NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
PER CURIAM.
Defendant Patrice Springette appeals from an order dated December 16, 2011, denying her motion to return this foreclosure case to mediation, and a February 7, 2012 order, denying an application for a stay of eviction from the foreclosed premises.[1] For the reasons that follow, we affirm.
In 2005, Springette and her then-fiancé (defendants) obtained a $371,250 loan, secured by a mortgage on their home. They defaulted on the loan in 2006. Plaintiff filed its foreclosure complaint on December 18, 2006. On January 25, 2007, defendants filed a "cross-complaint" asserting that some of their mortgage payments were misapplied. However, their pleading did not deny that they were in default. Springette and her fiancé both signed the cross-complaint. On July 20, 2007, the trial court granted summary judgment striking the answer and defenses. A final judgment of foreclosure was entered on December 4, 2007, and the property was sold at a sheriff's sale on August 19, 2009.
On August 24, 2009, defendants filed a motion to vacate the foreclosure judgment and to vacate the sheriff's sale, alleging that Springette was not served with the foreclosure complaint and defendants were not served with notice of the sheriff's sale.
By order dated November 6, 2009, Judge Glenn Berman denied the motion, noting that both defendants were served with the complaint by mail and filed an answer, and that notice of the sheriff's sale was posted on the premises. Defendants did not appeal from that order. Instead, on January 27, 2010, they filed another motion to vacate the sheriff's sale, this time contending that they had been making mortgage payments pursuant to a forbearance agreement. Judge Berman denied that motion by order dated March 19, 2010. However, he also ordered the parties to participate in mediation. Defendants did not appeal from that order either.
After the case was not resolved at mediation, Springette filed a motion to require continued mediation based on her claim that plaintiff failed to fully participate in the mediation. Her motion was supported by a certification from an attorney who had not participated in any of the mediation sessions and had no personal knowledge about those sessions. Plaintiff filed opposition, supported by a certification of counsel attesting that either he or one of the firm's associates had attended the mediation sessions and that the mortgage company's representative had been available to participate by telephone. Judge Berman denied the motion by order dated December 16, 2011.
On this appeal, Springette argues that the trial court should have vacated the final judgment of foreclosure and the sheriff's sale. Those arguments are not properly before us, because she did not file a timely appeal from the trial court's orders denying that relief. However, they are also without merit for the reasons stated by Judge Berman. Springette further argues that the trial court should have ordered continued mediation, because plaintiff failed to "meaningfully" participate in the prior mediation process. Plaintiff presented evidence that its counsel attended all eight mediation sessions and that a representative of the mortgage company was available by telephone for those sessions. Based on the record presented to us, we find no abuse of Judge Berman's discretion in denying the motion to continue the mediation. See U.S. Bank Nat. Ass'n v. Williams, 415 N.J. Super. 358 (App. Div. 2010).
Affirmed.
[1] The February 7 order stayed the eviction until February 17 but denied any further stay. On February 16, 2012, we denied Springette's application for a stay of eviction pending appeal. She has not briefed the validity of the February 7, 2012 order and we will not address it here. According to plaintiff's brief, Springette is still living in the foreclosed premises, although the loan has been in default since 2006. This appeal was referred to the Civil Appeals Settlement Program, but no settlement was reached.
On July 22, 2011, plaintiff Lamar Enterprises, LLC, obtained a judgment by default in the amount of $108,804.51 against its former tenant SES Properties, LLC, and William Spencer, trading as Smoothie Factory. The judgment was docketed on August 17, 2011, and a writ of execution issued October 20, against Spencer. Defendants filed a motion objecting to the garnishment, seeking a stay of execution, and a hearing to address the amount of the judgment. The court denied the application and the subsequent motion for reconsideration. We affirm for the reasons stated by Judge Robert J. Brennan in his well-reasoned analysis rendered from the bench. We add the following very brief comments.
Spencer, in addition to his wages, operates two businesses and owns a commercial building. He nets $4068.96 per month (calculated on 4.3 weeks each month) from his salary at a full-time job. Pursuant to the terms of his divorce, he pays limited duration alimony, child support, and equitable distribution in the amount of $3947.66 monthly. He is current on that obligation. It is not paid by garnishment, or even through the probation department.
At the beginning of oral argument on the motion, defendants' attorney advised the court that Spencer was available by phone to testify. Judge Brennan declined the offer pursuant to Rule 1:6-2, which requires facts not of record, or cognizable by judicial notice, to be submitted on motions in affidavits or certifications.
