Deutsche Bank National Trust Co. v. Russo
429 N.J. Super. 91
| N.J. Super. Ct. App. Div. | 2012Background
- Defendants Russo refinanced in 2006 with a $458,700 note/mortgage to MERS as nominee for Countrywide; loan labeled interest-only with a later principal increase and higher payments; $31,000 in points/fees allegedly added.
- Defendants defaulted on June 1, 2007, less than a year into the term, before any principal payments came due.
- Foreclosure action filed November 27, 2007; service on defendants January 24, 2008; default entered June 8, 2008; final judgment entered March 17, 2009; defendants were aware of the judgment.
- Sheriffs sale postponed repeatedly, including bankruptcy-induced delays; sale finally rescheduled and pursued after numerous adjournments, with litigation continuing into 2011.
- July 5, 2011: defendants filed order to show cause seeking to stay the sale and to vacate the 2009 judgment under Rule 4:50-1 and -2.
- Defendants argued lack of standing due to a post-complaint assignment; assignment to Deutsche Bank not signed/recorded until June 17, 2008, after filing; plaintiff asserted valid possession of the note via Wells Fargo and PSA.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Rule 4:50-1 motion was timely and properly denied | Plaintiff argues delay was unreasonable, excusable neglect not shown; standing not an issue post-judgment | Defendants claim excusable neglect and delay caused by efforts to modify loan; equity favors relief | No abuse of discretion; motion untimely under Rule 4:50-1 and not excused |
| Whether plaintiff had standing to foreclose at filing | DB possessed the note and had proper assignment by the time of judgment | Lack of timely assignment prevents standing at filing | Plaintiff had standing; lack of earlier assignment not meritorious defense |
| Whether lack of standing constitutes a meritorious defense to foreclosure | Standing issue does not defeat enforceability after record demonstrates possession of note | Lack of standing should defeat the foreclosure | Lack of standing is not a meritorious defense in post-judgment context |
| Whether the judgment was void as a Rule 4:50-1(d) defense | Not void; standing is judicially reviewable, not jurisdictional | Judgment void for lack of standing | Judgment not void; standing is not jurisdictional in NJ courts |
| Whether fraud or other meritorious defenses exist to vacate the judgment | Fraud claims untimely and unsupported by record | Defendants alleged fraud related to loan terms | No meritorious defense; fraud claim untimely and unsupported |
Key Cases Cited
- Guillaume, 209 N.J. 449 (N.J. 2012) (excusable neglect and standing analysis in post-judgment motions)
- Deutsche Bank Trust Co. Americas v. Angeles, 428 N.J. Super. 315 (App.Div.2012) (motions under Rule 4:50-1 must be filed within a reasonable time)
- Raftogianis v. Bank of New York, 418 N.J. Super. 323 (Ch.Div.2010) (considerations of standing and dismissal where standing issues arise)
- DeVesa v. Dorsey, 134 N.J. 420 (1993) (standing as a matter of judicial policy, not jurisdiction)
- Mancini v. EDS ex rel. N.J. Auto. Full Ins. Underwriting Ass’n, 132 N.J. 330 (1993) (excusable neglect concept in default motions)