BETAR REALTY, INC v. 39-45 7TH AVENUE REALTY, LLC

NOT FOR PUBLICATION WITHOUT THE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-2277-20

BETAR REALTY, INC.,

          Plaintiff-Respondent,

v.

39-45 7TH AVENUE
REALTY, LLC,

     Defendant-Appellant.
_______________________

                   Submitted January 31, 2022 – Decided February 9, 2022

                   Before Judges Sabatino and Mayer.

                   On appeal from the Superior Court of New Jersey,
                   Chancery Division, Passaic County, Docket No. F-
                   001145-18.

                   The Law Office of Rajeh A. Saadeh, LLC, attorneys for
                   appellant (Rajeh A. Saadeh, Robert F. Galvan,
                   Stilianos M. Cambilis and Lindsay A. McKillop, on the
                   briefs).

                   McNally & Associates, LLC, attorneys for respondent
                   (Stephen B. McNally, on the brief).

PER CURIAM
      In this tax foreclosure case, defendant 39-45 7th Avenue Realty, LLC,

appeals the trial court's March 5, 2021 order denying defendant's motions to

vacate a second final judgment entered against it on December 9, 2020 in favor

of plaintiff Betar Realty, Inc. We affirm.

      Defendant purchased the subject real property in the City of Paterson,

known as 39-45 7th Avenue, Block 2107, Lot 1, in December 2011. Defendant

held title to the property since its purchase. The sole member and principal of

the defendant LLC is an individual named Branko Rovcanin. Although the

property is industrial and includes a warehouse, Rovcanin eventually resided

and kept his belongings there.

      As a result of defendant's failure to pay municipal taxes due on the

property, a tax sale certificate was issued to the City in consideration of

$7,818.90, on June 26, 2012. The certificate was later assigned to plaintiff on

August 21, 2017, for the sum of $260,760.

      Plaintiff filed a complaint to foreclose its tax sale certificate against

defendant on January 19, 2018.      Upon receiving no response after making

service, plaintiff moved for entry of final judgment by default, which the trial

court initially granted on December 24, 2018.



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      In July 2019, defendant moved for an order, which plaintiff opposed,

vacating the default judgment, which the court granted on July 26, 2019.

Defendant filed an answer to plaintiff's foreclosure complaint in August 2019.

      Thereafter, a consent order was negotiated and entered on October 29,

2019, to establish a plan for how the matter should proceed. The consent order

was mutually signed by plaintiff's counsel and the attorney who was then

representing defendant. Among its provisions, the consent order included the

following:

             3. In the event the Defendant redeems plaintiff's lien by
             no later than March 1, 2020 and final judgment has been
             entered prior to redemption, the final judgment will be
             vacated. Plaintiff will not make application for final
             judgment before January 20, 2020.

                   ....

             5. Defendants will not be entitled to any further stay of
             plaintiff's right to apply for final judgment in this
             matter.

             6. By executing this Consent Order, the Defendants
             expressly acknowledge that they waive their right to
             contest plaintiff's foreclosure unless plaintiff fails to
             comply with the terms of this Consent Order.

      Defendant contends that from July 2019 to October 2020 it attempted to

raise the funds required to redeem the tax sale certificate.        In particular,

defendant's principal alleges he had entered into a contract to sell the property

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for $425,000, a sum which would have been more than enough to pay off the tax

debt, but that sale fell through in October 2020 due to the buyer's failure to make

a timely deposit.

      Meanwhile, defendant filed a bankruptcy petition, which temporarily

stayed the foreclosure case. The automatic stay was lifted by the Bankruptcy

Court on August 26, 2020.

      Once the bankruptcy stay lifted, plaintiff filed a renewed motion for final

judgment in September 2020. There still being no redemption of the tax sale

certificate, the trial court entered final judgment against defendant for a second

time on December 9, 2020.

      On December 29, 2020, defendant moved for relief under Rule 4:50-1

seeking vacation of the second entry of final judgment. Plaintiff filed opposition

to the motion, and it was orally argued without testimony on March 4, 2021.

      Both parties were represented by counsel at the motion argument before

Assignment Judge Ernest M. Caposela.         Defendant represented that it had

recently entered into a different agreement with a purchaser who would pay

$225,000 for a fifty percent interest in the defendant LLC.

      Judge Caposela denied defendant's Rule 4:50-1 motion in an order and

corresponding written statement of reasons entered on March 5, 2021.


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      On March 30, 2021, plaintiff moved for an order for possession of the

property and defendant filed its opposition on April 16, 2021. Judge Adam

Jacobs entered the order for possession on the same date. A notice of lis pendens

was recorded on April 23, 2021.

      Thereafter, defendant filed the present appeal and requested a stay of the

matter pending appeal, which was denied by the trial court on May 4, 2021.

      On appeal, defendant argues the trial court erred and acted inequitably in

rejecting its motion to vacate the second final judgment. Defendant stresses that

it had negotiated a second transaction that, if consummated, allegedly would

have allowed it to pay off the debt and keep the premises.

      Having considered defendant's arguments, we affirm the March 5, 2021

order, substantially for the sound reasons expressed by Judge Caposela.

      Our review of a trial court's Rule 4:50-1 determination is entitled to

substantial deference and is reviewed under an abuse of discretion standard.

U.S. Bank Nat'l Ass'n v. Guillame,  209 N.J. 449, 467 (2012). An abuse of

discretion exists when a decision is "made without a rational explanation,

inexplicably departed from established policies, or rested on an impermissible

basis." Flagg v. Essex Cnty. Prosecutor,  171 N.J. 561, 571 (2002). We discern

no such abuse of discretion in the circumstances presented here.


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      Defendant clearly agreed in the October 2019 consent order that it had

until March 1, 2020 to redeem the amount due in full and that it waived its right

to contest the final judgment if it was unable to redeem the certificate by that

agreed-upon date. Defendant failed to do so. More than a year had passed

beyond that deadline when the motion to vacate the second judgment was argued

in March 2021, and defendant still did not have the funds actually in hand to

redeem the delinquency. Although it expressed sympathy about defendant's

circumstances, the court was not obligated to set aside the judgment and permit

further delay.

      Affirmed.




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