1

JASON S. NUNNERMACKER, ESQ. 2849

ARTURI, D’ARGENIO, GUAGLARDI & MELITI, LLP

MACK CENTER I

365 W. PASSAIC STREET, Suite 130

ROCHELLE PARK, NJ 07662

201-947-4100

Attorneys for Arturi, D’Argenio, Guaglardi & Meliti, LLP and

Conrad Roncati

UNITED STATES DISTRICT COURT

DISTRICT OF NEW JERSEY

___________________________________

: Case No.: 10-6319

LEIGH RZASA-ORMES, :

:

Plaintiff, : On Appeal From The

: Bankruptcy’s Court

v. : October 26, 2010, Order

: Of Summary Judgment

CONRAD RONCATI and ARTURI, :

D’ARGENIO, GUAGLARDI & MELITI, LLP,: CIVIL ACTION

:

Defendants. :

___________________________________

________________________________________________________________

DEFENDANTS ARTURI, D’ARGENIO, GUAGLARDI & MELITI, LLP AND DR. 

CONRAD RONCATI’S MEMORANDUM OF LAW IN SUPPORT OF ITS APPEAL OF 

THE UNITED STATES BANKRUPTCY’S COURT OCTOBER 26, 2010, ORDER OF 

SUMMARY JUDGMENT

________________________________________________________________

On the brief: Jason S. Nunnermacker, Esq.

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TABLE OF CONTENTS

Page No.

TABLE OF AUTHORITIES........................................................................................................................3

STATEMENT OF FACTS..............................................................................................................................5

LEGAL ARGUMENT..........................................................................................................................................13

I. SUMMARY JUDGMENT WAS NOT APPROPRIATE AS THERE 

REMAINED A GENUINE DISPUTE OF MATERIAL FACTS 

WHICH REQUIRED A TRIAL ON THE MERITS AND 

THEREFORE THE BANKRUPTCY’S COURT’S OCTOBER 25, 

2010ER WAS ERROR......................................................................................................13

A. THERE WAS A MATERIAL DISPUTE AS TO WHETHER THE 

CHEVROLET OF UPPER SADDLE RIVER PAYMENTS WERE 

PROPERTY OF PLAINTIFF’S ESTATE..................................................................14

B. ADGM AND RONCATI WERE ENTITLED TO DISCOVERY AS TO 

THE RELATIONSHIP AMONGST PLAINTIFF, CHEVROLET OF 

UPPER SADDLE RIVER AND RAMSEY CHEVROLET-GEO, INC............18

C. THE CONSENT ORDER IS A LIEN AGAINST THE RAG 

REALTY PAYMENTS THAT WAS PROPERLY PERFECTED BEFORE 

THE COMMENCEMENT OF THE PLAINTIFF’S BANRKUPTCY CASE......20

D. EQUITY AND FAIRNESS DEMAND THAT ADGM AND RONCATI 

RETAIN ALL PAYMENTS RECEIVED PRIOR TO THE FILING 

OF PLAINTIFF’S BANKRUPTCY PETITION.........................................................25

CONCLUSION.........................................................................................................................................................30

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TABLE OF AUTHORITIES 

Cases Page No.

Bailey v. Nelson,

17 B.R. 50 (Bankr. W.D. Ark. 1981)...........................................................................24,25

Begier v. IRS, 496 US 53 (1990)....................................................................................16

Bonded Fin. Serv., Inc. v. Eur. Am. Bank, 

838 F. 2d 890 (7th Cir. 1988).............................................................................................16

Chemetron Corp. v. Jones,

72 F. 3d 341 (3d Cir. 1995)................................................................................................13

Donaldson v. Bernstein,

104 F. 3d 547 (3d. Cir. 1997)..........................................................................................13

Edmondson v. Aladdin Synergetics, Inc.,

43 B.R. 277 (Bankr. M.D. Tenn. 1984).....................................................................15

Ellenberg v. First National Bank,

15 B.R. 850 (Bankr. N.D. GA,1981).....................................................................16,17,18

Hayes Lemmerz International, Inc. v. 

Hyundai Motor Company, 329 B.R. 136 (D. Del. 2005)...........................16

In re Ameriserv Food Distribution, Inc. v. 

Tramsed Foods, Inc., 315 B.R. 24 (Bankr. Del. 2004)........................15

In re Blease, 605 F. 2d 907 (3d. Cir. 1979)................................................21

In re Cellnet Data Systems, Inc. 

327 F. 3d 242 (3d Cir. 2003).............................................................................................13

In re Evcco Corp. v. Ace Trucking Co.,

828 F. 2d 188 (3d Cir. 1987).............................................................................................22

In re Italiano, 66 B.R. 468 (Bankr. D.N.J. 1986).................................21

In re Parcel Consultants, Inc. v. Guardian Insurance,

287 B.R. 41 (Bankr., D.N.J. 2002)..............................................................................16

In re Ramco American International, Inc.

