October 2, 2013
AURORA LOAN SERVICES, LLC, Plaintiff-Respondent,
JOHN M. PICINIC, Defendant-Appellant, and CYNTHIA M. PICINIC, Defendant.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted August 20, 2013.
On appeal from the Superior Court of New Jersey, Chancery Division, Bergen County, Docket No. F-19719-09.
Kenneth Rosellini, attorney for appellant.
Knuckles, Komosinski & Elliott, LLP, attorneys for respondent (Robert T. Yusko, on the brief).
Before Judges Graves and Simonelli.
In this foreclosure matter, defendant John M. Picinic appeals from the May 11, 2012 Chancery Division order, which denied his second motion to vacate a default judgment entered on December 1, 2010, and dismiss the complaint. On appeal, defendant contends that plaintiff Aurora Loan Services, LLC, lacked standing at the time it filed the foreclosure complaint. We disagree and affirm.
The facts are straightforward and supported by a certification from plaintiff's authorized representative based on her personal knowledge and personal review of the applicable documents. On June 23, 2006, defendant executed a note to Lehman Brothers Bank, FSB (Lehman Brothers) in the amount of $841, 250. To secure payment of the note, defendant and his wife, defendant Cynthia M. Picinic,  executed a mortgage to Mortgage Electronic Registration Systems, Inc. (MERS), as nominee for Lehman Brothers, on his property in Old Tappan (the property). The note was subsequently transferred from Lehman Brothers to Lehman Brothers Holdings, Inc. (LBHI), as evidenced by an endorsement on the note. Defendant defaulted on December 1, 2008.
On March 19, 2009, the note was physically transferred to plaintiff and has been in plaintiff's possession since that date. On April 1, 2009, MERS assigned the note and mortgage to plaintiff, and on April 15, 2009, plaintiff recorded the assignment with the Bergen County Clerk.
On April 9, 2009, plaintiff filed a complaint for foreclosure. Defendant was personally served with the summons and complaint on July 12, 2009. On October 29, 2009, the court entered default against defendant after he failed to file an answer or otherwise defend. On December 1, 2010, the court entered a final judgment granting foreclosure and a writ of execution.
On September 21, 2011, defendant filed a motion to vacate the default judgment and dismiss the complaint. The record before us does not indicate the court rule on which defendant relied; however, we discern from plaintiff's opposition that defendant asserted that the judgment was void pursuant to Rule 4:50-1(d) because plaintiff was not the holder of the note at the time the complaint was filed, and thus, lacked standing to file the complaint. On October 21, 2011, the court denied the motion.
Relying on this court's unpublished opinion in Aurora Loan Services, LLC v. Toledo, No. A—0804-10 (App. Div. Oct. 18, 2011),  on February 15, 2012, defendant filed a second motion to vacate the default judgment and dismiss the complaint, arguing the judgment was void pursuant to Rule 4:50-1(d) for lack of standing. In denying the motion, the judge distinguished Toledo, finding that there, the plaintiff did not possess the note before filing the complaint, whereas here, plaintiff possessed the note prior to filing the complaint. The judge also found that the standard of review was different because Toledo involved a summary judgment motion filed after the completion of discovery, whereas here, defendant never answered the complaint and the motion was to vacate a default judgment. The judge also determined that defendant did not file the motion within a reasonable time. This appeal followed.
On appeal, defendant reargues that the judgment is void for lack of standing. Defendant did not address the timeliness issue.
We review the trial court's decision on a motion to vacate a default judgment for abuse of discretion. U.S. Bank Nat'l Ass'n v. Guillaume, 209 N.J. 449, 467-68 (2012); Deutsche Bank Nat'l Trust Co. v. Russo, 429 N.J.Super. 91, 98 (App. Div. 2012). "The trial court's determination under [Rule 4:50-1] warrants substantial deference, " and the abuse of discretion must be clear to warrant reversal. Guillaume, supra, 209 N.J. at 467. We discern no abuse of discretion in this case.
"[S]tanding is not a jurisdictional issue in our State court system and, therefore, a foreclosure judgment obtained by a party that lacked standing is not 'void' within the meaning of Rule 4:50-1(d)." Russo, supra, 429 N.J.Super. at 101. The judgment is voidable unless the plaintiff has standing from either possession of the note or an assignment of the mortgage that predated the original complaint. Deutsche Bank Trust Co. Ams. v. Angeles, 428 N.J.Super. 315, 319-20 (App. Div. 2012); Deutsche Bank Nat'l Trust Co. v. Mitchell, 422 N.J.Super. 214, 216, 222 (App. Div. 2011). Here, plaintiff had possession of the note and an assignment of the mortgage prior to filing the complaint. Thus, plaintiff had standing to file the foreclosure complaint.
In addition, "[a] Rule 4:50-1(d) motion, based on a claim that the judgment is void, does not require a showing of excusable neglect but must be filed within a reasonable time after entry of the judgment." Russo, supra, 429 N.J.Super. at 98; see also Angeles, supra, 428 N.J.Super. at 319. Here, there is no dispute that defendant was properly served with the summons and complaint on July 12, 2009. He did not raise the standing issue or contest the foreclosure until over two years later, when he filed his first motion to vacate. He presented no explanation for his delay.