STATE OF NEW JERSEY v. AMBOY NATIONAL BANK (L-5279-10, MONMOUTH COUNTY AND STATEWIDE)

• Court: New Jersey Superior Court Appellate Division
• Decided: May 29, 2019
• Docket: A-0487-17T3
• Status: Unpublished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NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court."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-0487-17T3

STATE OF NEW JERSEY,

Plaintiff-Respondent,

v.

AMBOY NATIONAL BANK ACCOUNT NUMBER XXX-XXXX-2 VALUED AT FOUR HUNDRED THIRTY-SIX THOUSAND EIGHT HUNDRED FORTY-FIVE DOLLARS AND EIGHTY-SIX CENTS IN UNITED STATES CURRENCY, AMBOY NATIONAL BANK ACCOUNT NUMBER XXX-XXXX-4 VALUED AT THREE HUNDRED EIGHTY-TWO THOUSAND THREE HUNDRED NINETY-EIGHT DOLLARS AND FOURTEEN CENTS IN UNITED STATES CURRENCY, AMBOY NATIONAL BANK ACCOUNT XXX-XXXX-5 VALUED AT SEVENTEEN THOUSAND NINE HUNDRED FIFTY DOLLARS AND FOURTEEN CENTS IN UNITED STATES CURRENCY, and EIGHT THOUSAND EIGHT HUNDRED FORTY-FIVE DOLLARS IN UNITED STATES CURRENCY, Defendants. ________________________________

Argued April 9, 2019 – Decided May 29, 2019

Before Judges Yannotti and Gilson.

On appeal from Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-5279-10.

Ralph Peter Ferrara argued the cause for appellants John R. Bovery, Jr. and Mary Bovery (Ferrara Law Group, PC, attorneys; Ralph Peter Ferrara and Kevin James Kotch, of counsel and on the briefs).

Carey J. Huff, Assistant Prosecutor, argued the cause for respondent (Christopher J. Gramiccioni, Monmouth County Prosecutor, attorney; Carey J. Huff, of counsel and on the brief).

PER CURIAM

This is the second appeal in this civil forfeiture action. In 2010, the State

seized just over $846,000 from the bank accounts and residence of the claimants

John R. Bovery, Jr. (Bovery) and his wife Mary Bovery (collectively,

claimants). The State then filed a civil forfeiture action, contending that

claimants obtained the seized funds from illegal sports pools. In 2014, the trial

court granted summary judgment to the State finding that the seizure was valid

and the claimants had failed to show that any of the funds came from legal

sources. We affirmed that final summary judgment order. State v. Amboy Nat'l

A-0487-17T3 2 Bank Account No. XXX-XXXX-2, 447 N.J. Super. 142 (App. Div. 2016). The

Supreme Court denied claimants' petition for certification. State v. Amboy Nat'l

Bank Account No. XXX-XXXX-2, 228 N.J. 249 (2016).

In 2017, claimants moved to open and vacate the final summary judgment

order, contending that the State had admitted that just over $26,000 of the seized

funds had come from legal sources. Initially, the trial court granted that motion

because it was not opposed. Thereafter, the State moved for reconsideration. In

an order entered on June 23, 2017, the trial court granted the State's motion for

reconsideration and denied claimant's motion to open and vacate the final

summary judgment order. Claimants now appeal from the June 23, 2017 order

and a September 14, 2017 order denying their motion for reconsideration. We

affirm. The trial court properly granted the State's motion for reconsideration.

The court also correctly ruled that claimants had not established a basis to open

and vacate the prior final summary judgment order.

I.

We have previously detailed the facts giving rise to this forfeiture action

and the related criminal charges against Bovery. See Amboy Nat'l Bank

Account No. XXX-XXXX-2, 447 N.J. Super. at 148-54. Accordingly, we will

only summarize some of the more relevant facts and procedural history.

A-0487-17T3 3 For approximately twenty years, Bovery organized sports pools. There

were thousands of participants in the pools who paid entry fees ranging from

$20 to $100. During the 2009 to 2010 "pool cycle," Bovery collected just over

$1.7 million in pool entry fees. The winners of the pools would then usually

pay a "gift" of approximately ten percent of the winnings to Bovery for operating

the pool. Bovery did not report the "gifts" he received as income to federal or

state taxing authorities.

