On appeal from the Superior Court of New Jersey, Chancery Division, Morris County, Docket No. F-2586-09.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted August 29, 2011
Before Judges Alvarez and Nugent.
This is a residential mortgage foreclosure action. Defendants Dennis Ulversoy and Donald Vincent (defendants) appeal from the January 8, 2010 Chancery Division order that granted summary judgment to plaintiff, HSBC Bank USA as Trustee for OMAC 2005-5 (HSBC); struck the defendants' answer; and entered a default against defendants. The defendants also appeal from the November 30, 2010 final judgment entered against them, arguing that it should not have been granted because the January 8, 2010 summary judgment motion was wrongly decided. We affirm.
We derive the following facts from the summary judgment motion record. On August 31, 2005, defendants executed a "Fixed/Adjustable Rate Note" (the Note) and a mortgage (the Mortgage) on their Kinnelon, New Jersey residence (the Property) to secure a loan of $568,000 from Opteum Financial Services, LLC (Opteum). Opteum is identified in the Note as the "Lender." Paragraph 11 of the Note provides in part:
In addition to the protections given to the Note Holder under this Note, a Mortgage . . . (the "Security Instrument"), dated the same date as this Note, . . . protects the Note Holder . . . . The Security Instrument describes how and under what conditions I may be required to make immediate payment in full of all amounts I owe under the Note.
The Mortgage explains that "'MERS' is Mortgage Electronic Registration Systems, Inc. MERS is a separate corporation that is acting solely as a nominee for Lender and Lender's successors and assigns. MERS is the mortgagee under this Security Instrument."*fn1 The Mortgage also provides:
Borrower understands and agrees that MERS holds only legal title to the interests granted by Borrower in this Security Instrument, but, if necessary to comply with law or custom, MERS (as nominee for Lender and Lender's successors and assigns) has the right: to exercise any or all of those interests, including, but not limited to, the right to foreclose and sell the Property; and to take any action required of Lender including, but not limited to, releasing and canceling this Security Instrument.
The Mortgage also includes a provision concerning the sale of the Note and a change in the entity servicing the Note and Mortgage. The provision states:
The Note or a partial interest in the Note (together with this Security Instrument) can be sold one or more times without prior notice to Borrower. A sale might result in a change in the entity (known as the "Loan Servicer") that collects Periodic Payments due under the Note and this Security Instrument and performs other mortgage loan servicing obligations under the Note, this Security Instrument, and Applicable Law.
There also might be one or more changes of the Loan Servicer unrelated to a sale of the Note. If there is a change of the Loan Servicer, Borrower will be given written notice of the change which will state the name and address of the new Loan Servicer, [and] the address to which payments should be made . . . . If the Note is sold and thereafter the Loan is serviced by a Loan Servicer other than the purchaser of the Note, the mortgage loan servicing obligations to Borrower will remain with the Loan Servicer or be transferred to a successor Loan Servicer and are not assumed by the Note purchaser unless otherwise provided by the Note purchaser.
The Note required defendants to pay interest on the unpaid principal, the interest rate varying in accordance with terms contained in the Note. The interest payments were to be made monthly between October 1, 2005 and September 1, 2015. Thereafter, defendants were required to make monthly payments of principal and interest until September 1, 2035, at which time they were required to pay the outstanding balance of the loan.
The defendants defaulted on September 1, 2008, and have made no payments since. MERS assigned defendants' Mortgage to HSBC. The "Assignment of Mortgage" (the Assignment) designated the assignment date as December 30, 2008. The Assignment was notarized on January 9, 2009, and recorded January 22, 2009. The Assignment recited that MERS assigned to HSBC the Mortgage as well as "the Bond, Note or other Obligation therein described, and the money due and to grow due thereon, with interest."
Meanwhile, on October 24, 2008, an entity named EverHome Mortgage Company (EverHome) sent to defendants a notice of intention to foreclose on the Mortgage. EverHome identified itself as the "Lender," stated that it held a security interest in the property, and required a payment to be made to EverHome no later than November 23, 2008.
On January 13, 2009, HSBC filed a complaint in foreclosure that it amended on March 20, 2009, to join additional defendants, including MERS. The complaint and amended complaint included a paragraph that stated: "The Notice of Intention was mailed to the debtor(s) in compliance with the Fair Foreclosure Act." Defendants timely filed an answer. Subsequently, on HSBC's motion, an order was entered reforming the Mortgage to correct an error in the property description.
In October 2009, HSBC moved for summary judgment. In support of its motion, its vice president filed a certification in which he averred that he had "complete knowledge of the amount due for principal and interest on defendant's [sic] obligation and mortgage set forth in the Complaint . . . ." He also certified that he had "examined the records of [HSBC] concerning the above referred to obligation," and found from those records that HSBC was due $635,477.26 plus interest. He did not aver that he had personal knowledge of the other facts contained in his certification, including his assertions that: HSBC was the holder of defendants' Note and Mortgage; those instruments "called for a payment in the initial sum of $3,964.17, per month for interest and principal,*fn2 plus taxes and insurance premiums"; defendants had made no payments since September 1, 2008; defendants' answer disputed neither the validity of the Mortgage nor HSBC's entitlement to a foreclosure judgment; and that there were no debts, setoffs, credits, or allowances due or to become due from HSBC to defendants.
The vice president also certified, on "information and belief," that neither of the defendants was in the military service. He did not identify the source of his "information and belief," and the ...