U.S. BANK TRUST, N.A v. LULU B. FLAMER,

NOT FOR PUBLICATION WITHOUT THE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-2208-17T1

U.S. BANK TRUST, N.A.,
AS TRUSTEE FOR LSF9
MASTER PARTICIPATION
TRUST,

          Plaintiff-Respondent,

v.

LULU B. FLAMER, a/k/a
LULU BELLE FLAMER,

     Defendant-Appellant.
_________________________

                    Submitted October 29, 2019 – Decided November 21, 2019

                    Before Judges Currier and Firko.

                    On appeal from the Superior Court of New Jersey,
                    Chancery Division, Atlantic County, Docket No. F-
                    030588-15.

                    Lulu B. Flamer, appellant pro se.

                    Stern & Eisenberg, attorneys for respondent (Salvatore
                    Carollo, on the brief).

PER CURIAM
      Defendant Lulu B. Flamer appeals from the denial of her motion to vacate

the final judgment of foreclosure and cancel her mortgage pursuant to  N.J.S.A.

2A:16-49.1, and the denial of her motion for reconsideration. We affirm.

      The facts are not in dispute. On August 26, 1997, defendant borrowed

$64,139.84 from Household Finance Corporation III and executed a promissory

note. Her Elwood home served as security for the loan.

      Defendant failed to make the March 28, 2014 installment payment, and

she has not made any payments since that date. The promissory note and

mortgage were assigned to plaintiff, U.S. Bank Trust, N.A., on January 15, 2015.

On August 28, 2015, plaintiff filed a foreclosure complaint in the trial court.

      On October 1, 2015, defendant filed a Chapter 7 bankruptcy petition.

Defendant filed an answer and affirmative defenses to the foreclosure complaint

on December 4, 2015, denying she was in default, and alleging accord and

satisfaction.

      On January 8, 2016, defendant was issued an Order of Discharge by the

bankruptcy court pursuant to 11 U.S.C. § 727. The Order of Discharge stated,

"a creditor with a lien may enforce a claim against the debto[r's] property subject

to that lien unless the lien was avoided or eliminated. For example, a creditor

may have the right to foreclose a home mortgage . . . ."


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      On July 5, 2016, defendant filed a motion for summary judgment in the

foreclosure action and plaintiff cross-moved for summary judgment.

Defendant's motion was denied and plaintiff's cross-motion was granted on

September 30, 2016. After striking defendant's answer, the trial court remanded

the case to the Office of Foreclosure to proceed as an uncontested matter.

      On October 27, 2016, defendant filed a motion to stay the foreclosure

proceeding pending appeal, but she withdrew her appeal on November 15, 2016.

Thereafter, on March 3, 2017, plaintiff moved for entry of final judgment.

Defendant filed an objection to the amount due, claiming an accord and

satisfaction. The trial court ordered plaintiff to submit a certification setting

forth defendant's payment history, late charges, and interest owed. Following

oral argument on September 18, 2017, the trial court denied defendant's

objection to the amount due and entered an order for final judgment of

foreclosure.

      On October 2, 2017, defendant moved to vacate the final judgment and

cancel the mortgage pursuant to  N.J.S.A. 2A:16-49.1. Defendant argued that

the mortgage loan was discharged under her bankruptcy order prior to the

issuance of the final judgment of foreclosure, and therefore, the lien was

cancelled. Plaintiff filed opposition to defendant's motion, and the trial court


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denied same on October 27, 2017. The trial court denied defendant's motion for

reconsideration on December 4, 2017.

      Defendant filed another motion to stay the foreclosure proceeding on

December 18, 2017, and to vacate the September 18, 2017 final judgment. She

again asserted that plaintiff failed to levy on her property during the bankruptcy

proceeding, and the lien was discharged. On January 19, 2018, the trial court

denied defendant's motion.

      A sheriff's sale was scheduled for January 25, 2018. After defendant

exercised her two statutory adjournment requests, the sale was rescheduled to

February 22, 2018. Thereafter, defendant filed a Chapter 13 bankruptcy petition

and an adversary proceeding seeking a determination as to the validity of

plaintiff's lien. As a result of the Chapter 13 bankruptcy petition filing, the

sheriff's sale was adjourned until February 21, 2019.

