DITECH FINANCIAL, LLC v. ANTHONY P. DICHIARA

NOT FOR PUBLICATION WITHOUT THE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-2144-16T3
DITECH FINANCIAL, LLC,

        Plaintiff-Respondent,

v.

ANTHONY P. DICHIARA, KATHRYN
L. DICHIARA, CAPITAL ONE BANK,
and STATE OF NEW JERSEY,

        Defendants,

and

JAMES DICHIARA,

     Defendant-Appellant.
_______________________________

              Submitted January 22, 2018 – Decided March 8, 2018

              Before Judges Messano and O'Connor.

              On appeal from Superior Court of New Jersey,
              Chancery Division, General Equity, Monmouth
              County, Docket No. F-028728-14.

              John J. Hopkins, III, attorney for
              appellant.

              Pluese, Becker & Saltzman, LLC, attorneys
              for respondent (Robert F. Thomas, on the
              brief).

PER CURIAM
     In this residential mortgage foreclosure action, defendant

James DiChiara appeals from a January 20, 2017 order denying his

motion to stay the sheriff's sale, as well as any other action

against the property.   We affirm.

                                 I

     We glean the following facts from the record.    Defendant

Kathryn L. DiChiara (Kathryn) and James DiChiara (James) were

married in 2000.
1 In 2001, Kathryn and James' father, defendant

Anthony P. DiChiara (Anthony), purchased a residential home

(home) for $164,000 as tenants in common.    At about that time,

Kathryn and Anthony borrowed $162,704 from and executed a

mortgage in favor of Ivanhoe Financial, Inc., (Ivanhoe), using

the home as collateral.   Kathryn and James lived in the home as

their principal marital residence until they divorced in 2012.

Anthony never lived in the home.

     In 2004, Kathryn and Anthony refinanced the loan from

Ivanhoe and borrowed $263,200 from Mortgage Electronic

Registration Systems, Inc. (MERS), executing a mortgage in MERS'

favor and using the home as collateral.     The loan from Ivanhoe

was paid off with the loan from MERS.   There is no dispute James

was aware of and approved of both mortgages; in fact, he and

     1
        Because of the common surname, we address the parties by
their first names. We intend no disrespect by employing this
informality.
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Kathryn made the monthly mortgage payments on both loans.      In

2008, MERS assigned the mortgage to GMAC Mortgage LLC (GMAC).

In 2011, the last payment toward the mortgage was made.

     In March 2012, James and Kathryn divorced.   In the property

settlement agreement (PSA), Kathryn conveyed her interest in the

home to James.   The PSA stated the judgment of divorce operated

as a deed to convey Kathryn's interest in the home to James,

although Kathryn was required to execute any documents necessary

to transfer ownership of the home to James, which was to include

providing a bargain and sale deed or a quitclaim deed, in

addition to other documents.   The PSA also reflected James had

exclusive use of the home.   In addition, the PSA acknowledged

the GMAC mortgage and required James to make all of the monthly

mortgage payments.

     In April 2014, GMAC assigned the mortgage to Greentree

Servicing LLC (Greentree).   In July 2014, Greentree filed a

complaint in foreclosure.    Later that month James was personally

served with the complaint, as well as a notice to tenants.

Like the other defendants, he did not file an answer or any

other responsive pleading to the complaint.   In October 2014,

default was entered against all defendants.

     In his brief before us, James notes Anthony "changed the

password on the on-line mortgage payment," which precluded James
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from paying the mortgage.     James does not state when Anthony

changed the password.     More important, James does not state why

he could not have made the monthly mortgage payments by simply

sending a check to the mortgagee.     Finally, James claims he made

efforts to contact Greentree to reinstate and modify the

mortgage, but Greentree refused to respond to him on the ground

he was not a mortgagor.

     On April 21, 2015, the Federal Trade Commission and the

Consumer Fraud Protection Bureau filed a complaint against

Greentree in the United States District Court, District of

Minnesota, alleging, among other things, that Greentree had

engaged in deceptive and aggressive collection tactics, and had

failed to adequately advise borrowers of loss mitigation

options.   Two days later, on April 23, 2015, the court issued a

permanent injunction against Greentree and ordered it to pay a

fine of forty-eight million dollars.

     In addition to other measures, the court ordered Greentree

to implement a plan to provide "affected consumers" with loss

mitigation options.   In the interim, Greentree was ordered to

suspend any pending foreclosure sales to the extent necessary to

permit such consumers to be solicited and considered for loss

mitigation.   The order of injunction defines "affected

consumers" as "consumers with first or second lien residential
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loans that were transferred to [Greentree] between January 1,

2010 and November 2014 and as of [April 23, 2015] . . . [were]

45 or more days delinquent or have been referred to

foreclosure[.]"

     In August 2015, Greentree was renamed Ditech Financial, LLC

(Ditech or plaintiff), and in February 2016, the trial court

entered an order substituting Ditech as plaintiff.    On June 3,

2016, Anthony died.   James is Anthony's sole heir, and James

acquired Anthony's share of the home through intestacy.   On June

10, 2016, the court entered final judgment in foreclosure in

favor of plaintiff and against all named defendants.2

     In October 2016, Kathryn finally provided James with a deed

in accordance with the PSA; this deed has never been recorded.

On January 20, 2017, the court entered an order denying

defendant's motion to stay the sheriff's sale, as well as "any

other action against the [home] until further order."

