N.J. Super. 533, 538 (App. Div. 2005). Once "a court has determined that a sister state court has entered a . . . judgment following due process standards, a broader collateral attack of that judgment -- absent exceptional circumstances, such as fraud [in procurement of the judgment] --is best made in the sister state court." Simmermon v. Dryvit Sys., Inc., 196 N.J. 316, 334 (2008); Sonntag, supra, 374 N.J. Super. at 537.
Defendant does not contest that the judgment obtained against him is entitled to full faith and credit by the courts of this State. He argues, however, that plaintiff and Valley deprived him of specific due process protections accorded to him by New Jersey law. Defendant's complaint, however, concerns efforts made to collect the judgment, not to procure the judgment. The UEFJA does not permit a judge in a state other than the state in which a judgment is procured to block enforcement of the foreign judgment based on acts or omissions of the judgment debtor in its effort to collect the debt. Sonntag, supra,, 374 N.J. Super. at 537-38. Yet, that is precisely what defendant sought from the Superior Court.
Furthermore, the objections advanced by defendant, concerning the procedure utilized by plaintiff to collect its judgment, occurred in New York in accordance with New York law. Any complaint and any remedy for a levy and execution not in accordance with New York law must be presented to a court in New York.*fn3
Defendant also was not entitled to a stay of enforcement of the foreign judgment. He had not sought a stay of the judgment pending resolution of his appeal from the New York judgment,*fn4 and had not posted a bond as required by N.J.S.A. 2A:49A-29.
The January 4, 2011 order denying a stay of the New York judgment and denying defendant's application to convert the matter into a plenary action against plaintiff and Valley is affirmed.