1

SYLLABUS

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the 

convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the 

interest of brevity, portions of any opinion may not have been summarized.)

Tahir Zaman v. Barbara Felton (A-60-12) (072128)

Argued March 18, 2014 -- Decided September 9, 2014

PATTERSON, J., writing for a unanimous Court.

This appeal requires the Court to analyze an agreement for the sale of a residential property and a 

subsequent lease and repurchase agreement, and to determine whether the transactions collectively gave rise to an 

equitable mortgage, violated consumer protection statutes, or contravened this Court’s decision in In re Opinion No. 

26 of the Committee on the Unauthorized Practice of Law, 139 N.J. 323 (1995) (In re Opinion No. 26).

In 2007, defendant Barbara Felton, an experienced buyer and seller of real estate, faced imminent 

foreclosure proceedings with respect to her unfinished home when she defaulted on a $105,000 construction 

mortgage. Felton was aware that no certificate of occupancy was issued with respect to the house, and the house 

was uninhabitable. A mutual acquaintance, Joseph Richardson, introduced Felton to Tahir Zaman, a licensed real 

estate agent. On June 16, 2007, Felton, Zaman, and Richardson met at the property to discuss its potential sale. 

Zaman was unaware that the house lacked a certificate of occupancy and was uninhabitable. Felton requested a 

price of $250,000 for the property, and Zaman made a $200,000 counteroffer. Felton wanted to keep the property. 

Zaman told Felton that if she accepted his offer of $200,000, he would agree to a buy-back option and would allow 

her to remain on the property as a tenant. Felton and Zaman then executed a written land sale agreement with a 

purchase price of $200,000, and Richardson signed the agreement as a witness. The agreement provided that each 

party had the right to arrange for an attorney to review its terms within three days of its execution, that either party 

could cancel the sale during the attorney-review period, and that the agreement would be binding at the conclusion 

of that period. The agreement contained no reference to a buy-back or lease provision. 

On June 23, 2007, at a closing in which neither party was represented by counsel, Felton and Zaman 

entered into two separate agreements: a lease agreement under which Felton agreed to pay $1,000 per month in rent, 

and an agreement that gave Felton the option to repurchase the property within three months for $237,000. Felton 

signed the deed, an affidavit of title, and the buy-back agreement. The parties did not execute any mortgage 

documents. Zaman gave Felton a cashier’s check in the amount of $85,960, the balance after mortgage payoff and 

other closing expenses. Neither party exercised the right to cancel the agreement during the three-day attorney 

review period. On July 19, 2007, Zaman recorded the deed to the disputed property. For the next seventeen months, 

Felton occupied the property, but did not pay rent in accordance with the lease agreement, or exercise her 

contractual right to repurchase the property. 

In December 2008, Zaman filed the underlying complaint, claiming that he was the purchaser in an 

enforceable land sale agreement. Felton filed a counterclaim based on fraud, slander of title, violations of the 

Consumer Fraud Act (CFA), violations of the Fair Foreclosure Act (FFA), N.J.S.A. 2A:50-53 to -68, and violations 

of the federal Truth in Lending Act (TILA), 15 U.S.C.A. §§ 1601 - 1667. Felton claimed that the parties’ 

transactions collectively comprised an equitable mortgage and that the transactions were voidable by virtue of an 

alleged violation of this Court’s opinion in In re Opinion No. 26. The trial court elected to hold a bifurcated trial. It 

assigned to the jury the following questions: whether Zaman had proven by a preponderance of the evidence that 

Felton knowingly agreed to sell the property to him, and if not, whether Felton had proven by clear and convincing 

evidence that Zaman obtained his deed to the property by “fraudulent actions.” The jury concluded that Zaman had 

proven by a preponderance of the evidence that Felton knowingly agreed to sell her property to him. The trial court 

then conducted the trial’s second phase, in which the trial judge was the factfinder. After hearing additional 

testimony, the trial court dismissed all of Felton’s remaining claims, including her contention that the transactions 

gave rise to an equitable mortgage and her allegation premised upon In re Opinion No. 26. 

Felton appealed, and the Appellate Division affirmed. Citing the jury’s determination that the property was 
2

knowingly sold, the panel concluded that the trial court correctly declined to find an equitable mortgage or a valid

claim under the CFA. In addition, the panel affirmed the trial court’s determination that In re Opinion No. 26 does 

not govern this case. The Supreme Court granted Felton’s petition for certification. 213 N.J. 537 (2013). 

HELD: The Court affirms the jury’s determination that Felton knowingly sold her property to Zaman. It reverses

the portion of the Appellate Division’s opinion that affirmed the trial court’s dismissal of Felton’s claim that the 

parties’ agreements gave rise to an equitable mortgage. The Court remands to the trial court for application of the 

eight-factor standard for the determination of an equitable mortgage set forth by the United States Bankruptcy Court 

in O’Brien v. Cleveland, 423 B.R. 477, 491 (Bankr. D.N.J. 2010) and, in the event that the trial court concludes that 

an equitable mortgage was created by the parties, for the adjudication of two of Felton’s statutory claims based on 

alleged violations of consumer lending laws, as well as several other claims not adjudicated by the trial court. The 

Court concurs with the trial court and Appellate Division that Felton has no claim under the Consumer Fraud Act, 

that this case does not implicate In re Opinion No. 26, and that Felton’s remaining claims were properly dismissed.

1. The Court reviews the jury’s determination – that Zaman had proven by a preponderance of the evidence that 

Felton knowingly agreed to sell the property to him – in accordance with a deferential standard. An appellate court 

should not disturb the findings of the jury merely because it would have found otherwise upon review of the same 

evidence. Carrino v. Novotny, 78 N.J. 355, 360 (1979). Applying that standard, the Court affirms the Appellate 

Division panel’s determination insofar as it affirmed the jury’s determination that Zaman had proven by a 

preponderance of the evidence that Felton knowingly conveyed her property to him. (pp. 15-18)

2. “New Jersey courts have repeatedly found that sale-leaseback arrangements made to avoid foreclosure are in fact 

equitable mortgages.” Johnson v. NovaStar Mortg., Inc., 698 F. Supp. 2d 463, 469 (D.N.J. 2010). It is the trial 

court’s task to discern whether the transaction has been labeled as a land sale in order to mask its actual objective: a 

mortgage loan secured by a deed to the property at issue. In O’Brien v. Cleveland, 423 B.R. 477 (Bankr. D.N.J. 