754 F. 2d 130 (3d Cir. 1985).............................................................................................21

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Katz v. First National Bank of Glen Head,

568 F. 2d 964 (2d. Cir. 1977)..........................................................................................24

Knauss v. Dwek, 

289 F. Supp. 2d 546 (D.N.J. 2003)..............................................................................14

Lease-a-Fleet, Inc. v. Wolk,

151 B.R. 341 (Bankr. E.D. Pa 1993)...........................................................................15

Pacitti v. Macy’s,

193 F. 3d 766 (3D. Cir. 1999)..........................................................................................14

United States v. United States Gypsum Co.

333 U.S. 364 (1948)........................................................................................................................13

Statutes 

11 USC 101...................................................................................................................................................15

11 USC 547...................................................................................................................................................14,15

N.J.S.A 17:10..........................................................................................................................................21

N.J.S.A. 2A:17-1.................................................................................................................................22,23

N.J.S.A. 2A:17-50..............................................................................................................................22

N.J.S.A 2A:17-63.................................................................................................................................22

Rules

Federal Bankruptcy Rule 7056.............................................................................................13,14

Federal Bankruptcy Rule 8013.............................................................................................13

Federal Rules of Civ. Procedure 56...........................................................................19

New Jersey Court Rule 2:2-3................................................................................................22

New Jersey Court Rule 4:42-1.............................................................................................22

New Jersey Court Rule 4:59-1.............................................................................................21

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STATEMENT OF FACTS

This matter began when Plaintiff Leigh Rzasa-Ormes 

(“Plaintiff”) and her former business partner, Raymond Van Duren 

(“Van Duren”) became embroiled in their own business dispute in 

1998. Plaintiff and Van Duren were partners in twelve 

automobile dealerships and related real estate holdings, 

operating under the trade name “Ramsey Auto Group” (“RAG”). 

On April 11, 2000, Plaintiff and Van Duren entered into a 

written Binding Arbitration Agreement to resolve the business 

dispute, designating Roncati as arbitrator. Certification of 

Jason S. Nunnermacker, Esq. in Opposition to Plaintiff’s Motion 

for Summary Judgment (“JSN Cert.”) Exhibit A1

After conducting several hearings, during the First Phase, 

. Roncati is in his 

mid 70’s, a retiree and was the former Bergen County Superior 

Court Administrator. 

The Arbitration had two separate phases that initially 

addressed the parties’ interests in the dealerships (“First 

Phase”) and then the parties’ interest in various real estate 

holdings (“Second Phase”). Van Duren and Plaintiff each agreed 

to pay one-half of Roncati’s fees to serve as arbitrator on an 

hourly basis and further agreed to pay equally for all expenses 

and professional fees incurred by Roncati relating to the 

arbitration. 

 1 The undersigned’s Certification is entered as Number 29 on the United States 

Bankruptcy Docket. For the convenience of the Court, a copy of this 

Certification is being forwarded to the Court via overnight mail. 

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Roncati issued a partial arbitration award dated March 19, 2001 

(“March 2001 Award”). Plaintiff believed Roncati’s March 2001 

Award was unfavorable on the basis that it did not adequately 

compensate her interests in the dealerships. In an attempt to 

compel Roncati’s recusal from the Second Phase, and as a mere 

litigation tactic, Plaintiff filed a frivolous lawsuit against 

Roncati claiming Roncati was biased and acted partially during 

the Arbitration. 

The Chancery Division of the Bergen County Superior Court 

dismissed Plaintiff’s lawsuit, sua sponte, determining that it 

had no basis in law or fact. The Chancery Court directed that 

any further action to vacate the award should await the 

completion of the entire arbitration, as the Court perceived the 

Plaintiff’s action against Roncati to be no more than a 

litigation ploy.

The Arbitration then continued into the Second Phase, with 

Roncati as arbitrator. He conducted hearings for another three 

years and issued a February 4, 2005, award (“February 2005 

Award”), which amongst other provisions, directed Plaintiff and 

Van Duren to each pay one half of his fee as arbitrator and onehalf of all attorney’s fees he incurred to ADGM. JSN Cert. 

Exhibit B2

The Chancery Division confirmed the February 2005 Award. 

Thereafter, Plaintiff appealed the confirmation of the February 

2005 Award to the Appellate Division and the Supreme Court 

. 

 2 The February 2005 Award was an interim award which was made final by a Final 

Arbitration Award issued by Roncati in June 2005. 

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arguing that Roncati was biased and incompetent to serve as 

arbitrator. Both the Appellate Division and the Supreme Court 

rejected Plaintiff’s arguments and confirmed the February 2005 

Award. 

Post-Arbitration Litigation

After the issuance of the February 2005 Award, and in spite 

of the Chancery Division’s prior rejection of Plaintiff’s bias 

claims against Roncati and admonitions against frivolous 

pleadings, and while her appeals were still pending, Plaintiff 

again filed suit against Roncati alleging bias and other 

inappropriate conduct during the Arbitration. In response, 

Roncati filed a counterclaim demanding that Plaintiff pay onehalf of his Arbitration fees and his counsel fees incurred 

during the Arbitration, and asserting that Plaintiff’s 

litigation was frivolous. 

In July 2008, the Law Division of the Bergen County 

Superior Court dismissed Plaintiff’s lawsuit against Roncati 

with prejudice on the basis that the prior Chancery Court 

decision was res judicata, as by this time, the Appellate 

Division and Supreme Court found no wrongdoing by Roncati. 

