279 Veterans LLC v. Village Green Associates, LLC

• Court: New Jersey Superior Court Appellate Division
• Decided: March 27, 2024
• Docket: A-0606-22
• Status: Unpublished

Opinion

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court ."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-0606-22

279 VETERANS LLC, FIDELITY MORTAGE, LLC, and SEABRIDGE ACQUISTIONS, LLC,

Plaintiffs-Respondents,

v.

VILLAGE GREEN ASSOCIATES, LLC,

Defendant-Appellant. _______________________________

Argued October 30, 2023 – Decided March 27, 2024

Before Judges Gilson and Bishop-Thompson.

On appeal from the Superior Court of New Jersey, Chancery Division, Middlesex County, Docket No. C-000107-20.

Avram E. Frisch argued the cause for appellant (Law Office of Avram E. Frisch, LLC, attorney; Avram E. Frisch, on the brief). Layne Alison Feldman argued the cause for respondents (Ansell, Grimm & Aaron, PC, attorneys; Lawrence H. Shapiro, of counsel and on the brief).

PER CURIAM

Defendant Village Green Associates LLC (Village Green) appeals from

the Law Division's October 14, 2022 order granting summary judgment in favor

of plaintiffs 279 Veterans LLC (279 Veterans), Seabridge Acquisitions LLC

(Seabridge), and Fidelity Mortgage LLC (Fidelity) (collectively plaintiffs) and

denying defendant's cross-motion for summary judgment. Having considered

the record and applied the governing law, we affirm.

I.

We summarize the material facts from the record, viewing them in the

light most favorable to defendant, as the non-moving party. Templo Fuente De

Vida Corp. v. Nat'l Fire Ins. Co. of Pittsburgh, 224 N.J. 189, 199 (2016). In

May 1999, defendant purchased property located at 405 Route 18, East

Brunswick, New Jersey (the Property), a retail shopping center containing

"21,000 [] square feet, a Learning Experience[,] and approximately 8 stores."

In May 2008, defendant borrowed $700,000 from 279 Veterans and

Seabridge, two companies owned by Harold Trieger. Joseph Grunwald, as the

sole owner and president of SYF Holding Corporation and the sole member of

A-0606-22 2 Village Green, signed a note in favor of Seabridge and a mortgage in favor of

279 Veterans. On September 20, 2011, the mortgage was recorded.

From 2010 to 2013, defendant made interest-only payments on the

Seabridge note identified in its accounting records as a construction loan. In

June 2013, defendant stopped making payments.

In August 2013, 279 Veterans assigned the note and the mortgage to

Fidelity, another entity owned by Trieger. Subsequently, Fidelity sent defendant

a demand letter stating the note and mortgage were in default for nonpayment

and $787,996.00 was due and owing. In September 2013, Fidelity filed a

foreclosure complaint against defendant. The foreclosure action was dismissed

without prejudice when Fidelity learned of "potential environmental issues" at

the Property.

On November 23, 2015, defendant filed a lawsuit against 279 Veterans

and Fidelity (the 2015 Action). It alleged that Grunwald had not signed the

mortgage, and therefore, it was null and void. During discovery, 279 Veterans

and Fidelity produced a handwriting expert who opined Grunwald signed the

mortgage. Thereafter, the parties filed a stipulation of dismissal with prejudice.

In 2016, Aryeh Weinstein filed suit against defendant and its subsidiaries,

seeking a declaration that he was a fifty-percent owner in properties acquired by

A-0606-22 3 defendant and a share of the profits for properties sold by defendant (the 2016

Action). Weinstein alleged he had an oral partnership with defendant. In the

2016 Action, Weinstein contested the validity of the mortgage. Grunwald

testified at trial; he did not state that the mortgage was paid and satisfied. Nor

did he allege that a satisfaction of the mortgage had been signed. Following an

eight-day trial in February 2020, Weinstein’s claims were dismissed with

prejudice.

Shortly thereafter, on March 20, 2020, defendant recorded a satisfaction

of the mortgage, dated February 8, 2014, allegedly signed by Paul Zicherman,

Grunwald's father-in-law. The satisfaction stated the mortgage given by 279

Veterans to defendant "IS PAID" and consented to the mortgage discharge.

After discovering the recorded satisfaction during a title search, plaintiffs

filed a complaint against defendant on July 10, 2020, seeking a declaration that

the satisfaction was fraudulent and seeking to remove it from the public record.

