Freedom Mortgage Corporation v. Jay Bubenheimer

• Court: New Jersey Superior Court Appellate Division
• Decided: June 13, 2025
• Docket: A-3826-23
• Status: Unpublished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NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court ."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-3826-23

FREEDOM MORTGAGE CORPORATION,

Plaintiff-Respondent,

v.

JAY BUBENHEIMER and DARIA BUBENHEIMER,

Defendants-Appellants. ________________________

Submitted June 3, 2025 – Decided June 13, 2024

Before Judges Susswein and Perez Friscia.

On appeal from the Superior Court of New Jersey, Chancery Division, Hunterdon County, Docket No. F-011955-22.

Olga Aleinik (Aleinik Law Firm, PLLC), attorney for appellants.

Powers Kirn, LLC, attorneys for respondent (Jeanette J. O'Donnell, on the brief).

PER CURIAM In this residential foreclosure matter, defendants Jay Bubenheimer and

Daria Bubenheimer 1 appeal from the July 5, 2024 Chancery Division order

denying Daria's motion to vacate the final judgment entered in favor of plaintiff

Freedom Mortgage Corporation (Freedom). Having reviewed the record,

parties' arguments, and governing legal principles, we affirm.

I.

On July 27, 2016, Jay borrowed $285,917 from Mortgage Research

Center, LLC d/b/a Veterans United Home (Mortgage Research). Jay executed a

note memorializing the loan, providing for a per annum interest rate of 3.875%

and obligating him to a monthly payment of $1,344.49. The same day, Jay and

Daria, husband and wife at the time, executed a mortgage on their Jeanette Lane

property in Milford in favor of Mortgage Research, securing the note. On

August 2, Mortgage Research recorded the mortgage in the Hunterdon County

Clerk's Office.

In January 2021, Jay defaulted on the loan because he failed to make the

necessary monthly payment and any payments thereafter. Mortgage Research

assigned the mortgage to Freedom, which Freedom recorded on May 10, 2022.

1 Because Jay Bubenheimer and Daria Bubenheimer share the same surname, we use first names for clarity. We intend no disrespect.

A-3826-23 2 On November 7, Freedom filed a foreclosure complaint and personally

served it on defendants the same month. Freedom's complaint alleged

compliance with N.J.S.A. 2A:50-56, which requires a notice of intention to

foreclose (NOI), under the Fair Foreclosure Act (FFA), N.J.S.A. 2A:50-53 to

-68. The complaint noted that Jay was the obligor on the note, and defendants

executed a mortgage securing Jay's payment obligation. Freedom also named

Daria as a defendant because she held a child support judgment against Jay.

On December 20, the court entered default against defendants for failing

to timely answer. On February 1, 2023, the court vacated default against Daria

by consent. One day later, Daria moved to consolidate the foreclosure action

with a pending matrimonial action, which the court denied. On April 18, the

court entered default against Daria again for failing to file an answer. On June

14, it entered the final judgment in favor of Freedom for $305,035.36. The same

day, Freedom served Jay and Daria with the final judgment via regular mail.

One year later, on June 14, 2024, Daria moved to vacate the final

judgment, averring that Freedom failed to serve her with a written NOI. While

Daria was not obligated to repay the loan Jay received from Freedom, she

alleged Freedom was required to separately serve her with an NOI, "as [she was]

a party of interest" regarding the property. After her divorce from Jay, Daria

A-3826-23 3 allegedly retained possession of the property. She argued the record did not

demonstrate Freedom perfected service of an NOI on Jay, but he did not join in

the motion to vacate or provide a certification. Daria alleged the final judgment

was void as a matter of law because she: "[wa]s named in the mortgage";

"occup[ied] the property"; and had "an independent right as a party in interest

to service of a timely NOI, separate and apart from her divorced co-defendant

Jay." She cited to N.J.S.A. 2A:50-56(c)(11), acknowledging that the NOI was

to provide "the debtor" with information.