On reconsideration, defendants argued that the court erred by refusing to allow Spencer to participate via telephone. Defendants raise the same arguments on appeal as they did before the trial court. They are:
POINT 1
PLAINTIFF HAS FAILED TO MITIGATE DAMAGES SO THE WAGE EXECUTION SHOULD BE DISMISSED
POINT 2
DEFENDANTS CANNOT AFFORD THE WAGE EXECUTION AND THEREFORE IT SHOULD BE MODIFIED AND/OR DISMISSED
POINT 3
A PERSON CANNOT BE SUBJECT TO MORE THAN ONE WAGEGARNISHMENT AT A TIME. N.J.S.A. 2A:17-52(a)
POINT 4
THE JUDGE ERRED IN MAKING FACTUAL AND LEGAL FINDINGS
Judge Brennan correctly noted that defendants could not, post-judgment, directly attack the merits of the judgment. Defendants had an opportunity to file an answer, or take an appeal, and did neither. Having failed to avail themselves of those options, they did not even file a motion to set aside the judgment pursuant to Rule 4:50-1. The court therefore correctly refused to entertain the argument.
The trial judge also observed that Spencer's asserted inability to afford the amount of the wage execution was not clearly established. Mathematically, it is reasonable to conclude that Spencer has other substantial income from which he is maintaining his divorce obligations. Spencer operates a septic pump business, a snow removal business, and owns a commercial building, in addition to holding down a job. Furthermore, the wage deductions from his employment were not proven to be involuntary in nature. His pay stub included deductions totaling $903.14 for health contributions, pension, loans, dues, and credit union. Therefore, Spencer's proofs simply failed to demonstrate any inequity in the wagegarnishment.
Judge Brennan did not credit Spencer's argument that he was being subjected to a "de facto" second wagegarnishment because of his matrimonial obligations. That argument is so lacking in merit as to warrant no further discussion in a written opinion. R. 2:11-3(e)(1).
Finally, we find no error in the judge's rejection of Spencer's motion for reconsideration, premised on the notion he should have been allowed to testify telephonically with regard to his pay and income. As the judge pointed out, on motions, Rule 1:6-2 does not permit facts to be established other than through an affidavit or certification. Hence the judge did not err in declining to allow Spencer's telephonic participation to answer questions that might arise during the hearing.
"A trial court's interpretation of the law and the legal consequences that flow from established facts are not entitled to any special deference." Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995). In this instance, the trial court's reasoned conclusion, in our view, correctly applied the law to established facts. Motions for reconsideration will be granted only where the court has failed to consider evidence, has rendered a decision based on plainly incorrect reasoning, or failed to correctly apply the law. See Fusco v. Bd. of Educ. of Newark, 349 N.J. Super. 455, 462 (App. Div.), certif. denied, 174 N.J. 544 (2002). The court in this case considered the evidence, analyzed the matter fairly, and correctly applied the law.
DEUTSCHE BANK TRUST COMPANY AMERICAS, AS TRUSTEE FOR RESIDENTIAL ACCREDIT LOANS, INC., Mortgage Asset-Backed Pass-Through Certificates, Series 2005-QSI4, Plaintiff-Respondent,
v.
Debbie A. WEINER and Clifford R. Weiner, Defendants-Appellants.
For many years, New Jersey lacked a statute of limitations for residential foreclosure actions. Instead, for more than a century, our courts applied the time-bar used in adverse possession actions: twenty years. See Depew v. Colton, 60 N.J. Eq. 454, 464, 46 A. 728 (E. & A. 1900); Security National Partners L.P. v. Mahler, 336 N.J. Super. 101, 106-07, 763 A.2d 804 (App. Div. 2000). In 2009, the Legislature made up for lost time and enacted N.J.S.A. 2A:50-56.1, which codified Security National Partners[1] by declaring that a residential foreclosure action "shall not be commenced following the earliest of" three points in time:
• Six years from "the date fixed for the making of the last payment or the maturity date set forth in the mortgage or the note," N.J.S.A. 2A:50-56.1(a);
• Thirty-six years from the date the mortgage was recorded or, if not recorded, from the date of execution, N.J.S.A. 2A:50-56.1(b); and
• Twenty years from the date of a default that "has not been cured," N.J.S.A. 2A:50-56.1(c).[2]
Defendants' contention that N.J.S.A. 2A:50-56.1(a)'s six-year time-frame applies and bars this foreclosure action, which was filed seven years after their uncured default, is without merit.