Roncati’s claims for Arbitration fees and counsel fees 

then proceeded to trial. 

At that time the Honorable Rachelle Harz, J.S.C. found as a 

matter of law that Plaintiff is liable for one-half of Roncati’s 

Arbitration fees and one-half of the attorney’s fees he 

incurred. 

Accordingly, on February 13, 2009 Judge Harz entered final 

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judgment against Plaintiff and in favor of Roncati and ADGM, in 

the amount of $201,791.93 (“Final Judgment”). JSN Cert. Exhibit

C. 

The Final Judgment was docketed with the Superior Court on 

February 19, 2009 as a lien against the Plaintiff’s real 

property. 

 Enforcement of Final Judgment against Plaintiff

After the Final Judgment was entered, ADGM received a 

payment of $32,015.63 from a third-party entity entitled 

Chevrolet of Upper Saddle River (“C.U.S.R”) in relation to its 

collection efforts to enforce the Final Judgment. Certification 

of Ilissa Churgin Hook, Exhibit C3

As ADGM and Roncati were undertaking collection efforts, it 

determined that Plaintiff received approximately $15,000.00 per 

month in commercial rental income from her fifty percent 

membership interest in Rag Realty, LLC (“Rag Realty”), a holding 

company for multiple commercial real property in Northern Bergen 

County, New Jersey. At the request of ADGM, a writ of execution 

was issued by the Superior Court on March 3, 2009. JSN Cert. 

Exhibit D. On March 4, 2009, ADGM prepared to forward the writ 

. Notably, C.U.S.R is not an 

entity in bankruptcy, nor is it listed on Rzasa-Ormes’

bankruptcy petition as an asset of her estate. 

 3

Ms. Hook’s Certification is entered as Number 22 on the United States 

Bankruptcy Docket. For the convenience of the Court, a copy of this 

Certification is being forwarded to the Court via overnight mail.

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of execution to the Bergen County Sheriff with instructions to 

levy the Rag Realty payments to Plaintiff, as well as other 

potential assets of the Plaintiff. However, before the writ was 

delivered to the Sheriff, the Plaintiff contacted ADGM and 

advised that, to deter further collections efforts, she would 

consent to Roncati’s and ADGM’s collecting the Rag Realty 

payment each month until the Final Judgment was satisfied. 

Therefore, in lieu of formal execution by ADGM and Roncati, 

Plaintiff consented to a garnishment of her approximate 

$15,000.00 rental income. 

In reliance upon Plaintiff’s offer, ADGM prepared a 

consent order pursuant to R. 4:59-1 and withheld service of the 

writ to the Sheriff and refrained from further collection 

procedures. However, Plaintiff, once again exhibiting bad 

faith, delayed executing the consent order. Consequently, ADGM 

again prepared to send the writ to the Sheriff and to submit an 

Order to Show Cause for restraint and turnover of the Rag Realty 

payments to Plaintiff. 

On March 11, 2009 ADGM advised Plaintiff that the showcause order would be filed the next day. ADGM also advised that 

it would seek to hold Plaintiff liable for the attorney’s fees 

incurred for the preparation and filing of the application 

pursuant to the June 2005 Award. The next day, March 12, 2009, 

Plaintiff executed the Consent Order, thus agreeing that ADGM 

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and Roncati should receive future Rag Realty Payments. The 

Superior Court entered and filed the Consent Order that day. 

The Consent Order recited that ADGM and Roncati had the right to 

levy upon the Rag Realty payments and that such payments were to 

be turned over to ADGM each month, in exchange, ADGM and Roncati 

agreed to not pursue any other collection efforts pursuant to 

the New Jersey Rules of Court. JSN Cert. Exhibit E.

Accordingly, because of the Consent Order there was no need 

for ADGM to forward the writ to the sheriff and formally levy 

upon the assets of the Plaintiff, which included but were not 

limited to, the Rag Realty Payment. If not for the Consent 

Order, the writ would have been forwarded to the Sheriff and the 

Rag Realty payment and all other personalty of the Plaintiff 

would have been subject to further execution.

However, despite Plaintiff’s previous bad faith that 

continued for years in this matter and ADGM’s and Roncati’s 

cooperation and good faith in refraining from executing upon the 

Final Judgment any further, it is the C.U.S.R. payment to ADGM 

and the Rag Realty payments that Plaintiff now seeks to be 

returned under the applicable bankruptcy preference statutes.

However, the C.U.S.R. payments were paid by a third-party 

entity, which is not listed as an asset of Plaintiff’s on her 

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bankruptcy petition. JSN Cert. Exhibit F4

This Court should be aware that for nearly a decade, 

Plaintiff, motivated solely by animosity and bitterness, sought 

revenge against Roncati because he made decisions in the 

Arbitration that Plaintiff believes were inaccurate and unfair. 

Her tactics tormented a former Superior Court trial 

administrator who was in his early and mid 70s simply because he 

performed his duties as Arbitrator, duties in which Plaintiff 

consented to him performing. Ten years after the start of the 

Arbitration and as a direct result of her constant litigation 

tactics and unfounded claims, the Final Judgment and the Consent 

. 

