WELLS FARGO BANK, N.A. v. DULCE M. FERREIRA

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0

WELLS FARGO BANK, N.A.,

Plaintiff-Respondent,

v.

DULCE M. FERREIRA,

Defendant-Appellant,

and

JORGE FERREIRA,

Defendant.

_______________________________________

October 22, 2015

Submitted September 8, 2015 Decided

Before Judges St. John and Manahan.

On appeal from the Superior Court of New Jersey, Chancery Division, Bergen County, Docket No. F-017623-12.

Dulce M. Ferreira, appellant pro se.

Powers Kirn, LLC, attorneys for respondent (Paige M. Bellino, on the brief).

PER CURIAM

In this mortgage foreclosure matter, defendant, Dulce M. Ferreira, appeals from a March 8, 2013, order entered by the trial judge granting summary judgment in favor of plaintiff, Wells Fargo Bank, N.A. (Wells Fargo). We affirm.

On June 22, 2005, Ferreira executed and delivered a note to World Savings Bank, FSB (World Savings) in the amount of $312,200. To secure payment, Ferreira delivered a mortgage against real property located in North Arlington. On the same date, she executed and delivered a second note and mortgage against the North Arlington property to World Savings, in the amount of $89,200.

In 2007, Golden West Financial Corporation (parent company of World Savings) was acquired by the Wachovia Corporation. As a result, World Savings was merged into Wachovia Mortgage, FSB (Wachovia Mortgage), a subsidiary of the Wachovia Corporation. In 2009, the Wachovia Corporation was acquired by Wells Fargo & Company. As a result, Wachovia Mortgage was converted into a national bank and merged into Wells Fargo, a subsidiary of Wells Fargo & Company.

Ferreira defaulted under the terms of the note in July 2011. Wells Fargo elected to accelerate the entire sum due. Ferreira never reinstated the loan despite being offered the opportunity to do so in a "Notice of Intent to Foreclose" letter dated February 27, 2012.

Wells Fargo filed a complaint on August 27, 2012, seeking to foreclose on the mortgages. Ferreira filed an answer on September 28, 2012, asserting Wells Fargo's lack of standing. On October 19, 2012, she filed a motion to dismiss for lack of standing and violations of the Fair Foreclosure Act, N.J.S.A. 2A:50-53 to -68. The judge denied the motion on December 7, 2012, taking judicial notice of the merger history and rejecting Ferreira's challenge to Wells Fargo's standing. On January 25, 2013, the judge denied a motion for reconsideration filed by Ferreira.

In February 2013, Wells Fargo filed a motion for summary judgment or to strike Ferreira's answer. On March 8, 2013, the judge entered an order granting Wells Fargo's motion and striking Ferreira's answer. Her motion for reconsideration was denied on June 21, 2013. Final judgment in the amount of $549,605.08 was entered by another judge on July 14, 2014. The order granting final judgment in favor of Wells Fargo directed the Sheriff of Bergen County to commence with a sale of the property.

On appeal, Ferreira presents six points for our consideration. All six points challenge Wells Fargo's standing and whether it owned or "held" the note on Ferreira's loan.1

A trial court must grant a summary judgment motion if "the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact challenged and that the moving party is entitled to a judgment or order as a matter of law." R. 4:46-2(c). "An issue of fact is genuine only if, considering the burden of persuasion at trial, the evidence submitted by the parties on the motion, together with all legitimate inferences therefrom favoring the non-moving party, would require submission of the issue to the trier of fact." Ibid.; see also Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995). On appeal, we hew to that same summary judgment standard. Townsend v. Pierre, 221 N.J. 36, 59 (2015).

Ferreira does not contest her execution of the loan documents or the availability of foreclosure after default. Instead, she contends there was a genuine issue of fact regarding Wells Fargo's standing and ownership of the note. We disagree.

