DEUTSCH BANK NATIONAL TRUST COMPANY, ETC. VS. GRACE HWANG,ET AL.(F-8076-09, BERGEN COUNTY AND STATEWIDE)
A-2949-15T2
| N.J. Super. Ct. App. Div. | Jul 13, 2017Background
- Grace Hwang executed a $2.9 million note and mortgage in Feb 2007, defaulted in Apr 2008, and made no payments thereafter. MERS assigned the mortgage to Deutsche Bank in Feb 2009. Deutsche Bank obtained a final judgment of foreclosure in Aug 2010.
- The sheriff's sale was repeatedly adjourned from 2010–2015 due to mediation, loss mitigation, and multiple bankruptcy filings; defendants participated in stay requests and loss-mitigation efforts.
- Grace acknowledged in 2013 she could not afford the property and requested stays/adjournments; a stay request that year was denied.
- The property was sold at sheriff’s sale on Dec 4, 2015. Defendants claimed they had no actual notice of that sale date and sought relief thereafter.
- The trial judge extended the statutory ten-day redemption period to Jan 6, 2016 and denied defendants’ motion to vacate the sheriff’s sale. Defendants appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the sheriff's sale must be vacated for lack of actual notice | Deutsche Bank: no vacation needed because public adjournments and prior proceedings provided constructive notice; extension of redemption period suffices. | Hwangs: they lacked actual notice of Dec 4, 2015 sale and thus the sale should be vacated and remanded. | Court affirmed: abuse-of-discretion standard; extension of redemption period was appropriate and not an abuse of discretion. |
| Proper standard of review for motion to vacate sale | Deutsche Bank: defer to trial court's discretionary ruling. | Hwangs: urged de novo review (citing Scurry). | Held: apply abuse-of-discretion standard to post-foreclosure relief. |
| Adequacy of notice when sale adjourned multiple times | Deutsche Bank: Rule 4:65-4 public adjournments and prior loss-mitigation actions put defendants on notice. | Hwangs: adjournments did not provide them actual notice of the final sale date. | Held: although actual notice was lacking, equity favors extension of redemption period rather than vacatur. |
| Appropriate remedy for lack of actual notice | Deutsche Bank: extension of redemption period is sufficient to put defendants in the position they would have had with notice. | Hwangs: sale should be set aside to permit full opportunity to redeem as if notice had been given. | Held: extension of the statutory redemption period was an appropriate remedy; no vacatur required. |
Key Cases Cited
- First Mut. Corp. v. Samojeden, 214 N.J. Super. 122 (App. Div. 1986) (public adjournment can supply effective notice of an adjourned sheriff’s sale)
- United States ex rel. U.S.D.A. v. Scurry, 193 N.J. 492 (2008) (remedies for notice failures can include extension of redemption period and remand to set reasonable redemption terms)
- N.B. Sav. Bank v. Markouski, 123 N.J. 402 (1991) (appropriate relief for notice failures depends on circumstances)
- Orange Land Co. v. Bender, 96 N.J. Super. 158 (App. Div. 1967) (trial court may set aside sale or order redemption when defendant lacked notice and knowledge of sheriff’s sale)
- DEG, L.L.C. v. Twp. of Fairfield, 198 N.J. 242 (2009) (appellate review of discretionary trial-court rulings uses abuse-of-discretion standard)
- Flagg v. Essex Cty. Prosecutor, 171 N.J. 561 (2002) (definition of abuse of discretion in appellate review)