2010), the Bankruptcy Court identified eight factors to assist trial judges in determining whether a given transaction 

gives rise to an equitable mortgage. Under the O’Brien framework, the court considers not only the form of the 

transaction itself but circumstances that can motivate a party to disguise a mortgage secured by a property as a sale 

of land and indications that both parties intend the seller to retain the land notwithstanding the purported sale. The 

Court adopts the O’Brien factors as a comprehensive and practical standard to guide trial courts as they determine 

whether a particular transaction, or series of transactions, gives rise to an equitable mortgage, and remands the 

matter to permit the trial court to apply the O’Brien test. (pp. 18-24)

3. In In re Opinion No. 26, supra, this Court considered whether real estate brokers commit the unauthorized 

practice of law when they conduct residential real estate transactions in which the “sellers and buyers are . . . 

unrepresented by counsel.” Id. at 326. The risk that the Court addressed in In re Opinion No. 26 – that a real estate 

broker acting in his or her own interest will promote the completion of a real estate transaction to the detriment of 

the seller, the buyer, or both – is not raised in the circumstances of this case. Nothing in the trial record suggests 

that Zaman purported to provide legal advice to Felton, or that Felton was somehow led to believe that Zaman was 

her advocate. Accordingly, the Court concurs with the trial court and the Appellate Division that In re Opinion No. 

26 is irrelevant to this case, that Zaman did not violate the principles of that decision, and that the trial court properly 

declined to void the parties’ transactions on that ground. (pp. 25-28)

4. The trial court properly dismissed Felton’s Consumer Fraud Act (CFA) claim; the trial court should consider the 

merits of Felton’s Fair Foreclosure Act (FFA) claim if it determines on remand that the parties’ agreements gave rise 

to an equitable mortgage; and, with the exception of her claim under 15 U.S.C.A. § 1639(h), governed by a threeyear statute of limitations, Felton’s federal Truth in Lending Act (TILA) claims were properly dismissed as timebarred. On remand, the trial court should ascertain whether any of the remaining claims were raised before it, and if 

so, whether such a claim gives rise to a cognizable cause of action in the circumstances of this case. Finally, 

Felton’s claim under the Foreclosure Rescue Fraud Prevention Act (FRFPA), not raised before the trial court, was 

properly dismissed by the Appellate Division. (pp. 28-36)

The judgment of the Appellate Division is AFFIRMED IN PART and REVERSED IN PART, and the 

matter is REMANDED to the trial court for proceedings consistent with the Court’s opinion.

CHIEF JUSTICE RABNER; JUSTICES LaVECCHIA, ALBIN, and FERNANDEZ-VINA; and 
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JUDGES RODRÍGUEZ and CUFF (both temporarily assigned) join in JUSTICE PATTERSON’s opinion.
1

SUPREME COURT OF NEW JERSEY

A-60 September Term 2012

072128

TAHIR ZAMAN,

Plaintiff-Respondent,

v.

BARBARA FELTON and MR. 

FELTON, her husband,

Defendants-Appellants.

Argued March 18, 2014 – Decided September 9, 2014

On certification to the Superior Court, 

Appellate Division.

Robert B. Silverman argued the cause for 

appellants.

I. Dominic Simeone argued the cause for 

respondent (Simeone & Raynor, attorneys; Mr. 

Simeone and Kelly A. Barse, on the briefs).

David G. McMillin argued the cause for 

amicus curiae Legal Services of New Jersey 

(Melville D. Miller, Jr., President 

attorney; Mr. McMillin and Mr. Miller, on 

the brief).

Barry S. Goodman argued the cause for amicus

curiae New Jersey Association of Realtors 

(Greenbaum, Rowe, Smith and Davis, 

attorneys; Mr. Goodman and Steven B. Gladis, 

on the brief).

JUSTICE PATTERSON delivered the opinion of the Court.

This appeal requires the Court to analyze an agreement for 

the sale of a residential property and a subsequent lease and 
2

repurchase agreement, and to determine whether the transactions 

collectively gave rise to an equitable mortgage, violated 

consumer protection statutes, or contravened this Court’s 

decision in In re Opinion No. 26 of the Committee on the 

Unauthorized Practice of Law, 139 N.J. 323 (1995). 

In 2007, defendant Barbara Felton faced foreclosure 

proceedings with respect to her unfinished, uninhabitable home 

and the land on which it was situated. Felton and plaintiff 

Tahir Zaman, a licensed real estate agent, entered into a 

written contract for the sale of the property. A week later, at 

a closing in which neither party was represented by counsel, 

Felton and Zaman entered into two separate agreements: a lease 

agreement under which Felton became the lessee of the property, 

and an agreement that gave her the option to repurchase the 

property from Zaman at a substantially higher price than the 

price for which she sold it. For more than a year, Felton 

remained on the property, paying no rent. She did not exercise 

her right to repurchase.

Zaman filed this action, claiming that he was the purchaser 

in an enforceable land sale agreement, and that he therefore was

entitled to exclusive possession of the property and to damages. 

Felton asserted numerous counterclaims, alleging fraud, slander 

of title, violations of the Consumer Fraud Act (CFA), N.J.S.A.

56:8-1 to -195, and violations of other federal and state 
3

consumer protection statutes. She claimed that the parties’ 

transactions collectively comprised an equitable mortgage and 

constituted a foreclosure scam, entitling her to relief under 

several theories. She further contended that the transactions 

were voidable by virtue of an alleged violation of this Court’s 

opinion in In re Opinion No. 26. 

A jury rendered a verdict in Zaman’s favor with respect to 

the question of whether Felton knowingly sold her property to 

him. The trial court subsequently conducted a bench trial and 

rejected Felton’s remaining claims, including her contention 

that the transactions gave rise to an equitable mortgage and her 

allegation premised upon In re Opinion No. 26. An Appellate 

Division panel affirmed the trial court’s judgment.

We affirm in part and reverse in part the Appellate 

Division’s determination. We affirm, as adequately supported by 

the evidence presented at trial, the jury’s determination that 

Felton knowingly sold her property to Zaman. We reverse the 

portion of the Appellate Division’s opinion that affirmed the 

trial court’s dismissal of Felton’s claim that the parties’ 

agreements constituted a single transaction that gave rise to an 

equitable mortgage. We adopt the eight-factor standard for the 

determination of an equitable mortgage set forth by the United 

States Bankruptcy Court in O’Brien v. Cleveland, 423 B.R. 477, 

491 (Bankr. D.N.J. 2010). We remand to the trial court for 
4

application of that standard to this case, and, in the event 

that the trial court concludes that an equitable mortgage was 

created by the parties, for the adjudication of two of Felton’s 

statutory claims based on alleged violations of consumer lending 

laws, as well as several other claims not adjudicated by the 

trial court. We concur with the trial court and Appellate 

Division that Felton has no claim under the CFA, that this case 

does not implicate In re Opinion No. 26, and that Felton’s 

remaining claims were properly dismissed.

I.

The trial record reveals the following information about 

the transactions in dispute in this case.

By 2007, Felton was an experienced buyer and seller of real 

estate, who had participated in prior land sales and financing 

transactions that involved significant sums of money. In July 

1976, Felton purchased the property at issue in this case, 

consisting of approximately fifteen acres of land in Plumsted 

Township, and commenced construction of a residence on the 

property. According to the testimony of a municipal 

construction and zoning official, due to structural defects and 

building code violations of which Felton was aware, no 

certificate of occupancy was issued with respect to the house, 

and the house was uninhabitable. As of 2007, a construction 

mortgage in the amount of $105,000 obtained by Felton was in 
5

default, and Felton confronted the imminent foreclosure of her 

unfinished home.

