NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court ."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-1058-24
88-90 PULASKI LLC,
Plaintiff-Appellant,
v.
MARCO ALTAMIRANO,
Defendant-Respondent. ________________________
Submitted October 16, 2025 – Decided December 12, 2025
Before Judges Mayer and Paganelli.
On appeal from the Superior Court of New Jersey, Law Division, Essex County, Docket No. LT-014194-24.
O'Hanlon Schwartz, PC, attorneys for appellant (Israel A. Schwartz and Noah A. Schwartz, of counsel and on the brief).
Respondent has not filed a brief.
PER CURIAM
In this residential landlord tenant matter, plaintiff-landlord appeals from
the trial court's November 8, 2024 order, vacating a judgment of possession and warrant of removal and dismissing the eviction complaint against defendant-
tenant. We affirm in part and reverse and remand in part.
We glean the facts and procedural history from the trial court proceedings.
On August 6, 2024, landlord filed a complaint alleging tenant failed to pay rent.
Landlord claimed tenant resided in and had possession of an apartment "since
. . . December 13, 2021, under a written agreement." Contrary to the complaint,
in a certification attached to the complaint, landlord's counsel stated the lease
was "not the subject of a written agreement." Further, landlord alleged tenant's
monthly rent was $800 and had been unpaid since January 1, 2022. Landlord
certified he was owed $2,250 in outstanding rent and sought attorney's fees and
court costs.
A mostly illegible Return of Service statement indicated service of the
complaint was effectuated on August 31, 2024. Tenant did not respond to the
complaint.
On September 23, 2024, landlord submitted another certification stating
tenant owed an additional one-hundred dollars, representing the filing fee for
the eviction action. Tenant did not appear for the trial scheduled for September
24. On October 1, 2024, landlord obtained a judgment of possession by default.
The judgment amount of $3,712 included $3,100 in base rent plus additional
A-1058-24 2 amounts for late charges, legal fees, and court costs. The judgment allowed for
the issuance of a warrant of removal after October 4.
On October 9, 2024, the warrant for removal was served on tenant. The
warrant advised tenant to vacate by October 15. On October 11, 2024, tenant
filed an order to show cause (OTSC) and certification for relief with the court.
He certified that he did not appear at trial because he "did not receive the court
notic[e]." Further, he certified he did not owe any rent and had "all the receipts
[and] proofs." Tenant alleged he tried to contact landlord before the filing of
the OTSC, but he was unsuccessful.
From the bench, the trial court phoned landlord's attorney. Because no
one answered at counsel's office, the court left a voice message with the court's
contact information. The court proceeded to hear from tenant on the OTSC.
Tenant asserted he moved into the premises fourteen years ago. Further, he
contended the building superintendent agreed to a "payment plan . . . because
there was a fire and some of [his] things were burned." In addition, tenant
acknowledged his monthly rent was $800, but asserted the rent was reduced to
$500 for three months because of the fire and his need to stay in a hotel. He
further asserted he and landlord reached an agreement after tenant made repairs
resulting from the fire.
A-1058-24 3 The trial court entered the OTSC. The order: (1) stayed the judgment of
possession and warrant of removal; (2) did not require tenant to make a deposit
into court; (3) required landlord and tenant to appear in person and that "landlord
shall show the court why the eviction of . . . [t]enant should not be further stayed
and/or why other appropriate relief should not be granted"; and (4) allowed
"landlord . . . [to] apply to the court to modify or dissolve th[e o]rder or to
accelerate the return date."
The matter returned to court on November 8, 2024. The trial court stated
"[tenant wa]s challenging the amount"; claiming he did not "owe any rent," and
had "all receipts and proofs"; and that there was a verbal agreement to reduce
the monthly rent payments as a result of a fire and damage to tenant's property.
Landlord's counsel stated there was a fire that "minimally affected" the
apartment. Further, landlord's attorney told the trial court "there was never any
agreement whatsoever to reduce or change [the] rent."
