Court Opinion

ID: 4428096
Source: CourtListenerOpinion
Date Created: 2019-08-20 19:00:40.32556+00
Date Added: 2024-06-11T14:50:48.150976
License: Public Domain

NOT FOR PUBLICATION WITHOUT THE
                               APPROVAL OF THE APPELLATE DIVISION
        This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the
     internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.

                                                         SUPERIOR COURT OF NEW JERSEY
                                                         APPELLATE DIVISION
                                                         DOCKET NO. A-3373-17T4

SANTANDER BANK, N.A.,

          Plaintiff-Respondent,

v.

IRA SMULYAN,

          Defendant-Appellant,

and

SHEILA SMULYAN and
CONSECO FINANCE
SERVICING CORP.,

     Defendants.
___________________________

                    Submitted May 28, 2019 – Decided July 8, 2019

                    Before Judges Gooden Brown and Rose.

                    On appeal from the Superior Court of New Jersey,
                    Chancery Division, Union County, Docket No. F-
                    043976-14.

                    Ira Smulyan, appellant pro se.
            Phelan Hallinan Diamond & Jones, PC, attorneys for
            respondent (Sonya Gidumal Chazin, on the brief).

PER CURIAM

      In this residential foreclosure action, defendant Ira Smulyan appeals from

several Chancery Division orders. Specifically, defendant appeals from the

December 18, 2015 order granting summary judgment to plaintiff Santander

Bank, N.A.; the March 4, 2016 order denying defendant's motion for

reconsideration; the November 18, 2016 order denying defendant's motion to

vacate default and dismiss the complaint; the February 3, 2017 order denying

defendant's motion for reconsideration; and the February 8, 2018 order entering

final judgment of foreclosure. For the reasons that follow, we affirm.

      By way of background, on December 23, 2003, defendant and his wife,

Sheila Smulyan (collectively defendants), executed a thirty-year promissory

note to Sovereign Bank, Federal Savings Bank, in the amount of $270,000. To

secure payment of the note, on the same date, defendants executed a non-

purchase money mortgage to Sovereign Bank, encumbering their residential

property located in Union (the subject property), which mortgage was recorded

in the Union County Clerk's Office on January 7, 2004. Defendants defaulted

on the mortgage loan by failing to make the August 1, 2011 installment payment,

or any payments thereafter.

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      Effective October 17, 2013, Sovereign Bank was renamed plaintiff

Santander Bank. Thereafter, on May 13, 2014, plaintiff mailed defendants at

the subject property by certified and regular mail a Notice of Default and

Intention to Foreclose (NOI), in accordance with the Fair Foreclosure Act

(FFA), N.J.S.A. 2A:50-53 to -73. After defendants failed to cure the default, on

October 21, 2014, plaintiff filed a foreclosure complaint. On November 26,

2014, defendant1 filed a motion to dismiss in lieu of an answer, asserting that

previously, on June 4, 2014, plaintiff had "sen[t] [a] [v]oluntary [d]ismissal to

[the trial c]ourt unbeknownst to [him,]" seeking to dismiss without prejudice an

earlier foreclosure complaint filed against him.

      On March 20, 2015, during oral argument on defendant's motion, plaintiff

conceded that it had filed a voluntary dismissal on the original complaint

because of a "deficien[t]" NOI. As a result, the court determined plaintiff had

violated Rule 4:37-1, by filing a voluntary dismissal without obtaining

defendant's consent. Thus, the court awarded defendant a $7000 credit, to be

applied at any future "proof hearing in this matter," representing a percentage

"of the attorney's fees . . . incurred" by defendant in connection with the

1
   Although Mr. and Mrs. Smulyan are both defendants, Mrs. Smulyan did not
participate in the proceedings in the trial court or on appeal. Therefore, we refer
to Mr. Smulyan as defendant throughout the opinion.
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dismissed foreclosure complaint. The court also allowed defendant thirty-five

days to file an answer.