In 2007, Zaman worked primarily as a medical imaging 

technologist. He conducted a “side business” in which he would 

purchase distressed residential properties, primarily from 

sheriffs’ sales, and rehabilitate and sell the homes. Zaman 

held a real estate license, which he used primarily to avoid 

paying real estate commissions on his purchases and sales. In 

ten years as a licensed real estate broker, Zaman acted as a 

broker for other parties’ transactions on only two occasions. 

Felton was introduced to Zaman by a mutual acquaintance, 

Joseph Richardson. According to Zaman, during an initial 

telephone call conducted by Zaman, Felton, and Richardson, Zaman 

told Felton that his business was to purchase properties, not to 

provide mortgages. Zaman disclosed to Felton that he had a real 

estate license. 

On June 16, 2007, Felton, Zaman, and Richardson met at the 

Plumsted Township property to discuss its potential sale. Zaman 

inspected the property, but was unaware that the house lacked a 

certificate of occupancy and was uninhabitable. Felton 

requested a price of $250,000 for the property, and Zaman made a

$200,000 counteroffer. According to the testimony of Zaman, 

Felton said that she wanted to keep the property. In response, 

Zaman told Felton that if she accepted his offer of $200,000, he 
6

would agree to a buy-back option and would allow her to remain 

on the property as a tenant.

During the June 16, 2007 meeting, Felton and Zaman executed 

a written land sale agreement, and Richardson signed the 

agreement as a witness. The agreement, a standard form obtained 

by Zaman from the real estate office with which he was 

associated, identified Zaman as the buyer and Felton as the 

seller. It described the location of the property and set forth 

a sale price of $200,000. The agreement provided that each 

party had the right to arrange for an attorney to review its 

terms within three days of its execution, that either party 

could cancel the sale during the attorney-review period, and 

that the agreement would be binding at the conclusion of that 

period. On its last page, the land sale agreement warned the 

buyer and seller about the risks of proceeding without an 

attorney, the benefits of retaining an attorney, and the 

conflicting interests of the broker and title company with 

respect to a real estate sale. The agreement contained no 

reference to a buy-back or lease provision. 

The closing took place on June 23, 2007, accelerated from a 

later date because of Felton’s concern that her property would 

be sold at a sheriff’s sale. Felton had not arranged for a deed 
7

to be prepared prior to closing. She accepted Zaman’s offer to 

have a deed prepared by a local attorney at Felton’s expense.1 

On the day of the closing, Felton and Zaman executed 

documents in two stages.2 First, at a Bordentown diner, they 

signed the lease and a seller’s residency certification, which 

were not notarized. After a brief dispute over the terms of the 

lease and buy-back agreements, Felton and Zaman agreed that 

Felton would pay Zaman $1,000 per month in rent. They also 

agreed that Felton would have an option to repurchase her 

property within three months for $237,000, which according to 

Zaman, would have been extended to one year had Felton requested 

an extension. 

Later, at the local branch of a bank, Felton signed the 

deed, an affidavit of title, and the buy-back agreement.3 Zaman 

gave Felton a cashier’s check in the amount of $85,960, which 

was calculated by subtracting from the $200,000 purchase price 

the amount that Zaman needed to pay off the existing mortgage, 

 

1 It is unclear whether the attorney contacted by Zaman spoke 

with Felton before preparing the deed on her behalf.

2 The record contains no evidence that Zaman learned before 

closing, or within a reasonable time thereafter, that the 

property was uninhabitable.

3 There was conflicting testimony at trial about the execution of 

the documents. Felton testified that she was shown only the 

signature pages of the documents that she signed. However, the 

attending notary testified that his practice is to verify that 

each individual who signs a document in his presence understands 

the terms of that document and has not been coerced into signing 

the document.
8

satisfy outstanding property tax obligations, and pay other 

expenses related to the sale. Zaman also paid Richardson 

$5,000, which was characterized at trial as a finder’s fee. The 

parties did not execute any mortgage documents.

At trial, Zaman maintained that he did not offer a mortgage 

to Felton, and that he has never offered a mortgage to anyone. 

Felton, in contrast, testified that she understood the parties’ 

transaction to be a mortgage. By Felton’s account, she thought 

that Zaman was loaning her $200,000. She also construed the 

$85,960 check issued to her to be the down payment on the loan, 

and understood that she would satisfy the terms of the mortgage 

loan if she paid Zaman $237,000 within three months of closing. 

Felton admitted that she never inquired about the interest rate 

applied to the purported mortgage, and that the parties never 

discussed any such interest rate.

Neither party exercised the right to cancel the agreement 

during the three-day attorney review period. However, one week 

after closing, while he was visiting the bank that held the 

existing construction loan, Zaman learned that Felton had told 

the bank that her transaction with Zaman was a “fraudulent 

deal,” and that she had urged the bank to reject any payment 

made by Zaman. The mortgagee bank initially refused to suspend 

foreclosure proceedings, but reversed its position after Zaman 

filed suit to compel it to accept his payment and to cancel the 
9

mortgage. Felton also attempted to rescind the sale agreement 

by sending a check in the amount of $85,983.65 to Zaman, but 

Zaman refused to cash the check. On July 19, 2007, Zaman 

recorded the deed to the disputed property. 

For the next seventeen months, Felton continued to occupy 

the property. She did not pay rent in accordance with the lease 

agreement, or exercise her contractual right to repurchase the 

property.

II.

In December 2008, Zaman filed a complaint against Felton in 

the Law Division. In the complaint, filed pursuant to N.J.S.A.

2A:35-1 to -2, Zaman sought possession of real property and 

damages derived from Felton’s allegedly illegal use and 

occupancy of the property.

4 Felton filed a counterclaim, 

asserting claims based on fraud, slander of title, violations of 

the CFA, violations of the Fair Foreclosure Act (FFA), N.J.S.A.

2A:50-53 to -68, and violations of the federal Truth in Lending 

Act (TILA), 15 U.S.C.A. §§ 1601 - 1667. 

As requested by Felton, and by agreement of the parties, 

the trial court elected to hold a bifurcated trial. It assigned

to the jury only the issue of fraud and reserved the remaining 

issues for a subsequent bench trial. After five trial days, the 

 

4 Felton’s husband, who died in 1991, was also named as a 

defendant. 
10

jury was charged to determine the following questions: whether 

Zaman had proven by a preponderance of the evidence that Felton 

knowingly agreed to sell the property to him, and if not, 

whether Felton had proven by clear and convincing evidence that 

Zaman obtained his deed to the property by “fraudulent actions.”

The trial court instructed the jury that if it answered the 

first question in the affirmative, it should not reach the 

second question, and that both questions called for “yes or no” 

answers. By a vote of six to one, the jury concluded that Zaman 

had proven by a preponderance of the evidence that Felton 

knowingly agreed to sell her property to him, thus disposing of 

the only issue presented in the first phase of the bifurcated 

trial. Felton filed a motion for a new trial under Rule 4:49-1, 

which the trial court denied.