Landlord testified that tenant had been living in the unit since 2018 when
landlord bought the building and tenant paid $800 a month in rent. Landlord
stated there was a fire in 2021 in the basement below tenant's apartment and
"there was some water damage and smoke damage." Landlord claimed it
A-1058-24 4 repaired "whatever needed to be fixed . . . at that time." Landlord testified the
last time it was in the apartment was about a year after the fire.
Landlord confirmed the complaint covered the time the period from
January 2022 "to the current time." Landlord stated that there were months when
tenant paid rent in full and others when he paid less. Landlord testified that, not
including the November rent, tenant owed $3,900. Landlord acknowledged that
tenant tried to pay the October rent, but it refused the payment.
The trial court reviewed the landlord's ledger of transactions. For the year
2022, the court found, and landlord's counsel agreed, tenant had a deficit of
$900. The deficit resulted from rent payments of $500, rather than $800, in
January, February, and March. Further, for the year 2023, the court found tenant
made all rent payments, but noted plaintiff still carried the $900 balance.
Landlord's counsel confirmed the $900 balance. Moreover, for the year 2024,
the court found tenant owed August and September rent and paid October rent,
but the payment was being held in escrow. Because there was no written lease
agreement, the court denied landlord's request for late charges, attorney's fees
or costs. Therefore, the court concluded tenant owed $2,500, comprised of: the
2022 balance of $900 and $1,600 owed from August and September 2024.
A-1058-24 5 Upon questioning from the court, tenant testified that landlord agreed to
the $500 payments for the three months in 2022 because he had "nowhere to
sleep [as] the apartment was inhabitable . . . [as a result] of the fire" and he "had
to sleep at a motel." Tenant stated he paid cash for the motel and did not have
receipts. Further, tenant asserted he did have proof of rent payments.
Tenant testified he spoke to the landlord about the damaged apartment.
Tenant stated landlord offered him money to move. However, because tenant
lived in the apartment for fourteen years, he did not want to move. Tenant
testified that although landlord said he would fix the apartment, tenant fixed the
apartment himself and had "receipts," but "never received a credit back" from
landlord for undertaking the repairs. Tenant testified landlord agreed for tenant
to make the repairs.
Tenant produced pictures of the apartment and testified they accurately
depicted its condition after the fire. In addition, tenant produced video of the
repairs. Further, tenant's contractor, who repaired the apartment, testified that
he removed and replaced sheetrock, spackled, replaced moldings and floors, and
painted the apartment. Tenant testified the repairs were completed within three
weeks to a month after the fire. Although unclear from the record, it appears
A-1058-24 6 tenant paid the contractor in excess of $4,000 for the repairs. Plaintiff reiterated
that he paid the rent "the entire time."
Landlord argued that the court was "holding a habitability hearing" post
judgment, which was procedurally improper. Further, landlord contended the
court could not, pursuant to C.F. Seabrook Co. v. Beck, 174 N.J. Super. 577
(App. Div. 1980), hear a claim for "an abatement" or "habitability" after a tenant
consistently paid rent because that type of claim was a counterclaim and not
permissible in an eviction action.
The trial court explained the judgment was entered in default and it had
the authority to hold a hearing on an OTSC. Further, the court rejected the
assertion that tenant was asserting "habitability in terms of a . . . defense," citing
Marini v. Ireland, 56 N.J. 130 (1970).
In an oral opinion, the trial court stated it believed tenant's testimony. The
court stated it did not believe the landlord because he had not been to the
apartment and did not "know what happened."
The court found there was a fire that damaged tenant's property. The court
based this finding on the testimony, photographs and video presented by tenant.
Further, the court found landlord offered tenant "money to vacate." The court
noted this offer established the landlord knew "there was an issue with the
A-1058-24 7 apartment." However, "in lieu of vacating," the court found tenant made repairs
and landlord gave tenant "a credit for three months off his rent."