The record reveals that defendant Debbie A. Weiner borrowed $657,500 from Weichert Financial Services in 2005 and then executed in Weichert's favor a promissory note that required monthly payments, 123 the last of which was scheduled for June 2035. To secure the note's repayment, both defendants executed a mortgage that was recorded in 2005 and ultimately assigned to plaintiff Deutsche Bank Trust Company Americas.[3]
There is no dispute that defendants failed to make a scheduled August 2009 payment and all later monthly payments. After four discontinued suits, Deutsche Bank commenced this foreclosure action in September 2016, more than seven years after defendants' uncured default.
The parties eventually cross-moved for summary judgment. The judge granted Deutsche Bank's motion, denied defendants' motion, and later denied defendants' motion for reconsideration. Once final judgment was entered in December 2017, defendants filed this timely appeal, arguing: (1) summary judgment should not have been entered because discovery was incomplete and there were genuine disputes about Deutsche Bank's claim, its standing to sue, and its status as a holder; (2) their answer should not have been stricken; and (3) the complaint was barred by the statute of limitations. We reject these arguments and affirm.[4]
In arguing the action was time-barred, defendants claim the six-year time frame in subsection (a) was triggered in 2009 when their default triggered the loan's acceleration. We disagree. Subsection (c) specifically provides a time frame to be considered upon an uncured default. To interpret subsection (a) as triggering the same event encompassed by subsection (c) would wreak havoc with the clearly delineated provisions of N.J.S.A. 2A:50-56.1. We refuse to inject such confusion into what the Legislature carefully planned when it adopted this multi-part statute of limitations.
Defendants' interpretation would also require that we ignore subsection (a)'s plain language. That provision declares that the six-year period runs from the date of the last payment or the maturity date "set forth in the mortgage or the note." N.J.S.A. 2A:50-56.1(a). June 1, 2035 was the date "set forth" in the note and mortgage here, and that date is the one and only date that triggers the six-year period in subsection (a). There is no ambiguity; that conclusion is what the plain language of the statute compels. See DiProspero v. Penn, 183 N.J. 477, 492, 874 A.2d 1039 (2005). Any other conclusion would mangle the Legislature's carefully phrased statute. State v. Clarity, 454 N.J. Super. 603, 608, 186 A.3d 919 (App. Div. 2018).
In short, the three events described in subsections (a), (b), and (c) of N.J.S.A. 2A:50-56.1, were scheduled to occur in 2041 (six years after the 2035 maturity date), 2041 (thirty-six years after the 2005 recording of the mortgage), and 2029 (twenty years from defendants' uncured 124*124 default), respectively. Since the earliest has yet to occur, this suit, commenced in September 2016, was not time-barred.[5]
Affirmed.
[1] See Assemb. Fin. Insts. & Ins. Comm. Statement to S. No. 250 — L. 2009, c. 105 (Oct. 6, 2008).
[2] For brevity's sake, we have omitted statutory language from the descriptions of each subsection that has no bearing here.
[3] The mortgage was first assigned to Deutsche Bank Trust Company Americas, as trustee for certain certificate holders, in 2009, and later assigned to Deutsche Bank, as trustee for Residential Accredit Loans, Inc., 2005-QS14, the plaintiff here, in 2013. The assignments were duly executed and recorded.
[4] We find insufficient merit in defendants' first two points to warrant further discussion in a written opinion. R. 2:11-3(e)(1)(E). We add only as to the first that, in moving for summary judgment, Deutsche Bank provided undisputed evidence that it was in possession of the note, which was endorsed to it, and that the mortgage assignments were duly executed and recorded. See Deutsche Bank Trust Co. v. Angeles, 428 N.J. Super. 315, 318, 53 A.3d 673 (App. Div. 2012).
[5] Although not raised, we assume N.J.S.A. 2A:50-56.1 applies to defendants' argument that Deutsche Bank's suit was untimely even though the statute did not become effective until August 6, 2009, approximately the same time as defendants' default. Even if the statute had no application here, the result would be the same, since the pre-statute twenty-year time-bar described in Colton and Security National Partners would allow for the maintenance of this suit.