Bovery deposited the entry fees from the pools into bank accounts he

controlled. In 2010, law enforcement officers became aware of Bovery's

operations, and they interviewed him. Thereafter, law enforcement officers

obtained warrants to seize three bank accounts held by claimants at Amboy

National Bank and to search their residence. When the warrants were executed

in September 2010, $846,039.14 was seized. Specifically, $436,845.86 was

seized from one bank account, $382,398.14 was seized from another account,

$17,950.14 was seized from a third account, and $8845 was seized from

Bovery's home and person. Of the monies seized, it was undisputed that

$722,000 came from players' entry fees and the remainder of approximately

$124,000 was alleged to be claimants' personal funds. The State maintained that

those personal funds were derived from illegal gifts for operating the sports

A-0487-17T3 4 pools. In contrast, Bovery contended that the $124,000 contained some money

that had been derived from legal sources.

After seizing the funds, the State instituted this forfeiture action. The

parties then engaged in and completed discovery. Thereafter, the State and

claimants filed motions for summary judgment. On June 10, 2014, the trial court

entered summary judgment in favor of the State and denied claimants' motion

for summary judgment. Claimants moved for reconsideration, but the trial court

denied that motion. Claimants then filed their first appeal.

As previously noted, in August 2016, we affirmed the grant of summary

judgment to the State. We held that the sports pools operated by Bovery were

illegal forms of gambling and that the State had demonstrated "a direct causal

connection between the seized funds and an indictable offense." Amboy Nat'l

Bank Account No. XXX-XXXX-2, 447 N.J. Super. at 162. In evaluating

whether the seizure of the entire $846,039.14 was appropriate, we concluded

that "claimants failed to present a genuine issue of fact that an identifiable

amount of the money seized was attributable to a legitimate source." Id. at 164.

In that regard, we noted that it was "claimants' burden to present 'sufficient

credible evidence to allocate the funds between illegal and legal purposes '" and

A-0487-17T3 5 we determined that the claimants had not met that burden. Id. at 165 (quoting

State v. Seven Thousand Dollars, 136 N.J. 223, 238 (1994)).

While the forfeiture action was proceeding, related criminal charges were

brought against Bovery. In February 2011, a grand jury indicted Bovery for

first-degree money laundering, N.J.S.A. 2C:21-25, and third-degree promotion

of gambling, N.J.S.A. 2C:37-2. Following plea negotiations, in April 2016,

Bovery pled guilty to an amended charge of third-degree possession of gambling

records, N.J.S.A. 2C:37-3. In pleading guilty, Bovery requested, and the court

granted, a civil reservation that prevented his criminal admission from being

used as evidence in any civil proceeding, including the forfeiture action.

In accordance with his plea agreement, Bovery was admitted into the

Pretrial Intervention Program (PTI) for six months. Bovery completed PTI and,

on November 16, 2016, the criminal charge against him was dismissed.

On April 7, 2017, claimants filed a motion to vacate the final order

granting summary judgment to the State in the civil forfeiture action. On April

28, 2017, the trial court granted claimants' motion because there was no

opposition from the State. Accordingly, the court entered an order vacating the

June 10, 2014 order that granted summary judgment in favor of the State. The

trial court also reopened the forfeiture matter. In issuing the order dated April

A-0487-17T3 6 28, 2017, the trial court did not give an oral or written statement of reasons

explaining its decision to vacate the summary judgment order and to reopen the

matter.

On May 17, 2017, the State filed a motion seeking reconsideration of the

April 28, 2017 order. In support of that motion, the State filed three

certifications and two affidavits from members of the Monmouth County

Prosecutor's Office, who represented that the State had not received the

claimants' motion seeking to vacate the final order and reopen the forfeiture

action.

On June 23, 2017, the trial court heard oral argument on the State's motion

for reconsideration. The court granted that motion and also heard argument on

claimants' motion to vacate the final order in the forfeiture matter. That same

day, the trial court issued a written statement of reasons and order memorializing

its decision to grant the State's motion for reconsideration and denying

claimants' motion to vacate the prior final order. Accordingly, the June 23, 2017

order vacated the trial court's order of April 28, 2017, and denied claimant's

motion to vacate the June 10, 2014 order that had granted summary judgment to

the State.