In addition, the trial court found landlord's property was "enhanced
because of the work that was done" by tenant. Therefore, the judge stated, "the
fair thing to do . . . [wa]s [to] dismiss the complaint and start all over." The
court found "[t]he repairs more than adequately compensate[d landlord] for the
rent." Indeed, the court concluded landlord had "been enriched by the increase
in the value of the apartment." The court dismissed the complaint and vacated
the default judgment.
Landlord moved for reconsideration. The court denied the motion on
"equitable principles." Landlord argued "equity follows the law" and tenant paid
for the repairs in June 2021, which predated the dates in the complaint, and
continued to pay rent thereafter. Thus, landlord argued tenant could not seek to
credit the amount paid for repairs against his current rent arrears, relying on C.F.
Seabrook Co. Landlord argued tenant's claim was an impermissible
counterclaim in a summary proceeding for possession and that tenant would
have to file a separate action in the Law Division. The court denied the motion
based upon "[j]udicial economy."
A-1058-24 8 The court's November 8, 2024 order provided that it "conduct[ed] a full
hearing as the [judgment of possession] was entered by way of [d]efault." The
order provided:
The tenant has satisfied the equivalent of rent due based upon the amount of monies expended to repair damages caused by the fire below his apartment and based upon monies he expended for hotel charges. The [c]omplaint and the [j]udgment of [p]ossession and [w]arrant of [r]emoval are dismissed with prejudice.
On appeal, landlord argues the trial court erred by applying "unstated
equitable principles rather than the law," which "resulted in disregard for . . .
procedural safeguards." Landlord contends the court: (1) allowed tenant to
prosecute a counterclaim in disregard of the principles of summary dispossess
proceedings and without affording landlord an opportunity to assert a
meaningful defense, and (2) vacated a default judgment without rendering
findings of fact or conclusion of law, citing Rule 1:7-4.
We begin our discussion with a review of the principles governing our
analysis. Rule 1:7-4(a) requires that "[t]he court shall, by an opinion or
memorandum decision, either written or oral, find the facts and state its
conclusions of law thereon . . . on every motion decided by a written order that
is appealable as of right." "In the absence of reasons, [an appellate court is] left
to conjecture as to what the judge may have had in mind." In re Farnkopf, 363
A-1058-24 9 N.J. Super. 382, 390 (App. Div. 2003) (quoting Salch v. Salch, 240 N.J. Super.
441, 443 (App. Div. 1990)). "Failure to perform that duty 'constitutes a
disservice to the litigants, the attorneys and the appellate court.'" Curtis v.
Finneran, 83 N.J. 563, 569-70 (1980) (quoting Kenwood Assocs. v. Bd. of
Adjustment Englewood, 141 N.J. Super. 1, 4 (App. Div. 1976)). "Naked
conclusions do not satisfy the purpose of" Rule 1:7-4. Id. at 570.
"The factual findings of a trial court are reviewed with substantial
deference on appeal, and are not overturned if they are supported by 'adequate,
substantial[,] and credible evidence.'" Manahawkin Convalescent v. O'Neill,
217 N.J. 99, 115 (2014) (quoting Pheasant Bridge Corp. v. Twp. of Warren, 169
N.J. 282, 293 (2001)). However, "[a] trial court's interpretation of the law and
the legal consequences that flow from established facts are not entitled to any
special deference." Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140
N.J. 366, 378 (1995). Therefore, "[i]n construing the meaning of a statute or the
common law, our review is de novo." Nicholas v. Mynster, 213 N.J. 463, 478
(2013). Similarly, we construe a court rule under a de novo standard. See In re
Ordinance 2354-12 of Twp. of W. Orange, Essex Cnty. v. Twp. of W. Orange,
223 N.J. 589, 596 (2015).
A-1058-24 10 I.
We consider landlord's assertion that tenant's presentation during the
return on the OTSC cause amounted to a counterclaim and was not permitted in
a summary dispossess proceeding.
Under N.J.S.A. 2A:18-61.1,
No lessee or tenant . . . may be removed by the Superior Court from any house, building, mobile home or land in a mobile home park or tenement leased for residential purposes . . . except upon establishment of one of the following grounds as good cause:
(a) The person fails to pay rent due and owing under the lease whether the same be oral or written; . . . .
