October 9, 2013
VNB NEW YORK CORP., a New York Corporation, Appellant/Cross-Respondent,
STAR HOLDINGS, LLC, a New Jersey Limited Liability Company; STAR CONSTRUCTION MANAGEMENT, LLC., a New Jersey Limited Liability Company; RICTAR CONSTRUCTION COMPANY, INC., a New Jersey Corporation; ANTHONY F. RICCARDELLI; SILVIO TARANDA and CONGREGATION AHAVAT YISROEL, Respondents/Cross-Appellants. VNB NEW YORK CORP., a New York Corporation, Plaintiff-Respondent,
STAR HOLDINGS, LLC, a New Jersey Limited Liability Company, and STAR CONSTRUCTION MANAGEMENT, LLC., a New Jersey Limited Liability Company, Defendants-Appellants, and RICTAR CONSTRUCTION COMPANY, INC., a New Jersey Corporation; ANTHONY F. RICCARDELLI; SILVIO TARANDA and CONGREGATION AHAVAT YISROEL, Defendants. VNB NEW YORK CORP., a New York Corporation, Plaintiff-Respondent,
STAR HOLDINGS, LLC, a New Jersey Limited Liability Company, and STAR CONSTRUCTION MANAGEMENT, LLC., a New Jersey Limited Liability Company, Defendants-Appellants, and RICTAR CONSTRUCTION COMPANY, INC., a New Jersey Corporation; ANTHONY F. RICCARDELLI; SILVIO TARANDA and CONGREGATION AHAVAT YISROEL, Defendants.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted August 20, 2013
On appeal from the Superior Court of New Jersey, Law Division, Middlesex County, Docket Nos. L-2507-11 and L-2758-11.
The Weir Law Firm, LLC and David S. Briman, attorneys for appellant/cross-respondent VNB New York Corp. in A-3957-11 and respondent VNB New York Corp. in A-4197-11 and A-4199-11 (Bonnie M. Weir, of counsel and on the briefs).
Chase Kurshan Herzfeld & Rubin, LLC, attorneys for respondents/cross-appellants in A-3957-11, for appellants Star Holdings, LLC and Star Construction Management, LLC in A-4197-11 and A-4199-11 (Peter J. Kurshan, of counsel and on the briefs).
Before Judges Graves and Simonelli.
In these consolidated matters, plaintiff VNB New York, Corp. appeals and defendants Anthony F. Riccardelli (Riccardelli) and Silvio Taranda (Taranda) cross-appeal from a March 12, 2012 Law Division order, which granted summary judgment to Riccardelli and Taranda and dismissed the complaint against them without prejudice (A-3957-11). Defendants Star Holdings, LLC (Star Holdings) and Star Construction Management, LLC (Star Construction) appeal from a second March 12, 2012 Law Division order, which granted summary judgment to plaintiff and awarded plaintiff monetary damages and attorney's fees and costs (A-4197-11). Star Holdings and Star Construction also appeal from a March 12, 2012 Chancery Division order, which granted summary judgment to plaintiff in a foreclosure matter and struck their answer and affirmative defenses, and from a July 2, 2012 final judgment of foreclosure (A-4199-11). We affirm in part and reverse in part.
On August 10, 2007, the following documents were executed in connection with a $425, 000 commercial loan from LibertyPointe to Star Holdings:
1. First Mortgage Note from Star Holdings to LibertyPointe (Note);
2. First Mortgage and Security Agreement from Star Holdings to LibertyPointe (Mortgage);
3. Assignment of Leases and Rents from Star Holdings to LibertyPointe (Lease Assignment);
4. Guaranty from Star Construction, Riccardelli, Taranda and defendant Rictar Construction Company, Inc. (Rictar) to LibertyPointe (Guaranty or Guarantees);
5. Subordination and Attornment Agreement between Star Holdings, Rictar and LibertyPointe; and
6. Tenant Estoppel Certificate to LibertyPointe from Star Holdings and Rictar.
The Mortgage provided as follows:
[T]he Mortgagor covenants with the Mortgagee as follows:
1. That the Mortgagor will pay the indebtedness as hereinbefore provided according to the terms of the Note, this Mortgage and the other Lien Instruments (as hereinafter defined), and keep and perform each and every term, covenant, and condition of the Note, this Mortgage, and the other Lien Instruments.
The Mortgage defined "Lien Instruments" as the Note, Mortgage, and "other documents dated even date herewith" that were given as additional security for payment of the note and mortgage. The Mortgage also provided that "[t]he Note, this Mortgage and all agreements executed in connection herewith shall be construed in accordance with and governed by the laws of the State where the Premises is located notwithstanding any rules regarding conflicts of laws."
The Note provided as follows:
As security for the payment of this Note, Maker has executed and delivered to Payee a certain First Mortgage Agreement (the "Mortgage"), Assignment of Leases and Rents, and U.C.C. Form 1 financing statements and other documents and instruments all dated even date herewith and sometimes collectively referred to and known as the "Lien Instruments."
The Guarantees were unconditional and remained in full force and effect until the loan was paid in full. The guarantors acknowledged that LibertyPointe would not have made the loan unless they "guaranteed payment." The Guarantees contain no provision prohibiting their assignment.
