NOT FOR PUBLICATION WITHOUT THE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
DOCKET NO. A-2189-16T4
WELLS FARGO BANK, N.A.,
LOUIS CICENIA and MRS. LATEF,
wife of Zafer Latef,
ZAFER LATEF and MORTGAGE
SYSTEMS, INC., as nominee for
METLIFE HOME LOANS,
Submitted May 9, 2018 — Decided July 17, 2018
Before Judges Koblitz, Manahan and Suter.
On appeal from Superior Court of New Jersey,
Chancery Division, Hudson County, Docket No.
Herold Law, PA, attorneys for appellants
(Raymond R. Siberine, of counsel and on the
brief; Craig S. Provorny, on the brief).
Reed Smith LLP, attorneys for respondent
(Henry F. Reichner, of counsel and on the
Zafer Latef and Mortgage Electronic Registration Systems,
Inc. (MERS) appeal from a December 21, 2016 final residential
foreclosure judgment and the preceding June 28, 2016 order of the
Chancery Division striking defendants' answer and returning the
matter to the Office of Foreclosure as an uncontested matter. R.
4:64-1(c)(3). We affirm.
By consent, this matter was tried by the Chancery Court based
on documentary evidence including depositions, with no live
testimony. Latef owns and resides at the residential condominium
property (Unit 2) subject to this foreclosure action. Unit 2 is
identified on the Hoboken tax map by block and lot number. MERS,
as nominee for MetLife Home Loans, is the mortgagee in the
Latef/MERS Mortgage. Cicenia is the previous owner of the property
who conveyed Unit 2 to Latef in 2010.
In October 2007, Cicenia entered into a $250,000 Prime Equity
Line of Credit Agreement with Wachovia (Wachovia Agreement). Wells
Fargo is the successor in interest to Wachovia by name change and
merger.1 The section of the Wachovia Agreement entitled
"Collateral" did not specifically describe Unit 2.
To secure the line of credit, Cicenia executed and delivered
a mortgage to Wachovia (Wachovia HELOC) that was recorded. The
first page of the Wachovia HELOC describes the mortgaged property
by the address, without including the unit number. The second
page of the Wachovia HELOC contains a section entitled "TRANSFER
OF RIGHTS IN THE PROPERTY." That section states in pertinent
This Security Instrument secures to [Wachovia]
. . . (ii) the performance of [Cicenia's]
covenants and agreements under this Security
Instrument and [Cicenia's] covenants and
agreements under the Debt Instrument. For
these purposes, [Cicenia] does hereby
mortgage, grant and convey to [Wachovia] the
following described property located in the
County of Hudson, State of New Jersey.
The space provided for insertion of a property description was
The last page of the Wachovia HELOC, not numbered and titled
Schedule A, refers to the property by street address without unit
number, and notes that it is more particularly described in a
deed, noting the book and page numbers where the deed is recorded.
Cicenia and Wells Fargo's closing agent stated at their depositions
See Suser v. Wachovia Mortgage, FSB,
433 N.J. Super. 317, 321
(App. Div. 2013).
that they had no recollection of Schedule A being attached to the
Wachovia HELOC at the time of execution.
In March 2010, Cicenia and Latef executed a contract of sale
(Latef contract) for $213,500 for Unit 2. Latef obtained a
$160,000 purchase money mortgage from MetLife Home Loans.
In April 2010, First Jersey Title Services, agent for First
American Title Insurance, conducted a title search for judgments
and liens, and reported the search was clear. First American then
issued a title policy stating the property was clear of any
encumbrances, liens, and judgments. After executing the Latef
contract, and before closing, Cicenia provided Latef with a copy
of Cicenia's owner policy of title insurance. The only mortgage
identified as an exception in Cicenia's owner policy was Cicenia's
1998 purchase money mortgage, which had since been discharged. It
did not disclose the Wachovia HELOC, nor did Cicenia or his
Prior to closing, Latef's counsel obtained a title commitment
covering Latef's purchase of Unit 2 and Latef's purchase money
mortgage. The title commitment indicated there were no open
mortgages of record encumbering Unit 2. Also before closing,
Cicenia received a monthly statement from Wells Fargo indicating
the outstanding balance on the Wachovia HELOC was $249,048.17. He
did not disclose this information to Latef.