The court denied Daria's motion to vacate the final judgment. 2 Although

it found Daria timely moved to vacate under Rule 4:50-1(d), the court found no

error in Freedom not serving her with an NOI. The court determined Jay was

the sole "residential mortgage debtor" obligated to make payments on the note.

It further found that Freedom was not required to serve Daria with "a separate

NOI" because she was "solely listed on the [m]ortgage and not the [n]ote."

Additionally, the court noted that Jay did not move to challenge Freedom's

service of an NOI on him and found Daria lacked "standing to assert such a

deficiency."

2 We note the court entered the order denying Daria's motion to vacate the final judgment on July 5, 2024, which the court thereafter amended on October 18 to reflect that Daria and Freedom had waived oral argument. A-3826-23 4 On appeal, defendants contend: (1) the lower court erred in granting the

final judgment without addressing Freedom's failure to serve NOIs as required

under the FFA; (2) Freedom's failure to serve NOIs deprived defendants of their

statutory right to cure and the court of any basis to enter the final judgment; (3)

a distinction exists between defective NOIs and the complete failure to serve

NOIs, which requires dismissal of the foreclosure complaint; (4) the court lacked

jurisdiction based on Freedom's failure to serve the NOIs; and (5) the absence

of valid NOIs renders the final judgment void as a matter of law.

II.

We review a motion to vacate final judgment under Rule 4:50-1 for an

abuse of discretion. 257-261 20th Ave. v. Roberto, 259 N.J. 414, 436 (2025);

see also BV001 REO Blocker, LLC v. 53 W. Somerset St. Props., LLC, 467 N.J.

Super. 117, 124 (App. Div. 2021). "A court abuses its discretion 'when a

decision is made without a rational explanation, inexplicably departed from

established policies, or rested on an impermissible basis.'" Parke Bank v.

Voorhees Diner Corp., 480 N.J. Super. 254, 262 (App. Div. 2024) (quoting

Mims v. City of Gloucester, 479 N.J. Super. 1, 5 (App. Div. 2024)).

Rule 4:50-1(a) to (f) "provides for relief from a judgment [or order] in six

enumerated circumstances." D.M.C. v. K.H.G., 471 N.J. Super. 10, 26 (App.

A-3826-23 5 Div. 2022) (quoting In re Est. of Schifftner, 385 N.J. Super. 37, 41 (App. Div.

2006)). "[T]he rule is a carefully crafted vehicle intended to underscore the need

for repose while achieving a just result." Ibid. (quoting DEG, LLC v. Township

of Fairfield, 198 N.J. 242, 261 (2009)). Rule 4:50-2 provides that "[t]he motion

shall be made within a reasonable time, and for reasons (a), (b) and (c) of R[ule]

4:50-1 not more than one year after the judgment, order or proceeding was

entered or taken."

Specifically, Rule 4:50-1(d) permits a court to relieve a party from a

judgment or order because "the judgment or order is void." "If a judgment is

void and, therefore, unenforceable, it is a particularly worthy candidate for relief

[under] []R[ule] 4:50-1(d)[,] provided that the time lapse is not unreasonable

and an innocent third party's rights have not intervened." Bank v. Kim, 361 N.J.

Super. 331, 336 (App. Div. 2003). "A Rule 4:50-1(d) motion, based on a claim

that the judgment is void, does not require a showing of excusable neglect but

must be filed within a reasonable time after entry of the judgment." Deutsche

Bank Nat'l Tr. Co. v. Russo, 429 N.J. Super. 91, 98 (App. Div. 2012).

The FFA defines a "[r]esidential mortgage" as "a mortgage . . . in which

the security is a residential property such as a house, . . . which is occupied, or

is to be occupied, by the debtor . . . or a member of the debtor's immediate

A-3826-23 6 family, as that person's residence." N.J.S.A. 2A:50-55. "[T]he express purpose

of [N.J.S.A. 2A:50-56 is] . . . to provide notice that makes 'the debtor aware of

the situation,' and to enable the homeowner to attempt to cure the default." U.S.