Rule 6:3-4(a) provides that "[s]ummary actions between landlord and
tenant for the recovery of premises shall not be joined with any other cause of
action, nor shall a defendant in such proceedings file a counterclaim or third -
party complaint." In C.F. Seabrook Co., we noted "[t]he terms set[-]off and
counterclaim are generally used interchangeably" and "a set[-]off is essentially
the same as a counterclaim." 174 N.J. Super. at 588.
Moreover, a tenant may not "raise the habitability issue with regard to a
time period for which it is not claimed he is in default or for which the rent is
already paid." Id. at 589 (quoting Academy Spires, Inc. v. Jones, 108 N.J. Super.
A-1058-24 11 395, 402 (App. Div. 1970)). This would allow for a counterclaim, not permitted
by Rule 6:3-4. See ibid.
Against this well-established law, we note landlord filed its complaint on
August 6, 2024. Landlord alleged tenant's failure to pay rent began January 1,
2022. The court found landlord could claim: (1) $900 for the period between
January to March 2022; (2) $800 for August 2024; and (3) $800 for September
2024. We consider these findings in turn.
First, we consider the $900 from the period of time between January 2022
and March 2022. The landlord was not entitled to possession on this basis.
Landlord incorrectly asserts that tenant relies on habitability to explain the rent
reduction for the three months in 2022. While a habitability claim would have
been an impermissible counterclaim, tenant is not relying on habitability for this
disputed time period. Instead, tenant's defense of paying $900 less in rent is that
there was an oral modification of the rent agreed to by landlord for those three
months between him and landlord. The trial court believed tenant's testimony
that landlord agreed to this reduced rent. Indeed, landlord did not testify to the
contrary. Therefore, the court did not err in finding tenant's rent for the three
months in 2022 was not "due and owing," see N.J.S.A. 2A:18-61.1, because
tenant paid the agreed upon amount. It was permissible for tenant to assert a
A-1058-24 12 defense to the amount due for a period claimed in landlord's complaint. See
Marini, 56 N.J. at 140 ("[E]quitable as well as legal defenses asserting payment
or absolution from payment in whole or in part are available to a tenant in a
dispossess action and must be considered by the court.").
Next, we consider the trial court's finding regarding outstanding rent from
August and September 2024. We note the September rent was not "due and
owing" when landlord filed the complaint in August. "[T]he amount claimed to
be due must be legally owing at the time the complaint was filed." McQueen v.
Brown, 342 N.J. Super. 120, 126 (App. Div. 2001) (internal quotation marks
omitted) (quoting Chau v. Cardillo, 250 N.J. Super. 378, 384 (App. Div. 1991)).
Therefore, the trial court did not have jurisdiction over the September rent
amount. See Sudersan v. Royal, 386 N.J. Super. 246, 251 (App. Div. 2005).
Thus, landlord would not have been entitled to possession on the basis the
September rent was outstanding.
Consequently, we affirm the dismissal of landlord's claim concerning the
September 2024 rent, although we require it to be without prejudice, and we do
so for different reasons than those stated by the trial court. See Hayes v.
Delamotte, 231 N.J. 373, 387 (2018) (applying the well-settled principle "that
appeals are taken from orders . . . and not from opinions," and that orders may
A-1058-24 13 be affirmed for reasons different from those set forth by the trial court (quoting
Do-Wop Corp. v. City of Rahway, 168 N.J. 191, 199 (2001))).
We next consider the August 2024 rent. This amount was alleged to be
"due and owing," see N.J.S.A. 2A:18-61.1, when landlord filed the complaint.
The court determined this amount was "due and owing," ibid., however, because
tenant's repairs "enhanced" the apartment, "enriched" landlord, and "more than
adequately compensate[d landlord] for the rent," the court determined tenant
was not responsible for payment.
