Opinion
DOCKET NO. A-0145-14T4
01-25-2017
STEPHEN L. GILBERT, SPECIAL ADMINISTRATOR FOR THE ESTATE OF EDWIN O. GILBERT, Plaintiff-Respondent, v. ELLEN HEINE, Defendant-Appellant, and RUTHANN HUGHES, RICHARD HOLLER, EVELYN ROBERTS and ANDREW TUSCANO, Defendants-Respondents.
Ellen Heine, appellant pro se. Ruthann Hughes, Richard Holler, Evelyn Roberts, and Andrew Tuscano, respondents pro se. Capehart & Scatchard, P.A., attorneys for respondent Stephen L. Gilbert (Betsy G. Ramos, 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NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION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 Yannotti and Gilson. On appeal from Superior Court of New Jersey, Chancery Division, Bergen County, Docket No. C-0346-12. Ellen Heine, appellant pro se. Ruthann Hughes, Richard Holler, Evelyn Roberts, and Andrew Tuscano, respondents pro se. Capehart & Scatchard, P.A., attorneys for respondent Stephen L. Gilbert (Betsy G. Ramos, on the brief). PER CURIAM
Defendant Ellen Heine appeals from an order entered by the trial court on November 18, 2014, which denied her motion for reconsideration of an order entered on September 24, 2014, granting summary judgment to plaintiff and dismissing Heine's counterclaims. We affirm.
We briefly summarize the relevant facts and procedural history. In 2004, Dr. Edwin O. Gilbert and Heine entered into a contract which provided that Dr. Gilbert would sell Heine an interest in certain real property on Van Bussum Avenue in the City of Garfield (City). Thereafter, Heine made several payments to Dr. Gilbert pursuant to the agreement. In January 2007, Dr. Gilbert executed a deed transferring the property to himself and Heine as joint tenants with a right of survivorship. The deed was recorded in the Office of the Bergen County Clerk.
In April 2007, Dr. Gilbert's health began to deteriorate. Plaintiff, who is Dr. Gilbert's son, became concerned about his father's judgment. In 2009, Dr. Gilbert suffered a stroke that rendered him incapacitated, and plaintiff became Dr. Gilbert's legal guardian. Plaintiff then discovered the 2004 contract and the 2007 deed to the Van Bussum Avenue property. Plaintiff also learned that the City had issued certain maintenance violations regarding the property. It appears that Dr. Gilbert had paid for the property's utilities; Heine had received rental payments from the property; Dr. Gilbert had an outstanding equity line of credit secured by a mortgage on the property; and property taxes had not been paid. Dr. Gilbert had passed away in New Mexico, and plaintiff was named special administrator of his estate.
Plaintiff filed an action in the trial court seeking to: invalidate the 2007 deed; eject Heine from the property; and recover the property's carrying charges, rental income from the property, and attorney's fees. Heine filed an answer, a counterclaim for breach of contract, and a third-party complaint against the City. Thereafter, the court conducted a trial on the matter.
The court found that Dr. Gilbert was competent when he entered into the contract in 2004 and executed the deed to the property in 2007. The court determined that Heine had not exercised undue influence over Dr. Gilbert. The court determined that the 2004 agreement and the 2007 deed were valid.
The court awarded Heine title to the property provided that she satisfied Dr. Gilbert's outstanding financial obligation of about $46,000, and discharged the mortgage securing that obligation. The court gave Heine the option to assume and discharge the outstanding mortgage or sell the property.
The court also rejected plaintiff's claim for the carrying costs, rental income, and attorney's fees. In addition, the court dismissed defendant's third-party complaint against the City.
The court entered an order dated January 24, 2011, which required Heine to pay Dr. Gilbert's outstanding financial obligation and discharge the mortgage within ninety days. The order stated that if Heine failed to do so, the property would be sold, the mortgage satisfied, and the net proceeds from the sale paid to her. Heine appealed from the trial court's January 24, 2011 order, and plaintiff filed a cross-appeal.
It is undisputed that Heine did not pay Dr. Gilbert's financial obligation or discharge the mortgage on the property within the time required by the court's order. Accordingly, plaintiff filed a motion to enforce the court's January 24, 2011 order. The trial court considered the motion on July 22, 2011, and decided to enforce the order.
The court appointed a real estate broker, Douglas Opirhory, to market the property for sale and, in doing so, to determine the listing price. Heine was ordered to cooperate with Opirhory and proceed with the sale of the property. The court memorialized its decision in an order dated July 22, 2011.
On July 29, 2011, Opirhory advised the court that the property had a value of $75,000. Opirhory's evaluation indicated that Heine had allowed the property to be encumbered with a mortgage issued to Ruthann Hughes in the amount of $110,000. Opirhory advised the court that because of the Gilbert and Hughes mortgages, the property could not be marketed.