A-0487-17T3 7 Claimants moved for reconsideration. The trial court, however, denied

that motion in an order entered on September 14, 2017. The trial court also

issued a written statement of reasons in support of its September 14, 2017 order.

II.

Claimants appeal from the orders entered on June 23, 2017 and September

14, 2017. On this second appeal, claimants make two primary arguments. First,

they contend that the State was properly served with their motion to vacate and,

therefore, there was no basis to grant reconsideration. Second, claimants argue

that the trial court erred in refusing to vacate the summary judgment order

entered on June 10, 2014. We are not persuaded by either of these arguments.

A. The State's Motion for Reconsideration

We will not disturb an order concerning a motion for reconsideration

absent an abuse of discretion. Brunt v. Bd. of Trs., Police & Firemen's Ret. Sys.,

455 N.J. Super. 357, 362 (App. Div. 2018). An abuse of discretion occurs "when

a decision is 'made without a rational explanation, inexplicably depart[s] from

established policies, or rest[s] on an impermissible basis.'" Ibid. (quoting Pitney

Bowes Bank, Inc. v. ABC Caging Fulfillment, 440 N.J. Super. 378, 382 (App.

Div. 2015)).

A-0487-17T3 8 A party may move for reconsideration of an order in accordance with Rule

4:49-2 when (1) the court's decision was based on "a palpably incorrect or

irrational basis," or (2) the court failed to consider or "appreciate the

significance of probative, competent evidence[.]" Cummings v. Bahr, 295 N.J.

Super. 374, 384 (App. Div. 1996) (quoting D'Atria v. D'Atria, 242 N.J. Super.

392, 401 (Ch. Div. 1990)). "Alternatively, if a litigant wishes to bring new or

additional information to the [c]ourt's attention which it could not have provided

on the first application, the [c]ourt should, in the interest of justice (and in the

exercise of sound discretion), consider the evidence." Ibid. (quoting D'Atria,

242 N.J. Super. at 401).

Here, the trial court's decision to grant the motion for reconsideration to

the State was not an abuse of discretion for two reasons. First, the State

established that it did not receive notice of claimants' motion to vacate. There

is "a presumption that mail properly addressed, stamped, and posted was

received by the party to whom it was addressed." SSI Med. Servs., Inc. v. Dep't

of Human Servs., 146 N.J. 614, 621 (1996). The trial court here did not abuse

its discretion in finding that the State had rebutted the presumption of receipt.

In that regard, the State submitted affidavits and certifications from five

employees of the Monmouth County Prosecutor's Office, all of whom swore or

A-0487-17T3 9 certified that they did not receive a copy of claimants' motion to vacate. Thus,

the trial court properly exercised its discretion to reconsider an order that it had

entered merely because there was no opposition.

Second, in entering its order dated April 28, 2017, the trial court did not

provide any reasons for granting the motion. Rule 1:7-4 states that the court

"shall" make written or oral findings of facts and state its conclusions of law on

every motion decided by a written order that is appealable as of right, and also

as required by Rule 3:29. Even when a substantive motion is unopposed, factual

findings and conclusions of law are required. See Allstate Ins. Co. v. Fisher,

408 N.J. Super. 289, 300-01 (App. Div. 2009) (explaining that trial courts are

not relieved from the obligation to make findings of fact and conclusions of law

when a substantive motion is unopposed). Without a statement of reasons, there

is no way for the parties or us to know what the basis of the trial court's decision

was in vacating the final order. Accordingly, the trial court did not abuse its

discretion in granting reconsideration of an order that was not supported by

findings of fact or conclusions of law.

B. Claimants' Motion to Vacate the 2014 Final Order Granting Summary Judgment to the State

Claimants contend that they are entitled to vacate the final summary

judgment order entered on June 10, 2014. In that regard, they rely on Rule 4:50-

A-0487-17T3 10 1(f), asserting that the State admitted that at least some portion of the seized

money was not associated with the illegal sports pools.