On October 29, 2020, defendant filed an answer, counterclaim, and third-

party complaint. It sought a declaration that the satisfaction was valid and that

the mortgage was no longer a valid, binding debt. Defendant also disputed the

ownership of 279 Veterans and the continued validity of the mortgage

documents.

A-0606-22 4 On October 14, 2021, NJ BNH III, LLC (NJ BNH III) commenced a

foreclosure action against defendant seeking to foreclose on a prior mortgage,

executed on October 27, 2005. The foreclosure sale was held in October 2023,

and the Property was sold for more than the sum owed to NJ BNH III as the first

lender.

Plaintiffs moved for summary judgment, arguing that they were entitled

to a declaratory judgment because the satisfaction was invalid and sought

dismissal of defendant's counterclaims and third-party claims. Specifically,

plaintiffs argued defendant's claims were barred by the entire controversy

doctrine, judicial estoppel, and res judicata.

Defendant cross-moved for summary judgment, contending that 1) there

was no justiciable controversy because plaintiffs failed to preserve their

counterclaims in the 2015 Action, 2) the entire controversy doctrine barred

plaintiffs' claims, 3) equitable considerations favored defendant, 4) the

satisfaction was valid, and 5) judicial estoppel and res judicata did not bar its

claims.

Following oral argument, on October 14, 2022, the judge entered an order

accompanied by a well-reasoned written decision. The judge granted plaintiffs'

motion for summary judgment for declaratory relief but denied the motion for

A-0606-22 5 summary judgment on the fraud claim. The judge denied defendant's cross-

motion in its entirety.

In granting plaintiffs' claim for declaratory judgment, the motion judge

concluded the mortgage was valid, and the satisfaction was invalid based on the

competent and undisputed evidence produced by plaintiffs. The judge stated

plaintiffs showed Trieger assigned the mortgage to Zicherman in 2009, but 279

Veterans did not hold the mortgage in February 2014. Additionally, plaintiffs

submitted "true copies of the [n]ote and [m]ortgage assignments from [279]

Veterans to Fidelity dated August 7, 2013." The judge, therefore, concluded

that Zicherman did not have the authority to discharge the mortgage or execute

the satisfaction.

In addition, the judge found that plaintiffs submitted substantial

documentary evidence to show that the mortgage was authentic and valid,

including (1) a handwriting expert's report to support its contention in the 2015

Action, and (2) account statements showing the history of defendant's mortgage

payments.

The judge also determined plaintiffs’ claims in this matter could not have

accrued in 2015 or 2016; and therefore, the entire controversy doctrine did not

bar the present claims. The judge found the certifications submitted by plaintiffs

A-0606-22 6 established that they did not learn of the satisfaction was not "discovered" until

2020, well after the conclusion of the prior actions. Moreover, defendant offered

no proofs to contradict when plaintiffs learned of the satisfaction.

The judge reasoned that it would have "been to [d]efendant's benefit to

assert the existence of the [s]atisfaction in support of its []claims" in the 2015

Action. The judge also noted that during oral argument defendant conceded that

counsel in the 2015 Action should have raised the issue of satisfaction. The

judge therefore concluded defendant was barred from asserting the validity of

the satisfaction in this action.

Further, the judge found defendant produced "only self-serving

certifications attesting to conclusory facts without supporting evidence."

Therefore, defendant's "'bare' certifications, without more, [were] insufficient to

raise a genuine factual dispute. Since the entire controversy doctrine bar[red]

[d]efendant from raising the issue of the [s]atisfaction's validity . . . it [wa s]

therefore undisputed that the [s]atisfaction [was] invalid."

On the other hand, the judge determined defendant's claims were not

barred under the doctrines of res judicata and collateral estoppel. The judge first

found that defendant's contention that the mortgage was fraudulent and,

therefore, invalid was consistent with its position taken in the 2015 Action. The

A-0606-22 7 judge then determined the 2015 Action was voluntarily dismissed. Finally, the

parties did not fully litigate and determine the validity of the mortgage, and as

such, neither doctrine barred defendant from raising the issue in this action.

Regarding both parties' fraud claim, the judge noted that only plaintiffs

"demonstrated a misrepresentation as a matter of law." The judge explained

plaintiffs, however, failed to prove the remaining elements of their claim by

undisputed facts. Defendant likewise "failed to set forth competent evidence

that proves its claim or contradict[ed] [p]laintiffs' evidence. Accordingly,

neither party established the elements of their fraud claims. After the entry of

the summary judgment order, the parties filed a consent order voluntarily

dismissing the remaining claims.