Bank Nat'l Ass'n v. Guillaume, 209 N.J. 449, 479 (2012) (quoting N.J.S.A.

2A:50-56(c)). The FFA provides that prior to commencing a residential

foreclosure action, a lender must provide an NOI to the debtor "at least [thirty]

days . . . in advance." N.J.S.A. 2A:50-56(a). An NOI is a mandatory

prerequisite to the filing of the foreclosure complaint under the FFA. Spencer

Sav. Bank, SLA v. Shaw, 401 N.J. Super. 1, 7 (App. Div. 2008).

III.

Defendants contend the court erred in denying Daria's motion to vacate

the final judgment because Freedom failed to serve them individually with

NOIs, precluding their right to cure. They further argue that Freedom's failure

to serve the NOI's was not curable by an equitable remedy, the court lacked

jurisdiction to foreclose, and because the final judgment is void, reversal is

warranted. We are unpersuaded.

N.J.S.A. 2A:50-56(b) requires a lender to send an NOI in writing to the

residential mortgage "debtor by registered or certified mail, return receipt

requested, at the debtor's last known address, and, if different, to the address of

A-3826-23 7 the property which is the subject of the residential mortgage." The lender's

written NOI shall "conspicuously state in a manner calculated to make the debtor

aware of the situation" fifteen points of information to address the default,

including the: "real estate security interest"; "nature of the default"; "right of

the debtor to cure the default"; amount "to cure the default"; and "debtor['s] . . .

option to participate in the Foreclosure Mediation Program." N.J.S.A. 2A:50-

56(c)(1) to (15). "The Legislature specifically intended that lenders faithfully

comply with the FFA provisions and articulated that '[w]aivers by the debtor of

rights provided pursuant to [the FFA] are against public policy, unlawful, and

void, unless given after default . . . in a separate written document signed by the

debtor.'" EMC Mortg. Corp. v. Chaudhri, 400 N.J. Super. 126, 139 (App. Div.

2008) (alterations in original) (quoting N.J.S.A. 2A:50-61). However, " [w]e will

not sanction a mortgagor's deliberate attempt to frustrate the mortgagee's efforts

by ignoring the properly sent notice of intent." Id. at 140.

We initially address defendants' argument that Freedom failed to serve Jay

with an NOI. Relevantly, Jay did not move before the court to vacate the final

judgment. Specifically, he never raised that Freedom did not properly serve him

with an NOI as the debtor on the note, and he did not provide a certification

alleging that Freedom failed to comply with N.J.S.A. 2A:50-56 during the

A-3826-23 8 foreclosure litigation. While defendants were both named on the mortgage,

defendants acknowledged Jay alone executed the note and as such, was the only

debtor. After only Daria moved to vacate, arguing Freedom did not serve Jay

with the NOI, the court correctly found that Daria did not have standing to raise

the issue of Freedom's service of an NOI on Jay. See Abbott v. Burke, 206 N.J.

332, 371 (2011) (stating "a litigant typically does not have standing to assert the

rights of third parties").

Regarding Jay's challenge that Freedom failed to properly serve him with

an NOI, which he raises for the first time on appeal, we generally decline to

consider issues not presented below when an opportunity for such a presentation

was available unless the questions raised on appeal concern jurisdiction or

matters of great public interest. Nieder v. Royal Indem. Ins. Co., 62 N.J. 229,

234 (1973); see also Zaman v. Felton, 219 N.J. 199, 226-27 (2014) (recognizing

claims that are not presented to a trial court are inappropriate for consideration

on appeal). Jay's failure to raise the issue below precluded: Freedom from

specifically addressing whether it separately served him with an NOI as the

debtor; and the court from ruling on the issue. Our Supreme Court has

elucidated that courts need not consider a party's newly raised Rule 4:50-1(d)

argument seeking to vacate a final judgment for "fail[ure] to comply with the

A-3826-23 9 FFA." Guillaume, 209 N.J. at 483. For these reasons, we decline to consider

Jay's NOI arguments under Rule 4:50-1(d).