Appellate courts grant "substantial deference" to a determination to vacate

a judgment under Rule 4:50-1 and will not reverse the trial court's decision

"unless it results in a clear abuse of discretion." US Bank Nat'l Ass'n v.

Guillaume, 209 N.J. 449, 467 (2012). As previously noted, a decision

constitutes an abuse of discretion when it is "made without a rational

explanation, inexplicably depart[s] from established policies, or rest[s] on an

impermissible basis." Id. at 467-68 (quoting Iliadis v. Wal-Mart Stores, Inc.,

191 N.J. 88, 123 (2007)).

Here, claimants argue that they are entitled to relief from the June 10,

2014 final summary judgment order under subsection (f) of Rule 4:50-1.

Subsection (f) provides that a party is entitled to relief for "any other reason

justifying relief from the operation of the judgment or order." R. 4:50-1(f).

Such relief, however, "is available only when 'truly exceptional circumstances

are present.'" Guillaume, 209 N.J. at 484 (quoting Hous. Auth. of Morristown

v. Little, 135 N.J. 274, 286 (1994)). "In such 'exceptional circumstances,' Rule

4:50-1(f) is 'as expansive as the need to achieve equity and justice.'" Ibid.

(quoting Court Inv. Co. v. Perillo, 48 N.J. 334, 341 (1966)). "In determining

A-0487-17T3 11 whether relief is warranted under this section of the rule, courts focus on

equitable considerations." Nowosleska v. Steele, 400 N.J. Super. 297, 303 (App.

Div. 2008) (citing Little, 135 N.J. at 294). "Generally, relief under subsection

(f) is applied 'sparingly, in exceptional situations' to prevent grave injustice."

Id. at 304 (quoting Cmty. Realty Mgmt., Inc. v. Harris, 155 N.J. 212, 237

(1998)).

Here, claimants contend there are exceptional circumstances because the

State allegedly admitted that some of the seized funds came from legal sources.

The new evidence they cite for that contention is a certification from their

counsel. In claimants' counsel's certification, he contends that during plea and

settlement negotiations, which occurred in March 2016, the then-Acting

Monmouth County Prosecutor and several assistant prosecutors "admitted that

at least $26,795 of the [seized] money at issue was in no way associated with

the alleged illegal pools[.]"

The trial court correctly ruled that claimants' counsel's hearsay statements

concerning what members of the prosecutor's office stated during settlement and

plea negotiations were inadmissible. "[S]tatements made by parties during

settlement negotiations are generally inadmissible in subsequent proceedings,

A-0487-17T3 12 N.J.R.E. 408, as are most statements made during criminal plea negotiations,

N.J.R.E. 410." State v. Williams, 184 N.J. 432, 449 (2005).

Here, claimants contend that the statements by members of the

prosecutor's office demonstrate that the State "obstructed justice and acted in

bad faith." That contention is not supported by the record for two reasons. First,

claimants are seeking to admit hearsay statements made during settlement and

plea negotiations. Such statements are inadmissible. See N.J.R.E. 408

(providing that "evidence of statements or conduct by parties or their attorneys

in settlement negotiations, . . . including offers of compromise or any payment

in settlement of a related claim, shall not be admissible to prove liability for, or

invalidity of, or amount of the disputed claim"); N.J.R.E. 410 (providing similar

protections as Rule 408 to criminal defendants and the State in the context of

plea negotiations); Williams, 184 N.J. at 447-49; Kas Oriental Rugs, Inc. v.

Ellman, 394 N.J. Super. 278, 283, 288 (App. Div. 2007).

Second, the assertions in claimants' counsel's certification are rebutted by

the record. In an exchange of emails in March 2016, the State made clear that

it was not admitting that some of the seized funds were derived from legal

sources; rather, it was open, as part of settlement discussions, to consider

A-0487-17T3 13 claimants' position that a relatively small portion of the seized funds may have

come from legal sources.

In short, having reviewed the entire record, and having considered the

contentions of the parties, we conclude that the trial court properly exercised its

discretion in granting reconsideration to the State and in denying claimants'

motion to vacate and open the previously-entered final order.

Affirmed.

A-0487-17T3 14