The trial court then conducted the trial’s second phase, in 

which the trial judge was the factfinder. After hearing 

additional testimony during a single trial day, the trial court 

dismissed all of Felton’s remaining claims. First, the trial 

court rejected Felton’s contention that the parties’ agreement 

was invalid because Zaman had failed to state in the contract 

that he held a real estate license. Second, the trial court 

rejected Felton’s argument premised upon In re Opinion No. 26. 

The court concluded that the three-day attorney review period 
11

and right of rescission had adequately protected Felton, who 

chose not to retain counsel or rescind the contract. 

Third, the trial court rejected Felton’s contention that 

her contract with Zaman was an unconscionable product of 

“grossly disproportionate bargaining power,” given Felton’s 

experience with prior real estate transactions and her awareness 

that the transaction to which she agreed constituted the sale of 

her property. Finally, the trial court held that no equitable 

mortgage was created by the parties’ agreements. In that 

regard, the trial court cited the jury’s finding that Felton 

intended to sell her property, as well as evidence that Felton 

understood that a sale of her property was her only alternative 

to foreclosure. The court held that the subsequent lease and 

buy-back provisions were separate agreements that were intended 

to protect the seller after closing and permit her to remain on 

the property, and that those agreements were not components of 

the original sale. The trial court characterized the case as an 

example of “[s]eller’s remorse,” and ruled that despite Felton’s 

equitable mortgage claim, the parties did not agree upon a loan 

secured by a deed of title. In light of that finding, the trial 

court did not reach Felton’s remaining arguments and dismissed 

her counterclaims.

Felton appealed, and an Appellate Division panel affirmed. 

The panel dismissed Felton’s argument that the trial court’s 
12

jury instruction incorrectly framed the issue of whether there 

was a knowing sale of the property. It rejected, on hearsay 

grounds, Felton’s contention that she should have been permitted 

to testify about a previous appraisal of her property. Citing 

the jury’s determination that the property was knowingly sold, 

the panel concluded that the trial court correctly declined to 

find an equitable mortgage or a valid claim under the CFA. 

Finally, the panel affirmed the trial court’s determination that 

In re Opinion No. 26 does not govern this case.

We granted Felton’s petition for certification. 213 N.J.

537 (2013). We also granted the motions of Legal Services of 

New Jersey (LSNJ) and New Jersey Association of Realtors (NJAR) 

to appear as amici curiae.

III.

Felton contends that she entered into a transaction that 

operated as an equitable mortgage and that she was the victim of 

a fraudulent mortgage scheme. Felton challenges the jury 

verdict that she knowingly entered into an agreement to sell her 

property, and that Zaman did not commit a fraud. She contends 

that the jury verdict does not preclude the court from 

concluding that the parties’ agreements constituted a single 

transaction that gave rise to an equitable mortgage. Felton 

argues that the Appellate Division panel misapplied this Court’s 

opinion in In re Opinion No. 26, and that the parties’ 
13

agreements should be held void because Zaman violated the 

principles of that decision. Felton claims that the trial court 

and Appellate Division improperly failed to enforce the CFA, the

FFA, the TILA, the Foreclosure Rescue Fraud Prevention Act

(FRFPA), N.J.S.A. 46:10B-53 to -68, N.J.S.A. 45:15-17(k) and 

(q), which authorize the New Jersey Real Estate Commission to 

sanction real estate brokers for certain acts in real estate 

transactions, and N.J.S.A. 2C:21-19, New Jersey’s criminal usury 

law.

Zaman characterizes the parties’ transactions as a

negotiated agreement for the sale of property with subsequent 

agreements that did not create an equitable mortgage. In 

support of that contention, Zaman cites the jury’s finding that 

Felton intended to sell her land, Felton’s inability to make the 

low monthly payments on her construction loan, the sequential

rather than simultaneous execution of the parties’ agreements, 

Felton’s experience in real estate transactions, her failure to 

object to any contract provisions, and the parties’ equivalent

bargaining power. Zaman contends that if the factors set forth 

in O’Brien, supra, 423 B.R. at 491, apply, those factors weigh 

against a finding of an equitable mortgage in this case. Zaman 

argues that In re Opinion No. 26 does not govern the parties’ 

transaction because he acted as a private investor, not a real 

estate broker, in the closing at issue, and that the contract 
14

provided sufficient protection for both parties in its provision 

authorizing a three-day period of attorney review. Zaman argues 

that the CFA does not govern his conduct with respect to this 

transaction because he was not a seller, but a consumer, because 

he committed no unlawful practice within the meaning of N.J.S.A.

56:8-2, and because it was he, not Felton, who was defrauded in 

this case when he was induced to purchase an uninhabitable 

residence. He contends that the FRFPA does not apply because no 

claim based upon this statute was made before the trial court, 

that the FFA is irrelevant because no foreclosure proceedings 

were instituted, that the TILA does not govern this case because 

there was no mortgage and any TILA claims asserted are timebarred, and that Felton’s remaining claims are meritless or 

time-barred. 

Amicus curiae LSNJ urges the Court to apply the factors of 

O’Brien, supra, 423 B.R. at 491, and to rule that the parties’

transaction created an equitable mortgage that violated the CFA 

and triggered an obligation on Zaman’s part to comply with the 

FFA. LSNJ asserts that the trial court and Appellate Division 

sanctioned contractual chicanery that undermines the CFA, the 

equitable mortgage doctrine, and the FRFPA. LSNJ contends that 

Zaman failed to meet the standards of his profession as a real 

estate broker, in violation of In re Opinion No. 26, and that 

this gave rise to a separate violation of the CFA. 
15

Amicus curiae NJAR urges the Court not to expand the reach 

of In re Opinion No. 26 to incorporate the transaction in 

dispute. NJAR argues that Zaman’s real estate license was 

tangential to his role in this case given that he extracted no 

commission or fee and the real estate office with which he was 

affiliated had no role in this dispute. NJAR contends that In 

re Opinion No. 26 should not govern transactions merely where 

one of the parties has a real estate license because in such a 

setting, the individual with a real estate license is not 

providing the other party with assistance that could be mistaken 

for legal advice. NJAR further argues that the CFA should not 

govern the parties’ agreements because Zaman acted as a private 

individual, not as a seller to consumers or a commercial lender. 

IV.

A.

We begin our review of this bifurcated case by considering 

Felton’s challenge to the verdict rendered by the jury following

the first phase of the trial. At Felton’s request, the trial 

court submitted only a limited issue to the jury: whether the 

parties’ agreement constituted a fraudulent transfer.5 The jury 

responded in the affirmative to a single question: whether 

 

5 This limitation was sought by Felton’s attorney, who requested 

prior to trial that the trial court “limit the request for a 

jury trial to the issues raised by the Fourth Separate Defense 

(Fraud) and the first count of the Counterclaim (Fraud).”
16

Zaman had proven by a preponderance of the evidence that Felton 

knowingly agreed to sell the property to him.6 Felton contends

on appeal that the jury’s verdict was against the weight of the 

evidence.