      The bankruptcy court dismissed defendant's adversary proceeding and her

case on November 6, 2018. On February 21, 2019, defendant filed an emergent

motion to stay the sheriff's sale and to vacate the foreclosure judgment with the

trial court, which was denied. Consequently, the sheriff's sale proceeded on

February 21, 2019, and the property was sold back to plaintiff through a bidding

process.


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      Defendant appealed. On appeal, defendant argues that the trial court

abused its discretion by failing to vacate the final judgment of foreclosure

pursuant to Rule 4:50 and cancel the mortgage under  N.J.S.A. 2A:16-49.1.

      We note initially that a trial court's determination under Rule 4:50-1 is

entitled to substantial deference and will not be reversed in the absence of a clear

abuse of discretion. U.S. Bank Nat'l Ass'n v. Guillaume,  209 N.J. 449, 467

(2012). To warrant reversal of the court's order, the defendant must show that

the decision was "made without a rational explanation, inexplicably departed

from established policies, or rested on an impermissible basis." Ibid. (quoting

Iliadis v. Wal-Mart Stores, Inc.,  191 N.J. 88, 123 (2007)).

      Here, defendant argues that the trial court erred in denying relief under

Rule 4:50-1(d), because she claims her mortgage was discharged in the

bankruptcy proceeding.      She relies on  N.J.S.A. 2A:16-49.1.         The statute

provides:

            At any time after [one] year has elapsed, since a
            bankrupt was discharged from his debts, pursuant to the
            acts of Congress relating to bankruptcy, he may apply,
            upon proof of his discharge, to the court in which a
            judgment was rendered against him, or to the court of
            which it has become a judgment by docketing it, or
            filing a transcript thereof, for an order directing the
            judgment to be canceled and discharged of record. If it
            appears upon the hearing that he has been discharged
            from the payment of that judgment or the debt upon

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              which such judgment was recovered, an order shall be
              made directing said judgment to be canceled and
              discharged of record; and thereupon the clerk of said
              court shall cancel and discharge the same by entering
              on the record or in the margin of the record of judgment,
              that the same is canceled and discharged by order of the
              court, giving the date of entry of the order of discharge.
              Where the judgment was a lien on real property owned
              by the bankrupt prior to the time he was adjudged a
              bankrupt, and not subject to be discharged or released
              under the provisions of the Bankruptcy Act, the lien
              thereof upon said real estate shall not be affected by
              said order and may be enforced, but in all other respects
              the judgment shall be of no force or validity, nor shall
              the same be a lien on real property acquired by him
              subsequent to his discharge in bankruptcy.

      This statute has been described as a housekeeping measure to assure that

judgments discharged in bankruptcy do not remain of record, cloud title, or

require payment in the future. The Party Parrot, Inc. v. Birthdays & Holidays,

Inc.,  289 N.J. Super. 167, 173 (App. Div. 1996); Assocs. Commercial Corp. v.

Langston,  236 N.J. Super. 236, 240 (App. Div. 1989).

      In the present case, the judgment against plaintiff was entered in

September 2017. Therefore, it could not have been discharged in the 2016

bankruptcy order. Further, the statutory remedy was not available to defendant

here because plaintiff obtained a final judgment after her discharge in

bankruptcy.



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      The trial judge properly analyzed  N.J.S.A. 2A:16-49.1, and duly found the

foreclosure action was in rem, and plaintiff had the right to enforce its lien and

foreclose on the mortgage notwithstanding defendant's bankruptcy discharge.

Defendant discharged the note but the mortgage was not cancelled in the

bankruptcy proceeding.     The basis for the trial judge's decision is correct.

Therefore, there was no abuse of discretion under Rule 4:50-1 to deny the

motion to vacate the judgment of foreclosure.

      We conclude the remaining arguments to the extent we have not addressed

them—lack sufficient merit to warrant any further discussion in a written

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

      Affirmed.




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