II.

On appeal, defendant asserts two arguments. First, it argues there were

material issues of fact that precluded the trial court from granting summary

judgement in favor of plaintiffs. Second, it contends the entire controversy

doctrine does not bar defendant from arguing the satisfaction discharged the

mortgage.

We review the trial court's grant or denial of a motion for summary

judgment de novo, applying the same standard used by the trial court. Samolyk

A-0606-22 8 v. Berthe, 251 N.J. 73, 78 (2022). Under that standard, we must "determine

whether 'the pleadings, depositions, answers to interrogatories and admissions

on file, together with the affidavits, if any, show that there is no genuine issue

as to any material fact challenged and that the moving party is entitled to a

judgment or order as a matter of law.'" Branch v. Cream-O-Land Diary, 244

N.J. 567, 582 (2021) (quoting R. 4:46-2(c)). "An issue of fact is genuine only

if . . . the evidence submitted by the parties on the motion, together with all

legitimate inferences therefrom favoring the non-moving party, would require

submission of the issue to the trier of fact." R. 4:46-2(c).

We reject defendant's arguments and affirm substantially for the same

reasons expressed by the motion judge. The burden of disputing the validity of

the mortgage was on defendant but defendant failed to produce credible

evidence to refute the validity of the mortgage. Moreover, there is no evidence

that Zicherman had authority to execute the satisfaction in 2014. Furthermore,

the satisfaction was not produced in the 2015 Action nor was it timely recorded.

Accordingly, plaintiffs' request for declaratory relief was essentially

unopposed after the judge ruled that defendant's satisfaction defense was barred

by the entire controversy doctrine. Defendant offered nothing more than bare

assertions without evidentiary support in challenging plaintiffs' motion, which,

A-0606-22 9 under well-settled principles, is insufficient to defeat a summary judgment

motion. Horizon Blue Cross Blue Shield of New Jersey v. State, 425 N.J. Super.

1, 32 (App. Div. 2012) (citing Brae Asset Fund, LP v. Newman, 327 N.J. Super.

129, 134, (App. Div. 1999)); accord Puder v. Buechel, 183 N.J. 428, 440-41

(2005).

The entire controversy doctrine is "an equitable doctrine whose

application is left to judicial discretion based on the factual circumstances of

individual cases." Bank Leumi USA v. Kloss, 243 N.J. 218, 227 (2020) (quoting

Dimitrakopoulos v. Borrus, Goldin, Foley, Vignuolo, Hyman & Stahl, PC , 237

N.J. 91, 114 (2019)). We review the doctrine presented on summary judgment

for an abuse of discretion rather than de novo. Unkert by Unkert v. Gen. Motors

Corp., 301 N.J. Super. 583, 595 (App. Div. 1997) (affirming denial of summary

judgment under the entire controversy doctrine, finding no "abuse of the trial

court's discretion in not applying the doctrine").

Under the entire controversy doctrine, a party must "assert all claims

known to them that stem from the same transactional facts, even those against

different parties." R. 4:30A; Joel v. Morrocco, 147 N.J. 546, 548 (1997). The

doctrine of res judicata precludes the re-litigation of substantially the same cause

of action once it is finally determined on the merits by a court of competent

A-0606-22 10 jurisdiction. Wadeer v. N.J. Mfrs. Ins. Co., 220 N.J. 591, 606 (2015). In

determining whether successive claims constitute one controversy for purposes

of the entire controversy doctrine, "the central consideration is whether the

claims . . . arise from related facts or the same transaction or series of

transactions." Ibid. It is the factual context "giving rise to the controversy itself,

rather than a commonality of claims, issues or parties, that triggers the

requirement of joinder to create a cohesive and complete litigation." Mystic Isle

Dev. Corp. v. Perskie & Nehmad, 142 N.J. 310, 323 (1995) (citing DiTrolio v.

Antiles, 142 N.J. 253, 267-68 (1995)).

Here, the record shows defendant should have been aware of the

satisfaction since at least February 2014. Based on the record, we are satisfied

the judge properly determined defendant failed to raise the issue of satisfaction

during the 2015 and 2016 Actions. Indeed, during the 2016 Action, Grunwald

had an opportunity to testify regarding the satisfaction but failed to do so.

Instead, defendant disputed the validity of the mortgage in the 2015 and 2016

Actions. Based on that record, the judge properly concluded defendant's

satisfaction claim was barred by the entire controversy doctrine.

Affirmed.

A-0606-22 11