The closing on Unit 2 took place on June 25, 2010. Cicenia
received $200,957.09. Wells Fargo discovered Cicenia sold Unit 2
over two months after the closing. Cicenia continued to make
payments on the Wachovia HELOC for approximately two more years.
Although it had accepted Cicenia's payments for almost two
years, in March 2012 Wells Fargo sent Cicenia a notice of default
based on the sale of Unit 2. Wells Fargo refused to accept
payments thereafter and sent two notices of its intent to
accelerate and foreclose, with a copy to Latef. As a result,
Latef filed a complaint against Cicenia in the Law Division of
Essex County, where Cicenia resided, alleging conversion, fraud,
and breach of covenant of title, seeking money damages only. The
complaint did not name Wells Fargo nor seek to quiet title for
Unit 2. Cicenia filed a third-party complaint against Wells Fargo,
which subsequently settled between the two parties.
The Law Division jury trial began in May 2014. At the
conclusion of Latef's case-in-chief, Cicenia moved for a directed
verdict and dismissal of Latef's claims, arguing Latef had not
established that the Wachovia HELOC was an encumbrance on Unit 2
and had not proved damages. The Law Division judge granted
Cicenia's motion, finding that no competent evidence was presented
that would allow the jury to calculate damages or determine that
Cicenia acted intentionally. She noted that the matter was not
an action to quiet title and Latef had not joined Wells Fargo to
the action. She did not rule on the issue of whether the Wachovia
HELOC was a valid encumbrance on Unit 2 as against Latef or the
mortgage was properly recorded. A June 11, 2014 order dismissed
Latef's complaint with prejudice.
Latef appealed and we affirmed. Latef v. Cicenia, No. A-
5747-13 (App. Div. March 14, 2016). We determined Latef lacked
standing to seek the amount due Wells Fargo because Latef had not
proved there was a substantial likelihood he would suffer harm.
He had not demonstrated at trial that Wells Fargo had a valid
lien. We noted that "Wells Fargo was an indispensable party to
litigation that determined the validity of its [mortgage] claim
against [Cicenia]." Any judgment in the matter "would not be
binding on Wells Fargo."
Recognizing the litigation did not involve a quiet title
claim, we determined the evidence did not demonstrate that Wachovia
HELOC encumbered Unit 2, stating:
The evidence at trial failed to show a lien
existed on the unit purchased by defendant by
virtue of a valid and properly recorded
mortgage. The actual security instrument
executing the [m]ortgage merely describes the
encumbered property as the address of the
building; it does not specify that it pertains
to Unit 2.
Because the mortgage did not specify that it
encumbered Unit 2, plaintiff is not left
unprotected against action to deprive him of
his interest in Unit 2. . . .
It is undisputed that plaintiff provided
"valuable consideration" to acquire his
interest in the property and that he did not
have notice of the Wells Fargo mortgage.
Assuming that plaintiff recorded his deed
before Wells Fargo filed any mortgage that
specifically identified the lien on Unit 2,
he would qualify as a bona fide purchaser
whose position would be protected against a
claim by Wells Fargo against the property.
The evidence therefore fails to show a
substantial likelihood he will suffer harm.
The deficiency in the description of the
property to be encumbered permitted plaintiff
to obtain insurable title and effectively
defeats plaintiff's claim that there was an
encumbrance upon Unit 2 constituting a breach
of defendant's promises.
On June 15, 2015, Wells Fargo filed this residential
foreclosure complaint naming Cicenia, Latef, and MERS as
defendants. The complaint was filed approximately five years from
the Unit 2 closing between Cicenia and Latef and over three years
after Wells Fargo sent Cicenia its first notice of intention to
accelerate and foreclose.
The Chancery Division found that although Wachovia HELOC
itself did not contain a sufficient legal description, Schedule
A, attached to the mortgage when recorded, did refer to the deed,
which clearly stated "the full address of the property, including
the unit number."
