                                NOT FOR PUBLICATION WITHOUT THE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-3360-17T2

FORECLOSED ASSETS SALES
AND TRANSFER PARTNERSHIP,

          Plaintiff-Appellant,

v.

RICHARD M. STRAUSS,

          Defendant-Respondent,

and

ANNE ERLICHMAN, and OCEAN
FRONT CONDOMINIUM
ASSOCIATION,

     Defendants.
_______________________________

                    Submitted February 5, 2019 – Decided March 8, 2019

                    Before Judges Hoffman and Firko.

                    On appeal from Superior Court of New Jersey, Law
                    Division, Atlantic County, Docket No. L-0373-17.

                    Powers Kirn, LLC, attorneys for appellant (Jeanette J.
                    O'Donnell, on the brief).
             Respondent has not filed a brief.

PER CURIAM

       Plaintiff Foreclosed Assets Sales & Transfer Partnership appeals from a

Law Division order denying its motion for summary judgment in this deficiency

action following the mortgage foreclosure of defendant Richard M. Strauss'

condominium located in Brigantine. 1 We affirm.

                                        I.

       This appeal arises from the following facts derived from evidence the

parties submitted in support of, and in opposition to, summary judgment, viewed

in a light most favorable to defendant, the non-moving party. Polzo v. Cty. of

Essex, 209 N.J. 51, 56-57 n.1 (2012) (citing Brill v. Guardian Life Ins. Co. of

Am., 142 N.J. 520, 523 (1995)). Defendant executed a note for $125,000 to Sun

National Bank that was recorded in the Atlantic County Clerk's office. Plaintiff

is the assignee of Sun National Bank by virtue of an assignment recorded on

March 19, 2015. A final judgment was entered in the Office of Foreclosure on

June 25, 2016, in the amount of $133,123.43. At the sheriff's sale on November

17, 2016, the property was sold back to plaintiff for $1000. As of the date of

the sheriff's sale, defendant owed $134,305.13 as a result of the judgment plus


1
    An order was entered suppressing an appellate brief from defendant.
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                                        2
post-judgment interest. The sheriff's deed was recorded on December 21, 2016,

and a deed from Apex Bank to plaintiff was recorded on February 21, 2017.

      On February 8, 2017, plaintiff sent via regular mail a Notice of Proposed

Deficiency Action (Notice) and a check for filing fees to the Atlantic County

Clerk's office in accordance with N.J.S.A. 2A:50-6. The statute provides:

            No judgment shall be entered by confession on any
            bond or note where a mortgage on real estate has been
            or may be given for the same debt or in any action on
            the bond or note, unless, prior to the entry of the
            judgment, if by confession, or prior to the
            commencement of the action, if the proceeding be by
            action, there shall be filed in the office of the clerk or
            register of deeds and mortgages as the case may be, of
            the county, in which the real estate described in the
            mortgage is situate a written notice of the proposed
            judgment or action, setting forth the court in which it is
            proposed to enter the judgment or begin the action, the
            names of the parties to the bond or note and to the
            judgment or action, the book and page of the record of
            the mortgage, together with a description of the real
            estate described therein.

      The three-month statute of limitations for instituting a deficiency action,

N.J.S.A. 2A:50-2, compelled plaintiff to file its complaint seeking a deficiency

judgment by February 17, 2017, which occurred prior to the Notice being filed.

N.J.S.A. 2A:50-2 provides in pertinent part:

            Except as otherwise provided, all proceedings to collect
            any debt secured by a mortgage on real property shall
            be as follows:

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                                        3
            First, a foreclosure of the mortgage; and

            Second, an action on the bond or note for any
            deficiency, if, at the sale in the foreclosure proceeding,
            the mortgaged premises do not bring an amount
            sufficient to satisfy the debt, interest and costs.

            The action for any deficiency shall be commenced
            within 3 months from the date of the sale, or, if
            confirmation is or was required, from the date of the
            confirmation of the sale of the mortgaged premises. In
            such action judgment shall be rendered and execution
            issued only for the balance due on the debt and interest
            and costs of the action.

            [(Emphasis added).]

      A deficiency judgment of $44,305.13 was sought by plaintiff, after

deducting a fair market credit of $90,000 against the $134,305.13 amount due.

Defendant filed an answer on April 11, 2017 to the deficiency action. The

Notice was recorded five days after the complaint was filed. Confirmation of

the recorded Notice was sent to defendant on March 1, 2017.

      Plaintiff moved for summary judgment. Defendant opposed the motion ,

contending that plaintiff failed to comply with the three-month statute of

limitations deadline, N.J.S.A. 2A:50-2, and because he was not provided with

fair market value for his property. During oral argument, the motion judge sua

sponte raised the issue that plaintiff failed to comply with N.J.S.A. 2A:50-6 by

filing its deficiency complaint before the Notice was filed, and therefore, it

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                                        4
lacked standing. The Notice was mailed via regular mail two weeks before the

deficiency complaint was filed but, due to a backlog in the clerk's office, it was

not processed within the ninety-day timeframe. Plaintiff argued that the Notice

"should have been received" by the clerk's office on February 9, 2017, more than

a week before the deficiency complaint was filed on February 17, 2017. In her

oral decision, the judge found the Notice is "clearly a statutory requirement,"

that "doesn't have to be sent to the county clerk, it has to be filed with the county

clerk prior to commencement of the action." (Emphasis added). We agree.