      On April 29, 2015, defendant filed a contesting answer containing

numerous affirmative defenses, including challenging the NOI and plaintiff's

standing. Following the completion of discovery, plaintiff moved for summary

judgment, affixing a copy of the original note, mortgage, payment history, and

NOI to its moving papers.        To support its motion, plaintiff submitted a

certification prepared by its default operations analyst, Alan Norris, who

certified that in his position, he had "complete access and authorization to

review . . . [p]laintiff's business records, including the computer records, logs

loan account[,] and related business records for and relating to . . . [d]efendant's

loan." According to Norris, these records were "maintained by [plaintiff]," were

"made at or near the time of the event, by or from information transmitted by a

person with knowledge[,]" and "[i]t [was] [plaintiff's] regular practice to keep

such records in the ordinary course of [its] regularly conducted business

activity."

      Norris certified further that "based upon [his] personal review of those

records . . . and . . . [his] . . . personal knowledge of how such records are kept

and maintained[,]" the "original promissory [n]ote was acquired by . . .

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                                         4
[p]laintiff on September 18, 2013[,]" and "remain[ed] in [plaintiff's] possession

. . . at th[at] time." He averred that plaintiff was in possession of the original

note when the instant foreclosure complaint was filed, when defendant defaulted

on the loan, and when defendant failed to cure the default after being served

with the NOI. He also certified that "Santander Bank, N.A. [was] formerly

known as Sovereign Bank, N.A."

      In    opposition,     defendant       certified   that   there    remained

"outstanding/unresolved issues of material fact of standing/ownership/

possession of the note [and] mortgage[,]" that "no discovery ha[d] been done[,]"

and that there were "multiple flaws in [the NOI]." To support his challenge to

plaintiff's standing, defendant provided a November 5, 2013 letter from

Santander's mortgage loan operations team, informing defendant that Mortgage

Partnership Finance (MPF) owned defendant's loan, while Santander Bank

remained the servicer of the mortgage and received "any scheduled periodic

payments from [defendant] pursuant to the terms of [the] loan[.]"

      On December 18, 2015, following oral argument, Judge Joseph P. Perfilio

granted plaintiff's motion in an oral opinion. Reciting the applicable legal

principles, the judge stated:

                 When a motion for summary judgment is made in
            a mortgage foreclosure case, the only material issues

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                                        5
            are the validity of the mortgage and the note, the
            existence of the indebtedness, and the plaintiff's right
            to foreclose. Additionally, . . . the mortgagee must
            demonstrate compliance with the [FFA] notice
            requirements under N.J.S.A. 2A:50-53 [to -73].

                   [Rule] 4:46-2(b) provides that all material facts
            in the movant's statement of undisputed facts which are
            sufficiently supported will be deemed admitted for
            purposes of the motion . . . unless specifically disputed
            by citation conforming to the requirements of
            paragraph [(a)], demonstrating the existence of a
            genuine issue of material fact.

                   Additionally, [Rule] 4:46-5(a) requires that when
            a motion for summary judgment is made and supported
            as provided by the rule, an adverse party may not rest
            upon mere allegations or denials of the pleading, but
            must respond by affidavits meeting the requirements of
            [Rule] 1:6-6 – in other words, on personal knowledge –
            or as otherwise provided in [Rule] 4:46-2(b), setting
            forth facts showing that there is a genuine issue for trial.

                   As the Appellate Division indicated, [the adverse
            party's] conclusions in the pleadings without factual
            support and tendered affidavits will not defeat a motion
            for summary judgment.

                  Further, a certification in a case like this will
            support the judgment if the material facts alleged
            therein . . . are based, as required by [Rule] 1:6-6, on
            personal knowledge.

      Summarizing the parties' respective positions, the judge stated that

"[p]laintiff argue[d] . . . there[] [was] no genuine issue of material fact" and

"[p]laintiff ha[d] the absolute right to foreclose, because . . . defendants

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defaulted on their mortgage[,] . . . giving . . . plaintiff the right to accelerate the

subject mortgage." In contrast, defendant argued plaintiff did not have standing,

the NOI was deficient because it was not sent in accordance with the FFA, and

there was still outstanding discovery. According to the judge, defendant also

challenged "the validity of the note," and the absence of an "assignment of the

mortgage" accompanying its sale. Further, the judge noted defendant questioned

"how [he] could be indebted to . . . plaintiff if the note ha[d] been paid off in the

sum of $270,000 by MPF[,]" as indicated in the November 5, 2013 letter.