In his written opinion, the Chancery judge described the
issue as "whether the property description contained in the
recorded [m]ortgage [Cicenia] granted [Wells Fargo] was sufficient
to put [Latef], a subsequent purchaser, on notice that the
[m]ortgage covered [Unit 2]." The judge found no legal reason
precluding Wells Fargo "from executing and recording a mortgage
that incorporates by reference a prior recorded deed," and the
recording by Wells Fargo "adequately placed all subsequent
purchasers of [Unit 2] on notice of [Wells Fargo's] mortgage."
The judge found the description of the property in Schedule A
directed subsequent purchasers to the Cicenia deed, which
precisely described the Unit 2 property.
Issues of law are reviewed de novo. The Palisades At Fort
Lee Condo. Ass'n, Inc. v. 100 Old Palisade, LLC,
230 N.J. 427, 442
(2017). "A trial court's interpretation of the law and the legal
consequences that flow from established facts are not entitled to
any special deference." Ibid. (quoting Manalapan Realty, L.P v.
Twp. Comm. of Twp. of Manalapan,
140 N.J. 366, 378 (1995)).
Defendants contend the law of the case doctrine is applicable
because Wells Fargo was brought in by Cicenia's third-party
complaint, and attended the first day of trial. Defendants rely
on Schmidt v. Smith,
294 N.J. Super. 569 (App. Div. 1996), which
they argue is factually similar to this case because an insurance
company chose not to participate in a trial that found its insured
liable, and the insurance company was thereafter held to be
obligated to indemnify its insured.
Latef also argues that the law of the case requires that our
appellate discussion of the law division appeal be applied to the
Chancery decision. Both our written opinion and the Law Division
oral opinion conclude that Wells Fargo was an indispensable party
to litigation attempting to determine the validity of its lien
and, absent joinder, Wells Fargo would not be bound by the rulings.
"The 'law of the case' doctrine generally 'requires a decision
of law made in a particular case to be respected by all other
lower or equal courts during the pendency of that case.'" CFG
Health Sys., LLC v. Cty. of Essex,
411 N.J. Super. 378, 384 (App.
Div. 2010) (quoting State v. Reldan,
100 N.J. 187, 203 (1985)).
The doctrine generally applies to "legal issues in the same case."
Franklin Med. Assocs. v. Newark Pub. Schs.,
362 N.J. Super. 494,
512 (App. Div. 2003).
The "law of the case" doctrine does not benefit defendants.
The doctrine applies to legal issues in the same case. Franklin
362 N.J. Super. at 512. This Chancery case is not
the same as the related Law Division or subsequent Appellate
Division case. Additionally, application of the doctrine to
preclude consideration of a legal issue is discretionary and not
a rule of law. Toto v. Princeton Twp.,
404 N.J. Super. 604, 618
(App. Div. 2009). Lastly, defendants' reliance on Schmidt is
misguided, because the Schmidt decision was based upon the
insurer/insured relationship of the parties, which does not exist
Defendants argue the Wachovia HELOC does not adequately
describe the mortgaged premises, Unit 2, and should therefore be
considered invalid. Defendants contend the Wachovia HELOC fails
to comply with the New Jersey Statute of Frauds,
Under the Statute of Frauds:
A transaction intended to transfer an interest
in real estate shall not be effective to
transfer ownership of the interest unless:
(1) a description of the real estate
sufficient to identify it, the nature of the
interest, the fact of the transfer and the
identity of the transferor and the transferee
are established in a writing signed by or on
behalf of the transferor.
"Generally, if property is not expressly included in the
instrument's description, it will not be covered by the mortgage."
Panetta v. Equity One, Inc.,
190 N.J. 307, 323 (2007).
New Jersey allows for incorporation by reference in a recorded
document that refers to a previous deed. See Garden of Memories,
Inc. v. Forest Lawn Mem'l Park Ass'n,
109 N.J. Super. 523, 532-34
(App. Div. 1970) (explaining that references in a deed's exception
recitals placed a purchaser on constructive notice of other
previous deeds and the existence of another's interest in the
subject property). The "purpose of a description of land . . .
is to identify the subject-matter of the grant," which "may be
done either by describing it in words at length, or by referring
the reader to some other deed or record containing such a
description." Mitchell v. D'Olier,
68 N.J.L. 375, 383 (E. & A.
1902). When a recorded document "refers to another deed, it has
the effect of incorporating the latter deed in the description,
so that what is therein described will pass." Kaplan v. Bernstein,
2 N.J. Misc. 762, 764 (Ch. Ct. 1924).
Defendants are correct that the numbered pages of the Wachovia
HELOC do not contain a sufficient description of Unit 2, nor do
they reference Schedule A. Based on Cicenia and the Wells Fargo
closing agent's failure to recall Schedule A more than eight years
after the closing, defendants speculate that the document was
attached to the Wachovia HELOC after Cicenia signed the mortgage.
