                                NOT FOR PUBLICATION WITHOUT THE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-3838-16T2

FEDERAL HOME LOAN
MORTGAGE CORPORATION,
("Freddie Mac"), a corporation
organized and existing under the
laws of the United States of America,

           Plaintiff-Respondent,

v.

CHRISTOPHER COLE and MARIA
COLE,

           Defendants-Appellants,

and

WELLS FARGO BANK, N.A.,

     Defendant.
_________________________________

                    Argued January 10, 2019 – Decided April 4, 2019

                    Before Judges Simonelli and Whipple.

                    On appeal from Superior Court of New Jersey,
                    Chancery Division, Essex County, Docket No. F-
                    021053-14.
              Christopher and Maria Cole, appellants, argued the
              cause pro se.

              Brian P. Matthews argued the cause for respondent
              (Reed Smith LLP, attorneys; Henry R. Reichner, of
              counsel and on the brief; Brian P. Matthews, on the
              brief).

PER CURIAM

        In this foreclosure matter, defendants Christopher Cole (Christopher) and

Maria Cole (Maria)1 appeal from the March 27, 2017 order denying their motion

to vacate the Sheriff's sale. We affirm.

                                        I.

        On March 16, 2005, Christopher executed a note in the amount of

$261,130. To secure payment of the note, Christopher and Maria executed a

mortgage on their property located in Nutley. On appeal, defendants do not

dispute the validity of the note and mortgage; that they defaulted on April 1,

2009; that plaintiff Federal Home Loan Mortgage Corporation had standing and

the right to foreclose; and that plaintiff followed the proper procedures regarding

the Sheriff's sale.

        An attorney represented defendants throughout the foreclosure matter. On

April 24, 2015, the court granted plaintiff's motion for summary judgment and


1
    We shall sometimes collectively refer to Christopher and Maria as defendants.
                                                                           A-3838-16T2
                                           2
dismissed defendants' contesting answer. On June 17, 2016, the court entered

final judgment of foreclosure.2 On November 2, 2016, plaintiff sent a notice of

sale to defendants and their attorney advising the property would be sold at a

Sheriff's sale on December 13, 2016. The Sheriff's sale was re-scheduled to

January 24, 2017, after defendants obtained two statutory adjournments

pursuant to N.J.S.A. 2A:17-36.3 On January 24, 2017, the property was sold at

a Sheriff's sale to a third-party purchaser for $323,000.

      Defendants timely filed a motion to vacate the Sheriff's sale. They argued

the sale price was not fair market value and relied on an estimated market value

of $523,146 listed as a "Zestimate" on Zillow.com.




2
   Because defendants only appealed from the March 15, 2017 order denying
their motion to vacate the Sheriff's sale, we cannot consider any facts or
arguments relating the April 24, 2015 order and June 17, 2016 judgment of
foreclosure. Pressler and Verniero, Current N.J. Court Rules, cmt. 6.1 on R.
2:5-1(f)(1) (2019); see 1266 Apt. Corp. v. New Horizon Deli, Inc., 368 N.J.
Super. 456, 459 (App. Div. 2004); Fusco v. Newark Bd. of Educ., 349 N.J.
Super. 455, 461-62 (App. Div. 2002).
3
  N.J.S.A. 2A:17-36 provides: "A sheriff or other officer selling real estate by
virtue of an execution may make two adjournments of the sale, and no more, to
any time, not exceeding [fourteen] calendar days for each adjournment.
However, a court of competent jurisdiction may, for cause, order further
adjournments."