Consequently, as was argued to the trial court and as set 

forth below, Plaintiff never had possession of such funds and 

therefore these monies were “never an interest of the debtor in 

property” pursuant to 11 USC 547(b). 

As to the other payments, they were received pursuant to a 

Consent Order, which Plaintiff only executed to avoid ADGM’s 

collection levy, while Plaintiff was represented by competent 

counsel. The Consent Order was entered for Plaintiff’s own 

benefit, as a gesture of good faith by Roncati and ADGM as she 

indicated that she wanted time to satisfy the Final Judgment. 

Notably, the Final Judgment was entered and docketed outside the 

90 day preference period. 

 4 Attached as Exhibit F to the JSN Cert. is Schedule B of Plaintiff’s Bankruptcy Petition.

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Order were entered. 

To force the return of the money ADGM and Dr. Roncati 

received without at least a trial on the merits of Plaintiff’s 

claims, it would only reward Plaintiff’s frivolous and spiteful 

litigation tactics in the New Jersey Superior Court. 

Consequently, ADGM and Dr. Roncati respectfully request 

that the Court remand this matter to the Bankruptcy trial court 

so that a full hearing could be held. 

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LEGAL ARGUMENT

I. SUMMARY JUDGMENT WAS NOT APPROPRIATE AS THERE REMAINED 

A GENUINE DISPUTE OF MATERIAL FACTS WHICH REQUIRED A 

TRIAL ON THE MERITS AND THEREFORE THE BANKRUPTCY’S 

COURT’S OCTOBER 25, 2010 ORDER WAS ERROR

Federal Bankruptcy Rule 8013 provides that the New Jersey 

District Court “may affirm, modify, or reverse a bankruptcy 

judge’s judgment, order, or decree or remand with instructions 

for further proceedings.” A district court is not to set aside 

a finding of fact unless “clearly erroneous.” Ibid. A finding 

of fact is clearly erroneous when “the reviewing court on the 

entire evidence is left with the definite and firm conviction 

that a mistake has been committed.” In re Cellnet Data Sys., 

Inc., 327 F.3d 242, 244 (3d Cir. 2003) (quoting United States v. 

United States Gypsum Co., 333 U.S. 364, 395(1948)). A bankruptcy 

court’s conclusions of law are subject to de novo or plenary 

review by the district court. See, Donaldson v. Bernstein, 104 

F.3d 547, 551 (3d Cir.1997). When a matter presents both a 

question of law and a question of fact, the relevant standard 

must be applied to each component of the issue. See, Chemetron 

Corp. v. Jones, 72 F.3d 341, 345 (3d Cir.1995).

As to summary judgment, Federal Rule of Bankruptcy 

Procedure 7056 provides:

If the pleadings, depositions, answers to 

interrogatories, and admissions on file, together with 

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the affidavits, if any, show that there is no genuine 

issue as to any material fact and that the moving 

party is entitled to a judgment as a matter of law.

The Court’s role while considering a summary judgment 

motion, “is not to weigh evidence, but to determine whether 

there is a genuine issue for trial.” Knauss v. Dwek, 289 F. 

Supp. 2d 546, 549 (D.N.J 2003). Of course, this court must 

“view all the underlying facts and all reasonable inferences 

therefrom in the light most favorable to the party opposing the 

motion.” Pacitti v. Macy’s, 193 F. 3d 766, 772 (3rd. Cir. 1999). 

For the reasons set forth below, the bankruptcy trial court

erred in granting Plaintiff’s motion for summary judgment and 

entering the October 25, 2010.

A. THERE WAS A MATERIAL DISPUTE AS TO WHETHER THE CHEVROLET 

OF UPPER SADDLE RIVER PAYMENTS WERE PROPERTY OF 

PLAINTIFF’S ESTATE

11 USC 547 (b)states:

Except as provided in subsection (c) or (i) of this 

section, the trustee may avoid any transfer of an 

interest in the Plaintiff in property-

(1) to or for the benefit of a creditor;

(2) for or on account of an antecedent debt owed by 

the Plaintiff before such transfer was made;

(3) made while the Plaintiff was insolvent;

(4) made-

(A) on or within 90 days before the filing of the 

petition; 

...

(5) that enables such creditor to receive more than 

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such creditor would receive if-

(A) the case were a case under Chapter 7 of this 

title;

(B) the transfer had not been made; and

(C) such creditor received payment of such debt to 

the extent provided by the provisions of this title. 

[Emphasis added].

Pursuant to 11 USC 547 (g), the trustee bears the burden of 

proving the avoidability of a transfer pursuant to section 547 

(b) by a preponderance of the evidence. Lease-a-Fleet, Inc. v. 

Wolk, 151 B.R. 341, 349 (Bankr. E.D. Pa 1993). 

11 USC 101 (54)(D) mandates that “each mode, direct or 

indirect, absolute or conditional, voluntary or involuntary, of 

disposing of or parting with (i) property or (ii) an interest 

property” shall be a transfer under the code. Therefore:

In order to establish the existence of a preference 

transfer pursuant to 11 USC 547 (b), the trustee must 

establish the threshold element that the property 

transferred belonged to the Plaintiff.

