WELLS FARGO BANK, N.A. et al. v. JAMES L. INGRAHAM et al.

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0154-05T10154-05T1

WELLS FARGO BANK, N.A. and

RFR PROPERTIES, LLC,

Plaintiffs-Respondents,

v.

JAMES L. INGRAHAM and WILLETTE R.

INGRAHAM,

Defendants-Appellants.

_________________________________

 

Submitted April 24, 2006 - Decided May 25, 2006

Before Judges Parrillo and Gilroy.

On appeal from the Superior Court of New Jersey,

Chancery Division, General Equity Part, Gloucester County, Docket No. F-10245-04.

David Paul Daniels, attorney for appellants.

Phelan, Hallinan & Schmieg, attorneys for respondent,

Wells Fargo Bank, N.A. (Vladimir Palma, on the brief).

McCabe, Weisberg & Conway, attorneys for respondent,

RFR Properties, LLC (Rita C. Buscher, on the brief).

PER CURIAM

Defendants, James L. and Willette R. Ingraham, appeal from an order of the Chancery Division, General Equity Part, denying their application to vacate the Sheriff's sale and delivery of deed to third-party purchasers, plaintiff RFR Properties, LLC (RFR). We affirm.

The facts of the underlying foreclosure are not in dispute. Defendants purchased a home at 45 White Pine Drive, Sewell, on February 24, 1989, for $175,000. They financed the purchase price through a mortgage in the amount of $147,100 to the Prudential Home Mortgage Company, Inc., which was subsequently assigned to plaintiff, Wells Fargo Bank, N.A. (Wells Fargo), on May 1, 1996, and recorded on December 2, 1996.

Defendants failed to make their scheduled mortgage payment on March 1, 2004, and Wells Fargo instituted foreclosure proceedings in the Chancery Division, Gloucester County, on June 9, 2004. Defendants were served with a copy of the summons and foreclosure complaint by certified mail on August 10, 2004, at their White Pine Drive residence after defendants successfully avoided personal service at this address. After defendants failed to respond to the foreclosure complaint, not having the funds to reinstate the mortgage, default was entered on October 14, 2004, and a copy of the filed default was mailed to defendants via regular mail on October 21, 2004. Notices, pursuant to Section 6 of the New Jersey Fair Foreclosure Act, N.J.S.A. 2A:50-53 to -68, were also sent to defendants on October 21, 2004, by way of certified and regular mail. The certified mail was returned unclaimed, however, the regular mail was never returned. Final judgment was ultimately entered against defendants on January 26, 2005. A copy of the entered final judgment was sent to defendants on February 7, 2005, via regular mail to their residence, which was never returned.

Upon entry of final judgment, a writ of execution was issued on January 26, 2005, and the Sheriff of Gloucester County scheduled a sheriff's sale of the property for March 23, 2005. Notice of the March 23, 2005 sheriff's sale was sent to defendants on February 15, 2005, via certified and regular mail, pursuant to Rule 4:65. The certified mail could not be located, but the regular mail was never returned. In addition, on February 20, 2005, the Sheriff posted notice on the property, advising defendants that the property was to be sold on March 23, 2005, at 2:00 p.m. On March 23, 2005, Wells Fargo sent a notice of adjournment of the March 23, 2005 sheriff's sale to defendants, via regular mail, advising them that the sheriff's sale had been adjourned to April 6, 2005. The regular mail was also never returned. On April 6, 2005, the property was sold by the Sheriff to third-party purchaser, RFR, who submitted a successful bid of $231,000.00.

On April 12, 2005, during the statutory ten-day right of redemption period, defendants filed a petition under Chapter 13 of the United States Bankruptcy Code. It appears undisputed that defendants' bankruptcy filing prevented the Sheriff from delivering the deed to RFR upon the expiration of the ten-day right of redemption, which would have been April 18, 2005. However, defendants' bankruptcy petition was dismissed on August 18, 2005. Upon learning of the dismissal on August 22, 2005, RFR tendered the balance of its successful bid to the Sheriff at 2:30 p.m. that day, and the Sheriff accordingly delivered the deed to RFR at that time, which was then promptly recorded. Throughout all this time, defendants never attempted to redeem the property, and in fact, admit that they did not have the means to effect a redemption.

Instead, that same day, August 22, 2005, at 5:01 p.m., defendants filed a second bankruptcy petition. However, upon receiving legal advice that their bankruptcy filing was ineffective in saving their interest in the property, defendants then filed the present order to show cause on August 26, 2005, directing plaintiffs to show cause why the sheriff's sale should not be vacated. On the September 7, 2005 return date, defendants argued that the sheriff's sale was void because they never received notice of the sale and the sale occurred before expiration of the ten-day right of redemption, which they claim was tolled by their first bankruptcy filing. The General Equity judge rejected both arguments and denied defendants the relief sought.

On appeal, defendants raise the same two arguments. We find neither contention persuasive.

As to the former, the record contains a certification of proof of mailing by both regular and certified mail of notice of the sheriff's sale originally scheduled for March 23, 2005. Such mailing comported with the requirements of Rule 4:65-2. Although Wells Fargo was unable to produce the certified mail receipt, counsel certified the notice was forwarded to defendants via certified and regular mail and the regular mail was never returned, thus creating a presumption that it was properly delivered. R. 1:6-3(c); Ivy Hill Park, Section III, Inc. v. Abutidze, 371 N.J. Super. 103 (App. Div. 2004). Additionally, the record contains an affidavit of posting from the Sheriff's office of the notice of sheriff's sale on the property. Moreover, Wells Fargo provided additional proof that notice of the adjournment of the sheriff's sale to April 6, 2005 was sent to defendants by regular mail, which also was never returned. We conclude that, under the circumstances, Wells Fargo satisfied the notice requirements of Rule 4:65-2 and that defendants had actual notice of the adjourned sale date. See First Mut. Corp. v. Samojeden, 214 N.J. Super. 122 (App. Div. 1986).

Defendants next contend that the sale is void because it occurred before the expiration of their ten-day right of redemption. Specifically, they argue that their ten-day right of redemption was interrupted by their initial bankruptcy petition, filed on April 12, 2005, the sixth day of the redemption period, the running of which being tolled by the automatic stay provision of 11 U.S.C.A. 362(a) until the petition was dismissed on August 18, 2005. Thus, they calculate that the ten-day redemption period then resumed on August 19, 2005, and would not have expired until the end of the business day on August 22, 2005, four days after their bankruptcy petition had been dismissed. However, because the deed was delivered at 2:30 p.m. on the fourth day, they assert that it was delivered prematurely, and therefore, should be set aside. Plaintiffs, on the other hand, maintain that Section 362's automatic stay provision only prohibits actions by a creditor during the pendency of a debtor's bankruptcy petition, such as the prosecution of a foreclosure action, and does not operate to toll the passage of time for purposes of calculating the ten-day right of redemption.

We need not decide whether the ten-day right of redemption is tolled during the pendency of the bankruptcy petition and resumes only after its dismissal because we are satisfied the judge properly ruled, on equitable considerations, that the sheriff's sale could not be overturned. Even if defendants' statutory right of redemption continued on August 19, 2005 through to the end of business on August 22, 2005, defendants nevertheless failed to properly redeem by the end of the business day on August 22, 2005. In fact, defendants admitted in their certification in support of their order to show cause that they did not have the monies required to redeem. Consequently, the court properly denied their request for relief and upheld the sheriff's sale as valid. In other words, defendants' undisputed inability to properly redeem the property effectively mooted their application for relief.

Affirmed.

 

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A-0154-05T1

May 25, 2006