"'[A] party seeking to foreclose a mortgage must own or control the underlying debt'" at the time the forfeiture complaint was filed. 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)). If the plaintiff cannot establish ownership or control, it "lacks standing to proceed with the foreclosure action and the complaint must be dismissed." Ford, supra, 418 N.J. Super. at 597. "If a debt is evidenced by a negotiable instrument, such as the note executed by defendant," whether the plaintiff established ownership or control over the note "is governed by Article III of the Uniform Commercial Code (UCC), N.J.S.A. 12A:3-101 to -605, in particular N.J.S.A. 12A:3-301." Ford, supra, 418 N.J. Super. at 597.

Thus, Wells Fargo had to show it fell within one of the "three categories of persons entitled to enforce negotiable instruments" as described in N.J.S.A. 12A:3-301. Deutsche Bank Nat'l Trust Co. v. Mitchell, 422 N.J. Super. 214, 222-23 (App. Div. 2011).

N.J.S.A. 12A:3-301 provides

"Person entitled to enforce" an instrument means the holder of the instrument, a nonholder in possession of the instrument who has the rights of a holder, or a person not in possession of the instrument who is entitled to enforce the instrument pursuant to [N.J.S.A.] 12A:3-309 or subsection d. of [N.J.S.A.] 12A:3-418. A person may be a person entitled to enforce the instrument even though the person is not the owner of the instrument or is in wrongful possession of the instrument.

Saliently, under the Banking Act of 1948, N.J.S.A. 17:9A-1 to -467, when two or more banks merge, "the corporate existence of each merging bank shall be merged into that of the receiving bank, and the property and rights of each merging bank shall thereupon vest in the receiving bank without further act or deed[.]" N.J.S.A. 17:9A-139(1).

Here, the judge took judicial notice of the merger history and concluded Wells Fargo had both standing and properly held the note without any endorsement. We see no error in the judge's determination, particularly given the undisputed merger and acquisition history of World Savings, Wachovia Mortgage, and Wells Fargo.

Consistent with N.J.S.A. 17:9A-139(1) and the requirements set forth in N.J.S.A. 12A:3-301, Wells Fargo was the "holder of the instrument" and was otherwise vested with the right to sue on instruments previously held by the acquired bank without presenting a separate assignment of the instruments. See also 12 U.S.C.A. 215a(e); N.J.S.A. 17:9A-132(1) and (2); N.J.S.A. 17:9A-148(C). As Wells Fargo demonstrated it was the holder of the note and the mortgage at the time of the complaint, it was therefore an appropriate party with standing to bring the foreclosure action. Mitchell, supra, 422 N.J. Super. at 224-25 (citation omitted).

Ferreira's argument as to Wells Fargo's standing includes a challenge to the certification submitted in support of Wells Fargo's summary judgment motion. The certification was signed by Jorge Salamanca, Wells Fargo's vice president of loan documentation.

"A certification will support the grant of summary judgment only if the material facts alleged therein are based, as required by Rule 1:6-6, on 'personal knowledge.'" Ford, supra, 418 N.J. Super. at 599 (citation omitted); see also R. 4:46-2(c).

Rule 1:6-6 states

[i]f a motion is based on facts not appearing of record or not judicially noticeable, the court may hear it on affidavits made on personal knowledge, setting forth only facts which are admissible in evidence to which the affiant is competent to testify and which may have annexed thereto certified copies of all papers or parts thereof referred to therein. The court may direct the affiant to submit to cross-examination, or hear the matter wholly or partly on oral testimony or depositions.

In Salamanca's certification, he discussed the merger and acquisition history of World Savings, Wachovia Mortgage, and Wells Fargo. Salamanca certified that Wells Fargo was the present holder of the note. The certification detailed the relevant dates for each merger and provided confirming documentation. Salamanca also certified , in his role as vice president of loan documentation, he had personal knowledge of Wells Fargo's business records and had personally reviewed the loan documents at issue. As such, Salamanca qualified as one who could authenticate the loan documents and could certify that Wells Fargo held the note and mortgage before the foreclosure complaint was filed.