We review the jury’s determination in accordance with a 

deferential standard. “A jury verdict is entitled to 

considerable deference and ‘should not be overthrown except upon 

the basis of a carefully reasoned and factually supported (and 

articulated) determination, after canvassing the record and 

weighing the evidence, that the continued viability of the 

judgment would constitute a manifest denial of justice.’” Risko 

v. Thompson Muller Auto. Grp., Inc., 206 N.J. 506, 521 (2011) 

(quoting Baxter v. Fairmont Food Co., 74 N.J. 588, 597-98 

(1977)). A trial court should overturn a jury verdict and grant 

a new trial “only where to do otherwise would result in a 

miscarriage of justice shocking to the conscience of the court.” 

Ibid. (internal quotation marks omitted). A reviewing court 

will not reverse a trial court’s denial of a motion for a new 

 

6 Although it appears that Felton preserved her right to 

challenge the jury verdict on appeal, the record with respect to 

her applications following the verdict is incomplete. The 

Appellate Division opinion referred to a motion for a judgment 

notwithstanding the verdict, filed by Felton pursuant to Rule

4:40-2, but no such motion appears in the record before this 

Court. The record contains a notice of motion for a new trial 

filed pursuant to Rule 4:49-1. Because of the deficiencies in 

the record, it is unclear what arguments were made by Felton in 

support of either motion. 
17

trial “unless it clearly appears that there was a miscarriage of 

justice under the law.” R. 2:10-1; accord Risko, supra, 206 

N.J. at 522. An appellate court should not disturb the findings 

of the jury merely because it would have found otherwise upon 

review of the same evidence. Carrino v. Novotny, 78 N.J. 355, 

360 (1979).

Applying that deferential standard, we reject Felton’s 

challenge to the jury verdict. There was more than sufficient 

evidence in the trial record to support the jury’s determination

that Zaman proved by a preponderance of the evidence that Felton 

knowingly agreed to sell her property to him. On June 16, 2007, 

Felton and Zaman executed a written land sale agreement,

entitled “Contract for Sale of a One-to-Four Family Residential 

Property.” The agreement described the location of the property 

and the negotiated sale price of $200,000. Moreover, the 

property was encumbered with a construction mortgage on which 

Felton owed approximately $105,000 to the mortgagee bank. 

Felton was not able to pay the loan as it came due and was 

facing foreclosure. She understood the sale of the property to 

be her only means of evading foreclosure. At the June 23, 2007 

closing, Zaman took possession of the deed to the property. 

Zaman also provided Felton with a cashier’s check for $85,960, 

representing the difference between the purchase price and the 

amount needed to pay off the mortgage, back taxes, and other 
18

expenses associated with the sale. In short, the jury heard 

ample evidence that Felton was fully informed about the nature 

of the agreements that she signed, and that she knowingly 

executed an agreement to sell her property. 

Accordingly, we affirm the Appellate Division panel’s 

determination insofar as it affirmed the jury’s determination

that Zaman had proven by a preponderance of the evidence that 

Felton knowingly conveyed her property to him. 

B.

We next review the trial court’s factual findings in the 

second phase of the bifurcated trial, in which the trial judge 

acted as the factfinder on all issues other than the single 

issue considered by the jury. Our inquiry on appeal is limited 

to whether there is “substantial, credible evidence to support 

the court’s findings.” In re Civil Commitment of J.M.B., 197 

N.J. 563, 597, cert. denied, 558 U.S. 999, 130 S. Ct. 509, 175 

L. Ed. 2d 361 (2009); see also State v. Johnson, 42 N.J. 146, 

162 (1964) (“The aim of the review at the outset is . . . to 

determine whether the findings made could reasonably have been 

reached on sufficient credible evidence present in the 

record.”). Accordingly, deference is given “to the trial 

court’s factual findings . . . ‘when supported by adequate, 

substantial and credible evidence.’” Toll Bros., Inc. v. Twp. 

of W. Windsor, 173 N.J. 502, 549 (2002) (quoting Rova Farms 
19

Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 

(1974)). This is especially the case when those findings “are 

substantially influenced by [the judge’s] opportunity to hear 

and see the witnesses and to have the ‘feel’ of the case, which 

a reviewing court cannot enjoy.” Johnson, supra, 42 N.J. at

161.

In contrast, the trial court’s conclusions of law are 

reviewed de novo. “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). “It is a 

well-established principle of appellate review that a reviewing 

court is neither bound by, nor required to defer to, the legal 

conclusions of a trial or intermediate appellate court.” State 

v. Gandhi, 201 N.J. 161, 176 (2010).

We first consider the trial court’s rejection of Felton’s 

claim that the parties entered into an equitable mortgage. 

Felton claims that although her initial agreement with Zaman was 

structured as a sale, the parties’ agreements should be 

construed as a single transaction, which was effectively a high

interest loan secured by the deed to her property.

The doctrine of equitable mortgages “is founded upon that 

cardinal maxim in equity which regards as done that which has 

been agreed to be, and ought to have been, done.” Rutherford 
20

Nat’l Bank v. H.R. Bogle & Co., 114 N.J. Eq. 571, 573-74 (N.J. 

Ch. 1933); see also Humble Oil & Ref. Co. v. Doerr, 123 N.J. 

Super. 530, 551 (Ch. Div. 1973) (stating that in recognizing 

equitable mortgage, “[i]t is clear that equity looks to 

substance rather than to form, and that a guarantor or surety 

who takes property or an interest therein as security for his 

guaranty is a mortgagee thereof in equity”). As an Appellate 

Division panel observed,

“[i]f a transaction resolves itself into a 

security, whatever may be its form and 

whatever name the parties may choose to give 

it, it is, in equity, a mortgage. If a deed 

or contract, lacking the characteristics of 

a common law mortgage, is used for the 

purpose of pledging real property, or some 

interest therein, as security for a debt or 

obligation, and with the intention that it 

shall have effect as a mortgage, equity will 

give effect to the intention of the parties. 

Such is an equitable mortgage.”

[Welsh v. Griffith-Prideaux, Inc., 60 N.J. 

Super. 199, 208 (App. Div. 1960) (quoting 

J.W. Pierson Co. v. Freeman, 113 N.J. Eq.

268, 270-71 (E. & A. 1933)).]

Courts apply principles of equity to “look beyond the plain 

terms” of an agreement between the parties, and thereby 

determine whether the agreement is in effect a mortgage. 

Johnson v. NovaStar Mortg., Inc., 698 F. Supp. 2d 463, 468 

(D.N.J. 2010). In that inquiry, the court focuses on the 

characteristics of the transaction at its inception:
21

The doctrine has been firmly established 

from an early day that when the character of 

a mortgage has attached at the commencement 

of the transaction, so that the instrument, 

whatever be its form, is regarded in equity 

as a mortgage, that character of mortgage 

must and will always continue. If the 

instrument is in its essence a mortgage, the 

parties cannot by any stipulations, however 

express and positive, render it anything but 

a mortgage, or deprive it of the essential 

attributes belonging to a mortgage in 

equity.