Whether the court's determination rested on set-off or habitability, it was
misplaced. A set-off is "essentially the same," as a counterclaim. C.F. Seabrook
Co., 174 N.J. at 589. Tenant's assertion of a set-off or counterclaim was
impermissible under the Rules governing summary dispossess actions. See ibid.
Moreover, if the court determined tenant's claim was one for habitability it was
not permitted under C.F. Seabrook Co. because any claim for habitability arose
in May 2021—when the fire occurred—and abated in June 2021, once tenant
completed the repairs. Tenant paid the rent during this period. Landlord alleged
tenant's default occurred after January 2022. Thus, a habitability claim was
improper because a tenant may not "raise . . . habitability . . . with regard to a
A-1058-24 14 time period for which it is not claimed he is in default or for which the rent is
already paid." Id. at 589.
Moreover, the trial court's reliance upon "[j]udicial economy" to consider
the August rent was misplaced. We have rejected notions of judicial economy
in these situations. See ibid. ("[W]e disagree with [the] contention that to avoid
the expense and delay attendant upon multiple actions all habitability claims
should be consolidated.").
Therefore, we affirm that part of the court's order dismissing landlord's
claims regarding the January, February, and March 2022 rent period. Moreover,
we affirm that part of the court's order dismissing landlord's claims regarding
the September 2024 rent, although we do so without prejudice.
For the reasons stated, we reverse the order dismissing the complaint
regarding the August 2024 rent. We reinstate landlord's complaint for the parties
to present evidence regarding the payment of August 2024 rent. This includes
tenant's right to invoke applicable statutory protections as suggested by landlord
and mentioned below.
II.
Landlord asserts that the trial court erred in failing to make findings of
fact or conclusions of law, under Rule 1:7-4, regarding its reasoning for the
A-1058-24 15 vacatur of landlord's judgment. Landlord asserts the court did not provide an
analysis under "the traditional statutory bases for vacating a judgment based on
non-payment of rent," citing N.J.S.A. 2A:18-55, N.J.S.A. 2A:42-8, N.J.S.A.
2A:42-9, N.J.S.A. 2A:42-10.16(a), or N.J.S.A. 46:8-49.3; nor did the court
provide an analysis for relief from the judgment under Rule 4:50-1. Instead,
landlord asserts, the court's reasoning appears to rest on "equitable principles,"
but the court failed to "explain what equitable principles allow[ed] it to disregard
the law pertaining to vacating default judgments."
"[T]he trial court had the authority to invoke Rule 4:50-1 to vacate a
judgment for possession in a summary-dispossess action after a warrant of
removal had been executed." Hous. Auth. of Morristown v. Little, 135 N.J. 274,
290 (1994). The court's "sound discretion . . . [is] guided by equitable principles
in determining whether relief should be granted or denied." Id. at 283. "The
decision . . . to open a judgment will be left undisturbed unless it represents a
clear abuse of discretion." Ibid.
We recognize tenant did not make a formal motion under Rule 4:50-1.
Moreover, the trial court did not specifically mention the Rule. Nevertheless,
given the unique procedural posture of this matter, with the trial court
conducting a plenary hearing, we conclude there is no abuse of discretion. After
A-1058-24 16 hearing testimony, the court concluded the default judgment should not stand
based on "equitable principles." "Rule 4:50 is instinct with equitable
considerations." Pro. Stone, Stucco & Siding Applicators, Inc. v. Carter, 409
N.J. Super. 64, 68 (App. Div. 2009). Moreover, "relief from default judgments
are to be 'viewed with great liberality, and every reasonable ground for
indulgence is tolerated to the end that a just result is reached.'" Ibid. (quoting
Marder v. Realty Constr. Co., 84 N.J. Super. 313, 319 (App. Div. 1964)). This
liberal and indulgent approach recognizes the desire for cases to be "decided on
the merits." Nowosleska v. Steele, 400 N.J. Super. 297, 303 (App. Div. 2008).
Therefore, we leave undisturbed the trial court's order vacating the default
judgment and the resultant warrant of removal.
Affirmed in part and reversed and remanded in part. We do not retain
jurisdiction.
A-1058-24 17