      Addressing the November 5, 2013 letter, stating that MPF was the owner

of the loan, the judge ultimately agreed with plaintiff that the letter was

inadmissible hearsay. Nonetheless, viewing the evidence in the light most

favorable to defendant, based on the discovery, the judge determined "that

[MPF] was an investor" and "[a]s an investor," defendant had no "privity in that

contract." The judge explained that "if Santander Bank [was] the successor [of]

Sovereign Bank," then plaintiff was the originating lender and could establish

standing to foreclose by virtue of its "possession of the note[,]" "as the mortgage

follow[ed] the note." In other words, "there[] [was] no need for an assignment

if the party has . . . possession of the note."

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                                          7
      Thus, the judge ordered plaintiff to provide proof within thirty days that

Sovereign Bank was, in fact, renamed Santander Bank, and directed plaintiff to

produce "a merger document or a certification of the merger and the date of the

merger" to establish that Sovereign Bank and Santander Bank were one in the

same. Subject to supplying the court with the requested documentation, the

judge accepted "Norris' certification in relation to the original note, mortgage,

and [NOI,]" to establish that plaintiff was "the holder of the note" and entitled

to foreclose on the mortgage.      The judge entered a conforming order on

December 18, 2015, granting plaintiff summary judgment, striking defendant's

answer, and entering default against him.

      Thereafter, plaintiff provided the requisite documentation showing that

effective October 17, 2013, Sovereign Bank, N.A. was renamed Santander Bank,

N.A. Defendant moved for reconsideration of the December 18, 2015 order ,

reiterating his contention that plaintiff did not have standing to foreclose. In

support, for the first time, defendant provided the court with a property

securitization analysis report prepared by Certified Forensic Loan Auditors,

LLC purportedly indicating that Sovereign Bank sold defendant's loan in 2004.

Defendant asserted that because plaintiff failed to provide in discovery any

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                                       8
assignment from the party to whom Sovereign Bank sold the loan, plaintiff could

not establish standing.

      On March 4, 2016, following oral argument, Judge Perfilio denied

defendant's motion in an oral opinion. Relying on Rule 4:49-2, Fusco v. Board

of Education of City of Newark, 349 N.J. Super. 455 (App. Div. 2002), and

D'Atria v. D'Atria, 242 N.J. Super. 392 (Ch. Div. 1990), the judge explained the

applicable legal principles as follows:

                   A motion for [re]consideration . . . shall be
            utilized only in those . . . cases which fall into the
            narrow corridor where either the [c]ourt has expressed
            its decision based on [a] palpably incorrect or irrational
            basis or it[] [is] obvious that the [c]ourt either did not
            consider or failed to appreciate the significance of
            probative competent evidence. . . .

                   So[,] a motion for reconsideration is within the
            sound discretion of the [c]ourt and a litigant must
            initially demonstrate that the [c]ourt acted in an
            arbitrary, capricious, or unreasonable manner before
            the [c]ourt should engage in the actual reconsideration
            process.

                  Alternatively, if a litigant wishes to bring new or
            additional information to the [c]ourt's attention that it
            . . . could not have provided on the first application,
            the [c]ourt should in the interest of justice and the
            exercise of sound discretion consider that
            evidence . . . . [I]f it could have been provided, it
            should have been provided.

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                                          9
      The judge rejected the report relied upon by defendant, noting it was an

"out-of-court statement that was offered . . . to prove the truth of its contents,"

and was therefore "a hearsay document." According to the judge, unlike the

Norris certification offered by plaintiff to support its summary judgment motion,

the report did not qualify under the business records exception to the hearsay

rule. See N.J.R.E. 803(c)(6). The judge continued that even if he accepted the

report, "defendant reassert[ed] the same arguments that were set forth in

opposition to the summary judgment [motion]" and were previously addressed

by the court. Thus, according to the judge, defendant failed to satisfy the

standard for reconsideration in that he "did not present evidence of an irrational

basis or evidence that [his argument] was not properly considered."