GREAT FALLS BANK, PLAINTIFF-RESPONDENT, v. JOSEPH PARDO, DEFENDANT-APPELLANT, AND FRANK PAPARATTO, MARIA PAPARATTO AND SAMUEL PETRACCA A/K/A/ SAM PETRACCA & SAMUEL S. PETRACCA, AND MARIA PETRACCA, A/K/A/ MARIA D. PETRACCA, JOHN F. KENNEDY MEDICAL CENTER AND THE STATE OF NEW JERSEY, DEFENDANTS.
Aldan O. Markson, argued the cause for appellant Joseph Pardo (Mr. Markson, on the brief).
Cheryl H. Burstein argued the cause for respondent Great Falls Bank (Williams, Caliri, Miller & Otley, attorneys; Ms. Burstein, of counsel and on the brief).
In 1987, Frank Paparatto, Ciro Spinella and Samuel Petracca entered a joint venture to build two-family houses on a parcel of land in North Arlington. To finance the venture, they personally executed a promissory note for a $350,000 loan Great Falls Bank ("plaintiff") made to their corporation. When they could not make payments, Paparatto and Petracca induced Pardo ("defendant") to acquire a 14% interest in the venture in exchange for $176,000 and execution on January 6, 1989 of a guaranty of the debt. On June 16, 1989 defendant also executed a mortgage to secure the guaranty in exchange for release by plaintiff of Paparatto's certificate of deposit previously given as security. Defendant contends that the mortgage was prepared by the bank's vice president, Glen Durr, but that he (defendant) had no direct communication with the 544bank or Durr. The mortgage was witnessed and notarized by Petracca. According to defendant's certification in opposition to plaintiff's motion for summary judgment, "[a]lthough my signature appears on the mortgage, I have no recollection of ever signing the mortgage ... I was not aware that I had signed a mortgage until many months after June 16, 1989." Defendant, a janitor who cannot read or write English, claims he never understood that he executed a mortgage to secure his guaranty and that he was fraudulently induced to do so by his "partners."[2]
Hey, how you doing? My name is George Cartagena, I am a client of Rafael Gomez, he just finished a case for me, and I am very satisfied with the result, I recommend him, he is the best.
On January 21, 1990 the four partners executed a renewal promissory note which facially changed defendant's obligation from that of guarantor to principal. When the obligors did not make timely interest payments, plaintiff commenced a suit in August 1990 against Paparatto, Spinella, Petracca and defendant. Incident to a settlement and dismissal of that litigation, the four "partners" executed another extension of the $350,000 loan. Defendant simultaneously executed a Mortgage Modification and Extension Agreement to secure the debt. Both the note and agreement provided that plaintiff could release any party or collateral without affecting the liability of any other debtor or mortgagor. About seven months later, plaintiff released Spinella and discharged his mortgage in exchange for 25% of the amount due under the loan. Because the remaining balance was not paid when due, plaintiff instituted this foreclosure action. Thereafter, plaintiff's motion for summary judgment was granted, and defendant's motion for reconsideration was denied. Great Falls Bank v. Pardo, 263 N.J. Super. 388, 622 A.2d 1353 (Ch.Div. 1993).
Defendant appeals and contends that the court erred by granting summary judgment. He argues that there are material facts in dispute which, if resolved favorably to him, support his claim that (1) plaintiff, as a third party beneficiary of his promises to his 545 "partners," stands in the shoes of the promisees and is therefore subject to the defense of fraud that he asserts against his "partners" in a related action; (2) his mortgage is void because it did not secure a valid, subsisting debt; (3) his original guaranty is unenforceable because plaintiff released a principal obligor on the debt;[3] (4) his guaranty and mortgage are unenforceable for lack of consideration, and (5) the trial judge improperly denied him a hearing on his request that the foreclosure sale of his mortgage be stayed until plaintiff could litigate his claims against his partners and require the plaintiff to satisfy his obligation against them before resorting to the foreclosure sale of his mortgage.