We turn to address Daria's argument that she was entitled to vacate the

final judgment because Freedom failed to serve her with an NOI. Daria argues

that although she was not a debtor on the note, Freedom was required to serve

her with an NOI because she was "named on the mortgage document, which

confers joint obligations and property rights." We disagree.

Daria cites no precedent, nor has our research revealed any authority,

supporting her contention that because she jointly owned the property and was

named on the mortgage, she was considered a "residential mortgage debtor" in

default for "fail[ing] to perform" on "a residential mortgage obligation" under

N.J.S.A. 2A:50-56(a). A "[r]esidential mortgage debtor" is defined as "any

person shown on the record of the residential mortgage lender as being obligated

to pay the obligation secured by the residential mortgage." N.J.S.A. 2A:50-55.

Further, "[o]bligation" is defined as "a promissory note, bond[,] or other similar

evidence of a duty to pay." N.J.S.A. 2A:50-55. Therefore, because Daria was

not a debtor on the note, Freedom was not required to serve her with a separate

NOI providing her with "notice of the right to cure the default." N.J.S.A. 2A:50-

56(a). Stated another way, Daria's name on the mortgage, which secured

A-3826-23 10 Freedom's note, and her property interest did not create an obligation for her to

repay Freedom's loan that Jay entered alone.

For these reasons, we discern no error in the court's denial of Daria's

motion to vacate the final judgment. Defendants' arguments that the court

lacked jurisdiction to enter the final judgment and that the order was void as a

matter of law lack merit.

Finally, we add that while the court found Daria timely filed her motion

to vacate under Rule 4:50-1(d), we question whether she sufficiently

demonstrated that moving to vacate the final judgment one year after the court

entered it was reasonable. Freedom filed the foreclosure action and personally

served defendants in November 2022. After the court entered default against

Daria, it vacated the order by consent on January 31, 2023. The court noted that

Daria attempted to file a deficient answer representing that Freedom did not

sufficiently serve her with an NOI, but she never perfected the answer. Daria

did not dispute litigating foreclosure issues, including seeking to consolidate the

foreclosure action with the matrimonial action. Thereafter, on April 18, the

court granted Freedom's second motion to enter default against Daria , and the

court entered the final judgment on June 14. The record is bereft of any

A-3826-23 11 explanation for why Daria waited twelve months after the court entered the final

judgment before moving to vacate based on alleged NOI deficiencies.

"[A] reasonable time is determined based upon the totality of the

circumstances." Romero v. Gold Star Distrib., LLC, 468 N.J. Super. 274, 296

(App. Div. 2021). We are mindful that Rule 4:50-1 is "designed to reconcile the

strong interests in finality of judgments and judicial efficiency with the equitable

notion that courts should have authority to avoid an unjust result in any given

case." Guillaume, 209 N.J. at 467 (quoting Mancini v. EDS ex rel. N.J. Auto.

Full Ins. Underwriting Ass'n, 132 N.J. 330, 334 (1993)). Further, "[t]he

Legislature's objective to ensure fair and effective foreclosure proceedings

depends upon the careful oversight of our courts of equity and the active

participation of lenders and homeowners." Id. at 485. The record provides

insufficient support demonstrating Daria's motion to vacate under Rule 4:50-

1(d) was "made within a reasonable time." R. 4:50-2; see also Deutsche Bank

Tr. Co. Ams. v. Angeles, 428 N.J. Super. 315, 319 (App. Div. 2012).

To the extent that we have not addressed the parties' remaining

contentions, it is because they lack sufficient merit to be discussed in a written

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

Affirmed.

A-3826-23 12