ACT PROPERTY LLC SERIES 116 FAIRVIEW AVE. VS. 22 ALPHA MANAGEMENT, LLC (F-018617-16, CAMDEN COUNTY AND STATEWIDE) ( 2018 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court."
Although it is posted on the internet, this opinion is binding only on the
parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-4061-16T1
ACT PROPERTY LLC
SERIES 116 FAIRVIEW
AVE.,
Plaintiff-Respondent,
v.
22 ALPHA MANAGEMENT,
LLC, a/k/a ALPHA 22
ASSOCIATES,
Defendant-Appellant,
and
THE STATE OF NEW JERSEY,
Defendant.
____________________________
Argued March 12, 2018 – Decided July 16, 2018
Before Judges Accurso and O'Connor.
On appeal from Superior Court of New Jersey,
Chancery Division, Camden County, Docket No.
F-018617-16.
Howard N. Sobel argued the cause for
appellant (Law Offices of Howard N. Sobel,
PC, attorneys; Howard N. Sobel and Margaret
D. Nikolis, on the briefs).
Robert W. Keyser argued the cause for
respondent (Taylor and Keyser, attorneys;
Robert W. Keyser and Jeffrey B. Datz, on the
brief).
PER CURIAM
In this tax sale foreclosure action, defendant 22 Alpha
Management, LLC appeals from an April 13, 2017 order denying its
motion to void the final judgment on the ground it had not been
served with the complaint in accordance with the Rules of Court.1
After reviewing the record and applicable legal principles, we
reverse and remand for further proceedings.
I
We glean the following from the motion record. In July
2013, defendant purchased property from Alpha 22 Associates.
Voorhees Township tax records state the physical location of the
subject property is 116 Fairview Avenue, Voorhees, and that
defendant is located at One Alpha Avenue, Suite 20, Voorhees.
In July 2014, plaintiff's predecessor in interest
(predecessor) purchased a tax sale certificate for unpaid
property taxes and county municipal sewer charges assessed
against the subject property. On July 5, 2016, the predecessor
1
The State of New Jersey was included as a party defendant in
the event defendant 22 Alpha Management, LLC owed the State
franchise taxes. The State did not enter an appearance. Unless
otherwise stated, the reference to "defendant" in this opinion
refers solely to 22 Alpha Management, LLC.
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filed a complaint in foreclosure against defendant and the State
of New Jersey. The predecessor sought to foreclose on the tax
sale certificate in the amount of $30,386.95, plus any taxes and
statutory interest that would subsequently accrue.
On July 22, 2016, the predecessor’s attorney filed a
certification of mailing, which stated that on July 15, 2015,
the summons and complaint were sent by regular and certified
mail to Steve Chase Brigham, identified by the attorney as
defendant's principal, to an address in Greenwich, Connecticut.
The attorney also certified the regular mail was not returned,
and the certified mail return receipt (the "green card") was
returned and signed by "Lee." Counsel did not volunteer how he
learned of Brigham and why counsel believed Brigham was
defendant's principal.
A photocopy of the green card reveals the envelope
containing the summons and complaint was addressed to "22 Alpha
Management, L.L.C.; c/o Steven Chase Brigham, Principal; 15 East
Putnam Avenue, Apartment One; Greenwich, Connecticut 06830
5424." The green card also reveals "Lee" checked off a box on
the green card next to which appears the term "Agent."
On August 1, 2016, the predecessor’s attorney filed a
certification of diligent inquiry because the predecessor had
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served defendant by substituted service, see Rule 4:4-5(b). The
highlights of that certification are as follows.
The attorney claimed diligent inquiry revealed Brigham's
address to be the aforementioned one in Connecticut; a search of
the State of New Jersey Division of Revenue and Enterprise
Services records showed 22 Alpha Management, L.L.C. was not
registered to do business in New Jersey; and "various business
searches and a comprehensive business report" obtained on
defendant indicated its last known address was One Alpha Avenue,
Suite 20, Voorhees.
Counsel further certified that, in May 2016, he sent a
letter to defendant at One Alpha Avenue, Suite 20, Voorhees, by
regular and certified mail. The letter sent by certified mail
was returned with a notation from the Post Office that stated
"undeliverable as addressed[;]" the letter sent by regular mail
was returned by the Post Office with the notation "[u]nable to
forward."