      The judge also reaffirmed his previous ruling granting plaintiff summary

judgment based on plaintiff's submission of the supplemental "documentation

regarding the merger of Sovereign Bank, which included a . . . certificate of

corporate existence and a certification of Gerard Chamberlain, the assistant

secretary of . . . plaintiff." The judge explained:

                   Mr. Chamberlain certifie[d] that . . . the
            resolution adopted by the bank's Board of Directors to
            change the bank's name to Santander Bank . . . was a
            letter from the Office of the Controller of the Currency
            addressed to Mr. Chamberlain October 1[,] 2013, which
            stated that the Office of the Controller of the Currency

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                                       10
            will amend its records to reflect that effective October
            17, 2013[,] the corporate title of Sovereign Bank
            National . . . Association will change to . . . Santander
            Bank National Association.

                   These papers demonstrate to the [c]ourt that . . .
            plaintiff does have standing to foreclose on the
            mortgage property and therefore the . . . December 18[,
            2015] . . . order granting summary judgment . . . will
            remain in place.

      Thereafter, defendant moved for a stay of the foreclosure proceedings and

for an order to: (1) compel plaintiff to produce a recital of all assignments in

connection with the chain of title in accordance with Rule 4:64-1(b)(10); (2)

substitute the appropriate party for plaintiff; and (3) dismiss the complaint. On

November 18, 2016, following oral argument, in an oral opinion, Judge Perfilio

denied defendant's motion, finding that defendant failed to meet the four

requirements for staying proceedings under Crowe v. De Gioia, 90 N.J. 126

(1982). The judge also determined that defendant "essentially reiterate[d] his

argument regarding standing," which was "already resolved . . . in plaintiff's

favor," "in addition to [advancing] several other baseless arguments."

      On August 12, 2016, plaintiff moved for entry of final judgment pursuant

to Rule 4:64-9. In support, plaintiff provided a certification of diligent inquiry,

pursuant to Rule 4:64-2(d), and a certification of proof of amount due with an

attached schedule, pursuant to Rule 4:64-2(b). Defendant objected to entry of

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                                       11
final judgment, and on December 16, 2016, Judge Perfilio granted defendant's

objection in part, and ordered that "[t]he amount stated in [p]laintiff's

certification of proof of amount due . . . be reduced by [$7000,]" consistent with

the previous March 20, 2015 order granting defendant a $7000 credit.

      Thereafter, defendant moved for reconsideration of the November 18,

2016 order, claiming he "obtained additional documents . . . from the public land

records, . . . which establish that one or more assignments . . . existed."

Defendant posited that these documents showed that "plaintiff did not comply

with [Rule] 4:64-1(b)(10)," which required plaintiff to include "a recital of all

assignments in the chain of title in the complaint[,]" thus rendering the

"complaint invalid." On February 3, 2017, following oral argument, in an oral

opinion, Judge Perfilio denied defendant's motion, finding defendant failed to

"[carry] his burden to warrant reconsideration."

      Initially, the judge noted "[t]he new evidence" consisted of "public

records which [were] available from the start," and, "as such," were "not new

records" unavailable to "defendant during his first application." Additionally,

according to the judge, "defendant has not demonstrated that the [c]ourt's prior

holding was based upon a palpably incorrect, irrational basis." Further, the

judge found that defendant's "application [was] a re-litigat[ion] of a previously

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                                       12
decided issue" because "[t]he [c]ourt ha[d] on three separate occasions

determined to its satisfaction that . . . there [were] no assignments in the chain

of title and that plaintiff ha[d] standing to foreclose on the instant mortgage."

Finally, the judge rejected "[d]efendant's theory . . . that there may be other

parties in interest or hidden assignment[s] stemming from the acquisition of

Sovereign Bank by Santander" because "no other parties are now nor has any

other party ever attempted to enforce th[e] loan which has been in default since

August . . . 2011."

      On January 11, 2018, plaintiff filed an amended motion for entry of final

judgment, along with a certification of diligent inquiry and a certification of

proof of amount due with an attached schedule, which accounted for the $7000

credit to defendant. On February 8, 2018, final judgment of foreclosure was

entered in favor of plaintiff, and this appeal followed.

      Although defendant listed several orders in his notice of appeal, he only

challenges the order granting plaintiff summary judgment in his merits brief.