Plaintiff then filed a motion in aid of litigant's rights seeking to hold Heine in contempt for granting the mortgage to Hughes and recording it. Alternatively, plaintiff sought an order discharging the Hughes mortgage. Heine opposed the motion, and filed a cross motion seeking a stay of enforcement of the court's prior orders.
The trial court entered an order dated April 27, 2012, which denied plaintiff's motion to hold Heine in contempt. The court also denied the motion to discharge the Hughes mortgage without prejudice to plaintiff, which allowed plaintiff to seek relief in a separate action. The court's order also stated that if Heine received any monies from Dr. Gilbert's estate, those funds would first be applied to Dr. Gilbert's outstanding financial obligation and mortgage on the Van Bussum Avenue property.
Plaintiff thereafter filed a motion for reconsideration of the order denying his motion to hold Heine in contempt. Plaintiff argued that Heine failed to inform the court that she had not made any tax payments on the property since the third quarter of 2011, and that the City had issued numerous health and property code violations against the property.
Plaintiff also presented the court with a copy of Heine's tax appeal, in which she claimed that the property had no value. Plaintiff requested that the court hold Heine in contempt of court, and issue a bench warrant for her arrest until the Hughes mortgage is discharged. The court entered an order dated June 15, 2012, denying the motion.
On November 20, 2012, plaintiff filed an order to show cause and a complaint in this matter against Heine and Hughes, seeking an order invalidating the Hughes mortgage. At the oral argument on the order to show cause, which took place on February 19, 2013, Heine disclosed for the first time that she had granted three other mortgages against the property.
The mortgages were issued to: Richard Holler, in the amount of $32,000; Evelyn Roberts, in the amount of $45,000; and Andrew Tuscano, in the amount of $100,000. Roberts is Heine's sister, and Heine has long-standing, close friendships with the other defendants. Plaintiff later amended his complaint to add Holler, Roberts, and Tuscano as defendants. Heine filed an answer opposing the relief requested. She also filed various counterclaims against plaintiff.
On August 8, 2014, plaintiff filed a motion for summary judgment on his claims and defendant's counterclaims. The court filed an opinion and order dated September 24, 2014, granting the motion. The order cancelled and discharged the Hughes, Roberts, Holler, and Tuscano mortgages. The order also stated that the property must be sold in accordance with the court's July 22, 2011 order. Heine filed a notice of appeal from the court's September 24, 2014 order.
On October 16, 2014, defendants filed a motion for reconsideration of the trial court's September 24, 2014 order, and sought a stay of the court's order. On November 14, 2014, we dismissed Heine's appeal from the September 24, 2014 order for lack of prosecution. On November 18, 2014, the trial court filed an opinion and order denying the defendants' motion.
In December 2014, Heine filed a motion to reinstate her appeal and to amend the notice of appeal to include the November 18, 2014 order. The motion was granted, but the order stated that the appeal was limited to the November 18, 2014 order. In addition, in January 2015, Hughes, Holler, Roberts, and Tuscano filed a motion for leave to join in Heine's appeal. Their motion was denied, but they were allowed to file a brief in support of Heine's appeal.
Thereafter, this court filed an opinion affirming the trial court's order of January 24, 2011. Gilbert v. Heine, No. A-3719- 10 (App. Div. Apr. 29, 2015) (slip op. at 5-7). We rejected Heine's contention that the trial court erred by requiring that she assume Dr. Gilbert's financial obligation and discharge the mortgage securing that obligation. Ibid. (slip op. at 5-7). We also rejected plaintiff's contention that the court erred by failing to award him carrying charges, damages, and attorney's fees. Id. at 8-10.
On this appeal, Heine argues: (1) plaintiff did not have standing to seek the sale of the Van Bussum Avenue property; (2) an "abuse of discretion" standard must be applied in examining the validity of the mortgages; (3) there are "questions" about certain allegedly fraudulent documents; and (4) she was denied her rights under the Fifth and Fourteenth Amendments to the United States Constitution, and the New Jersey Civil Rights Act, N.J.S.A. 10:6-2. We reject these arguments and affirm.
In their brief, Hughes, Holler, Roberts, and Tuscano argue that: (1) Heine's motion satisfied the requirements for reconsideration because she presented the trial court with new information; (2) plaintiff does not have standing to bring this action because he is not a creditor and is a non-party to the transactions; (3) plaintiff failed to prove that the mortgages were fraudulent transfers; and (4) their statutory rights were violated by plaintiff's action to set aside the mortgages.
