POL X, LLC v. 181 MAPES AVE, LLC
2:16-cv-09540
D.N.J.Dec 21, 2017Background
- Plaintiff Patch of Land Lending, LLC (POL Lending) holds by assignment a $175,000 commercial promissory note, guaranty, recorded mortgage on 181 Mapes Avenue, Newark (Block 3664, Lot 52), and a perfected security agreement securing additional personal property.
- 181 Mapes Ave., LLC executed the Note, Mortgage, and Security Agreement on February 20, 2015; Richard Sajous executed the Guaranty.
- Loan matured February 29, 2016 with 14% interest; default interest and collection costs were contractually provided.
- Defendants failed to make required payments (including the February 1, 2016 installment) and did not cure after written default notice; POL assigned the loan documents to POL Lending on November 30, 2016 and recorded the assignment.
- POL Lending filed suit December 28, 2016 asserting breach of note, breach of guaranty (against Sajous), foreclosure of the mortgage, and foreclosure of the security agreement; parties agreed to forego fact discovery and proceeded on cross-motions for summary judgment.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Validity of loan documents and indebtedness | POL Lending is assignee and holder of the Note, Mortgage, Guaranty, and Security Agreement; amounts due are calculable from loan records | Defendants did not deny signing but challenged holder/standing | Court: Documents valid, assignment recorded, indebtedness established; prima facie case for foreclosure granted |
| Default and entitlement to accelerate | Defendants failed to pay when due; default triggered acceleration and default interest | Defendants offered no evidence of payment or cure | Court: Default proven; acceleration and damages permitted under contract |
| Standing/ownership of the Note | POL validly received assignment from POL and holds the Note and related instruments | Defendants claimed lack of standing/holder status | Court: POL Lending has standing as assignee; defenses rejected |
| Affirmative defenses (statute of limitations, estoppel, mitigation, unclean hands, etc.) | Plaintiff contends defenses are unsupported and contradicted by record | Defendants asserted ten defenses but produced no evidentiary support and discovery was closed | Court: Defenses meritless or unsupported; summary judgment for plaintiff |
| Remedy (amount, foreclosure, deficiency) | Seek judgment for $235,812.95 (as of June 13, 2017) plus per diem interest and sale of mortgaged and personal property to satisfy debt | Defendants offered no competing damages calculation or offset | Court: Entered judgment for $235,812.95 plus $117.50/day from June 14, 2017; ordered foreclosure sale with proceeds to satisfy debt; defendants liable for any deficiency |
Key Cases Cited
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (summary judgment standard)
- Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment burden-shifting)
- Miller v. Indiana Hosp., 843 F.2d 139 (summary judgment review standards)
- Great Falls Bank v. Pardo, 263 N.J. Super. 388 (Ch. Div. 1993) (material issues in foreclosure limited to validity of mortgage, indebtedness, and right to foreclose)