We are satisfied the certification was in compliance with Rule 4:64-2(c), which states

[t]he affidavit shall be made either by an employee of the plaintiff, if the plaintiff services the mortgage, on the affiant's knowledge of the plaintiff's business records kept in the regular course of business, or by an employee of the plaintiff's mortgage loan servicer, on the affiant's knowledge of the mortgage loan servicer's business records kept in the regular course of business.

Here, the mortgage was serviced by Wells Fargo as the successor by merger. Salamanca, in his capacity as vice president of loan documentation, could properly attest to his knowledge of Wells Fargo's business records kept in the regular course of business.

As well, predicated upon Salamanca's certification, the loan documents satisfied the business records hearsay exception. N.J.R.E. 803(c)(6). A statement is not excluded by the hearsay rule if it is

[a] statement contained in a writing or other record of acts, events, conditions, and, subject to Rule 808, opinions or diagnoses, made at or near the time of observation by a person with actual knowledge or from information supplied by such a person, if the writing or other record was made in the regular course of business and it was the regular practice of that business to make it, unless the sources of information or the method, purpose or circumstances of preparation indicate that it is not trustworthy.

[N.J.R.E. 803(c)(6).]

"The purpose of the business records exception is to broaden the area of admissibility of relevant evidence where there is necessity and sufficient guarantee of trustworthiness." Liptak v. Rite Aid, Inc., 289 N.J. Super. 199, 219 (App. Div. 1996) (quotation and citation omitted). Our Supreme Court has established that

[i]n order to qualify under the business record exception to the hearsay rule, the proponent must satisfy three conditions

"First, the writing must be made in the regular course of business. Second, it must be prepared within a short time of the act, condition or event being described. Finally, the source of the information and the method and circumstances of the preparation of the writing must justify allowing it into evidence."

[State v. Sweet, 195 N.J. 357, 370 (2008) (quoting State v. Matulewicz, 101 N.J. 27, 29 (1985)), cert. denied, 557 U.S. 934, 129 S. Ct. 2858, 174 L. Ed. 2d 601 (2009).]

"There is no requirement that the foundation witness [certifying that a record is a business record must] possess any personal knowledge of the act or event recorded." New Century Fin. Servs., Inc. v. Oughla, 437 N.J. Super. 299, 326 (App. Div.) (citation omitted), certif. denied, 218 N.J. 531 (2014). Accordingly

an employee of a successor bank may certify on summary judgment to the loan history printouts of transactions of its predecessor because the employee's position rendered him sufficiently familiar with the record system used to allow him to establish that it was the regular practice of the predecessor bank to make the record.

[Id. at 326-27 (citing Garden State Bank v. Graef, 341 N.J. Super. 241, 245 (App. Div. 2001)).]

After Wells Fargo established a prima facie case, the burden shifted to Ferreira to present evidence of a genuine issue of material fact for trial. Brill, supra, 142 N.J. at 529. Under Rule 4:46-5(a)

[w]hen a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of the pleading, but must respond by affidavits meeting the requirements of [Rule] 1:6-6 or as otherwise provided in this rule and by [Rule] 4:46-2(b), setting forth specific facts showing that there is a genuine issue for trial.

Ferreira failed to provide any facts to defeat Wells Fargo's motion for summary judgment. In her affidavit opposing Wells Fargo's motion, she did not proffer any evidence disputing that Wells Fargo was the successor by merger and holder of the note prior to the commencement of the foreclosure action. Instead, her affidavit in opposition contains legal arguments and general assertions contesting Wells Fargo's standing and ability to hold the note. "Conclusory claims" without explanation and "[b]ald assertions are not capable of . . . defeating summary judgment." Ridge at Back Brook, LLC v. Klenert, 437 N.J. Super. 90, 97-98 (App. Div. 2014).

In light of our review of the record and after consideration of controlling substantive and procedural law, we hold the decision to grant summary judgment was not in error.

Affirmed.

1 Wells Fargo's opposition contends the appeal was filed out of time. As the arguments have been fully briefed, we choose to decide the appeal on the merits.