     In its decision, the court rejected all of James's

arguments.   James' primary contentions were:   (1) the mortgage

was defective and unenforceable because he had not signed it;

(2) the mortgage vested in him when, upon Anthony's death, he


     2
        The final judgment indicates defendants include "Anthony
P. DiChiara." It is not known if plaintiff moved to substitute
the estate for Anthony P. DiChiara.

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                                                          A-2144-16T3
acquired the remaining interest in and became the sole owner of

the home; (3) Greentree could not foreclose upon the mortgage

because it was merely a servicing company; (4) the federal order

of injunction precluded Greentree from prosecuting any

foreclosure actions; and (5) he was entitled to a modification

of the mortgage.

                                II

    On appeal, James' principal arguments are: (1) 
N.J.S.A.

3B:28-3 mandates that if a mortgage is refinanced, all owners of

the property being used as collateral must sign the mortgage or

the mortgage is defective and unenforceable; (2) 
N.J.S.A.

3B:28-3 permits a married person to be in possession of the

principal marital residence and such property cannot be

transferred without the consent of both spouses; (3) the order

of injunction prohibited plaintiff from pursuing the foreclosure

action; and (4) the mortgage is unenforceable because plaintiff

did not permit James to modify the mortgage.   None of these

arguments has any merit.   We address each argument in turn.

    According to James, 
N.J.S.A. 3B:28-3 requires that if a

mortgage is refinanced, all owners of the property must sign the

mortgage or it will be unenforceable.   First, when the subject

mortgage was created in 2004, Kathryn and Anthony, the only

owners of the property, did sign the mortgage.   Second, N.J.S.A.
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                                                          A-2144-16T3
3B:28-3 does not state that if a mortgage is refinanced – or

even executed in the first instance – the property that is the

subject of the mortgage must be signed by all of its owners.

This statute states:

             a. During life every married individual
             shall be entitled to joint possession
             with his spouse of any real property
             which they occupy jointly as their
             principal matrimonial residence and to
             which neither dower nor curtesy
             applies. One who acquires an estate or
             interest in real property from an
             individual whose spouse is entitled to
             joint possession thereof does so
             subject to such right of possession,
             unless such right of possession has
             been released, extinguished or
             subordinated by such spouse or has been
             terminated by order or judgment of a
             court of competent jurisdiction or
             otherwise.

             b. Nothing contained herein shall be
             construed to prevent the release,
             subordination or extinguishment of the
             right of joint possession by either
             spouse, by premarital agreement,
             separation agreement or other written
             instrument.

             c. The right of joint possession shall
             be extinguished by the consent of both
             parties, by the death of either spouse,
             by judgment of divorce, separation or
             annulment, by other order or judgment
             which extinguishes same, or by
             voluntary abandonment of the principal
             matrimonial residence.

             [Ibid.]

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N.J.S.A. 3B:28-3 is not germane to any of issues before us.

This statute provides that a married person who jointly occupies

the principal marital residence with his or her spouse is

entitled to possession.   If a third party acquires an interest

in such property, the third party does so subject to a spouse's

right of possession, unless such right has been extinguished.

The right of joint possession can be extinguished by the consent

of both spouses or by a judgment of divorce.

      
N.J.S.A. 3B:28-3 provides no support for James' argument

that, because he did not sign the subject mortgage, it is

unenforceable.   Further, this statute does not pertain to the

parties' circumstances, who in March 2012 divorced and agreed

James could have sole use and occupancy of the home, thus

extinguishing both James' and Kathryn's right to joint

possession.

      James also claims this statute permits a married person to

be in possession of the principal marital residence and that

such property cannot be transferred without the consent of both

spouses.   We agree the statute permits a married individual to

joint possession of the principal martial residence, unless that

right has been extinguished as provided in the statute; however,

we question the relevance of such premise to the issues before

us.   Similarly, there is no need to address whether a principal
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marital residence can be transferred without the consent of both

spouses, because both Kathryn and James agreed she would

transfer her share of the home to James.

    James next argues the order of injunction prohibited

plaintiff from pursuing the foreclosure action.     We disagree.

The injunction requires plaintiff to reach out to "affected

consumers" and offer loss mitigation options.     In the interim,

plaintiff was required to suspend any pending foreclosure sales

to the extent necessary to permit such consumers to be solicited

and considered for loss mitigation.

    James, who is not a signatory to the mortgage, is not an

"affected consumer" protected by the order of injunction.     An

affected consumer must be a mortgagor with a first or second

lien residential loan that was transferred to Greentree between

January 1, 2010 and November 2014.    While the subject mortgage

was transferred to Greentree during the latter time period,

James is not a mortgagor.   He may be responsible for paying the

mortgage under the PSA, but that is as a result of entering into

a private agreement between him and Kathryn.    There is no

agreement between James and plaintiff.

    Finally, James argues the mortgage is unenforceable because

plaintiff did not permit him to modify the mortgage.     James does

not cite any law that supports this premise, specifically, that
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a mortgagee is obligated to afford a third-party – who is not

even a mortgagor or a party to the mortgage agreement – the

opportunity to modify the mortgage.

    We have considered James' remaining arguments, and conclude

they are without sufficient merit to warrant discussion in a

written opinion.   See R. 2:11-3(e)(1)(E).

    Affirmed.




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