Edmondson v. Aladdin Synergetics, Inc. 43 B.R. 277, 

278 (Bankr. M.D. Tenn. 1984).

The statute requires “that the property transferred by the 

Plaintiff be ‘an interest of the Plaintiff in property.’” In Re 

Ameriserv Food Distribution, Inc. v. Tramsed Foods, Inc. 315 

B.R. 24, 29 (Bankr. Del. 2004). “It is well settled that for 

the avoiding powers to be invoked pursuant to sections 547 and 

549, the property transferred must have been property of the 

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estate.” In re Parcel Consultants, Inc. v. Guardian Insurance 

401, 287 B.R. 41 (Bankr, D.N.J. 2002). The Supreme Court has 

held this to mean that the “property that would have been part 

of the estate had it not been transferred before the 

commencement of bankruptcy proceedings.” Begier v. IRS, 496 US

53, 58 (1990). “The minimum requirement of status as a 

transferee [to recover payments] is dominion over the money or 

other asset, the right to put the money to one’s own purpose.” 

Parcel Consultants, Inc., at 46. Further, for a Plaintiff to 

have “dominion” over the property sought to be recovered, she 

shall be capable of utilizing the property for “whatever 

purposes he or she wishes, be it to invest in lottery tickets or 

uranium stocks.” Bonded Fin. Serv. Inc. v. Eur. Am. Bank, 838 F. 

2d 890, 894 (7th Cir. 1988). 

As such, and notably, “the use of another entity’s property 

to pay a creditor of the Plaintiff cannot be a preference.” 

Hayes Lemmerz International, Inc. v. Hyundai Motor Company, 329 

B.R. 136, 141 (D. Del. 2005).

Similar to the facts at bar, in Ellenberg v. First National 

Bank, 15 B.R. 850 (Bankr. N.D. GA, 1981) the Northern District 

of Georgia addressed whether a payment made by a third-party to 

a creditor of a Plaintiff within the preference period can be 

voided by the trustee. There, the Plaintiff’s father made an 

installment loan payment by check to the bank-defendant on 

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behalf of his daughter-Plaintiff, which was payable to the bank. 

The partial payment was slightly more than the installment due 

as it was the father’s intention for the daughter to have the 

balance, which equaled approximately $140.00. The trustee 

sought to void the payment by the father as a preference because 

the bank required the endorsement of Plaintiff on the check and 

therefore, as alleged, it was briefly in Plaintiff’s control, 

i.e., possession. Id., p. 851. 

Rejecting the trustee’s claim, the Court stated:

A consideration of the totality of the circumstances 

shows clearly that this result cannot be reached when 

viewed in light of the overriding policies and spirit 

of the Bankruptcy Code. We note that there is no 

reason why a third-party cannot take it upon himself 

to pay the debts of another and therefore help in his 

own way to facilitate the Plaintiffs eventual fresh 

start. 

[Ibid].

The Court further held:

The check payable to [Defendant] was never meant to be 

paid to Plaintiff, but was intended to directly pay 

her debt. The estate of the Plaintiff has not been 

diminished, and that is the concern of 547(b). To 

find a preference on the facts before us would not do 

equity among the parties.

[Id., p. 852]. 

Here, as in Ellenberg, a third party, General Motors, 

issued two checks payable to another third-party entity, 

C.U.S.R. Certification of Ilissa Hook, Exhibit C. The checks 

were not payable to Plaintiff, or any other entity owned by 

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Plaintiff seeking bankruptcy protection. The checks were never 

deposited into Plaintiff’s bank accounts. Plaintiff, as the 

plaintiff in Ellenberg, simply endorsed the checks to ADGM. 

These checks were never part of the bankruptcy estate, nor were 

they ever in the Plaintiff’s possession. Further, these checks 

are not even payable to Plaintiff. 

Nothing highlights this point better than the fact that 

C.U.S.R is not listed as an asset on Plaintiff’s bankruptcy 

petition. JSN Cert. Exhibit F. Quite simply, Plaintiff cannot 

now claim an interest in property, specifically C.U.S.R, when 

that asset is not listed on her petition. 

Therefore, the C.U.S.R payments were never a part of the 

estate and were never in Plaintiff’s position. Consequently, 

Plaintiff cannot recover such payment and the trial Court erred 

in granting Plaintiff’s motion to recover such payments from 

Defendants. 

B. ADGM AND RONCATI WERE ENTITLED TO DISCOVERY AS TO THE 

RELATIONSHIP AMONGST PLAINTIFF, CHEVROLET OF UPPER SADDLE

RIVER AND RAMSEY CHEVROLET-GEO, INC. 

Federal Rules of Civil Procedure provide:

When Facts Are Unavailable to the Nonmovant. If a 

nonmovant shows by affidavit or declaration that, for 

specified reasons, it cannot present facts essential to 

justify its opposition, the court may:

(1) defer considering the motion or deny it;

(2) allow time to obtain affidavits or declarations or to 

take discovery; or 

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(3) issue any other appropriate order. 

[Emphasis added. Fed. R. Civ. P. 56 (d)]. 

