MIDLAND FUNDING v. Giambanco
28 A.3d 831
| N.J. Super. Ct. App. Div. | 2011Background
- Defendant Giambanco defaulted on a credit card; parties settled with monthly $50 payments.
- Settlement culminated in a proposed consent judgment titled 'Consent Judgment and Order Conditionally Withholding Wage Execution.'
- The proposed judgment included a clause allowing wage execution without further notice upon certification of default.
- Trial court struck two waiver provisions; accepted judgment without those provisions, prompting plaintiff to seek relief.
- Amicus Legal Services of New Jersey was invited; court issued detailed opinion addressing notice requirements and public policy.
- Appellate Division held that a waiver of notice is not per se invalid if the waiver is knowing and informed; unilaterally striking provisions was error; remanded for further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Waiver of notice is void against public policy? | Waiver should be enforceable to facilitate settlement. | Waiver contravenes statutory notice protections and public policy. | Waiver allowed if knowing and informed. |
| Can a judgment-debtor waive prior notice of wage garnishment? | Waiver permissible to permit structured payment plan. | Waiver undermines pre-garnishment protections. | May waive if knowing and informed. |
| Did the court err in severing the waiver from the consent judgment? | Court should enforce agreed terms, including waiver. | Court may strike problematic provisions to protect rights. | Court erred by unilaterally striking provisions; remedy depends on party agreement. |
| Is the proposed consent judgment a contract of adhesion? | Not necessarily an adhesion contract; settlements encouraged. | Potentially reflects unequal bargaining power. | No basis to treat as a contract of adhesion. |
| Was the waiver sufficiently informed under Rule 4:59-1(d) & N.J.S.A. 2A:17-50(a)? | Waiver embedded in consent judgment should be effective. | Waiver lacked necessary informing detail; improper. | Waiver insufficiently informed; but enforceability depends on informed waiver standard. |
Key Cases Cited
- Judson v. Peoples Bank & Trust Co., 25 N.J. 17 (1957) (settlements favored; enforceability of settlements)
- Muhammad v. County Bank of Rehoboth Beach, 189 N.J. 1 (2006) (considers consumer loan arbitration; notice protections)
- Delta Funding Corp. v. Harris, 189 N.J. 28 (2006) (adhesion and consumer protection context; settlement considerations)
- Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474 (1974) (due process; notice and opportunity to be heard essential)
- Christafano v. N.J. Mfg. Ins. Co., 361 N.J. Super. 228 (2003) (consent judgments and proper contract interpretation)
- Pope v. Kingsley, 40 N.J. 168 (1963) (consent judgments; equal adjudicative effect)
- Morris Cnty. Fair Hous. Council v. Boonton Twp., 197 N.J. Super. 359 (1984) (settlements; judicial resource conservation)
- Carteret Props. v. Variety Donuts, Inc., 49 N.J. 116 (1967) (tenant protections; settlement and notice context)