Opinion
DOCKET NO. A-5698-14T1
11-28-2016
MOUNTAIN STATES ADJUSTMENT, A DIVISION OF MS SERVICES, LLC, ASSIGNEE OF BANK OF THE WEST (assignee of MarineMax), Plaintiff-Respondent, v. BARRY SERGEANT, Defendant-Appellant.
Michael Confusione argued the cause for appellant (Hegge & Confusione, LLC, attorneys; Mr. Confusione, of counsel and on the brief). Alicia M. Sandoval argued the cause for respondent (Mattleman, Weinroth & Miller, P.C., attorneys; Ms. Sandoval, of counsel and on the brief).
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION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. Before Judges Hoffman and O'Connor. On appeal from Superior Court of New Jersey, Law Division, Somerset County, Docket No. L-1070-13. Michael Confusione argued the cause for appellant (Hegge & Confusione, LLC, attorneys; Mr. Confusione, of counsel and on the brief). Alicia M. Sandoval argued the cause for respondent (Mattleman, Weinroth & Miller, P.C., attorneys; Ms. Sandoval, of counsel and on the brief). PER CURIAM
Defendant appeals from the July 27, 2015 Law Division order denying his motion to vacate a December 18, 2014 order granting summary judgment for plaintiff, entered on its collection claim. We affirm.
I.
We derive the following facts from the record. On July 31, 2006, defendant entered into a retail installment contract and security agreement (collectively, "the loan agreement") with MarineMax for the purchase of a boat and two motors. On that same date, MarineMax assigned its interest in the loan agreement to Bank of the West. Under the loan agreement terms, defendant received financing in the amount of $67,204.65 at an interest rate of 7.5% and agreed to make payments of $541.40 per month for 240 months, beginning on August 30, 2006.
Defendant defaulted under the terms of the loan agreement by failing to make payments as they became due. The transaction history sheet from Bank of the West shows defendant made payments from August 30, 2006, until July 14, 2011. Defendant's last payment left a $60,519.11 balance due.
On April 9, 2013, Bank of the West assigned its interest in the loan agreement to MS Services, LLC, of which plaintiff is a division, for purposes of collection. Plaintiff filed a complaint against defendant on August 8, 2013, seeking replevin of the boat and two motors, and damages of $88,349.61 for breach of contract. Plaintiff served defendant with interrogatories, requesting defendant identify any expert witnesses. Defendant answered the interrogatories, but did not identify any experts.
Plaintiff states when it received the assignment, interest on the amount due totaled $18,752.63, increasing the overall balance from $60,519.11 to $79,271.74. Furthermore, under the terms of the loan agreement, defendant was obligated upon default to pay attorneys' fees not in excess of fifteen percent of the amount due at the point the loan agreement was referred to an attorney for collection. Plaintiff calculated the attorney fee as $9,077.87, making the total balance $88,349.61 at the time of filing. --------
Plaintiff then moved for summary judgment. The court granted plaintiff's motion, awarding plaintiff $88,349.61 on its breach of contract claim, but it denied plaintiff's application for replevin of the boat and two motors (plaintiff later withdrew its replevin claim). Plaintiff then moved to amend the judgment to $95,950.45 to include contract interest, and defendant filed a cross-motion for reconsideration and possession of chattels. The court granted plaintiff's motion and denied defendant's motions on April 24, 2015.
Defendant subsequently moved to vacate the summary judgment, pursuant to Rule 4:50-1, and to quash an information subpoena served by plaintiff. Defendant asked the court to vacate judgment, in relevant part, on the grounds of excusable neglect, Rule 4:50-1(a), and newly discovered evidence, Rule 4:50-1(b). Defendant disputed the amount of the final judgment, asserting miscalculations on the interest on his partial payments. In support of this claim, defendant provided a new interest calculation from a certified public accountant (CPA), stating:
2. Eugene Neseralla is the Certified Public Accountant who found both the balance and interest discrepancies. The information below is compiled from Discovery documents [certified] by Alicia Sandoval — see Exhibit A, Exhibit B and Exhibit C.Defendant certified he obtained these expert calculations just before filing his motion to vacate.
Exhibit A
Charge-off $66,634.14
Recovered $7,176.00
Costs $305.00
Interest $755.97, 10.11%
Balance $60,519.11
Exhibit B
Amounts received by Bank of the West, Recovery Dept. $8,209.60
Recovery Dept. received payments between 04/07/09 and 07/14/11[.]