The judgment is affirmed substantially for the reasons expressed by Judge Boyle in his written opinion, Great Falls Bank v. Pardo, 263 N.J. Super. 388, 622 A.2d 1353 (Ch.Div. 1993), together with the following. It is uncontested before us that defendant was named as a defendant in the action filed in August 1990 based on the January 21, 1990 note executed by Paparatto, Petracca, Spinella and defendant, and that the suit was dismissed incident to execution by the same four individuals on November 14, 1990 of a new $350,000 promissory note, together with guaranties executed by the wives of Paparatto, Petracca and Spinella, and the Mortgage Modification and Extension Agreement signed by defendant (and apparently separate such agreements by Petracca 546*546 and Spinella as well). These items were submitted to the plaintiff by counsel for defendants in the 1990 action.[4] In fact, counsel witnessed and notarized defendant's signature on the modification agreement, and defendant simultaneously executed an affidavit of title to his mortgaged property. If nothing else, dismissal of the 1990 complaint and renewal of the loan in November of that year provided consideration for the new obligation defendant undertook, and plaintiff could fairly rely on these documents sent to the bank by defendant's counsel.[5]
My name is Marco Santucci. Rafael Gomez representing me just now, he did a really great job. I thought I was going to lose my license today and he amended my charges and he brought belief to me when I thought I had none. So I thank him.
We do not believe that the bank had an independent obligation in these circumstances to scrutinize the relationship between the individuals who each appeared to have an interest in the entity for whose benefit the loan was made, or to question if there was a conflict among obligors (or obligors and guarantors), or in their joint representation. As Judge Boyle stated in his opinion, "any fraud perpetrated by the partners is of no moment unless Great Falls had knowledge thereof or participated therein...." Great Falls v. Pardo, supra, 263 N.J. Super. at 398, 622 A.2d 1353. There was an insufficient showing of such knowledge, which defendant claims to flow from Durr's prior close relationship with one of the "partners" and his personal lawyer. Moreover, as defendant acknowledged in the November 1990 Mortgage Modification and Extension Agreement that the 1989 mortgage "shall continue to secure repayment" of the borrowers' obligation to repay the loan simultaneously renewed and extended, and acknowledged the "obligation" under his original guaranty, defendant cannot now deny the validity of the 1989 mortgage. We therefore reject his contention that there are factual issues related to the execution of the mortgage which would preclude summary judgment in this foreclosure action.
547Before us defendant claims for the first time the Mortgage Modification and Extension Agreement signed by defendant is unenforceable because it was not executed by the plaintiff. Hence, defendant asserts he did not consent to the release of Spinella as a principal obligor, thereby adversely affecting defendant's guaranty. However, independent of whether defendant was then a principal obligor protecting his own investment, the modification agreement was signed by defendant, "the party to be charged." N.J.S.A. 25:1-5. The fact the bank may not have executed the modification does not control.
As we disagree with defendant on the merits, we see no reason to further consider whether a stay should have been granted pending resolution of his cross-claims against the other defendants in a related action. Generally, the bank can proceed directly against a guarantor. Delaware Truck Sales, Inc. v. Wilson, 131 N.J. 20, 32-33, 618 A.2d 303 (1993); Summit Trust v. Willow Business Park, supra, 269 N.J. Super. at 445-46, 635 A.2d 992. In any event, we have been told that the premises have not yet been the subject of a foreclosure sale as plaintiff was, in fact, permitted to proceed only to one foreclosure sale and elected to proceed against Petracca (with whom it subsequently settled) and is awaiting this opinion before taking further action.
Affirmed.
[1] The case was originally submitted on May 3, 1994.
[2] In a certification defendant described Paparatto, who he "trusted ... implicitly," as "my long-standing and intimate friend and next-door neighbor" and "godfather of one of my children, my best man at my wedding, and ... related to me through marriage."
[3] Because of contested issues of fact, the trial judge "assume[d] that Pardo remained at all times only a guarantor and that Paparatto and Petracca fraudulently induced Pardo to execute the guaranty and mortgage." Great Falls Bank v. Pardo, supra, 263 N.J. Super. at 394, n. 3, 622 A.2d 1353. Despite execution of the January and November 1990 documents as principal, we will also proceed on that assumption principally because the Mortgage Modification and Extension Agreement expressly provided that
[t]his Agreement is intended by the parties to be an extension and renewal of the loan obligation of the Borrowers as set forth in the Note dated January 21, 1990 and obligation of Pardo under the Note and Guaranty Agreement dated June 8, 1988. It is not a termination or release of the existing loan obligation of the Borrowers or Pardo as Guarantor.
See Summit Trust Co. v. Willow Business Park, L.P., 269 N.J. Super. 439, 443-44, 635 A.2d 992 (App.Div.), certif. denied, 136 N.J. 30, 641 A.2d 1041 (1994).
[4] The 1990 pleadings were not submitted to us.
