U.S. BANK NATIONAL ASSOCIATION, ETC. VS. SUZANNAH COHEN (F-019846-13, BERGEN COUNTY AND STATEWIDE)

• Court: New Jersey Superior Court Appellate Division
• Decided: July 17, 2020
• Docket: A-4993-17T2
• Status: Unpublished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NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION This opinion shall not "constitute precedent or be binding upon any court."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-4993-17T2

U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE, ON BEHALF OF THE HOLDERS OF CSMC MORTGAGE-BACKED PASS-THROUGH CERTIFICATES, SERIES 2007-5,

Plaintiff-Respondent,

v.

SUZANNAH COHEN and YITZCHAK COHEN,

Defendants-Appellants,

and

MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., AS NOMINEE FOR FIRST MERIDIAN MORTGAGE, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., AS NOMINEE FOR SPECIALIZED LOAN SERVICING, LLC, VALLEY HOSPITAL, STATE OF NEW JERSEY, UNITED STATES OF AMERICA, Defendants.

Argued telephonically June 24, 2020 – Decided July 17, 2020

Before Judges Accurso and DeAlmeida.

On appeal from the Superior Court of New Jersey, Chancery Division, Bergen County, Docket No. F- 019846-13.

Michael M. Cohen argued the cause for appellants.

Anita Jeanne Murray argued the cause for respondent (Eckert Seamans Cherin & Mellott LLC, attorneys; Anita Jeanne Murray, on the brief).

PER CURIAM

Defendants Suzannah and Yitzchak Cohen appeal from a March 2018

final judgment of foreclosure on a complaint filed in June 2013 on a default

that occurred in September 2009. Following entry of summary judgment

striking defendants' answer and defenses and returning the case to the

Foreclosure Unit in January 2015, defendants submitted an application for a

loan modification to plaintiff U.S. Bank N.A. That application was denied,

and defendants insist they never sought another. But the record contains

several letters the bank's mortgage servicer sent defendants from early 2015

A-4993-17T2 2 through early 2017 about available programs to save their home, including

offering them a repayment plan.

While those efforts continued, the Foreclosure Unit dismissed the

complaint without prejudice for lack of prosecution under Rule 4:64-8 in April

2016. The bank moved to reinstate the action in October 2017 based on good

cause. Specifically, the bank contended it had put the foreclosure "on hold"

while it reviewed defendants for a loan modification pursuant to Consumer

Financial Protection Bureau regulations which prohibit "dual tracking" in

residential foreclosure actions. Defendants did not oppose the motion, and the

complaint was reinstated on October 13, 2017.

A month later, defendants moved to vacate the reinstatement contending

they only received notice of the motion after the order was entered, that there

were no serious loss mitigation efforts after 2015, and that the bank had

unconscionably delayed prosecuting the foreclosure and "tortured" defendants

by leading them to believe the case had been abandoned, only to reinstate it

without notice. The bank countered that defendants' delay in accepting

certified mail service did not defeat timely service, that defendants had never

advised they were not interested in a loan modification, and that they could

A-4993-17T2 3 hardly claim prejudice for being allowed to remain in a home for which they

had not paid the mortgage, taxes and insurance for eight years.

After hearing argument, Judge Toskos denied the motion. In a clear and

concise statement of reasons, the judge noted the regular mail to defendants

had not been returned, raising a presumption of timely service on the motion

record, notwithstanding defendants' failure to collect the certified mailing for

ten days after being advised of an attempted delivery. He also noted that

despite arguing that the prolonged foreclosure proceedings had caused them

"emotional distress and hardship," defendants urged "the best course forward

is to deny [r]einstatement of the foreclosure action and have the [p]laintiff file

a new complaint and start the entire process" all over again.

Accepting defense counsel's representation that defendants would be

presenting the same arguments had they had the full ten days to oppose

reinstatement, Judge Toskos found those arguments unpersuasive. The judge

found that even accepting defendants' argument that the federal regulations did

not apply, the court was satisfied the bank delayed pursuing entry of final

judgment "as part of a good faith effort to provide [d]efendants with a loan

modification." He further found defendants suffered no prejudice, and indeed,

A-4993-17T2 4 received a net benefit by being "provided with more time to remain in their

home without making mortgage payments."

Judge Toskos subsequently denied defendants' objection to final

judgment and entered the July 2018 judgment of foreclosure entitling the bank

to have the sum of $920,841.86 together with contract interest of 6.875% on

the $650,296.43 principal sum in default raised and paid out of sale of the

mortgaged premises. Defendants initially appealed only the 2017 orders to

reinstate, triggering finality review in the clerk's office. When defendants

failed to respond to the inquiry, the appeal was dismissed for failure to

prosecute in August 2018. We ordered the appeal reinstated on defendants'

motion in November 2018. It was dismissed again, however, in April 2019,

following defendant Yitzchak Cohen's voluntary Chapter 13 petition on the

eve of the scheduled sheriff's sale. Following dismissal of the petition by the

bankruptcy court, we again reinstated the appeal on defendants' motion in

September 2019.

On appeal, defendants contend the trial court erred in denying their

motion to vacate reinstatement of the foreclosure, reprising the arguments they

made to the judge that they were not permitted a full ten days to respond to the

bank's motion, that the bank failed to show good cause for reinstatement, that

A-4993-17T2 5 purported lack of prejudice to defendants cannot suffice for good cause under

Rule 4:64-8, and that their motion to vacate should have been granted because

the bank's opposition to it was untimely filed. They also add an argument not

raised to the trial court, that they were entitled to attorney's fees on their

unsuccessful motion to vacate reinstatement based on their view that the bank's

motion to reinstate the action "was completely baseless."

We reject those arguments as entirely without merit, not warranting

discussion in a written opinion. See R. 2:11-3(e)(1)(E). Having considered

defendants' arguments and reviewed the record on the motion, we affirm the

judgment of foreclosure. Defendants do not contest that their 2006, $524,000

purchase money mortgage has been in default since September 2009. They

have fully litigated this foreclosure at every step of the process. As we noted

in Deutsche Bank Tr. Co. Ams. v. Angeles, 428 N.J. Super. 315, 320 (App.

Div. 2012), "[i]n foreclosure matters, equity must be applied to plaintiffs as

well as defendants." Reinstatement of the action did not violate the letter or

spirit of Rule 4:64-8.

Affirmed.

A-4993-17T2 6