Counsel certified he sent two letters of inquiry to the
Postmaster of Voorhees. One asked the Post Office to furnish
the "new address" for defendant at One Alpha Avenue, Suite 20,
Voorhees, and the other letter requested the new address for
defendant at 116 Fairview Avenue, Voorhees. Both letters were
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returned by the Post Office with the notation, "[f]orward
expired."
Despite the latter information from the Post Office, we
note a "Comprehensive Business Report" attached to the
certification of diligent inquiry states 22 Alpha Management,
LLC is located at 116 Fairview Avenue, Voorhees, yet another
page in the report states defendant is located at 22 Alpha
Avenue, Voorhees. The motion record reveals the subject
property is on a corner and the building on the property has two
entrances; one door has the address 116 Fairview Avenue and the
other 22 Alpha Avenue.
The attorney also certified he obtained a skip trace report
on Brigham, which the attorney claimed confirmed Brigham had a
residence at 15 East Putnam Avenue, Apartment One, in Greenwich.
Counsel did not explain how the report confirmed Brigham in fact
had a residence at this location. Finally, counsel certified he
sent a letter of inquiry to the Post Office in Greenwich asking
it to furnish the "new address" for Brigham in Greenwich. The
Post Office returned counsel's letter with the notation, "good
as addressed."
We note the skip trace report on Brigham shows a person by
the name of Steven Chase Brigham also has the following
addresses in Voorhees: One Alpha Avenue, Suite 20; One Alpha
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Avenue, Suite 27; 1094 Corbridge Court, Unit 1094; and 125 West
Evesham Road. Counsel did not state whether he had sent a copy
of the summons and complaint or any other correspondence to
defendant “in care of" Brigham at any of the aforementioned four
addresses, or to 116 Fairview Avenue and 22 Alpha Avenue.
Although the attorney discovered sending mail to only defendant
at One Alpha Avenue and 116 Fairview Avenue was unproductive,
there was no indication sending correspondence to defendant in
the care of Brigham to the other addresses would have been
similarly futile.
In August 2016, default was entered against defendants. In
October 2016, the tax sale certificate was assigned to plaintiff
Act Property LLC Series 116 Fairview Avenue and, in November
2016, such entity was substituted as plaintiff. The attorney
for the predecessor and plaintiff are the same. On January 6,
2017, final judgment was entered against both defendants.
According to a certification of mail executed by plaintiff's
counsel, the final judgment was served upon defendant by sending
a copy by regular mail to Brigham’s address in Connecticut.
On March 16, 2017, defendant filed a motion to set aside
the judgment and permit redemption pursuant to Rule 4:50-1(d).
Defendant premised its argument on the ground the judgment was
void because defendant had not been served with the summons and
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complaint. In a certification filed in support of the motion,
Brigham claimed he did not know about the foreclosure action
until January 20, 2017, when one of his staff members was served
with the final judgment by a process server at 22 Alpha Avenue,
Voorhees.
In the certification, Brigham admitted he maintains a
mailbox at a UPS Store located at 15 Putnam Avenue, Greenwich,
but certified he does not live or have an apartment there and
thus his address did not include "Apartment One." He claimed he
never received any communication from plaintiff at the Greenwich
address. Brigham also stated he was willing to pay the full
amount owed for taxes and other municipal charges on the subject
property. Finally, he mentioned he did not have an attorney
when he acquired the property in 2013 and did not know he had to
register defendant with the State. However, he registered
defendant with the State of New Jersey five days after
defendant's staff was served with the final judgment.
It is not disputed plaintiff did not attempt to personally
serve the summons and complaint upon defendant, and that Brigham
lives at the Corbridge Court address in Voorhees. As previously
stated, it is not known how plaintiff discovered Brigham's name
and his association with defendant.
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The trial court denied defendant's motion, finding
plaintiff had made diligent inquiry to locate and serve
defendant, an effort the court determined was made more
complicated by the fact defendant failed to register with the
State of New Jersey and identify who and where its agent to
receive process was located. Although the court found the
Greenwich address was not Brigham's residence but a UPS Store
where he maintained a mailbox, the court determined plaintiff
was justified in serving defendant at such address by regular
and certified mail.