Schedule A of the Wachovia HELOC, however, was attached and
recorded, and defendants have not provided evidence that Schedule
A was not, in fact, attached to the Wachovia HELOC at the time of
execution. A failure to recall is not affirmative evidence that
it was not there.
Wells Fargo's obligation to provide a description of Unit 2
sufficient to identify it,
N.J.S.A. 25:1-11(a)(1), was fulfilled
by Schedule A's reference to the Cicenia Deed.
Defendants argue that this matter is similar to a case
recently resolved by the New York Appellate Division, Second
Department, Maurice v. Maurice,
131 A.D.3d 454 (N.Y. App. Div.
2015), where that court determined a deed having a deficient
description of the mortgaged property was invalid. Id. at 455-
57. In Maurice, an action to quiet title, the plaintiff submitted
a deed that did not include a property description above his
mother's signature and contained a blank space in the area where
the description of the property was usually set forth. Id. at
Unlike in New Jersey, New York case law states that "a deed
conveying real property must set forth 'a specific grantor, a
specific grantee, a property designation of the property, a recital
of the consideration, and . . . technical operative words.'" Id.
at 456 (alteration in original) (quoting Cohen v. Cohen,
933, 933 (N.Y. App. Div. 1919)). "A deed which contains a blank
space instead of a description when signed is not an instrument
of conveyance." Ibid. (quoting Rekis v. Lake Minnewaska Mountain
170 A.D.2d 124, 127 (N.Y. App. Div. 1991)). Because
the deed did not contain a property description, "it was void for
uncertainty." Ibid. Additionally, a "Schedule A" document, which
contained a metes and bounds description of the property, "and was
allegedly found in the files of the law firm which prepared the
1999 deed, could not serve as a legal property description, as the
1999 deed contained no language incorporating it by reference."
131 A.D 3d at 456. The court thus affirmed the trial
court's ruling that the deed was invalid. Id. at 456-57.
Unlike in Maurice, where the Schedule A was found in the
files of a law firm which had prepared the deed,
131 A.D 3d at
456, the Schedule A document in this matter was recorded as part
of the Wachovia HELOC. We are therefore unpersuaded by this
Our recording statutes govern mortgage priorities.
46:26A-1 to -12. "Lenders and other parties are generally charged
with constructive notice of instruments that are properly
recorded." Sovereign Bank v. Gillis,
432 N.J. Super. 36, 43-44
(App. Div. 2013) (citing Cox v. RKA Corp.,
164 N.J. 487, 496
(2000)). "Any recorded document affecting the title to real
property is, from the time of recording, notice to all subsequent
purchasers, mortgagees and judgment creditors of the execution of
the document recorded and its contents."
A party is presumed to be a bona fide purchaser unless proven
otherwise. Reaves v. Egg Harbor Twp.,
277 N.J. Super. 360, 366
(Ch. Div. 1994). The burden is on Wells Fargo to show Latef had
either actual, constructive, or inquiry notice of the Wachovia
HELOC. It is "the duty of the purchaser to search the grantor and
other pertinent recording indexes for each holder of record title
for the period during which he [or she] held such title." Garden
109 N.J. Super. at 533.
The Wachovia HELOC with the attached Schedule A was recorded
and indexed by the name of the mortgagor, Cicenia, by the Hudson
County Register's Office.
N.J.S.A. 46:26A-8(c). The name was
spelled correctly, thereby allowing for a successful title search.
Manchester Fund, Ltd. v. First Am. Title Ins. Co.,
332 N.J. Super.
336, 344 (Law Div. 1999). Schedule A referenced by incorporation
the Cicenia deed, which sufficiently described Unit 2. Therefore,
defendants had record or constructive notice of Wells Fargo's
interest in Unit 2 via the Wachovia HELOC.