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New Jersey’s Appellate Division Affirms Summary Judgment in Contested Foreclosure Action

On October 16, 2018, in Deutsche Bank National Trust Company Americas v. Janet Spinelli (Docket No. A-3642-16T4), New Jersey’s Appellate Division affirmed a trial court decision that granted Plaintiff’s motion for summary judgment and to strike defendant’s answer, and denied defendant’s cross-motion to dismiss the complaint. 

The appeal was filed by defendant Louis Spinelli (“Defendant”), who executed the subject mortgage along with Janet Spinelli.  Only Ms. Spinelli, however, executed the note.  On appeal, Defendant argued that: (1) he did not receive notice of assignment of the mortgage to Plaintiff; (2) the Notice of Intention to Foreclosure (“NOI”) violated New Jersey’s Fair Foreclosure Act, N.J.S.A. 2A:50-53, et. seq. (“FFA”); (3) Plaintiff lacked standing because it did not possess the original note; 4) Plaintiff did not execute the assignment, and did not have legal title or the ability to foreclose; and (5) the lower court applied the wrong standard to adjudicate Defendant’s motion to dismiss.

In affirming the lower court’s decision, the Appellate Division highlighted some of the basic tenants of New Jersey foreclosures.  The decision includes a brief overview of the caselaw, and of N.J.S.A. 12A:3-301, where standing is derived from in a foreclosure action.  The Court noted that “standing may be established through ‘either possession of the note or an assignment of the mortgage that predated the original complaint.’”  Further, the Court confirmed that there is no requirement that a mortgagor receive notice of a mortgage assignment, and that the Defendant specifically acknowledged when he signed the mortgage that it could be assigned. 

The Appellate Division also rejected Defendant’s argument that the NOI was invalid under the FFA, and conducted an analysis on the requirements of the NOI under the statute.  Defendant argued, in part, that the NOI was defective because the name of the loan servicer was listed, based on the holding US Bank Nat’l Ass’n v. Guillaume, 209 N.J. 449 (2012).  The Court distinguished Guillaume from this case because, in addition to the name of the loan servicer, the name and address of the mortgagee were also present on the NOI.

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