[5] There was no assertion that the attorney had a conflict of interest, did not represent defendant, or the like.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
PER CURIAM.
Plaintiff Edwin L. Siegel appeals from the denial of his application pursuant to Rule 4:59-1(d)(1) for an order permitting the sale of real property for satisfaction of a judgment debt. The property he desired sold no longer belonged to the judgment debtor, Leonard Blasucci, but to Venkat Gourkanti, who acquired it from sellers who purchased the property at sheriff's sale following foreclosure of Blasucci's mortgage. We affirm.
The essential facts are undisputed. Blasucci and his wife took title to the residential property in 1976. The Blasuccis gave a first mortgage to First Fidelity Bank in 1986 and a second mortgage to Washington Savings Bank in 1987. Washington Savings instituted a foreclosure action against the Blasuccis in May 1990 and obtained final judgment of foreclosure the following October. First Fidelity and Washington Savings subsequently assigned their mortgages to Martin Tave and the Sylvia T. Cohen Revocable Trust (Tave and Cohen). The property was sold at sheriff's sale in June 1994 to Tave and Cohen, who took subject to the First Fidelity mortgage which they held and subsequently discharged. Tave and Cohen conveyed the property to Gourkanti in October 1997.
Siegel did not obtain his default judgment against Blasucci until July 1992, almost two years after the entry of the foreclosure judgment. Siegel claims that his judgment, docketed in July 1992 and revived in November 2011, was a lien against Blasucci's real property that was not extinguished by the
October 1990 foreclosure judgment and subsequent sheriff's sale. He contends that either Washington Savings or Tave and Cohen was required to amend the foreclosure complaint to include him as a subsequent encumbrancer in order to bind him to the foreclosure judgment. We disagree.
We addressed this issue in Morsemere Fed. Sav. & Loan Ass'n v. Nicolaou, 206 N.J. Super. 637 (App. Div. 1986). Morsemere, a foreclosing mortgagee, obtained final judgment of foreclosure against Nicolaou. Id. at 640-41. After entry of the foreclosure judgment, DiPrima obtained a default judgment against Nicolaou. Id. at 641. DiPrima subsequently purchased the property at sheriff's sale. DiPrima then filed a motion to intervene in the foreclosure action and for payment of surplus funds. Ibid.
We held that a lien claimant such as DiPrima cannot be made a party to a foreclosure suit after entry of final judgment. Morsemere, supra, 206 N.J. Super. at 641-42. We reasoned that N.J.S.A. 2A:50-30, which operates to bind the holders of unrecorded interests existing at the filing of the foreclosure to the judgment and allows those holding such interests to intervene as of right upon recording, did not apply "because DiPrima's lien did not exist `at the time of the filing of the complaint' or even at the time the foreclosure judgment was entered." Ibid. Instead, we held that N.J.S.A. 2A:50-37 was controlling, and thus a creditor who obtains a money judgment subsequent to entry of the foreclosure judgment "may participate in any surplus after prior claiming lienholders (at the time of the foreclosure judgment) have been paid or satisfied." Morsemere, supra, 206 N.J. Super. at 642-43.
Siegel, who obtained his judgment after Washington Savings obtained its foreclosure judgment against Blasucci, is in the same position as was DiPrima in Morsemere. The lien of his judgment only allowed him to participate in any surplus remaining after sheriff sale. The holding is in accord with the general rule "that surplus funds take on the character of the land, at least with respect to junior encumbrancers whose liens existed at the time of the foreclosure." Ibid.
Because Siegel's remedy was limited to participation in any surplus funds arising from the sheriff's sale, the trial court correctly denied his motion for sale of Gourkanti's property to satisfy Siegel's 1992 judgment against Blasucci. Siegel's remaining arguments relating to the priority of his judgment and the conduct of the sheriff's sale conducted in 1994 are without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).
Joseph M. Pinto argued the cause for appellants (Polino and Pinto, attorneys).
Mary Lynn McCaffrey argued the cause for respondent (Isabel L. Becker, attorney).
PER CURIAM.