3. Recovered amount is incorrect (recovery amount should be $8,209.60 not $7,176), the interest rate is incorrect (Exhibit C, should be 7.5% not 10.11%) and the $305 cost can NOT be included in the interest calculation. These inaccuracies impact all of the resulting judgment and interest amounts[.]
Defendant also argued the judgment should be vacated because plaintiff failed to obtain a "New Jersey Collection Agency License Surety Bond" (the bond) before proceeding with suit, in violation of N.J.S.A. 45:18-1. Specifically, defendant alleged plaintiff did not acquire the bond until 2015, one year after initiating suit against defendant, and therefore it did not have the right to act as a collection agency against defendant or bring suit.
The motion court denied defendant's motion to vacate on July 27, 2015, holding an allegedly incorrect calculation is not a basis for relief under Rule 4:50-1. The court further declined to consider the miscalculation as newly discovered evidence, noting defendant could have retained a CPA to produce these calculations before the summary judgment motion was decided. Regarding the bond, the court held the statute did not apply to this matter, as it contains an exemption stating it "shall not apply to an attorney at law." See N.J.S.A. 45:18-6. The court also held the statute was not a basis to vacate the judgment pursuant to either Rule 4:50-1(c), (d), or (f). This appeal followed.
II.
On appeal, defendant argues the motion judge erred by denying Rule 4:50-1 relief based on (1) the alleged interest miscalculation and (2) plaintiff's failure to file the bond. We disagree.
Rule 4:50-1 permits a court to relieve a party from a final judgment for the following reasons:
(a) mistake, inadvertence, surprise, or excusable neglect; (b) newly discovered evidence which would probably alter the judgment or order and which by due diligence could not have been discovered in time to move for a new trial under R. 4:49; (c) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party; (d) the judgment or order is void; (e) the judgment or order has been satisfied, released or discharged, or a prior judgment or order upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment or order should have prospective application; or (f) any other reason justifying relief from the operation of the judgment or order.
[R. 4:50-1.]
"Courts should use Rule 4:50-1 sparingly, in exceptional situations[,]" in order to prevent injustice. Hous. Auth. of Morristown v. Little, 135 N.J. 274, 289 (1994). 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." Mancini v. EDS ex rel. N.J. Auto. Full Ins. Underwriting Ass'n, 132 N.J. 330, 334 (1993) (quoting Baumann v. Marinaro, 95 N.J. 380, 392 (1984)). We will not reverse the trial court's decision on appellate review "unless it represents a clear abuse of discretion." DEG, LLC v. Twp. of Fairfield, 198 N.J. 242, 261 (2009) (quoting Hous. Auth. of Morristown, supra, 135 N.J. at 283). Abuse of discretion occurs where a decision is "made without a rational explanation, inexplicably departed from established policies, or rested on an impermissible basis." U.S. Bank Nat'l Ass'n v. Guillaume, 209 N.J. 449, 467 (2012) (quoting Iliadis v. Wal-Mart Stores, Inc., 191 N.J. 88, 123 (2007)).
Defendant argues the motion court should have vacated the judgment due to the alleged miscalculation under three different subsections of Rule 4:50-1: subsection (a) (mistake), subsection (b) (newly discovered evidence), and subsection (c) (misrepresentation).
First, under Rule 4:50-1(a), defendant did not establish the alleged miscalculation constituted a "mistake" warranting relief. Our Supreme Court has held a difference of expert opinion does not constitute a mistake sufficient to vacate judgment under Rule 4:50-1(a), nor is there a basis to vacate where it is unclear whether factual errors actually occurred. DEG, supra, 198 N.J. at 262-63. Defendant argues his CPA's interest calculations were not merely a difference in expert opinion, but "showed that the calculations underlying the amount of the judgment entered against defendant [were] wrong." However, defendant failed to provide a figure for the "correct" judgment amount, only contending the alleged inaccuracies "impact[ed]" the resulting calculations. Defendant also failed to provide a clear explanation of his expert's calculations and conclusions.
Conversely, in support of its motion for summary judgment, plaintiff provided a certification from managing partner Dan Price, stating defendant's principal balance owed was $60,519.11 ($88,349.61 including interest and attorney's fees). The transaction history sheet from Bank of the West shows this number comes from the balance due after defendant stopped making payments. We find these documents do not establish a mistake but a difference in expert opinion. DEG, supra, 198 N.J. at 262.