[Humble Oil, supra, 123 N.J. Super. at 544-

45.]

Ordinarily, the conveyance of a property accompanied or 

followed by a leaseback transaction is precisely what it 

purports to be: a sale in which the parties separately agree 

that the seller will become the tenant, and the buyer will 

become the landlord, in accordance with the terms of a lease. 

However, “New Jersey courts have repeatedly found that saleleaseback arrangements made to avoid foreclosure are in fact 

equitable mortgages.” Johnson, supra, 698 F. Supp. 2d at 469; 

see also James Talcott, Inc. v. Roto Am. Corp., 123 N.J. Super.

183, 202 (Ch. Div. 1973) (noting that “[t]here are numerous 

authorities for the proposition that an absolute conveyance 

intended as security for an obligation will be treated as a 

mortgage”). It is the trial court’s task to discern whether the 

transaction has been labeled as a land sale in order to mask its 
22

actual objective: a mortgage loan secured by a deed to the 

property at issue.

In Johnson, supra, the United States District Court for the 

District of New Jersey adopted a standard articulated by the 

United States Bankruptcy Court for the District of New Jersey in 

O’Brien, supra, 423 B.R. at 491. 698 F. Supp. 2d at 469-70. In 

O’Brien, supra, the Bankruptcy Court scrutinized a residential 

sale that was conducted under the threat of imminent 

foreclosure, in which the parties agreed that the seller would 

remain in his home and buy the home back from the buyer in a 

series of payments over time. 423 B.R. at 483-86. It 

identified eight factors to assist trial judges in determining 

whether a given transaction gives rise to an equitable mortgage:

[(1)] Statements by the homeowner or 

representations by the purchaser indicating 

an intention that the homeowner continue 

ownership; [(2)] A substantial disparity 

between the value received by the homeowner 

and the actual value of the property; [(3)]

Existence of an option to repurchase; [(4)]

The homeowner’s continued possession of the 

property; [(5)] The homeowner’s continuing 

duty to bear ownership responsibilities, 

such as paying real estate taxes or 

performing property maintenance; [(6)]

Disparity in bargaining power and 

sophistication, including the homeowner’s 

lack of representation by counsel; [(7)]

Evidence showing an irregular purchase 

process, including the fact that the 

property was not listed for sale or that the 

parties did not conduct an appraisal or 

investigate title; [(8)] Financial distress 

of the homeowner, including the imminence of 
23

foreclosure and prior unsuccessful attempts 

to obtain loans.

[Id. at 491.]

Under the O’Brien framework, the court considers not only 

the form of the transaction itself but circumstances that can 

motivate a party to disguise a mortgage secured by a property as 

a sale of land and indications that both parties intend the 

seller to retain the land notwithstanding the purported sale. 

We concur with the District Court that the eight factors set 

forth in O’Brien are “useful and consistent with New Jersey 

equitable mortgage jurisprudence.” Johnson, supra, 698 F. Supp.

2d at 470. We adopt the O’Brien factors as a comprehensive and 

practical standard to guide trial courts as they determine 

whether a particular transaction, or series of transactions,

gives rise to an equitable mortgage.

We remand the matter to permit the trial court to make 

findings addressing each of the eight factors that comprise the 

O’Brien test. Because the parties presented extensive evidence 

at trial regarding Felton’s financial situation, the parties’ 

respective experiences with land sale transactions, their 

negotiations, their statements about their intent to enter into 

the transactions, the terms of each agreement, and the conduct 

of each party following closing, the trial court’s findings on 
24

remand may be based upon the existing record, without the need 

for further testimony.

We note that in ruling that the parties’ transactions did 

not give rise to an equitable mortgage, the trial court relied 

in part on the jury’s determination that Felton intended to sell 

her property, and the absence of any indication in the parties’ 

agreements that they contemplated a mortgage loan. Consistent 

with the limitation of its inquiry to the issue of fraud, the 

jury was not instructed on the question of whether the parties 

intended to create an equitable mortgage. The jury’s 

determination that Felton knowingly sold her property does not 

itself resolve the question of whether the parties created an 

equitable mortgage. Its finding that Zaman had proven by a 

preponderance of the evidence that Felton knowingly entered into 

a land sale may, however, be relevant to one or more of the 

O’Brien factors in the trial court’s inquiry on remand. Other 

considerations cited by the trial court, such as the imminent 

foreclosure proceedings, Felton’s inability to obtain a new 

mortgage or meet her obligations under her existing loan, and 

Felton’s failure to exercise her right of repurchase, may also 

be relevant to the trial court’s application of the O’Brien

factors on remand. 

C.
25

Affirming the determination of the trial court, the

Appellate Division panel rejected Felton’s claim that Zaman 

violated the rule set forth by this Court in In re Opinion No. 

26, supra, 139 N.J. 323. We concur with the Appellate 

Division’s analysis.

In In re Opinion No. 26, this Court considered whether real 

estate brokers commit the unauthorized practice of law when they 

conduct residential real estate transactions in which the 

“sellers and buyers are . . . unrepresented by counsel.” Id. at 

326. The Court analyzed the risks posed to an uncounseled 

residential real estate buyer or seller when a real estate 

broker, whose commission is contingent on the successful 

completion of the transaction, conducts the closing. Id. at 

334-35. The Court noted the potential conflict between the 

interests of the broker, who may choose the attorney who drafts 

the deed, and the interests of the seller, who may be under the 

mistaken impression that he or she is receiving independent 

legal advice from counsel selected by the broker. Id. at 336-

37. The Court noted that the buyer is similarly unprotected by 

legal advice in an uncounseled closing. Id. at 337. It 

observed that “[t]he buyer may not know if the description of 

the property is precisely that assumed to be the subject of the 

purchase,” may be unaware of whether “the title described in the 

contract is that with which he would be satisfied,” may 
26

misunderstand the seller’s obligations and may lack “fair 

comprehension of whether all of the possible and practical 

concerns of [the] buyer have been addressed by the contract.” 

Id. at 335.

The Court held that although it has the authority to 

prohibit residential real estate closings conducted without the 

assistance of counsel, “the public interest does not require 

such a prohibition.” Id. at 326. Instead, it determined that 

if residential buyers and sellers “are informed of the true 

interests of the broker and title officer, sometimes in conflict 

with their own interests, and of the risks of not having their 

own attorney, [they] should be allowed to proceed without 

counsel.” Ibid. 

To that end, the Court prescribed conditions under which 

“those participating in such transactions shall not be deemed 

guilty of the unauthorized practice of law.” Ibid. It required 

that both sellers and buyers be informed in writing by the real 

estate broker about the benefits of seeking the advice of 

counsel, the risks associated with proceeding unrepresented, and 

the “conflicting interests of brokers and title companies in 

these matters.” Id. at 357-59, 362-63. Pending recommendations 

from the Civil Practice Committee on “practical methods for 

achieving those aims,” the Court mandated a written notice 

“attached to the proposed contract of sale as its cover page,”
27

supplemental to the notice required to appear on the first page 

of the contract, advising the parties that the contract will be 

binding within three business days, that an attorney for either 

party may review its terms, and that the agreement may be 

cancelled within the attorney review period. Id. at 357-58, 

362-63. As drafted on an interim basis by the Court, that 

notice provided that the real estate broker represented the 

seller and not the buyer, that the title company represented 

neither party, that it is in the broker’s financial interest 

that the house be sold and the closing completed, that the 

broker is neither permitted nor qualified to provide legal 

advice, and that there are significant risks to foregoing the 

assistance of counsel. Id. at 362-63.