                                                                        A-3838-16T2
                                        3
        Defendants also argued the court should vacate the Sheriff's sale based on

fraud. Defendants submitted a joint certification, stating that, with the aid of a

paralegal from their attorney's office, they spoke with a representative of

plaintiff on January 23, 2017, and requested modification assistance and an

adjournment of the Sheriff's sale.4 Defendants admitted the representative said

he lacked the authority to grant an adjournment, but claimed the representative

said he would convey their request to the appropriate representative who would

contact them. Defendants also admitted the representative said defendants were

rejected for modification assistance, but claimed the representative said they

would still be considered for reinstatement or other alternatives to foreclosure,

such as a short sale or deed in lieu of foreclosure. Defendants argued these

statements led them to reasonably believe that "plaintiff must be planning to

adjourn the sale on [its] own[,]" and they relied on the representations that there

were still other alternatives available to them. Defendants also argued that

plaintiff fraudulently induced them not to file a Chapter 13 bankruptcy petition

or cure the default.

        In a January 24, 2017 letter to the paralegal, with a copy to defendants,

plaintiff responded to defendants' requests as follows, in pertinent part:


4
    Defendants did not submit a certification from the paralegal.
                                                                             A-3838-16T2
                                         4
            We've reviewed the account in the past for payment
            assistance options.       Based on the facts and
            circumstances of the situation, and the prior review(s)
            received, we will not review your loan for mortgage
            assistance options again due to:

                     Account is [thirty-eight] days or less to the
                       foreclosure sale date.
                  ....

            We recognize you asked us to postpone the foreclosure
            sale date of January 24, 2017, and we're unable to fulfill
            that request as the account is no longer eligible for
            payment assistance options. We regret we're unable to
            provide the resolution you requested.

      At oral argument of the motion to vacate, defendants' attorney conceded

that plaintiff never stated the Sheriff's sale would be adjourned. In a March 27,

2017 order and written opinion, the motion judge denied the motion, finding the

"Zestimate" was not competent evidence of the property's market value. Citing

Murray v. D'Orsi, 98 N.J. Eq. 548 (Ch. 1925) and First Tr. Nat'l. Ass'n v. Merola,

319 N.J. Super. 44 (App. Div. 1999), the judge determined that even considering

the estimated value reflected in the "Zestimate," the alleged inadequacy of the

sale price was not so gross as to justify a presumption of fraud.

      The judge also found that plaintiff never agreed to adjourn the Sheriff's

sale or misled defendants into believing it would do so or consider them for

reinstatement or other alternatives to foreclosure. The judge concluded that:


                                                                          A-3838-16T2
                                        5
             [Defendants'] subjective understanding of the
             [p]laintiff's [representative's] statement in the
             conversation on January 23 [was] not evidence of a
             misleading statement. There was no assurance given as
             to the pending sale and the January 24 letter, which
             [defendants] acknowledge summarizes the essential
             points of the January 23 conversation, confirms this is
             so.

      The judge found defendants failed to demonstrate that plaintiff

intentionally misled them for the purpose of preventing them from filing a

Chapter 13 bankruptcy petition. The judge explained that although defendants

pointed to plaintiff's unwillingness to negotiate with them over the course of

several years, defendants did not allege any facts that demonstrated plaintiff

knew of defendants' intention to file a Chapter 13 bankruptcy petition.

      The judge also found defendants were not without recourse. The judge

explained that when defendants did not receive an explicit commitment from

plaintiff to adjourn the Sheriff's sale, they could have sought the court's

intervention on or before the sale by seeking an emergent stay. The judge

concluded:

             For all of these reasons, the circumstances here are
             much closer to those presented in Merola and [Crane v.
             Bielski, 15 N.J. 342 (1954)], in that [defendants]
             understood the Sheriff's sale was scheduled for January
             24, understood the nature of that proceeding, had not
             received an explicit agreement or representation that it
             would be adjourned, and could have taken action on

                                                                          A-3838-16T2
                                        6
            their own accord         to     seek   a   [c]ourt-imposed
            adjournment.

                                          II.

      On appeal, defendants reiterate that the Sheriff's sale should be vacated

because plaintiff intentionally misled them into believing it would adjourn the

sale and afford them reinstatement or alternatives to foreclosure, and

fraudulently induced them not to file a Chapter 13 bankruptcy petition.5 We

disagree.

