June 19, 2013
THE STANDOFF, LLC,  Plaintiff-Respondent,
JOANNE BETHEA, Defendant-Appellant, and LEROY BETHEA, LEXINGTON NATIONAL INSURANCE CORP., UNITED STATES OF AMERICA, Defendants.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted June 4, 2013.
On appeal from the Superior Court of New Jersey, Chancery Division, Union County, Docket No. F-314-08.
Joanne Bethea, appellant pro se.
Knuckles, Komosinski, & Elliott, LLP, attorneys for respondent (Fincey John, on the brief).
Before Judges Fisher and Waugh.
Defendant Joanne Bethea appeals the Chancery Division's June 29, 2012 order denying her application to vacate the default judgment of foreclosure entered on July 18, 2011, and the resulting sheriff's sale of the foreclosed property on April 11, 2012. We affirm.
We discern the following facts and procedural history from the record on appeal.
In February 2007, Bethea and her husband executed a promissory note to FGC Commercial Mortgage Finance d/b/a Fremont Mortgage and a related mortgage to Mortgage Electronic Registration Systems, Inc. (MERS), as FGC's nominee. They defaulted on mortgage payments beginning in September of the same year.
MERS assigned the mortgage to Citigroup Global Markets Realty Corp. at the beginning of January 2008. Citigroup commenced an action to foreclose the mortgage by filing a complaint on January 3, 2008. A process server attempted to serve the summons and complaint at the mortgaged premises on January 14, 15, and 17, but was unsuccessful. The documents were then served by regular and certified mail. The certified mail was returned as "unclaimed, " but the regular mail was not returned.
Default was entered on June 17, 2008. Bethea and her husband were served with notice of the default. Citigroup applied for a final judgment of foreclosure, which was denied because the service history suggested that Bethea and her husband did not reside at the mortgaged premises. The judge noted that defendants should have been served by publication.
The loan was then sold to MDG, LLC, and the mortgage was assigned to MDG. MDG published notice of the suit in a local paper on October 29, 2009. It was eventually substituted as plaintiff in January 2010, although by then, the mortgage and note had been assigned to The Standoff, LLC. Default based on service by publication was entered on January 4, 2010, and served on defendants by regular and certified mail the following day. The certified letters were accepted by Bethea.
Bethea sent a letter, dated January 4, 2010, to plaintiff's counsel. The letter referenced the docket number of the foreclosure action and requested that payoff information be sent to her at the mortgaged premises. Counsel responded by letter dated January 28, 2010. Bethea took no action to challenge the foreclosure until May 2012.
A final judgment of foreclosure was issued on July 18, 2011. The sheriff's sale was scheduled for October 5, and defendants were sent notice of the sale on September 14. Bethea filed a bankruptcy petition on November 1.
The automatic bankruptcy stay was lifted on February 15, 2012. The sheriff's sale took place on April 11, at which time the mortgaged premises were purchased by plaintiff.
On May 29, Bethea filed a motion seeking to have the default judgment and the sheriff's sale vacated on the grounds of improper service. Plaintiff opposed the motion. The Chancery judge denied the motion on June 29. This appeal followed.
On appeal, Bethea argues that the judge abused his discretion under Rule 4:50-1 by refusing to vacate the judgment and sheriff's sale. She further argues that plaintiff's counsel improperly attached documents to the brief, without submitting a certification, citing Rule 1:6-6. Although not clearly articulated, we understand Bethea's argument to be that plaintiff never properly proved it had standing to bring the action in light of the several transfers of the note and mortgage. Finally, she contends that the alleged inadequate notice amounted to a denial of due process.
Rule 4:50-1 provides, in pertinent part, as follows:
On motion, with briefs, and upon such terms as are just, the court may relieve a party or the party's legal representative from a final judgment or order for the following reasons: (a) mistake, inadvertence, surprise, or excusable neglect; . . . (d) the judgment or order is void; . . . or (f) any other reason justifying relief from the operation of the judgment or order.
A trial judge's decision to grant or deny an application to vacate a default judgment is accorded substantial deference and will not be disturbed absent a "clear abuse of discretion." US Bank Nat'l Ass'n v. Guillaume, 209 N.J. 449, 467 (2012); Hous. Auth. of Morristown v. Little, 135 N.J. 274, 283 (1994). A party seeking relief from a default judgment pursuant to Rule 4:50-1(a) must demonstrate both excusable neglect and a meritorious defense. Dynasty Bldg. Corp. v. Ackerman, 376 N.J.Super. 280, 285 (App. Div. 2005) (citing Marder v. Realty Constr. Co., 84 N.J.Super. 313, 318 (App. Div.), aff'd, 43 N.J. 508 (1964)). Although a claim that a judgment is void under Rule 4:50-1(d) does not require a showing of excusable neglect, it must still be filed within a reasonable time after the judgment is entered. R. 4:50-2; M & D Assocs. v. Mandara, 366 N.J.Super. 341, 351-52 (App. Div.), certif. denied, 180 N.J. 151 (2004).
In this case, it is clear from her January 4, 2010 letter referencing the docket number of the foreclosure action that Bethea knew the foreclosure was pending at that time. She did not dispute service or standing between January 2010 and May 2012 when she filed her motion to vacate That was more two years after she learned about the action and more than ten months after entry of the final judgment of foreclosure She has made no effort to explain or justify the delay in seeking to have the judgment set aside
In Deutsche Bank Trust Co Americas v Angeles 428
N.J.Super. 315 316-17 (App Div 2012) the defendant challenged the plaintiff's standing to bring the foreclosure action nearly three years after defaulting on the mortgage two years after final judgment was entered and more than a year after the sheriff's sale was conducted We affirmed the Chancery judge's refusal to consider the issue because the defendant waited too long to raise the issue of standing or otherwise contest the foreclosure Id at 316; see also Deutsche Bank Nat'1 Trust Co v. Russo 429
N.J.Super. 91101 (App Div 2012) (rejecting defendants' late objection to standing and noting that standing is not a jurisdictional issue in New Jersey).
Having reviewed Bethea's arguments based upon the facts in the record and applicable law we see no abuse of discretion and no denial of due process.