Here, after the Final Judgment was entered, ADGM received a 

payment of $32,015.63 from C.U.S.R in relation to its collection 

efforts to enforce the Final Judgment. Certification of Ilissa 

Churgin Hook, Exhibit C. Notably, and acknowledged by Plaintiff 

in her reply papers and at oral argument on the motion, C.U.S.R 

is not an entity in bankruptcy, nor is it listed on Rzasa-Ormes’

bankruptcy petition as an asset of her estate.

It was not until Defendants reviewed Plaintiff’s reply 

papers on the morning of October 18, 2010, the day of oral 

argument for Plaintiff’s Motion for summary judgment, that the 

Defendants learned that Plaintiff alleges C.U.S.R is simply the 

trade name for Ramsey Chevrolet-Geo, Inc. (“Ramsey Chevrolet”), 

an entity listed on Plaintiff’s petition. Reply Certification 

of Leigh Rzasa-Ormes, ¶35

Clearly, the Defendants would have no knowledge that 

Plaintiff intended to posit that C.U.S.R and Ramsey Chevrolet 

. Therefore, Plaintiff argued in her 

reply papers and during oral argument that as C.U.S.R. and 

Ramsey Chevrolet are the same entity, the payments from General 

Motors were part of the Plaintiff’s estate and subject to 

recovery as a preference transfer.

 5 Plaintiff’s Reply Certification is entered as number 30 on the United States 

Bankruptcy Court’s Docket. A copy of same is being forwarded to the Court 

via overnight mail. 

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were the same entity as Plaintiff did not identify such 

relationship, either in her petition or in her discovery 

responses. It is simply inequitable and prejudicial to the 

Defendants to learn at the literal 11th hour that Plaintiff 

claims that C.U.S.R. and Ramsey Chevrolet are the same entity 

and that such payments from General Motors were therefore part 

of her estate.

In the very least, Defendants should have been allowed to 

engage in discovery as to this issue and learn the true 

relationship of these entities before judgment was entered by 

the trial court.

Consequently, the trial court’s refusal to allow such 

discovery and its judgment compelling Defendants to return the 

$32, 015.63 was in error. Therefore, this Court must remand this 

matter to the trial court for further proceedings. 

C. THE CONSENT ORDER IS A LIEN AGAINST THE RAG REALTY 

PAYMENTS THAT WAS PROPERLY PERFECTED BEFORE THE 

COMMENCEMENT OF THE PLAINTIFF’S BANRKUPTCY CASE

The Final Judgment against the Plaintiff in the amount of 

$201,791.93 was entered in favor of ADGM and Roncati on February 

13, 2009, and docketed with the Clerk of the Superior Court on 

February 19, 2009. Both dates are beyond the 90 day preference 

period. The Final Judgment was not appealed within the time 

provided by the New Jersey Rules of Court. The Plaintiff does 

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not contend that the Final Judgment should be avoided, nor that 

there was any irregularity in its enforcement.

Ordinarily, under New Jersey law, a lien against personal 

property in favor of a judgment creditor is created by a levy, 

which relates back to the date a writ of execution is delivered 

to the sheriff. N.J.S.A. 17-10; In re Ramco American 

International, Inc., 754 F. 2d 130, 132 (3d Cir. 1985). A 

judgment creditor who levies prior to the filing of a judgment 

debtor’s bankruptcy petition has perfected its lien against the 

hypothetical lien of the trustee of the bankruptcy estate. In 

re Blease, 605 F. 2d 907 (3d Cir. 1979); In re Italiano, 66 B.R. 

468, 478 (Bankr. D.N.J. 1986).

New Jersey procedure does not limit enforcement of a judge 

to issuance of a writ of execution:

Execution (a) In General. Process to enforce a 

judgment or order for the payment of money and process 

to collect costs allowed by a judgment or order, shal 

be a writ of execution, except if the court otherwise 

orders . . . .

[R. 4:59-1 (emphasis added)]. 

In addition, New Jersey practice provides for the issuance 

of court orders to enforce judgments against income or profits 

of a judgment plaintiff:

When a judgment has been recovered in the Superior 

Court, and where any wages, debts, earnings, salary, 

income from trust funds or profits are due and owing 

to the judgment Plaintiff, or thereafter become due 

and owing to him, to the amount of $48.00 or more a 

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week, the judgment creditor may, on notice to the 

Plaintiff, apply to the court in which the judgment 

was recovered, or to the court having jurisdiction 

over same, and upon satisfactory proofs, by affidavit 

or otherwise, the court shall grant an order directing 

that execution issue against the wages, debts, 

earnings, salary, income from trust funds or profits 

of the judgment Plaintiff.

[N.J.S.A. 2A:17-50 (emphasis added)]. 

Further, a court order is the means by which execution of a 

debt due or accruing to the judgment Plaintiff is turned over 

from the third party garnishee for the benefit of the judgment 

creditor. N.J.S.A. 2A:17-63. 

New Jersey practice provides broad authority for the entry 

of consent judgments and orders. R. 4:42-1(d). A judgment or 

order entered with the consent of the parties is ordinarily not 

appealable for the purpose of challenging its substantive 

provisions. Pressler, Current N.J. Court Rules, Comment Rule 

2:2-3[2.2.3] (Gann).

