Towd Point Mortgage Trust 2017-Fre1, Etc. v. Sheri L. Best ( 2024 )

NOT FOR PUBLICATION WITHOUT THE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-2176-22
TOWD POINT MORTGAGE
TRUST 2017-FRE1, U.S. BANK
NATIONAL ASSOCIATION,
as Indenture Trustee,
Plaintiff-Respondent,
v.
SHERI L. BEST,
Defendant-Appellant,
and
DENNIS RIORDON and
NATIONAL CITY BANK,
Defendants.
______________________________
Submitted March 18, 2024 – Decided April 3, 2024
Before Judges Marczyk and Vinci.
On appeal from the Superior Court of New Jersey,
Chancery Division, Hunterdon County, Docket No.
F-019349-19.
Sheri L. Best, appellant pro se.
Fein, Such, Kahn & Shepard, PC, attorneys for
respondent (Michael S. Hanusek, on the brief).
PER CURIAM
In this foreclosure action, defendant Sheri L. Best appeals from a March
17, 2023 order denying her motion to vacate default judgment filed two years
after judgment was entered in favor of plaintiff Towd Point Mortgage Trust
2017-FRE1 (Towd Point). Based on our review of the record and applicable
legal standards, we affirm.
On May 18, 2007, Best executed a note and purchase-money mortgage in
the amount of $372,000 for property located in Califon, and delivered the note
and mortgage to Bank of America, N.A. (Bank of America). Bank of America
recorded the mortgage on June 4, 2007. The note provides Best, as the borrower,
"understand[s] that the Lender [Bank of America] may transfer this [n]ote."
On September 11, 2012, Bank of America assigned the mortgage to
Ocwen Loan Servicing, LLC (Ocwen). The assignment was recorded on
September 25, 2012. On April 28, 2017, Ocwen assigned the mortgage to Select
Portfolio Servicing, Inc. (SPS). The assignment was recorded on May 18, 2017.
On April 23, 2019, SPS assigned the mortgage to Towd Point. The
assignment was recorded on May 10, 2019, and states SPS, as the "Assignor[,]
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does hereby grant, sell, assign, transfer and convey, unto the above-named
Assignee [Towd Point] all interest under that certain Mortgage Dated: [May 18,
2007], in the amount of $372,000[], executed by Sheri L. Best and Dennis
Riordon, wife and husband to Bank of America, N.A."
On August 1, 2018, Best defaulted on her obligations under the note and
mortgage. On November 14, 2019, Towd Point filed the underlying foreclosure
complaint. On November 29, 2019, Best was personally served. Best did not
answer the complaint. On January 20, 2020, Towd Point filed a request for and
certification of default. On February 17, 2021, the court entered default
judgment in favor of Towd Point in the amount of $331,422.87. On June 16,
2021, at Best's request, Towd Point faxed Best a payoff letter. On December
12, 2021, Towd Point assigned the mortgage to FirstKey Mortgage, LLC.
On February 14, 2023, Best, appearing pro se, moved to vacate default
judgment pursuant to Rule 4:50-1. On March 13, 2023, the court heard oral
argument and denied Best's motion in an oral decision, finding it was "entirely
without merit" because: (1) she did not address any excusable neglect that
warrants disturbing a default judgment; and (2) it was unreasonable that she filed
her motion two years after judgment was entered. The court noted Best "clearly
was aware of this litigation" because she was personally served with the
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complaint, was mailed copies of all documents, and requested and received a
pay-off letter, yet did "not indicate at all why she failed to participate in this
lawsuit."
On March 17, 2023, the trial court entered an order denying Best's motion
for the reasons set forth on the record on March 13, 2023. On appeal, Best
argues the court abused its discretion in denying her motion to vacate default
judgment because Towd Point lacked standing to foreclose.
"The trial court's determination under [Rule 4:50-1] warrants substantial
deference, and should not be reversed unless it results in a clear abuse of
discretion." U.S. Bank Nat'l Ass'n v. Guillaume, 209 N.J. 449, 467 (2012). An
abuse of discretion exists "when a decision is 'made without a rational
explanation, inexplicably departed from established policies, or rested on an
impermissible basis.'" Id. at 467-68 (quoting Iliadis v. Wal-Mart Stores, Inc.,
191 N.J. 88, 123 (2007)).
We affirm substantially for the reasons set forth in the court's thorough
and well-reasoned oral opinion. We add the following comments.