II
On appeal, defendant contends the trial court erred when it
denied its motion. Defendant argues the judgment is void
because it was not served with the complaint. If argues that,
to the extent plaintiff contends it was justified in serving
defendant by mail, plaintiff failed to make a diligent inquiry
to effectuate personal service and, thus, substituted service by
mail was ineffective.
Rule 4:50-1(d) provides the court may relieve a party from
a final judgment if it is void. "The decision whether to grant
such a motion is left to the sound discretion of the trial
court[.]" U.S. Bank Nat'l Ass'n v. Curcio, 444 N.J. Super. 94,
105 (App. Div. 2016) (alteration in original) (quoting Mancini
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v. EDS ex rel. N.J. Auto. Full Ins. Underwriting Ass'n, 132 N.J.
330, 334 (1993)). However, "[a] default judgment will be
considered void when a substantial deviation from service of
process rules has occurred, casting reasonable doubt on proper
notice." Jameson v. Great Atl. & Pac. Tea Co., 363 N.J. Super.
419, 425 (App. Div. 2003) (citing Sobel v. Long Island Entm't
Prod., Inc., 329 N.J. Super. 285, 293-94 (App. Div. 2000)).
Rule 4:4-4(a)(6) states the primary method of obtaining in
personam jurisdiction over a corporation in this State is to
personally serve a copy of the summons and complaint:
on any officer, director, trustee or
managing or general agent, or any person
authorized by appointment or by law to
receive service of process on behalf of the
corporation, or on a person at the
registered office of the corporation in
charge thereof, or, if service cannot be
made on any of those persons, then on a
person at the principal place of business of
the corporation in this State in charge
thereof, or if there is no place of business
in this State, then on any employee of the
corporation within this State acting in the
discharge of his or her duties . . . ;
[Rule 4:4-4(a)(6).]
If after diligent inquiry a defendant cannot be located and
personally served in New Jersey, Rule 4:4-5(a) provides an
alternate method of service in actions affecting specific
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property or any interest therein. Rule 4:4-5(a) states in
pertinent part:
(a) Whenever, in actions affecting specific
property, or any interest therein, or any
res within the jurisdiction of the court,
. . . it shall appear by affidavit of the
plaintiff's attorney . . . that a defendant
cannot, after diligent inquiry as required
by this rule, be served within the State,
service may, consistent with due process of
law, be made by any of the following . . .
methods:
(1) personal service outside this
State as prescribed by R. 4:4-
4(b)(1)(A) and (B); or
(2) service by mail as prescribed by
R. 4:4-4(b)(1)(C); or
(3) by publication. . . . ; or
(4) as may be provided by court order.
(b) Contents of Affidavit of Inquiry. . .
. The affidavit of inquiry shall be made by
the inquirer fully specifying the inquiry
made, of what persons and in what manner, so
that by the facts stated therein it may
appear that diligent inquiry has been made
for the purpose of effecting actual notice.
Here, plaintiff contends it properly served defendant
pursuant to Rule 4:4-5(a)(2) by mailing the summons and
complaint to Brigham's Connecticut address, because such rule
provides a party may be served by mail as long as the serving
party adheres to Rule 4:4-4(b)(1)(C). Plaintiff asserts it
complied with the latter rule, which states in relevant part:
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If it appears by affidavit satisfying the
requirements of R. 4:4-5(b) that despite
diligent effort and inquiry personal service
cannot be made in accordance with [Rule 4:4-
4(a)], then, consistent with due process of
law, in personam jurisdiction may be
obtained over any defendant as follows:
. . . .
(C) mailing a copy of the summons and
complaint by registered or certified
mail, return receipt requested, and,
simultaneously, by ordinary mail to:
. . . .
(3) a corporation, partnership or
unincorporated association that
is subject to suit under a
recognized name, addressed to a
registered agent for service, or
to its principal place of
business, or to its registered
office. . . .
[Rule 4:4-4(b)(1)(C).]