The risk that the Court addressed in In re Opinion No. 26 -

- that a real estate broker acting in his or her own interest 

will promote the completion of a real estate transaction to the 

detriment of the seller, the buyer, or both –- is not raised in 

the circumstances of this case. The Court’s concern in In re 

Opinion No. 26 was “unlearned and unskilled” legal advice. Id.

at 341 (internal quotation marks omitted). Its remedy was 

premised on a real estate broker’s authority to “guide, control 

and handle” a transaction involving unrepresented parties, who 

may erroneously believe that they are being advised by counsel. 

Id. at 326. 
28

Here, in contrast to the setting addressed by the Court in 

In re Opinion No. 26, Zaman acted not in his professional 

capacity as a broker seeking to promote a successful closing but 

on his own behalf as the property’s buyer. Nothing in the trial 

record suggests that Zaman purported to provide legal advice to 

Felton, or that Felton was somehow led to believe that Zaman was 

her advocate. Given the parties’ relationship and Felton’s 

experience in real estate transactions, the record reveals no 

cause for concern that Zaman’s statements to Felton could have 

been misconstrued as the advice of her lawyer. The fact that 

Zaman holds a real estate license does not deprive him of the 

right to participate in a transaction on his own behalf, or 

convert his activities in that regard to the unauthorized 

practice of law. See In re Baker, 8 N.J. 321, 346 (1951) (Case, 

J., dissenting).

Accordingly, we concur with the trial court and the 

Appellate Division that In re Opinion No. 26 is irrelevant to 

this case, that Zaman did not violate the principles of that 

decision, and that the trial court properly declined to void the 

parties’ transactions on that ground.

D.

Finally, we review the trial court’s dismissal of Felton’s 

remaining statutory claims.
29

In her counterclaim, Felton asserted a CFA claim premised 

upon Zaman’s alleged fraud in connection with the sale or 

advertisement of real estate, in violation of N.J.S.A. 56:8-2. 

To prevail on a CFA claim, a plaintiff must establish three 

elements: “1) unlawful conduct by defendant; 2) an 

ascertainable loss by plaintiff; and 3) a causal relationship 

between the unlawful conduct and the ascertainable loss.”

Bosland v. Warnock Dodge, Inc., 197 N.J. 543, 557 (2009); see

also Int’l Union of Operating Eng’rs Local No. 68 Welfare Fund 

v. Merck & Co., 192 N.J. 372, 389 (2007). N.J.S.A. 56:8-2 

defines an “unlawful practice” to include

any unconscionable commercial practice, 

deception, fraud, false pretense, false 

promise, misrepresentation, or the knowing, 

concealment, suppression, or omission of any 

material fact with intent that others rely 

upon such concealment, suppression or 

omission, in connection with the sale or 

advertisement of any merchandise or real 

estate, or with the subsequent performance 

of such person as aforesaid, whether or not 

any person has in fact been misled, deceived 

or damaged thereby.

For purposes of determining whether the first element -–

the existence of an unlawful practice -– is established, the CFA 

“defines ‘sale’ to include ‘any sale, rental or distribution, 

offer for sale, rental or distribution or attempt directly or 

indirectly to sell, rent or distribute.’” D’Agostino v. 

Maldonado, 216 N.J. 168, 186 (2013) (quoting N.J.S.A. 56:8-
30

1(e)). “Advertisement” is defined to denote “the attempt . . . 

to induce directly or indirectly any person to enter or not 

enter into any obligation to acquire any title or interest in 

any merchandise or to increase the consumption thereof or to 

make any loan.” N.J.S.A. 56:8-1(a). As a component of the 

definition of “merchandise” in N.J.S.A. 56:8-1(c), “services” 

offered to the public may involve an unlawful practice for 

purposes of the CFA. See Lemelledo v. Beneficial Mgmt. Corp. of 

Am., 150 N.J. 255, 265 (1997) (holding that sale and provision 

of consumer credit constitutes “merchandise” under N.J.S.A.

56:8-1(c)); Quigley v. Esquire Deposition Serv., LLC, 400 N.J. 

Super. 494, 505-06 (App. Div. 2008) (recognizing shorthand 

reporting services and sale of deposition transcripts as 

“merchandise” under CFA). 

Notwithstanding these broad definitions, New Jersey 

appellate courts have adopted “a limited construction of the 

[CFA]’s applicability to real estate transactions.” 539 Absecon 

Blvd., L.L.C. v. Shan Enters. Ltd., 406 N.J. Super. 242, 274 

(App. Div. 2009). Consistent with the CFA’s limitation to 

“fraudulent, deceptive or other similar kind of selling or 

advertising practices,” Daaleman v. Elizabethtown Gas Co., 77 

N.J. 267, 271 (1978), our courts have declined to impose the CFA 

remedies upon the non-professional, casual seller of real 

estate, see Strawn v. Canuso, 140 N.J. 43, 59 (1995) (limiting 
31

“holding to professional sellers of residential housing (persons 

engaged in the business of building or developing residential 

housing) and the brokers representing them”); Byrne v. Weichert 

Realtors, 290 N.J. Super. 126, 134 (App. Div.) (“The provision 

does not apply, however, to non-professional sellers of real 

estate, i.e. to the homeowner who sells a house in the normal 

course of events.”), certif. denied, 147 N.J. 259 (1996). 

Indeed, this Court has never applied the CFA against a nonprofessional, who does not advertise real estate services to the 

public, based upon his or her purchase of residential real 

estate for personal use or as an investment.

In D’Agostino, supra, the Court held that a foreclosure 

rescue scheme that was advertised to the public and involved the 

payment of a fee gave rise to a cognizable claim under the CFA. 

216 N.J. at 186-88. The circumstances of this case differ

significantly from those of D’Agostino. There, the plaintiffs 

were prompted to contact the defendant about a foreclosure 

rescue after seeing an advertisement of the defendant’s real 

estate services on his vehicle. Id. at 176, 187. Moreover, the 

defendant in D’Agostino demanded and collected a fee for his 

real estate services. Id. at 187-88. By virtue of the five 

separate agreements that the defendant prepared for the 

plaintiff’s signature, the defendant obtained the plaintiff’s 
32

property, valued at $480,000, for $10 -– a result never 

contemplated by the plaintiff. Id. at 177, 190. 

In contrast, Zaman did not advertise real estate services 

to the public, initiate contact with Felton, or demand a fee for 

real estate services. There is no evidence that Zaman 

represented himself to the public as a source of mortgage loans, 

or that Felton was deceived with respect to the terms or 

consequences of the parties’ agreements. The considerations 

that prompted this Court to recognize a CFA claim in D’Agostino

are not presented by this case.