When bankruptcy courts assess the creation of property 

rights during the collection of judgments, it is “well settled 

that a party may waive statutory provisions (as well as other 

rights) intended for that party’s benefit and not affecting the 

public interest.” In re Evcco Leasing Corp. v. Ace Trucking 

Co., 828 F.2d 188, 193 (3d Cir. 1987). In Evvco Leasing, the 

judgment creditor executed against realty prior to personalty in 

violation of N.J.S.A. 2A:17-1. However, it did so based on the 

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plaintiff’s representation that it had no personal assets. Id.

at 190. The Third Circuit held that plaintiff’s representations 

constituted a waiver of its rights under N.J.S.A. 2A:17-1, and 

therefore upheld the creditor’s lien. 

A waiver need not be asserted directly or 

expressly. It is well settled that waiver may be 

established by conduct inconsistent with claiming 

the waived right or any action or failure to act 

evincing an intent not to claim the right.... 

New Jersey Courts have held that a waiver occurs 

when a party dispenses with the performance of 

something which he or she has a right to exact, 

or does or forbears to do something 

inconsistently with the right or the intention to 

rely on it.... [Plaintiff]’s conduct amounted to 

a waiver as a matter of law.

[Id. at 195.]

Here, by entering into the Consent Order, the Plaintiff 

waived any right she may have had to enforcement of a lien 

through the delivery of a writ of execution to the sheriff and a 

subsequent levy. The Consent Order provides that “Roncati and 

[ADGM] are judgment creditors of Leigh Rzasa-Ormes and are 

entitled to levy upon the net monthly income paid to Leigh 

Rzasa-Ormes from her ownership interest in the RAG Properties”. 

The Consent Order decreed that “Joshua Krantz of National 

Property Associates [address] is hereby directed to pay Leigh 

Rzasa-Ormes’ share of all the net monthly rental proceeds 

arising from the RAG Properties directly to the law firm of 

[ADGM] as and when due and payable to Rzasa-Ormes”. The Consent 

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Order was received by Krantz and honored by him through the 

payment of three monthly installments to ADGM. 

Thus, the Consent Order is the equivalent of a writ of 

execution, levied against a garnishee, as to which a turnover 

has been entered in order to satisfy a judgment which was 

entered outside the 90 day period. The Consent Order served as 

a lien against the RAG Realty payments that had been properly 

perfected against the bankruptcy estate and should be honored by 

the Bankruptcy Court as to the payments already made thereto. 

As such, the trial court erred in granting Plaintiff’s 

motion and this matter should be remanded to the trial court for 

further hearing. 

D. EQUITY AND FAIRNESS DEMAND THAT ADGM AND RONCATI RETAIN 

ALL PAYMENTS RECEIVED PRIOR TO THE FILING OF PLAINTIFF’S 

BANKRUPTCY PETITION

The Second Circuit has held that when considering whether a

transfer is preference pursuant to Section 547, the trial court 

shall “look...through form to substance, (and) treat the 

transaction according to its real nature.” Katz v. First 

National Bank of Glen Head, 568 F. 2d 964, 970 (2d. Cir. 1977). 

In Bailey v. Nelson, 17 B.R. 50 (Bankr. W.D. Ark. 1981), 

the Court addressed whether a payment simply endorsed over by 

the plaintiff-debtor to the defendant-creditor in partial 

satisfaction of a material’s man lien was a preference payment 

to be voided. Id. at 51. There, the plaintiff was a plumber 

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sub-contractor that purchased material from the defendant in the 

amount of $9,445.14. The plaintiff advised defendant that it 

could no longer afford making payments on this debt and that it 

was “taking bankruptcy”. Ibid. However, the plaintiff had one 

final payment owed to him from the general contractor in the 

amount of $4,005.84. The plaintiff and defendant both went to 

the general contractor and received the check at which time 

plaintiff promptly endorsed it over to defendant in partial 

satisfaction of the debt. Ibid. 

The Court held that:

In substance, the payment was simply a payment on 

account of the materials which was owed on account of 

the material-man’s lien of the defendant.

The debtor simply acted as a conduit for the payment, 

which, under the circumstances detailed above, must be 

regarded as paid only on account of the lien and or 

the express purpose of dissolving it. 

[Id. at p. 52.]

Moreover, the Court cited equitable principles as well when 

holding that the payment at issue was not a voidable preference:

Even if the bankruptcy estate could be said to be 

entitled to recover the money thus paid, the demands 

of equity and justice would require that the same 

money should be regarded as the proceeds of the 

material against which the defendant’s lien was 

initially asserted and therefore payable to defendant 

from the estate in satisfaction of the lien. 

[Emphasis added. Ibid.]. 

Here, as set forth above, the Final Judgment served as a 

lien against Plaintiff’s property. The Final Judgment was 

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entered as the Superior Court recognized the many years of 

Plaintiff’s frivolous and spiteful tactics in bringing suit 

twice against Roncati. Plaintiff continued her tactics despite 

the fact that the Superior Court’s Chancery Division and Law 

Division, both multiple times, the Appellate Division, and even 

the New Jersey Supreme Court all found that Plaintiff’s claims 

against Roncati were entirely baseless. 