      "[T]he Chancery Division has the authority to set aside a sheriff's sale and

order a resale of property. However, the exercise of this power is discretionary

and must be based on considerations of equity and justice." Merola, 319 N.J.

Super. at 49 (citation omitted). "[A] judicial sale may be set aside 'by reasons

of fraud, accident, surprise, or mistake, irregularities in the conduct of the sale,

and so on[;]'" however, "a judicial sale is not ordinarily vacated 'on the ground

of mistake flowing from [a moving party's] own culpable negligence.'" Ibid.




5
  We decline to consider statements in defendants' merits brief that are not
supported by the record, such as their alleged post-motion contact with "Freddie
Mac," their dealings with plaintiff after the Sheriff's sale, and their 1099A and
1099C indicating the value of the property. See N.J. Div. of Youth & Family
Servs. v. M.M., 189 N.J. 261, 278 (2007); Pressler & Verniero, Current N.J.
Court Rules, cmt. 1 on R. 2:5-4(a) (2019).
                                                                            A-3838-16T2
                                          7
(third alteration in original) (quoting Karel v. Davis, 122 N.J. Eq. 526, 528 (E.

& A. 1937)).

      The power to set aside a judicial sale should be "sparingly exercised." Id.

at 52 (quoting Karel, 122 N.J. Eq. at 529). A sheriff's sale should only be

vacated "when necessary to correct a plain injustice." Karel, 122 N.J. Eq. at

529; see also E. Jersey Sav. & Loan Ass'n v. Shatto, 226 N.J. Super. 473, 476

(Ch. Div. 1987) (holding that "[t]he power to set aside a foreclosure sale is to

be exercised with great care and only when necessary for compelling reasons").

"The burden of proof rests with the objector." Shatto, 227 N.J. Super at 476.

Applying these standards, we are satisfied the motion judge properly denied the

motion to vacate the Sheriff's sale.

      To establish a claim for common law fraud, defendants had to show that

plaintiff made a material misrepresentation of a presently existing or past fact

with knowledge or belief of its falsity and an intention that defendants rely on

it, and that defendants reasonably relied thereon and suffered damages. See

Allstate N.J. Ins. Co. v. Lajara, 222 N.J. 129, 147 (2015). "Misrepresentation

and reliance are the hallmarks of any fraud claim, and a fraud cause of action

fails without them." Banco Popular, 184 N.J. at 174. To succeed on a claim of

fraudulent misrepresentation or fraudulent inducement, defendants must


                                                                         A-3838-16T2
                                       8
demonstrate that they relied on a representation by plaintiff, and their reliance

was actual and justifiable. See Walid v. Yolanda for Irene Couture, Inc., 425

N.J. Super. 171, 180-81 (App. Div. 2012). Fraud is never presumed. Each of

the elements of fraud must be proven by clear and convincing evidence.

Stoecker v. Echevarria, 408 N.J. Super. 597, 617 (App. Div. 2009). .

      There is no evidence in this case, let alone clear and convincing evidence,

that plaintiff made a material misrepresentation to defendants. As defendants

conceded at oral argument, plaintiff never represented that the Sheriff's sale

would be adjourned. A party conceding a material fact before the trial court

may not argue the contrary on appeal. See First Am. Title Ins. Co. v Vision

Mortg. Corp., 298 N.J. Super. 138, 143 (App. Div. 1997).              Defendants'

subjective assumption that plaintiff "must be planning to adjourn the sale on [its]

own" is insufficient to establish plaintiff made a material misrepresentation

about adjourning the sale.

      In addition, plaintiff never represented that defendants qualified for

reinstatement or other alternative to foreclosure, and never promised,

guaranteed, or approved any loan modification. To the contrary, plaintiff's

representative made clear that defendants had been rejected for modification




                                                                           A-3838-16T2
                                        9
assistance. Accordingly, defendants failed to demonstrate that plaintiff made a

material misrepresentation warranting reversal of the Sheriff's sale.