Because defendant presents no legal argument or citation of law challenging the

other orders in his brief, he has effectively waived those arguments on appeal.

See N.J. Dep't of Envtl. Prot. v. Alloway Twp., 438 N.J. Super. 501, 505 n.2

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                                       13
(App. Div. 2015); see also El-Sioufi v. St. Peter's Univ. Hosp., 382 N.J. Super.

145, 155 n.2 (App. Div. 2005).

      As to the summary judgment order, defendant renews the same arguments

repeatedly rejected by the judge. Specifically, defendant argues plaintiff did not

have standing to foreclose because plaintiff "did not retain ownership or

possession of the original [n]ote" when the foreclosure complaint was filed,

plaintiff did not have an assignment of the mortgage from MPF, and plaintiff

mailed him a deficient NOI. We disagree.

      We review a grant of summary judgment applying the same standard used

by the trial court. Steinberg v. Sahara Sam's Oasis, LLC, 226 N.J. 344, 366

(2016). "Summary judgment is appropriate where the evidence fails to show a

genuine issue as to any material fact challenged and the moving party is entitled

to judgment as a matter of law." Allstate Ins. Co. v. Fisher, 408 N.J. Super. 289,

299 (App. Div. 2009) (citing R. 4:46-2(c)). In reviewing summary judgment

motions, while we "view the 'evidential materials . . . in the light most favorable

to the non-moving party[,]'" Cortez v. Gindhart, 435 N.J. Super. 589, 605 (App.

Div. 2014) (alteration in original) (quoting Brill v. Guardian Life Ins. Co. of

Am., 142 N.J. 520, 540 (1995)), "an adverse party may not rest upon the mere

                                                                           A-3373-17T4
                                       14
allegations or denials of the pleading . . . [to show] that there is a genuine issue

for trial." R. 4:46-5(a).

      Further, it is "well settled that '[b]are conclusions in the pleadings without

factual support in tendered affidavits, will not defeat a meritorious application

for summary judgment.'" Cortez, 435 N.J. Super. at 606 (alteration in original)

(quoting Brae Asset Fund, LP v. Newman, 327 N.J. Super. 129, 134 (App. Div.

1999)). Additionally, all sufficiently supported material facts will be deemed

admitted for purposes of the motion unless "specifically disputed" by the party

opposing the motion. R. 4:46-2(b).

      Pertinent to this appeal, when reviewing a motion for summary judgment

in a foreclosure proceeding, "[t]he only material issues . . . are the validity of

the mortgage, the amount of the indebtedness, and the right of the mortgagee to

resort to the mortgaged premises." Great Falls Bank v. Pardo, 263 N.J. Super.

388, 394 (Ch. Div. 1993), aff'd, 273 N.J. Super. 542, 545 (App. Div. 1994).

When "the execution, recording, and non-payment of the mortgage [are

established], a prima facie right to foreclosure [is] made out."         Thorpe v.

Floremoore Corp., 20 N.J. Super. 34, 37 (App. Div. 1952). "As a general

proposition, a party seeking to foreclose a mortgage must own or control the

underlying debt" in order to have "standing to proceed with the foreclosure

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                                        15
action." Deutsche Bank Nat'l Tr. Co. v. Mitchell, 422 N.J. Super. 214, 222 (App.

Div. 2011) (quoting Wells Fargo Bank, N.A. v. Ford, 418 N.J. Super. 592, 597

(App. Div. 2011)). However, "either possession of the note or an assignment of

the mortgage that predated the original complaint confer[s] standing." Deutsche

Bank Tr. Co. Ams. v. Angeles, 428 N.J. Super. 315, 318 (App. Div. 2012) (citing

Mitchell, 422 N.J. Super. at 216).

      Here, applying these principles, we are satisfied that summary judgment

was properly granted and affirm substantially for the reasons articulated in Judge

Perfilio's comprehensive and well-reasoned oral opinions. To the extent we

have not addressed a particular argument, it is because either our disposition

makes it unnecessary or the argument is without sufficient merit to warrant

discussion in a written opinion. R. 2:11-3(e)(1)(E).

      Affirmed.

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