Specifically, after conducting several hearings, during the 

First Phase, Roncati issued a partial arbitration award, the 

March 2001 Award. Plaintiff believed Roncati’s March 2001 Award 

was unfavorable on the basis that it did not adequately 

compensate her interests in the dealerships. In an attempt to 

compel Roncati’s recusal from the Second Phase, and as a mere 

litigation tactic, Plaintiff filed a frivolous lawsuit against 

Roncati claiming Roncati was biased and acted partially during 

the Arbitration. 

The Chancery Division of the Bergen County Superior Court, 

for the first time, dismissed Plaintiff’s lawsuit, sua sponte, 

determining that it had no basis in law or fact. The Chancery 

Court directed that any further action to vacate the award 

should await the completion of the entire arbitration, as the 

Court perceived the Plaintiff’s action against Roncati to be no 

more than a litigation ploy. 

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The Arbitration then continued into the Second Phase, with 

Roncati as arbitrator. He conducted hearings for another three 

years and issued the February 2005 Award, which amongst other 

provisions, directed Plaintiff and Van Duren to each pay one 

half of his fee as arbitrator and one-half of all attorney’s 

fees he incurred to ADGM. JSN Cert. Exhibit B. The Chancery 

Division confirmed the February 2005 Award over Plaintiff’s 

vigorous allegations that Roncati was biased and incompetent to 

serve as Arbitrator.

 Thereafter, Plaintiff appealed the confirmation of the 

February 2005 Award to the Appellate Division and the Supreme 

Court arguing, once again, that Roncati was biased and 

incompetent to serve as arbitrator. Both the Appellate Division 

and the Supreme Court rejected Plaintiff’s arguments and 

confirmed the February 2005 Award. JSN Cert. ¶¶9-12.

Incredibly, it was not enough for Plaintiff that her claims 

were deemed unfounded, as after the issuance of the February 

2005 Award, and in spite of the Chancery Division’s prior 

rejection of Plaintiff’s bias claims against Roncati and 

admonitions against frivolous pleadings, and while her appeals 

were still pending, Plaintiff again filed suit against Roncati 

alleging bias and other inappropriate conduct during the 

Arbitration. 

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In response, Roncati was compelled to file a counterclaim 

demanding that Plaintiff pay one-half of his Arbitration fees 

and his counsel fees incurred during the Arbitration, and 

asserting that Plaintiff’s litigation was frivolous. In July 

2008, the Law Division of the Bergen County Superior Court 

dismissed Plaintiff’s lawsuit against Roncati with prejudice on 

the basis that the prior Chancery Court decision was res 

judicata, as by this time, the Appellate Division and Supreme 

Court found no wrongdoing by Roncati. Roncati’s claims for 

Arbitration fees and counsel fees then proceeded to trial. At 

that time the Honorable Rachelle Harz, J.S.C. found as a matter 

of law that Plaintiff is liable for one-half of Roncati’s 

Arbitration fees and one-half of the attorney’s fees he 

incurred. 

Accordingly, on February 13, 2009 Judge Harz entered final 

judgment against Plaintiff and in favor of Roncati and ADGM, in 

the amount of $201,791.93. JSN Cert. Exhibit C. The Final 

Judgment was docketed with the Superior Court on February 19, 

2009 as a lien against the Plaintiff’s real property. JSN Cert. 

¶¶13-19. 

As a direct result to Plaintiff frivolous claims against 

Roncati, a man at the time in his early-mid 70s, was compelled 

to incur significant attorney’s fees, and great emotional 

stress, to defend against allegations that the Chancery 

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Division, twice, the Law Division, twice, the Appellate Division 

and the Supreme Court all found to be completely without merit. 

Despite Plaintiff’s nearly decade full of bad faith and 

disregard for New Jersey Courts, ADGM and Roncati extended her 

courtesy and good faith by agreeing to enter into the Consent 

Order so that Plaintiff could satisfy the Final Judgment lien 

over time, rather than levying on her property. The levying of 

such property was imminent as a writ had already been issued and 

was being forwarded to the Sheriff the very next morning, as 

well as the filing of an Order to Show Cause to garnish the Rag 

Realty payments to Plaintiff. Both, Plaintiff and her former 

counsel are well aware of the immediacy of the levy and 

garnishment. 

Indeed, no good deed goes unpunished, as now Plaintiff 

incredibly seeks back the payments ADGM and Roncati received. 

Payments that were agreed to by the parties to help Plaintiff. 

Consequently, ADGM and Roncati respectfully submit that the 

“demands of equity and justice” mandate that this Court find the 

trial court committed error in granting Plaintiff’s motion in 

its entirety and that this Court remand the matter to allow a 

trial on the merits. 

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CONCLUSION

As a result of the foregoing, ADGM and Roncati respectfully 

request that the Court remand this matter in its entirety to the 

trial court for a trial on the merits.

Respectfully submitted,

/S/ Jason S. Nunnermacker

Jason S. Nunnermacker, Esq.

Attorney for Defendants

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