On March 8, 2010, the Federal Deposit Insurance Corporation (FDIC) was appointed receiver for LibertyPointe. On March 8, 2011, the FDIC assigned the Note and Mortgage to Valley National Bank (Valley National). That same day, Valley National assigned the Note and Mortgage to plaintiff but continued servicing the loan. Both assignments were given in consideration of ten dollars and "other good and valuable consideration, " both assigned the Mortgage "[t]ogether with the bonds or notes or obligations described in said mortgage, " and both were recorded on March 18, 2011.
Prior to the FDIC's assignment to Valley National, defendants made loan payments directly to Valley National beginning in approximately March 2010. There is no dispute that Star Holdings defaulted. As a result, Valley National sent defendants a notice of default and acceleration, demand for payment, and notice of imposition of default rate interest. Star Holdings made no further payments and the Note remained in default. Valley National's records revealed that as of January 15, 2012, $540, 377.89 was the amount due and owing on the loan. In addition, the Note permitted plaintiff to recover attorney's fees, costs, disbursements and allowances in the event it retained counsel to enforce the Note and other loan documents.
Thus, plaintiff sought an additional $18, 392.20 for attorney's fees.
On April 12, 2011, plaintiff filed a complaint for compensatory damages and a complaint for foreclosure. Following the completion of discovery, the parties filed motions for summary judgment. In a March 12, 2012 written decision, the motion judge found that the assignments were valid and plaintiff owned the Note and Mortgage. Despite that finding, the judge relied on an unpublished out-of-state trial court opinion to conclude that plaintiff failed to establish standing to maintain an action against Riccardelli and Taranda on their personal Guarantees. The judge reasoned that the assignments did not assign those Guarantees because the Mortgage did not specifically reference them, or Riccardelli or Taranda. The judge found that the assignment validly assigned Star Construction's Guaranty despite the fact that this Guaranty was identical to the individual guarantors' Guarantees and neither the Guaranty nor Star Construction were specifically referenced in the Mortgage. The judge entered judgment against Star Construction and Star Holdings on the Note in the amount of $540, 377.89 plus $18, 392.20 for attorney's fees. The judge also entered a judgment in plaintiff's favor in the foreclosure matters. This appeal followed.
On appeal, plaintiff contends that the judge erred in dismissing the complaint as to the individual guarantors because their guarantees were assignable and properly assigned. On cross-appeal, defendants contend that the judge should have dismissed all guarantee claims with prejudice. They argue that plaintiff lacked standing to enforce all of the guarantees because they were not assignable or assigned. Defendants also contend that the judge erred in finding that plaintiff had standing to enforce the mortgage against Star Holdings.
Our review of a ruling on summary judgment is de novo, applying the same legal standard as the trial court. Nicholas v. Mynster, 213 N.J. 463, 477-78 (2013); Tymczyszyn v. Columbus Gardens, 422 N.J.Super. 253, 261 (App. Div. 2011), certif. denied, 209 N.J. 98 (2012). Thus, we consider, as the trial judge did, "'whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law.'" Liberty Surplus Ins. Corp. v. Nowell Amoroso, P.A., 189 N.J. 436, 445-46 (2007) (quoting Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 536 (1995)). Summary judgment must be granted "if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact challenged and that the moving party is entitled to a judgment or order as a matter of law." R. 4:46-2(c). If there is no genuine issue of material fact, we must then "decide whether the trial court correctly interpreted the law." Massachi v. AHL Servs., Inc., 396 N.J.Super. 486, 494 (App. Div. 2007), certif. denied, 195 N.J. 419 (2008). We review issues of law de novo and accord no deference to the trial judge's conclusions on issues of law. Nicholas, supra, 213 N.J. at 478 (citing Zabilowicz v. Kelsey, 200 N.J. 507, 512-13 (2009)).
This was a commercial transaction that involved eight integral documents signed at the same time. All of the documents were specifically referenced in the Note and Mortgage as "Lien Instruments" that were given as additional security for payment of the loan. The assignments assigned the Note and Mortgage and "obligations described in said mortgage, " meaning the Lien Instruments. There could be no other interpretation of the assignment, and it was error for the judge to rule otherwise based on an unpublished lower court out-of-state opinion. See Trinity Cemetery Ass'n v. Twp. of Wall, 170 N.J. 39, 48 (2001) (holding that unpublished opinions are not precedential or binding); State v. Martes, 266 N.J.Super. 117, 120 (Law Div. 1993) (noting that a trial court's published opinion has no binding effect on a trial court of equal jurisdiction); Meadowlands Basketball Assoc. v. Director, Div. of Taxation, 340 N.J.Super. 76, 83 (App. Div. 2000) (holding that an out-of-state opinion is neither binding nor controlling on a New Jersey court); R. 1:36-3. In addition, the terms of the Guarantees were clear and unambiguous, and there was no provision prohibiting assignment. We, therefore, conclude that the assignments were assignable and were properly assigned to plaintiff. Accordingly, we reverse the grant of summary judgment to Riccardelli and Taranda.
We have considered defendants' contentions on cross-appeal in light of the record and applicable legal principles and conclude they are without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E). However, we make the following brief comments.
A plaintiff has standing to enforce a mortgage where it possessed 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 enforce the mortgage.
Affirmed in part, reversed in part and remanded for entry of final judgment against Riccardelli and Taranda, jointly and severally, in the amount of $540, 377.89 plus $18, 392.20 for attorney's fees.