                                         II.

      At argument on the motion, plaintiff claimed that the Notice was filed

within three months and is not required to be filed within ninety days of the

sheriff's sale as asserted by defendant. N.J.S.A. 2A:50-2. Because the Notice

was sent to defendant within the statutory time period, plaintiff further contends

that there was substantial compliance, entitling it to a deficiency judgment

because the foreclosure action was completed. Further, plaintiff argues that

delays in recording the Notice by the County are beyond its control, and it should

not be penalized for the backlog in the clerk's office. There was no prejudice to

a potential third-party purchaser here, and plaintiff argued that title was already

vested in its name at the time.


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                                         5
      As of December 2017, defendant no longer had a right of redemption,

N.J.S.A. 2A:50-5, therefore plaintiff argues that the sequence of events here was

simply form over substance. In defense, defendant argued that plaintiff could

have filed the Notice electronically or hand-delivered it to the clerk's office and

had the Notice timely stamped "received" and recorded it in due course. This is

not an uncommon occurrence, and defendant claimed the statute is intended to

protect residential homeowners, and should be strictly construed. We agree.

      In her ruling, the judge found that the Notice was clearly "recorded on

February 22nd at 9:17 a.m." and it "wasn't filed prior to the commencement of

the action because it wasn't stamped filed until the 22nd," which was five days

after the complaint was filed. In denying the motion, the judge also found:

            You have a residential homeowner that basically has
            had his credit . . . destroyed, and he walks away from a
            condominium and now he's going to be told you owe us
            another $30,000, and I believe that the statute is to
            protect the consumer and it wasn't filed in time. So for
            those reasons I'm going to deny the motion for summary
            judgment.2

The judge also cancelled the trial date.

                                       III.


2
  At the time of argument, the judge was dismayed to learn that plaintiff recently
sold the Brigantine condominium for $100,000 and that defendant's counsel was
not advised of this beforehand.
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                                           6
      Plaintiff attempts to avert the consequences of its failed effort to timely

record the Notice by relying upon the doctrine of substantial compliance.

Relying upon an affidavit of merit decision, Ferreira v. Rancocas Orthopedic

Associates, 178 N.J. 144, 151 (2003), plaintiff argues that the substantial

compliance doctrine requires the moving party to show: "(1) the lack of

prejudice to the defending party; (2) a series of steps taken to comply with the

statute involved; (3) a general compliance with the purpose of the statute; (4) a

reasonable notice of [plaintiff's] claim; and (5) a reasonable explanation why

there was not strict compliance with the statute." See Galik v. Clara Maass Med.

Ctr., 167 N.J. 341, 347-48 (2001) (finding substantial compliance where

plaintiff did not file an affidavit within statutory timeframe, but plaintiff's

counsel, before initiating suit, provided defendants' insurance carriers with two

detailed expert reports that established legitimacy of complaint and served as a

basis for settlement discussions). We are not persuaded by plaintiff's argument

or reliance upon Ferreira as there is no similarity to this case.

      Plaintiff does not present any basis as to why the Notice could not have

been mailed earlier or why it could not be hand-delivered and stamped

"received" by the clerk's office prior to filing the deficiency complaint.

Defendant was unaware of the pending deficiency complaint – and he was also


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                                         7
unaware that plaintiff sold the condominium. An action on a note for deficiency

under N.J.S.A. 2A:50-2 must be strictly construed since the statute is in

derogation of common law. See, e.g., Hirsch v. Tushill, Ltd., 110 N.J. 644, 647

(1988). The doctrine of substantial compliance, equitable in nature, cannot be

invoked to circumvent the mandate of the statute. Plaintiff failed to file i ts

action to obtain a deficiency judgment within three months after the date of the

sheriff's sale and, therefore, its complaint was properly dismissed summarily.

See N.J.S.A. 2A:50-2.

      We have previously warned about the perils of mailing a document whose

filing is required by a specified time. In Leake v. Bullock, 104 N.J. Super. 309,

313 (App. Div. 1969), we affirmed the dismissal of a complaint filed after the

statute of limitations had expired. We noted that plaintiff had waited "until four

days before the expiration of the two-year limitation period before attempting to

file her complaint." We then said "[d]ue diligence would have required her

either to have filed it directly with a [s]uperior [c]ourt judge . . . or to have had

it personally delivered to the clerk for filing . . . . Under these circumstances,

the risk of delay in the mail is her own." Ibid. The same rationale applies here

and we see no reason to invoke the equitable remedy of substantial compliance.




                                                                             A-3360-17T2
                                         8
      For these reasons, the trial judge did not err in denying summary judgment

and cancelling the trial date. The remaining arguments raised by plaintiff are

without sufficient merit to warrant discussion in a written opinion. R. 2:11-

3(e)(1)(E).

      Affirmed.




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