This appeal arises from plaintiffs' complaint to cancel and discharge a creditor's judgment lien held by defendant Citi Mortgage, Inc. (Citi), following the conclusion of bankruptcy proceedings conducted pursuant to Chapter 7 of the United States Bankruptcy Code (Chapter 7), 11 U.S.C.A. §§ 701-784. In 1997, the Superior Court entered a default judgment in favor of Citi against plaintiffs, and by virtue of its docketing of that judgment, Citi obtained a lien on all of plaintiffs' real property in New Jersey. Four years later, plaintiffs instituted a Chapter 7bankruptcy proceeding in the United States BankruptcyCourt. Because plaintiffs listed the law firm that had represented Citi, rather than Citi itself, in their Chapter 7 petition, the bankruptcycourt did not provide notice of the proceeding to Citi. After the bankruptcy trustee abandoned two of plaintiffs' New Jersey properties, the bankruptcycourt discharged plaintiffs' debt and closed their Chapter 7 case. Citi did not attempt to levy on plaintiffs' property at any time prior to the bankruptcy filing and did not seek to enforce its lien in the wake of plaintiffs' bankruptcy discharge.
More than three years after the bankruptcy discharge, plaintiffs filed this action under N.J.S.A. 2A:16-49.1. That statute permits a debtor, whose debts have been discharged in bankruptcy, to apply to the state court that has entered a judgment against the debtor, or has docketed the judgment, for an order directing the judgment 743 to be canceled and discharged. N.J.S.A. 2A:16-49.1. The statute requires the debtor to wait at least a year following his or her bankruptcy discharge before seeking the cancellation and discharge of the judgment lien. Ibid. Pursuant to N.J.S.A. 2A:16-49.1, plaintiffs sought an order cancelling Citi's judgment lien on the two properties.
The trial court granted Citi's motion for summary judgment and dismissed plaintiffs' claim. The court acknowledged that a judgment creditor, such as Citi, who has not levied on the debtor's property prior to the debtor's filing of a bankruptcy petition, may enforce its valid lien following the bankruptcy discharge, but must do so within the year following the discharge. The court explained that if Citi did not enforce its lien within that period, its lien could be canceled pursuant to N.J.S.A. 2A:16-49.1. The trial court found, however, that Citi had not received notice of plaintiffs' Chapter 7bankruptcy proceeding. It accordingly ruled that due process principles would be violated if Citi's judgment lien was canceled prior to the expiration of a year following the date upon which Citi belatedly learned of the bankruptcy proceedings and plaintiffs' attempt to cancel its lien. Consequently, the trial court equitably tolled the one-year period prescribed by the statute.
In a published opinion, the Appellate Division affirmed the determination of the trial court. Gaskill v. Citi Mortg., Inc., 428 N.J.Super. 234, 237, 52 A.3d 192 (App. Div.2012). The panel concluded that the Citi judgment lien was subject to discharge or release in plaintiffs' bankruptcy proceedings and was consequently subject to cancellation pursuant to N.J.S.A. 2A:16-49.1. Id. at 242-43, 52 A.3d 192. The panel agreed with the trial court that Citi had not received the required actual notice of the bankruptcy petition or the bankruptcy discharge obtained by plaintiffs. Id. at 245-46, 52 A.3d 192. It held that N.J.S.A. 2A:16-49.1 was drafted on the assumption that any creditor subject to its terms had received notice of the bankruptcy proceeding. Ibid. The panel ruled that the trial court's remedy of equitable tolling of the one-year waiting period prescribed by N.J.S.A. 2A:16-49.1 was proper. Id. at 245, 52 A.3d 192. We granted certification. 217 N.J. 52, 84 A.3d 601 (2014).
We affirm, substantially for the reasons stated by the Appellate Division. We add only brief comments with respect to the decision of the United States Court of Appeals for the Third Circuit in Judd v. Wolfe, 78 F.3d 110 (3d Cir.1996), upon which plaintiffs substantially rely in their argument before this Court. For the reasons that follow, we consider Judd to address a procedural question of federal bankruptcylaw that is distinct from the issue raised by this appeal and accordingly find that it does not support plaintiffs' argument.