A trial court's order on a motion for reconsideration will not be set aside unless shown to be a mistaken exercise of discretion. Granata v. Broderick, 446 N.J. Super. 449, 468 (App. Div. 2016) (citing Fusco v. Bd. of Educ., 349 N.J. Super. 455, 462 (App. Div.), certif. denied, 174 N.J. 544 (2002)). Reconsideration should only be granted in those cases in which the court had based its decision "upon a palpably incorrect or irrational basis," or did not "consider, or failed to appreciate the significance of probative, competent evidence." Ibid. (quoting D'Atria v. D'Atria, 242 N.J. Super. 392, 401 (Ch. Div. 1990)).
As we have explained, Heine sought reconsideration of the trial court's September 24, 2014 order, which granted summary judgment in favor of plaintiff and set aside the Hughes, Roberts, Holler, and Tuscano mortgages. Summary judgment may be granted when there is no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law. R. 4:46-2(c); Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995).
As noted, the court found that the essential facts regarding the mortgages that Heine allowed to be placed on the Van Bussum Avenue property were undisputed. Based on those facts, the court determined that Heine had improperly allowed the property to be encumbered in order to thwart the sale of the property and payment of Dr. Gilbert's outstanding financial obligation.
The court found that Heine knew the property was the subject of prior court orders, and that it had to be sold. The court further found that when Heine issued the mortgages to Hughes, Roberts, Holler, and Tuscano, she "knew the property offered no security from the alleged loans and that the mortgages were worthless."
The court pointed out that, even so, Heine had allowed the property to be encumbered by the four mortgages to hinder the discharge of the mortgage that Dr. Gilbert placed on the property. The court determined that discharging and cancelling the Hughes, Roberts, Holler, and Tuscano mortgages would allow Dr. Gilbert's debt to be paid and the mortgage discharged in accordance with the court's prior orders.
Heine sought reconsideration of the court's September 24, 2014 order, arguing that new information showed that the court erred by stating that the property was worthless. Heine asserted that a property tax valuation on the property had been upheld, and evidence showed that the City had not condemned the property.
Heine also asserted that the City had issued an imminent hazard notice regarding the property, but this was not an act of the City's Fire Safety Department. She further asserted that the court's order should be stayed pending appeal because plaintiff did not have the power to sell the property, and Dr. Gilbert's will had not been probated.
In its opinion dated November 18, 2014, the court determined that reconsideration of its earlier order was not warranted. The court found that Heine had not presented any new probative or competent evidence warranting reconsideration of the prior order. The court noted that Heine could have submitted the evidence regarding the value of the property when plaintiff moved for summary judgment, but she had not done so.
The court determined that the allegedly "new" information would not affect the court's decision. The court stated that, "[a]t best [the so-called new evidence] may lead to the property being worth a marginal amount more than originally anticipated, but it does not defeat the ruling that" Heine made fraudulent transfers of her interest in the property to the other defendants. The court also stated that the newly-proffered information did not alter the court's determination that its prior orders should be enforced.
The record provides clear support for the court's September 24, 2014 order granting summary judgment to plaintiff and its order denying reconsideration. As we have explained, the court granted Heine title to the Van Bussum Avenue property, but did so on the condition that she assumed Dr. Gilbert's outstanding financial obligation and discharged the mortgage that he had placed on the property to secure that obligation.
It is undisputed that defendant failed to pay Dr. Gilbert's obligation and discharge the mortgage within the time prescribed, and the court thereafter entered orders compelling the sale of the property so that the debt could be paid and the mortgage discharged. Moreover, Opirhory informed the court that Heine had placed a mortgage upon the property in the amount of $110,000 in favor of Hughes.
As noted, Opirhory valued the property at $75,000, but he informed the court that with the outstanding Gilbert and Hughes mortgages, the property was not marketable. Plaintiff later learned that Heine also had allowed the property to be encumbered with three additional mortgages, totaling $177,000. The court noted that the outstanding mortgages far exceeded the value of the property.
The court thus determined that the Hughes, Roberts, Holler, and Tuscano mortgages were worthless and were issued by defendant for the purpose of hindering the payment and discharge of Dr. Gilbert's mortgage. The court properly found that the Hughes, Roberts, Holler, and Tuscano mortgages should be cancelled so that the property could be sold and Dr. Gilbert's mortgage discharged.
As the court noted, the so-called "new information" that Heine had provided to the court with her reconsideration motion had little bearing upon the court's finding that defendant made fraudulent transfers of her interest in the property to thwart the payment of Dr. Gilbert's debt and the enforcement of the prior court orders. The record supports the court's decision. We therefore conclude that the order denying Heine's motion for reconsideration was not a mistaken exercise of discretion.
We have considered Heine's other contentions, and the arguments raised by the other defendants, and find them to lack sufficient merit to warrant discussion. R. 2:11-3(e)(1)(E).
Affirmed. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION