WELLS FARGO BANK, N.A. VS. MARCIA A. HARRIS (F-046925-10, BERGEN COUNTY AND STATEWIDE) ( 2018 )

NOT FOR PUBLICATION WITHOUT THE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-5611-15T3
WELLS FARGO BANK, N.A.,
Plaintiff-Respondent,
v.
MARCIA A. HARRIS, her heirs,
devisees, and personal
representatives and his/her,
their, or any of their
successors in right, title
and interest,
Defendant-Appellant,
and
MR. HARRIS, HUSBAND OF MARCIA A.
HARRIS, his heirs, devisees, and
personal representatives and
his/her, their, or any of their
successors in right, title and
interest and UNITED STATES OF
AMERICA,
Defendants.
___________________________________
Submitted December 11, 2017 – Decided July 9, 2018
Before Judges Ostrer and Whipple.
On appeal from Superior Court of New Jersey,
Chancery Division, Bergen County, Docket No.
F-046925-10.
Joshua L. Thomas, attorney for appellant.
Reed Smith LLP, attorneys for respondent
(Henry F. Reichner, of counsel; Siobhan A.
Nolan, on the brief).
PER CURIAM
In this mortgage foreclosure case, defendant Marcia Harris
appeals from (1) the trial court's order conditionally reinstating
the complaint of plaintiff Wells Fargo Bank, N.A., after it had
been dismissed for failure to prosecute; and (2) the trial court's
order granting summary judgment in Wells Fargo's favor. As the
trial court did not abuse its discretion in reinstating the action,
and no genuine issues of material fact preclude Wells Fargo's
right to foreclose, we affirm.
On May 22, 2006, Harris borrowed $543,000 from World Savings
Bank, FSB, to purchase a residential property in Englewood. The
thirty-year note was secured by a mortgage on the property. The
following year, Harris borrowed an additional $150,000 from World
Savings, on a home equity line of credit, secured by a mortgage
on the Englewood property.
That same year, the federal Office of Thrift Supervision
confirmed in correspondence that World Savings amended its bylaws
and charter to change its name to Wachovia Mortgage, FSB, effective
December 31, 2007. Almost two years later, Wells Fargo acquired
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Wachovia. The acquisition was confirmed in a January 7, 2013
letter from the United States Comptroller of the Currency.
Harris provides no competent evidence to dispute Wells
Fargo's contention that both obligations have been in default
since August 15, 2009. Wells Fargo served its notice of intention
to foreclose in a timely manner. The matter was automatically
stayed from July 27, 2011, until February 8, 2012 by Harris's
Chapter 13 bankruptcy proceeding. On March 14, 2012, after the
automatic stay was lifted as to Wells Fargo's secured interest,
Harris filed an answer to the foreclosure complaint alleging that
Wells Fargo lacked standing because it was neither the original
mortgagee nor an assignee of the mortgage.
Wells Fargo then moved for summary judgment, which the trial
court granted on August 24, 2012, finding no genuine factual issues
about either Wells Fargo's standing or Harris's default status.
The trial court also instructed that Wells Fargo could request an
entry of final judgment through the Office of Foreclosure on an
uncontested basis. However, Wells Fargo failed to request final
judgment and the Office of Foreclosure dismissed the case for lack
of prosecution on December 20, 2013.
On March 20, 2015, Wells Fargo moved for reinstatement,
arguing that changes to Rule 4:64, establishing new certification
requirements, took time to implement firm wide. Despite Harris's
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opposition, the trial court reinstated the action under Rule 4:64-
8 after finding that Wells Fargo established good cause and Harris
was not prejudiced since she was living in the home rent free.
But, Wells Fargo failed to move for final judgment. Again
over Harris's opposition, the court on October 9, 2015, gave Wells
Fargo another 120 days to move for final judgment. Wells Fargo
failed to act within the allotted time, and requested yet another
extension on February 19, 2016. Harris opposed the motion, arguing
the case should be dismissed since all the delays were Wells
Fargo's fault. As to good cause, Wells Fargo argued it had yet
to finalize the certification of amount due. In granting the
motion, the judge reasoned that forcing Wells Fargo to start over
was too harsh a remedy. The judge granted Wells Fargo a one
hundred day extension to move for final judgement.
Finally, Wells Fargo complied and moved for final judgment
on April 8, 2016, seeking $989,974.47 as the total amount due.
Over Harris's objection, the trial court entered final judgment,
specifying that Harris owed $543,000 as the principal due on the
first mortgage, $150,000 on the home equity line of credit, plus
$7,500 in attorney's fees, combined with interest, for a total
amount due of $989,974.47. This appeal followed.
We review de novo the trial court's grant of summary judgment,
applying the same familiar standard that governs the trial court,
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Henry v. N.J. Dep't of Human Servs., 204 N.J. 320, 330 (2010), but
we deferentially review the trial court's discretionary decision
to grant a motion to reinstate a complaint, and will act only to
prevent an injustice, St. James AME Dev. Corp. v. City of Jersey
City, 403 N.J. Super. 480, 484 (App. Div. 2008).
Reinstatement of a foreclosure action following a dismissal
for failure to prosecute "may be permitted only on motion for good
cause shown." R. 4:64-8. We have found no reported decision that
explains the "good cause" requirement, but the rule's language
"generally follows Rule 1:13-7." See Pressler & Verniero, Current
N.J. Court Rules, cmt. 1 on R. 4:64-8 (2018). However, Rule 1:13-
7 grants a party ninety days to seek reinstatement for "good
cause," after which the party must show "exceptional
circumstances." By contrast, Rule 4:64-8 includes no such ninety-
day period. Nonetheless, as for the meaning of "good cause," we
may presume that the Rule's drafters "used the word in the later
[rule] in the same sense as in the . . . earlier [rule]." Bank
of Montclair v. McCutcheon, 107 N.J. Eq. 564, 567 (Prerog. Ct.
1930) (referring to statutory interpretation).
Rule 1:13-7 is an "administrative rule designed to clear the
docket of cases that cannot, for various reasons, be prosecuted
to completion." Mason v. Nabisco Brands, Inc., 233 N.J. Super.
263, 267 (App. Div. 1989). "Notwithstanding the adoption of the
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good cause standard, absent a finding of fault by the plaintiff
and prejudice to the defendant, a motion to restore under the rule
should be viewed with great liberality." Ghandi v. Cespedes, 390
N.J. Super. 193, 197 (App. Div. 2007).
The delay in filing the final judgment with the Office of
Foreclosure was clearly attributable to Wells Fargo. The court
allowed reinstatement of the complaint on the theory that Harris
would not suffer any prejudice. The court reasoned that Harris
was living rent free in the home while the foreclosure proceedings
continued. Additionally, dismissing the action would not have
secured any property rights for Harris; the residence would have
remained encumbered, and the mortgage would have remained in
arrears. Wells Fargo apparently would have had every right to
reinstitute the foreclosure action since Harris does not argue
that the statute of limitations has run. See N.J.S.A. 2A:50-56.1.
Thus, the trial court did not abuse its discretion in reinstating
the complaint.
As for the multiple extensions of time, "[a] court may
exercise broad discretion in controlling its calendar." State v.
Kates, 426 N.J. Super. 32, 45 (App. Div. 2012), aff'd o.b., 216
N.J. 393 (2014). We will not disturb the discretionary ruling
unless it was "clearly unreasonable" and "prejudice[ed] . . . the
rights of the party complaining." Smith v. Smith, 17 N.J. Super.
6 A-5611-15T3
128, 133 (App. Div. 1951). The trial judge determined that
judicial economy warranted an extension of time, rather than
dismissal of the case without prejudice and returning a six-year
litigation back to square one. This was not an abuse of
discretion, particularly since Harris did not suffer any
prejudice.
We turn next to Harris's substantive arguments. "The only
material issues in a foreclosure proceeding are the validity of
the mortgage, the amount of the indebtedness, and the right of the
mortgagee to resort to the mortgaged premises." Great Falls Bank
v. Pardo, 263 N.J. Super. 388, 394 (Ch. Div. 1993), aff'd, 273
N.J. Super. 542 (App. Div. 1994). Harris presents no competent
evidence to contest the first two elements. Rather, she argues
Wells Fargo lacks standing because World Savings, not Wells Fargo,
is the original mortgagee; therefore, only World Savings has
standing to foreclose.
The legal effect of a merger between two banking institutions
is that "the property and rights of [the] merging bank . . . vest
in the receiving bank without further act or deed," and "the rights
and obligations of [the] merging bank shall become the rights and
obligations of the receiving bank." N.J.S.A. 17:9A-139(1), (3).
We specifically addressed the merger between Wachovia and
Wells Fargo in Suser v. Wachovia Mortg., FSB, 433 N.J. Super. 317,
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321 (App. Div. 2013). The plaintiff sought to quiet title by,
among other things, removing a mortgage recorded by World Savings.
Id. at 320. We rejected the plaintiff's challenge to Wells Fargo's
standing, stating:
Wells Fargo's authority to seek foreclosure
of the World Savings mortgage was [not] based
on an assignment. Instead, Wells Fargo
asserted, without substantial contradiction,
that the original mortgage holder World
Savings Bank, FSA changed its name to Wachovia
Mortgage, FSB, effective December 31, 2007,
and that Wachovia was acquired by and merged
into Wells Fargo effective November 1,
2009. . . . Wells Fargo's right to enforce
the mortgage arises by operation of its
ownership of the asset through mergers or
acquisitions, not assignment. Accordingly,
plaintiff's assertions regarding standing
have no bearing on Wells Fargo . . . .
[Ibid.]
Here as well, Wells Fargo has provided sufficient and
undisputed documentation that it acquired and merged with
Wachovia, formerly World Savings. Therefore, Wells Fargo has
standing to foreclose without proof of a formal assignment.
Harris argues for the first time on appeal that the final
judgment of foreclosure should be vacated under Rule 4:50-1(a),
(b), and (c), because Wells Fargo's calculations of the final
amount due were incorrect. As Harris could have raised this issue
before the trial court, and the issue does not involve the trial
court's jurisdiction or a significant public policy matter, we
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decline to address it. See Nieder v. Royal Indem. Ins. Co., 62
N.J. 229, 234 (1973).
Harris's remaining argument regarding rescission of the loan
under the Truth in Lending Act, 15 U.S.C. § 1601 to § 1667, lacks
sufficient merit to warrant discussion. R. 2:11-3(e)(1)(E).
Affirmed.
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