In Judd, the Third Circuit did not consider the issue raised by this case: the effect of a debtor's failure to provide notice to a creditor of a Chapter 7bankruptcy petition on the debtor's right to cancel a judgment lien under state statutory law. Instead, the court considered the procedural requirements imposed by federal bankruptcylaw, following the closing of the bankruptcy case, on a debtor who has failed to list a claim on the schedule of creditors submitted in a Chapter 7 no-asset case in which no bar date has been set. Id. at 111. The Third Circuit held that such a debtor is not required to file a motion to reopen the bankruptcy case, pursuant to 11 U.S.C.A. § 350(b), in order to discharge the debt that had been omitted from the schedule, unless one or more 744of the statutory exceptions to discharge applied.Ibid.[1]
In support of its holding, the Third Circuit pointed to the text of 11 U.S.C.A. § 727(b), which provides that "[e]xcept as provided in section 523 of this title, a discharge . . . discharges the debtor from all debts that arose before the date of the order for relief under this chapter." 11 U.S.C.A. § 727(b); Judd, supra, 78 F.3d at 113-14. The court explained that 11 U.S.C.A. § 523 provides that the only situation in which a debt is not discharged is if it was "`[n]either listed nor scheduled ... in time to permit ... timely filing of a proof of claim.'" Judd, supra, 78 F.3d at 114 (quoting 11 U.S.C.A. § 523(a)(3)(A)). The Third Circuit further noted that "[b]ecause [the case before it] is a `no-asset' Chapter 7 case, the time for filing a claim has not, and never will, expire unless some exempt assets are discovered; thus, section 523(a)(3)(A) cannot be applied" to prevent the discharge of an unlisted debt in a no-asset case. Ibid. The court held that such an unscheduled debt is discharged even if that discharge may disadvantage or prejudice the unlisted creditor. See id. at 113 n. 6, 115, 116 n. 13. "In a case where there are no assets to distribute," the creditor's "right to file a proof of claim is a hollow one," because "[a]n omitted creditor who would not have received anything even if he had been originally scheduled, [is] not ... harmed by omission from the bankrupt's schedules and the lack of notice to file a proof of claim." Id. at 115. Accordingly, the Third Circuit reasoned, the failure to give notice to the creditor in the bankruptcy proceeding could not affect that creditor's position, because there were no assets in any event. Ibid.
The Third Circuit acknowledged, however, that in a bankruptcy case that involves assets, the debt of an unnoticed creditor is not discharged unless that creditor received notice in time to file a proof of claim. See id. at 114-15. Moreover, any intentional tort debt is not discharged unless the creditor received notice in time to file a complaint pursuant to 11 U.S.C.A. § 523(c). See id. at 114 n. 9.
The circumstances of this case stand in contrast to the no-asset setting of Judd, in which action taken by the creditor in the bankruptcy proceedings would have been futile even if it had received timely notice of the bankruptcy petition and the subsequent discharge. As noted by the trial court and the Appellate Division, had Citi received notice of the bankruptcy petition and discharge in this case, it would have been in a position to enforce its lien during the year following the bankruptcy discharge, as permitted by N.J.S.A. 2A:16-49.1. Gaskill, supra, 428 N.J.Super. at 243-44, 52 A.3d 192. The notice that was omitted in this case would not have been meaningless, as it was in the no-asset, no-bar date setting of Judd. Instead, timely notice would have enabled the creditor to take action within the time limitation of N.J.S.A. 2A:16-49.1 to protect its interest in the real property at issue.
Accordingly, the Third Circuit's holding in Judd does not address the due process argument that was raised by the debtor in this case: whether notice to a creditor of a 745Chapter 7bankruptcy proceeding and discharge constitutes a prerequisite to the cancellation and discharge of a judgment under N.J.S.A. 2A:16-49.1. We concur with the Appellate Division's conclusion that such notice is required before a debtor may invoke the protection of N.J.S.A. 2A:16-49.1, and that equitable tolling was an appropriate remedy in the circumstances of this case.
The judgment of the Appellate Division is affirmed.
For affirmance—Chief Justice RABNER and Justices LaVECCHIA, PATTERSON, FERNANDEZ-VINA and Judge FUENTES (temporarily assigned)—5.
Not participating—Justice ALBIN and SOLOMON—2.
Opposed—None.
[1] Subsections (a)(2), (a)(4), and (a)(6) of 11 U.S.C.A. § 523 exempt from discharge "debts incurred by false pretenses, false representation or actual fraud ... (523(a)(2)); debts incurred by fraud or defalcation while acting as a fiduciary ... (523(a)(4)); and debts for willful and malicious injury ... (523(a)(6))." Id. at 114 (internal quotation marks omitted). The Third Circuit explained that "[i]f the debt at issue is not a debt described under section 523(a)(2), (4) or (6), the debt has been discharged by virtue of section 727(b), whether or not it was listed. If, however, the debt is a debt that falls under sections 523(a)(2), (4) or (6), the debt is not discharged by virtue of section 523(a)(3)(B)." Id. at 115.