Moreover, Rule 4:50-1(a) is intended to correct the type of mistake "that a party could not have protected against." DEG, supra, 198 N.J. at 263 (quoting Cashner v. Freedom Stores, Inc., 98 F.3d 572, 577 (10th Cir. 1996)); see also Hendricks v. A.J. Ross Co., 232 N.J. Super. 243, 249 (App. Div. 1989) ("[C]ounsel's failure to assert [a] claim earlier in the litigation is not the kind of 'mistake' for which a litigant is entitled to relief under R. 4:50-1(a)."). As the motion court noted, defendant could have hired a CPA to challenge these figures prior to his motion to vacate. Defendant provides no explanation for his failure to do so. Although defendant appears to have been self-represented until this appeal, "[p]ro se litigants are not entitled to greater rights than litigants who are represented by counsel." Ridge at Back Brook, LLC v. Klenert, 4 37 N.J. Super. 90, 99 (App. Div. 2014) (citing Rubin v. Rubin, 188 N.J. Super. 155, 159 (App. Div. 1982)). Because defendant could have "protected against" this alleged mistake, we decline to vacate the judgment on this basis.
We also reject defendant's argument his new CPA calculations were newly discovered evidence under Rule 4:50-1(b). To prevail under this subsection, the moving party must show "that the evidence would probably have changed the result, that it was unobtainable by the exercise of due diligence for use at the trial, and that the evidence was not merely cumulative." DEG, supra, 198 N.J. at 264 (quoting Quick Chek Food Stores v. Twp. of Springfield, 83 N.J. 438, 445 (1980)). The party seeking relief must satisfy all three requirements. Ibid. Moreover, this category of newly discovered evidence "does not include an attempt to remedy a belated realization of the inaccuracy of an adversary's proofs." Ibid. (citing Posta v. Chung-Loy, 306 N.J. Super. 182, 206 (App. Div. 1997), certif. denied, 154 N.J. 609 (1998)). We conclude defendant's motion belatedly attempted to correct an alleged inaccuracy, which he could have addressed earlier had he exercised proper due diligence.
Defendant further asserts the motion court should have granted relief under Rule 4:50-1(c) on the basis plaintiff's presentation of the incorrect calculation constituted a "misrepresentation." This contention lacks merit. Defendant provides no support for this claim; he merely makes a one-sentence conclusory allegation.
We find equally meritless defendant's argument that plaintiff's judgment should be vacated because plaintiff failed to file the required bond. The statute provides:
No person shall conduct a collection agency, collection bureau or collection office in this state, or engage therein in the business of collecting or receiving payment for others of any account, bill or other indebtedness, . . . unless such person, or the person for whom he may be acting as agent has on file with the secretary of state sufficient bond as hereinafter specified.
[N. J.S.A. 45:18-1.]
The motion court found the statute did not apply to this matter, noting the statute provides an exemption, which states, "This chapter shall not apply to an attorney at law duly authorized to practice in this state, a national bank, or any bank or trust company duly incorporated under the laws of this state." N.J.S.A. 45:18-6. The motion court found plaintiff was exempted from this statute, presumably because the law firm Mattleman, Weinroth & Miller, P.C., conducted the collection by way of this litigation. We discern no basis to disturb this determination.
Defendant further argues we should vacate plaintiff's judgment because it creates an inequitable result under Rule 4:50- 1(f) ("any other reason justifying relief from the operation of the judgment or order."). Indeed, courts can vacate a judgment under subsection (f) in exceptional circumstances where the result would be "unjust, oppressive, or inequitable." Harrington v. Harrington, 281 N.J. Super. 39, 48 (App. Div.) (citations omitted), certif. denied, 142 N.J. 455 (1995); see also DEG, supra, 198 N.J. at 269-70. However, we discern no abuse of discretion in the motion court's finding that no such injustice or exceptional circumstance occurred here.
Moreover, there is no dispute defendant failed to pay the amount due under the loan agreement. We are satisfied defendant demonstrated no reasonable mistakes, excusable neglect, or exceptional circumstances warranting relief under Rule 4:50-1. We perceive no abuse of discretion in the court's denial of his motion to vacate.
Affirmed. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION