WACHOVIA BANK, N.A., as Assignee for PHOENIX FUNDING, INC. v. DAREDREE G. MANRADGE, MR. MANRADGE, Husband of Daredree Manradge et al.

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-2184-04T22184-04T2

WACHOVIA BANK, N.A., as

Assignee for PHOENIX

FUNDING, INC.,

Plaintiff-Appellant,

v.

DAREDREE G. MANRADGE, MR.

MANRADGE, Husband of

Daredree Manradge and

U.S. MORTGAGE CORPORATION,

Defendants-Respondents.

 

Submitted October 26, 2005 - Decided

Before Judges Weissbard and Francis.

On appeal from the Superior Court of New Jersey, Chancery Division, Passaic County, Docket No. F-1292-04.

Goldenberg, Mackler, Sayegh, Mintz, Pfeffer, Bonchi & Gill, attorneys for appellant (Keith A. Bonchi, on the brief).

Castano Quigley, attorneys for respondent U.S. Mortgage Corporation (Sondra V. Lasky, on the brief).

PER CURIAM

In this appeal, plaintiff Wachovia Bank, N.A. as Assignee for Phoenix Funding, Inc., challenges the granting of defendant U.S. Mortgage Corporation's (U.S. Mortgage) motion to vacate a final judgment in a tax sale foreclosure.

On June 28, 2001, Phoenix Funding successfully bid on Tax Sale Certificate no. 2000-1041 relating to property owned by defendant Daredree Manradge (Manradge) for outstanding real estate taxes and sewer charges for 2000 and 2001. It is undisputed that both Manradge and U.S. Mortgage, the mortgagee of record, were properly served in this action.

On January 20, 2004, a complaint to foreclose the tax sale certificate was filed. Neither Manradge nor U.S. Mortgage answered the complaint and, on April 1, 2004, an order entering default judgment, setting May 17, 2004 as the last day to redeem, was entered.

Final judgment was entered on May 28, 2004. The motion to vacate the default judgment, which underlies this appeal, was filed on September 7, 2004 and heard September 24 and November 5, 2004. The motion judge entered an order wherein final judgment would be vacated upon redemption, which was ordered to take place on or before December 3, 2004.

Plaintiffs argue that the motion judge erred in failing to apply the standard for vacating a final judgment established by R. 4:50-1, and instead applied an equitable standard extending the redemption period. We agree and remand.

In granting defendant's application, the judge stated, "it would be inequitable to have this defendant lose this property. Even though there are things that she could have done at some point in time that might have put her in a better position." Further, the judge stated, "[a]lthough I am bound by certain things, I think under the circumstances that I am going to balance the equities in the matter."

In seeking to effectuate a fair result, the motion judge impermissibly crafted a remedy which avoided application of R. 4:50-1. The motion judge stated, "[s]o actually what you're asking me for instead of vacating the judgment would be to extend, to set a date certain for a time of redemption." Although couched in language extending the redemption period, the judge's ruling effectively amounted to vacating the final judgment without conducting a proper analysis consistent with R. 4:50-1, which provides in relevant part,

On motion, with briefs, and upon such terms as are just, the court may relieve a party or the party's legal representative from a final judgment or order for the following reasons: (a) mistake, inadvertence, surprise, or excusable neglect; . . . or (f) any other reason justifying relief from the operation of the judgment or order.

"[E]quity will generally conform to established rules and precedents, and will not change or unsettle rights that are created and defined by existing legal principles" which is "the basis of the equitable maxim 'equity follows the law.'" Dunkin Donuts of Am. v. Middletown Donut Corp. 100 N.J. 166, 183 (1985) (quoting Natovitz v. Bay Head Realty Co., 142 N.J. Eq. 456, 463-64 (E. & A. 1948). "[T]his maxim must yield if 'extraordinary circumstances' exist." Id. at 184 (quoting Monmouth Lumber Co. v. Indem. Ins. Co., 21 N.J. 439, 451 (1956). No such circumstances exist in this case.

Defendant U.S. Mortgage contends that there was sufficient evidence to support a finding that defendants were entitled to relief pursuant to R. 4:50-1(a) and R. 4:50-2. We express no opinion as to whether the record would support vacating the judgment.

A motion to vacate a final judgment "should be granted sparingly, and is addressed to the sound discretion of the trial court, whose determination will be left undisturbed unless it results from a clear abuse of discretion." Pressler, Current N.J. Court Rules, comment 1.1 on R. 4:50-1 (2005).

Regarding plaintiff's contention that the motion was untimely, in terms of R. 4:50-1(a), although the three-month time limit set forth in the foreclosure statute, N.J.S.A. 54:5-87, "would ordinarily govern a motion to vacate a foreclosure judgment based on a tax sale for reasons other than fraud or lack of jurisdiction, in an appropriate case relief may be granted on an application brought beyond that time period." Bergen-Eastern Corp. v. Koss, 178 N.J. Super. 42, 45 (App. Div. 1980). The Bergen court clearly upheld the "supremacy of R. 4:50 over foreclosure statutes." Ibid. Motions made pursuant to R. 4:50-1(a) must be made within one year of the date that the judgment or order was entered or taken. R. 4:50-2.

Reversed and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.

 

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A-2184-04T2

December 7, 2005