US BANK NATIONAL ASSOCIATION v. DANIELA SOARES

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0

US BANK NATIONAL ASSOCIATION AS

TRUSTEE FOR ADJUSTABLE RATE

MORTGAGE TRUST 2005-9, ADJUSTABLE

RATE MORTGAGE BACKED PASS THROUGH

CERTIFICATES 2005-9,

Plaintiff-Respondent,

v.

DANIELA SOARES,

Defendant-Appellant.

___________________________________________

July 25, 2016

Before Judges St. John and Vernoia.

On appeal from Superior Court of New Jersey, Chancery Division, Somerset County, Docket No. F-55074-09.

Law Offices of Andy Winchell, P.C., attorneys for appellant.

Reed Smith LLP, attorneys for respondent (Henry F. Reichner, on the brief).

PER CURIAM

Defendant Daniela Soares appeals the Chancery Division's judgment of foreclosure on real property located at Robin Road in Warren Township. On appeal, defendant argues the judgment of foreclosure was granted improvidently and prematurely. Following our review of these arguments in light of the record and applicable law, we affirm.

I.

On June 21, 2005, defendant executed a $799,600 thirty-year promissory note payable to Credit Suisse First Boston Financial Corporation (Lender). The note was secured by a purchase money mortgage on the Robin Road property. The named mortgagee was Mortgage Electronic Registration Systems, Inc. (MERS) "solely as nominee for Lender and Lender's successors and assigns." The mortgage was recorded on June 21, 2005.

Plaintiff contends, and defendant does not contest, that defendant defaulted on the note on July 1, 2009. On October 13, 2009, the Lender assigned its interest in the mortgage to US Bank National Association as Trustee for Credit Suisse First Boston ARMT 2005-9 (Trust One). However, MERS continued as the mortgagee under the mortgage. Trust One then initiated a foreclosure action on October 15, 2009.

On January 23, 2014, US Bank National Association as Trustee for Adjustable Rate Mortgage Trust 2005-9, Adjustable Rate Mortgage Backed Pass through Certificates 2005-9 (Trust Two) "acquired the [n]ote and [m]ortgage" from Trust One. Again, MERS continued to serve as the mortgagee. An employee of Wells Fargo, the loan servicer, characterized this assignment as a "vesting change in name only," and certified that the loan did not actually leave the trust in which it was held.

On April 1, 2013, plaintiff moved to amend the caption, strike defendant's answer and affirmative defenses, and dismiss defendant's counterclaims. In an order and opinion issued June 3, 2013, the trial judge granted the motion. Defendant's affirmative defenses were stricken, her counterclaims were dismissed, and the caption was changed to reflect the new title of the trust. The matter was deemed uncontested, and plaintiff was directed to request entry of final default through the Office of Foreclosure, in accordance with Rule 4:64-1 and Rule 1:34-6.

Defendant moved for reconsideration of the trial judge's order, raising most of the same arguments made on appeal. On October 25, 2013, the motion judge issued a written order and opinion denying reconsideration. The opinion dismissed defendant's motion as untimely, but also addressed the merits of her motion. A final judgment of foreclosure was issued on August 14, 2014.

Defendant filed an amended notice of appeal on February 27, 2015, appealing the Chancery Division's final judgment of foreclosure "as well as all orders subsumed within that judgment."

II.

Proof of "execution, recording, and non-payment" of a mortgage is sufficient to establish a prima facie case for foreclosure. Thorpe v. Floremoore Corp., 20 N.J. Super. 34, 37 (App. Div. 1952). In this case, defendant does not dispute execution, recordation, or default. Rather, defendant contends, among other things, that plaintiff had no standing to foreclose on the property, and the Chancery Division had no factual basis on which to issue the final judgment of foreclosure. We disagree.

We review the denial of a motion for reconsideration under an abuse of discretion standard. Cummings v. Bahr, 295 N.J. Super. 374, 389 (App. Div. 1996). In performing this review, the findings of a trial judge are binding on appeal if they are supported by "adequate, substantial and credible evidence." Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974).

We are satisfied that plaintiff had standing to foreclose on the property in question. Generally, the law requires that the party initiating foreclosure must "own or control" the underlying debt obligation at the time the action is initiated to demonstrate standing to foreclose a mortgage. Deutsche Bank Nat'l Trust Co. v. Mitchell, 422 N.J. Super. 214, 222 (App. Div. 2011). Where the plaintiff is not the original lender, it must present adequate evidence it was a "'person entitled to enforce' the instrument under N.J.S.A. 12A:3-301, that is, 'a nonholder in possession of the instrument who has the rights of a holder.'" Wells Fargo Bank, N.A. v. Ford, 418 N.J. Super. 592, 598 (App. Div. 2011) (quoting N.J.S.A. 12A:3-301). A court will not void a mortgage based on a challenge to its assignment where the mortgage was valid when executed and has not been satisfied. See Suser v. Wachovia Mortgage, FSB, 433 N.J. Super. 317, 324 (App. Div. 2013).

We find no flaw in the trial judge's conclusion that the assignment of defendant's note and mortgage to Trust One was valid and executed prior to the filing of the complaint. See Deutsche Bank Trust Co. Americas v. Angeles, 428 N.J. Super. 315, 318 (App. Div. 2012). Likewise, we find no error with the court's conclusion that the "vesting change" from Trust One to Trust Two was a change in name only, and did not involve any sale, transfer or removal of the mortgage from the trust.

Defendant also contends that the court "obviously considered matters outside the pleadings when drafting the order and opinion[,]" thereby converting plaintiff's motion to dismiss the counterclaims into a summary judgment motion. However, defendant points to no place in the opinion showing the court considered extrinsic evidence in dismissing her counterclaims. Instead, a review of the court's written opinion dismissing the counterclaims reveals that the court relied only on applicable law and the pleadings in reaching its conclusion.

Defendant's first counterclaim alleged that Trust Two could not foreclose on the mortgage because of a violation of the pooling agreement that created the trust. The court dismissed that counterclaim after holding, as a matter of law, that a servicer can still foreclose on a loan that has been transferred to a securitized trust. See Bank of New York v. Raftogianis, 418 N.J. Super. 323, 346 ( App. Div. 2010).

Defendant's second counterclaim alleged a violation of the Consumer Fraud Act, N.J.S.A. 56:8-1 to -204. The court dismissed that counterclaim as time-barred because it was brought nearly eight years after the incident at issue, whereas the statute of limitations on Consumer Fraud Act claims is six years. See N.J.S.A. 2A:14-1; Mirra v. Holland America Line, 331 N.J. Super. 86, 90 (App. Div. 2000). These determinations did not require extrinsic evidence and were appropriate for dismissal under Rule 4:6-2.

Defendants' remaining arguments lack sufficient merit to warrant further discussion in a written opinion. R. 2:11-3(e)(1)(E).

Affirmed.