In order for the kind of service plaintiff endeavored to
effectuate here to be effective, plaintiff first had to attempt
personal service in accordance with Rule 4:4-4(a)(6). Only
after a diligent attempt to personally serve a corporation in
accordance with this rule fails may alternate modes of service
be used. R. 4:4-4(a).
Plaintiff contends it (1) was unable to serve the agent
defendant designated to accept service of process because
defendant never registered with the State; (2) could not locate
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defendant despite diligent efforts; and (3) could not find
Brigham, defendant's principal, in the State of New Jersey.
Therefore, plaintiff argues, it was justified in resorting to
serving defendant by mailing a copy of the summons and complaint
to Brigham in Connecticut. In our view, as evidenced by
plaintiff's counsel's own certification of inquiry, plaintiff
failed to make a diligent attempt to serve defendant in
accordance with Rule 4:4-4(a)(6).
Defendant's failure to register with the State of New
Jersey does not necessarily justify resorting to substituted
service. Rule 4:4-4(a)(6) does not require that a party serve a
registered agent of a corporation. The rule identifies a number
of individuals qualified to accept service on behalf of a
corporation who may not also be registered agents. These
individuals include the person in charge at the corporation's
principal place of business or, if there is no place of business
in this State, an employee of the corporation who is within this
State and acting in the discharge of his or her duties. R. 4:4-
4(a)(6).
Here, the subject certification of inquiry fails to address
what efforts were undertaken to locate defendant's principal
place of business in New Jersey and the person in charge, as
well as an employee in New Jersey acting in the discharge of his
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or her duties. The certification informs the Post Office
indicated One Alpha Avenue and 116 Fairview Avenue in Voorhees
were no longer viable addresses for defendant. However, an
investigative report attached to the certification stated
defendant was located at 116 Fairview Avenue and another page in
the report stated it was located at 22 Alpha Avenue, Voorhees.
In the certification, counsel did not expound upon the
efforts plaintiff expended, if any, to reconcile the
inconsistency between the information provided by the Post
Office and the investigative report. Plaintiff did not explore
whether defendant was located at either one or both of these
addresses by sending out an employee or agent to physically
inspect 116 Fairview Avenue and 22 Alpha Avenue, especially
given the former address is the physical location of the subject
property.
In addition, although plaintiff believed Brigham was
defendant's principal, there was no attempt to contact the
Brigham who maintained addresses in Voorhees, the very
municipality in which the subject property was and defendant
ostensibly located. Had plaintiff done so, it would have
discovered the same Brigham associated with defendant resided at
the Corbridge Court address in Voorhees. Plaintiff ignored
obvious clues that almost certainly would have led to
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discovering where defendant was located in New Jersey, instead
resorting to substituted service.
The requirement a plaintiff file an affidavit2 of diligent
inquiry to justify a factual basis for using an alternate mode
of service is not a mere formality. As we held in M & D
Associates v. Mandara, 366 N.J. Super. 341, 353 (App. Div.
2004), diligent inquiry is a predicate to determining whether
the requirements of due process have been satisfied. In
ascertaining the sufficiency of service outside of this State,
the court must carefully scrutinize the affidavit required to
ascertain whether plaintiff undertook a diligent inquiry. Ibid.
Doing so here would have revealed defendant, whom plaintiff did
not allege was trying to evade service, was readily available
for personal service within the State, thus making alternative
service impermissible. See N.J. Tpk. Auth. v. Tootle, 59 N.J.
308, 313 (1971).
In addition, even if substituted service by mail were
appropriate, Rule 4:4-4(b)(1)(C) requires that a copy of the
summons and complaint be mailed to the corporation's principal
place of business, registered agent for service, or registered
office. While the latter two choices did not exist, plaintiff
2
A certification may be executed in lieu of an affidavit. See
R. 1:4-4(b).
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failed to ascertain and mail the summons and complaint to
defendant's principal place of business.
Given the deficiencies in the certification of inquiry and
the service of process of the summons and complaint, the April
13, 2017 order denying defendant's motion to set the final
judgment aside is reversed and the matter remanded for further
proceedings.
Reversed and remanded for further proceedings consistent
with this opinion. We do not retain jurisdiction.
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