      Even if defendants satisfied this requirement, they failed to demonstrate

reasonable and justifiable reliance on the alleged misrepresentation. See Walid,

425 N.J. Super. at 180-81. Defendants maintained they relied on plaintiff's

misrepresentation that they would still be considered for reinstatement or other

alternatives to foreclosure. However, New Jersey courts have repeatedly held

that negotiations regarding potential loan modifications did not relieve the

borrower from responding to a foreclosure action. See U.S. Bank Nat'l Ass'n v.

Guillaume, 209 N.J. 449, 468-69 (2012) (rejecting defendants' argument that

they were misled into failing to respond to a foreclosure action while negotiating

a loan modification); Deutsche Bank Nat'l Tr. Co. v. Russo, 429 N.J. Super. 91,

99-100 (App. Div. 2012) (rejecting the contention that a delay in defending a

foreclosure procedure was reasonable based on the existence of an application

for a loan modification).

      Furthermore, plaintiff had the right to enforce the terms of the note and

mortgage and proceed with the foreclosure action and Sheriff's sale irrespective

of defendants' eligibility for modification assistance or other alternatives to

foreclosure. See U.S. Bank Nat'l Ass'n v. Curcio, 444 N.J. Super. 94, 114 (App.


                                                                          A-3838-16T2
                                       10
Div. 2016) (holding that "[e]ngaging in negotiations with defendant regarding

modification to her mortgage did not preclude plaintiff from seeking

foreclosure"); Kaminski v. London Pub, Inc., 123 N.J. Super. 112, 116 (App.

Div. 1973) (finding a mortgagee has the right to insist upon strict observance of

the terms of the note and mortgage).            Accordingly, defendants cannot

demonstrate that their reliance on plaintiff's alleged misrepresentation was

reasonable and justifiable.

                                        III.

      Defendants reiterate that the Sheriff's sale should be vacated because the

sale price was below fair market value. Again, we disagree.

      It is well-established that a Sheriff's sale normally should not be vacated

on the basis of inadequacy of sale price alone. G.E. Capital Mortg. Servs., Inc.

v. Marilao, 352 N.J. Super. 274, 285 (App. Div. 2002) ("[i]nadequacy of price

alone normally does not warrant setting aside a Sheriff's sale"); Crane, 15 N.J.

at 348 ("inadequacy is just one of the factors to be taken into consideration" and

is not "an indispensable ingredient"); W. Ridgelawn Cemetery v. Jacobs, 108

N.J. Eq. 513, 514-15 (Ch. 1931) ("mere inadequacy of price affords no ground

of relief."). A Sheriff's sale "is a form of distress sale that cannot reasonably be

expected to produce full fair market value." Marilao, 352 N.J. Super. at 285;


                                                                            A-3838-16T2
                                        11
see also Carteret Sav. & Loan Ass'n, F.A. v. Davis, 105 N.J. 344, 351 (1987)

("foreclosure sales rarely, if ever, bring the fair market value of the foreclosed

property"). Thus, in order to vacate a Sheriff's sale due to inadequacy of the

sale price,

              it is essential that the price be so grossly inadequate as
              to support the inference of fraud, or to shock the
              judgment and conscience, or be accompanied by an
              independent substantive ground for equitable relief . . .
              making confirmation inequitable and unjust to one or
              more of the parties.

              [Karel, 122 N.J. Eq. at 530-31.]

      Here, the property was sold at the Sheriff's sale for $323,000, and the

"Zestimate" estimated a market value of $532,146. Thus, even assuming the

"Zestimate" is competent evidence of the property's fair market value, which it

is not, the sale price was not "so grossly inadequate as to support an inference

of fraud."    See ibid.    Further, the sale price does not shock the judicial

conscience, and there was no independent substantive ground for equitable

relief. See ibid. Thus, the alleged inadequacy of the sale price was insufficient

to justify vacating the Sheriff's sale.

      Affirmed.




                                                                           A-3838-16T2
                                          12