Accordingly, regardless of whether the trial court 

determines on remand that the parties’ transactions created an 

equitable mortgage, we hold that the record does not support a 

finding that Zaman committed an “unconscionable commercial 

practice” within the meaning of N.J.S.A. 56:8-2. Accordingly, 

the trial court properly dismissed Felton’s CFA claim.

Felton’s FFA claim, premised upon a contention that Zaman’s 

action for possession of the property was not accompanied by the 

“notice of intention to take action” mandated by N.J.S.A. 2A:50-

56, is contingent upon a finding that the parties’ transactions 

gave rise to an equitable mortgage. N.J.S.A. 2A:50-56 mandates 

that, prior to taking any “legal action to take possession of 

[a] residential property which is the subject of [a] mortgage,

[a] residential mortgage lender [must] give the residential 
33

mortgage debtor notice of such intention at least 30 days in 

advance of such action.” Accordingly, if the trial court 

determines on remand that there was no equitable mortgage in 

this case, it need not further consider Felton’s FFA claim. If 

it determines that the parties’ agreements gave rise to an 

equitable mortgage, the trial court should consider the merits 

of Felton’s FFA claim.

With the exception of one claim, we agree with the trial 

court and Appellate Division that Felton’s TILA claims were

properly dismissed as time-barred. Pursuant to 15 U.S.C.A. §

1640, a TILA action 

may be brought in any United States district 

court, or in any other court of competent 

jurisdiction, within one year from the date 

of the occurrence of the violation . . . .

Any action under this section with respect 

to any violation of [15 U.S.C.A. § 1639, 

1639b, or 1639c] may be brought in any 

United States district court, or in any 

other court of competent jurisdiction, 

before the end of the 3-year period

beginning on the date of the occurrence of 

the violation.

[15 U.S.C.A. § 1640(e) (emphasis added).]

“The violation ‘occurs’ when the transaction is 

consummated. Nondisclosure is not a continuing violation for 

purposes of the statute of limitations.” In re Smith, 737 F.2d 

1549, 1552 (11th Cir. 1984) (internal citation omitted). “The 

credit transaction is consummated when ‘a contractual 
34

relationship is created between [a creditor and consumer].’”

Williams v. Countrywide Home Loans, Inc., 504 F. Supp. 2d 176, 

186 (S.D. Tex. 2007) (alteration in original) (quoting Bourgeois 

v. Haynes Constr. Co., 728 F.2d 719, 720 (5th Cir. 1984)), 

aff’d, 269 F. App’x 523 (5th Cir. 2008).

Here, the last of the transactions giving rise to Felton’s 

TILA allegation occurred on June 23, 2007. Even if the claims 

set forth in Felton’s amended counterclaim relate back to prior 

pleadings in accordance with Rule 4:7-1, most of her TILA claims 

are barred by the one-year statute of limitations prescribed by 

15 U.S.C.A. § 1640(e).

One of Felton’s TILA allegations, her claim that Zaman 

engaged “in a pattern and practice of extending credit to 

consumers under mortgages . . . based on the consumers’ 

collateral without regard to the consumers’ repayment ability” 

in violation of 15 U.S.C.A. § 1639(h), is not governed by the 

one-year statute of limitations, but by a three-year statute of 

limitations. 15 U.S.C.A. § 1640(e). Accordingly, Felton’s 

claim based on that provision was timely filed. If the trial 

court determines on remand that no equitable mortgage was 

created in this case, Felton’s claim under 15 U.S.C.A. §

1639(h), predicated on an alleged extension of credit in 

connection with a mortgage, fails as a matter of law. If, 

however, the trial court finds on remand that the parties 
35

created an equitable mortgage, it should determine the merits of 

Felton’s claim under 15 U.S.C.A. § 1639(h). 

We briefly address Felton’s remaining claims. On appeal, 

Felton asserts four claims that were not pled in her original or 

amended counterclaim: first, that Zaman violated New Jersey’s 

criminal usury statute, N.J.S.A. 2C:21-19(a); second, that he 

violated N.J.S.A. 45:15-17(k), for paying compensation or 

commission to a person who does not possess a real estate 

license; third, that he violated N.J.S.A. 45:15-17(q), for 

failing to disclose his status as a real estate agent, and 

fourth, that the terms of the parties’ agreement were 

unconscionable pursuant to the Appellate Division’s holding in 

Howard v. Diolosa, 241 N.J. Super. 222 (App. Div.), certif. 

denied, 122 N.J. 414 (1990). The record does not indicate 

whether Felton properly raised these claims before the trial 

court. Neither the trial court nor the Appellate Division 

addressed the merits of those claims. Accordingly, on remand, 

the trial court should ascertain whether any of those four

claims were raised before it, and if so, whether such a claim

gives rise to a cognizable cause of action in the circumstances 

of this case.

7

 

7 If the trial court determines that there was no equitable 

mortgage, Felton’s claim under N.J.S.A. 2C:21-19(a) should be 

dismissed, even if it was properly raised below.
36

Felton’s claim under the FRFPA was not raised before the 

trial court and, accordingly, was properly dismissed by the 

Appellate Division. See State v. Robinson, 200 N.J. 1, 20 

(2009) (“‘[I]t is a well-settled principle that our appellate 

courts will decline to consider questions or issues not properly 

presented to the trial court when an opportunity for such a 

presentation is available unless the questions so raised on 

appeal go to the jurisdiction of the trial court or concern 

matters of great public interest.’” (quoting Nieder v. Royal 

Indem. Ins. Co., 62 N.J. 229, 234 (1973))).

V.

The judgment of the Appellate Division is affirmed in part 

and reversed in part, and the matter is remanded to the trial 

court for proceedings consistent with this opinion. We do not 

retain jurisdiction. 

CHIEF JUSTICE RABNER; JUSTICES LaVECCHIA, ALBIN, and 

FERNANDEZ-VINA; and JUDGES RODRÍGUEZ and CUFF (both temporarily 

assigned) join in JUSTICE PATTERSON’s opinion.
1

SUPREME COURT OF NEW JERSEY

NO. A-60 SEPTEMBER TERM 2012

ON CERTIFICATION TO Appellate Division, Superior Court

TAHIR ZAMAN,

Plaintiff-Respondent,

v.

BARBARA FELTON and MR.

FELTON, her husband,

Defendants-Appellants.

DECIDED September 9, 2014

Chief Justice Rabner PRESIDING

OPINION BY Justice Patterson

CONCURRING/DISSENTING OPINIONS BY

DISSENTING OPINION BY 

CHECKLIST

AFFIRM IN PART/

REVERSE IN 

PART/

REMAND

CHIEF JUSTICE RABNER X

JUSTICE LaVECCHIA X

JUSTICE ALBIN X

JUSTICE PATTERSON X

JUSTICE FERNANDEZ-VINA X

JUDGE RODRÍGUEZ (t/a) X

JUDGE CUFF (t/a) X

TOTALS 7