VALLEY NATIONAL BANK, Successor by Merger to Bergen Commercial Bank, Plaintiff-Respondent,
J. RONALD MEIER, Defendant-Appellant, and GREGORIA MEIER, Defendant
Argued September 16, 2014.
Approved for Publication September 26, 2014.
On appeal from the Superior Court of New Jersey, Chancery Division, Atlantic County, Docket No. F-063285-09.
Bruce H. Dexter argued the cause for appellant ( Dexter & Kilcoyne, attorneys; Mr. Dexter and Virginia Kilcoyne, on the brief).
David Neeren argued the cause for respondent ( Udren Law Offices, P.C., attorneys; Mr. Neeren, on the brief).
Before FISHER, NUGENT and MANAHAN
[437 N.J.Super. 402] FISHER, P.J.A.D.
In this appeal, we consider the ramifications for a later foreclosure action when, six years earlier, defendant J. Ronald Meier, owner with his wife of the foreclosed property, paid off the first mortgage loan and, rather than obtain a discharge of the mortgage, received an assignment. We agree with the Chancery judge that, in these circumstances, the mortgage had no further validity.
The critical facts are undisputed. In 1999, defendant and his wife purchased the Ventnor property in question with the proceeds of a $168,000 loan from Community Bank of Bergen County the repayment of which was secured by a purchase money mortgage. Defendant was the president, chief executive officer and chairman of the board of Community Bank.
In 2005, defendant and his wife obtained a $100,000 home equity loan, also secured by a mortgage on the Ventnor property, from Bergen Commercial Bank, which later merged with plaintiff Valley National Bank. In 2007, defendant paid the entire amount due on the 1999 loan, and, in exchange, Community Bank provided defendant with a written assignment, which he recorded, of the 1999 mortgage. Defendant claimed in the trial court -- no affidavit [437 N.J.Super. 403] or certification to this effect was provided -- that he paid off this debt with " premarital assets." 
In 2009, plaintiff Valley National Bank filed a complaint against defendant and his wife, as well as the holder of a later $15,000 mortgage, seeking foreclosure of the 2005 home equity loan. The complaint made no mention of the 1999 mortgage defendant paid off in 2007. A final judgment by default was entered in plaintiff's favor on August 22, 2012, and plaintiff purchased the property at a sheriff's sale on January 3, 2013.
On April 1, 2013, approximately three months after the sheriff's sale, defendant demanded payment from plaintiff of $149,838.06 -- the amount paid by defendant to Community Bank in 2007 -- plus $53,019.20, which was asserted to be accrued interest, presumably since defendant paid the principal amount to Community Bank in 2007. After investigating, plaintiff demanded that defendant agree to a discharge of the mortgage. When defendant refused, plaintiff moved for a divestiture of the assignment of mortgage.
As we have observed, defendant filed no written response to plaintiff's motion. On the return date, the Chancery judge permitted the unrepresented defendant to argue his position and then adjourned the matter to allow additional time for the retention of ...