Midland Funding LLC v. Carl Albern, Jr.
433 N.J. Super. 494
| N.J. Super. Ct. App. Div. | 2013Background
- Midland Funding LLC filed suit against Carl Albern Jr. on June 15, 2011 over an alleged outstanding credit card account.
- Albern pro se moved to dismiss; the motion was denied on October 6, 2011.
- Default was entered against Albern in December 2011 after plaintiff claimed no defense had been filed.
- A default judgment for $19,366.77 plus $269.12 in costs was entered on March 21, 2012.
- Albern moved for relief under Rule 4:50-1 on May 14, 2012; the trial judge denied relief for excusable neglect and lack of meritorious defense.
- The Appellate Division reversed, holding plaintiff could not seek default ex parte and Albern had a meritorious defense, remanding for a fair opportunity to answer.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether ex parte default procedure was proper under Rule 4:43-1 | Plaintiff relied on Rule 4:43-1 to seek default due to Albern's lack of defense. | Albern had an ongoing defense (motion to dismiss) and thus default could not be sought ex parte. | Default ex parte not permitted; vacate and allow defense. |
| Whether Albern's motion to dismiss constituted an answer | Defendant had not filed an answer after denial. | Defendant had already defended via motion to dismiss and expected discovery. | Court treated motion as not a substitute for an answer; but due process requires relief. |
| Whether Rule 4:50-1 relief requires a meritorious defense | Plaintiff asserted standing/merits issues against Albern. | Rule 4:50-1 relief for void judgments does not require a meritorious defense. | Meritorious defense not required if relief from void judgment; defendant's standing defense was legitimate. |
| Whether Albern was entitled to notice of default or related proceedings | Clerk acted on supposed failure to plead/defend. | Ex parte default violated due process; Albern did defend by motion. | Ex parte default notice not proper; requires notice and opportunity to be heard. |
Key Cases Cited
- Ragusa v. Lau, 119 N.J. 276 (1990) (disposition of cases on merits favors; procedural restraints limited)
- Galik v. Clara Maass Med. Ctr., 167 N.J. 341 (2001) (strong preference for adjudication on the merits)
- Mayfield v. Cmty. Med. Assocs., P.A., 335 N.J. Super. 198 (App. Div. 2000) (policy favoring merits over procedural disposition)
- Marder v. Realty Constr. Co., 84 N.J. Super. 313 (App. Div. 1964) (due process for pro se litigants when reasonable expectations exist)
- Mancini v. EDS ex rel. N.J. Auto. Full Ins. Underwriting Ass'n, 132 N.J. 330 (1993) (excusable neglect principles applied to rule relief)
- Rubin v. Rubin, 188 N.J. Super. 155 (App. Div. 1982) (procedural bars must consider pro se reasonable expectations)
- Baumann v. Marinaro, 95 N.J. 380 (1984) (interpretation of procedural rules in context)
- Peralta v. Heights Med. Ctr., Inc., 485 U.S. 80 (1988) (merits not required for relief from void judgments)
- City of Passaic v. Shennett, 390 N.J. Super. 475 (App. Div. 2007) (defense viability in subsequent proceedings)