Pursuant to Rule 4:50-1,
the court may relieve a party . . . from a final judgment
or order for the following reasons: (a) mistake,
inadvertence, surprise, or excusable neglect; (b) newly
discovered evidence which would probably alter the
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judgment or order and which by due diligence could not
have been discovered in time to move for a new trial
under [Rule] 4:49; (c) fraud . . . , misrepresentation, or
other misconduct of an adverse party; (d) the judgment
or order is void; (e) the judgment or order has been
satisfied, released or discharged, or a prior judgment or
order upon which it is based has been reversed or
otherwise vacated, or it is no longer equitable that the
judgment or order should have prospective application;
or (f) any other reason justifying relief from the
operation of the judgment or order.
Without referring to a specific ground for relief under Rule 4:50-1, Best
contends the court improperly denied her motion to vacate default judgment
because Towd Point lacked standing to foreclose. Best's argument implicates
Rule 4:50-1(a), excusable neglect, or (f), any other reason justifying relief from
the operation of the judgment or order.
To obtain relief from a default judgment under Rule 4:50-1(a), the movant
must demonstrate both excusable neglect and a meritorious defense. Dynasty
Bldg. Corp. v. Ackerman, 376 N.J. Super. 280, 285 (App. Div. 2005). For relief
under Rule 4:50-1(f), the movant must demonstrate the circumstances are
exceptional, and that enforcement of the order or judgment would be unjust,
oppressive, or inequitable. Badalamenti v. Simpkiss, 422 N.J. Super. 86, 103
(App. Div. 2011) (citing Linek v. Korbeil, 333 N.J. Super. 464, 473-74
(App. Div. 2000)).
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Best failed to establish a meritorious defense or exceptional circumstances
warranting relief because, as the court correctly determined, Towd Point had
standing to foreclose. "As a general proposition, a party seeking to foreclose a
mortgage must own or control the underlying debt." Wells Fargo Bank, N.A. v.
Ford, 418 N.J. Super. 592, 597 (App. Div. 2011) (quoting Bank of N.Y. v.
Raftogianis, 418 N.J. Super. 323, 327-28 (Ch. Div. 2010)). A party has standing
to foreclose if it either (a) "demonstrate[s] that it possessed the note" when it
filed the complaint, or (b) "present[s] an authenticated assignment indicating
that it was assigned the note before it filed the original complaint." Deutsche
Bank Nat'l Tr. Co. v. Mitchell, 422 N.J. Super. 214, 224-25 (App. Div. 2011)
(citing N.J.S.A. 46:9-9).
The court correctly found Towd Point had standing to foreclose based on
certified copies of the note, mortgage, and assignment of mortgage that
demonstrate Towd Point was the legal owner of the mortgage at the time it filed
its foreclosure complaint. Because Best's claim that Towd Point lacked standing
was without merit, the court did not abuse its discretion by denying her motion
to vacate default judgment.
The court also did not abuse its discretion in determining Best's motion
was untimely. A motion to vacate pursuant to Rule 4:50-1(a) must be filed "not
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more than one year after the judgment, order or proceeding was entered or
taken." R. 4:50-2. A motion pursuant to Rule 4:50-1(f) must be filed "within a
reasonable time." Ibid. A court may not "enlarge the time specified by . . .
[Rule] 4:50-2." R. 1:3-4(c).
If Best's motion was premised on Rule 4:50-1(a), it was precluded because
it was filed more than one year after judgment was entered. If Best sought relief
under Rule 4:50-1(f), the court did not abuse its discretion by determining her
motion was untimely. As the court noted, Best did not offer any explanation for
her failure to participate in the litigation or delay in waiting two years to move
to vacate default judgment. There is no reason to disturb the court's
determination that Best failed to seek relief under Rule 4:50-1(f) within a
reasonable time. The court did not abuse its discretion by denying Best's motion
to vacate default judgment.
Affirmed.
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