NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION.
PER CURIAM.
Defendants 511-517 Enterprises, LLC (Borrower), its principal and guarantor, Sergio Zaquiera, and guarantors Belkis Zequiera1 and Antonio Figueredo, appeal from an order of the Chancery Division denying their motion to vacate a default judgment entered in a foreclosure action. We affirm.
Plaintiff filed a foreclosure complaint against defendants on or about August 21, 2007. Defendants filed an answer and counterclaim, asserting a general denial of the allegations raised by plaintiff and raising no defenses disputing the validity or priority of plaintiff's mortgage. Plaintiff filed a motion for summary judgment, which defendants did not oppose, and on January 4, 2008 the court granted the motion in its entirety, striking defendants' answer and counterclaim for failure to comply with discovery, entering default against each defendant, and permitting plaintiff to proceed in the action as an uncontested foreclosure. On January 29, 2008, plaintiff filed with the Foreclosure Unit of the Superior Court its final foreclosure judgment package, which included a notice of motion for entry of judgment and certification of amount due, along with a proposed writ of execution and proposed final judgment. The same day, copies of the documents were served by Federal Express, overnight delivery, on defendants' counsel of record and sent by certified mail, return receipt requested, to each individual defendant. Defendants filed nothing in opposition. Accordingly, on November 14, 2008, a final judgment was entered in the foreclosure action in favor of plaintiff, awarding plaintiff $2,100,302.64, with interest and counsel fees, and authorizing the sale of the property, with the proceeds to be used to satisfy the judgment. Upon receipt of the final judgment, plaintiff's counsel served it on defendants' counsel of record and served copies on each of the individual defendants by Federal Express.
On December 24, 2008, defendants, represented by new counsel, filed a motion to vacate the default judgment. After conducting several hearings, Judge Olivieri denied defendants' motion on the record on January 14, 2010, memorialized in an order of January 20, 2010. By order of February 3, 2010, the court denied defendants' motion to stay the foreclosure scheduled for February 4, 2010. On February 4, 2010, we denied defendants' emergent motion for a stay, as did the Supreme Court. This appeal ensued.
On appeal, defendants contend the judge failed to apply the appropriate standard for vacating a default judgment because he appeared to have overlooked that such application is "viewed with great liberality, and every reasonable ground for indulgence is tolerated to the end that a just result is reached." See Marder v. Realty Constr. Co., 84 N.J.Super. 313, 319 (App. Div.), aff'd, 43 N.J. 508 (1964). Defendants also argue the judge erred in finding defendants did not demonstrate excusable neglect in having failed to oppose the foreclosure and they had a meritorious defense to the action as required by Rule 4:50-1. Based on our review of the record and applicable law, we find defendants' arguments unpersuasive, and affirm substantially for the reasons articulated by Judge Olivieri on the record. We add the following comments.
On May 2, 2005, plaintiff and Borrower entered into a construction loan agreement whereby plaintiff agreed to loan Borrower the total principal amount of $1,450,000. Subsequently, Borrower executed three separate amendments, increasing the total loan commitment up to $1,712,000. In connection with the loan agreement, Borrower executed four separate promissory notes, the first dated May 2, 2005, as well as a mortgage of the same date securing Borrower's real property located at 511-517 Third Street in Union City. The mortgage and subsequent amendments were duly recorded. To further secure Borrower's obligations under the loan documents, the individual defendants each executed payment guarantees.
Plaintiff advanced funds in accordance with the loan documents. It is uncontested defendants failed to repay that portion of the loan evidenced by the first three notes by December 31, 2005, in accordance with the notes, as well as that portion of the loan evidenced by the fourth note by September 30, 2006, in accordance with the terms of that note. Defendants also failed to cause certain construction work to be timely completed in accordance with the loan documents, also constituting a default.
Pursuant to Rule 4:50-1, a court may relieve a party from a final judgment based on
(a) mistake, inadvertence, surprise, or excusable neglect;
. . . .
(c) fraud[,] . . . misrepresentation, or other misconduct of an adverse part; [or]
. . . .
(f) any other reason justifying relief from the operation of the judgment or order.
"Generally, a defendant seeking to reopen a default judgment must show that the neglect to answer was excusable under the circumstances and that he has a meritorious defense." Siwiec v. Fin. Res., Inc., 375 N.J.Super. 212, 219 (App. Div. 2005) (quoting Marder, supra, 84 N.J. Super. at 318).
The denial of a motion to vacate a default judgment rests in the "sound discretion of the trial court, guided by principles of equity." Coryell, L.L.C. v. Curry, 391 N.J.Super. 72, 79 (App. Div. 2006) (citing Hous. Auth. of Town of Morristown v. Little, 135 N.J. 274, 283 (1994)). It is well settled that "the action of the trial judge in granting or denying a motion to vacate a default judgment on the ground of mistake, inadvertence, surprise or excusable neglect will not be disturbed on appeal unless it is apparent that the judge abused his discretion." Keller v. County of Somerset, 137 N.J.Super. 1, 11 (App. Div. l975). See also Mancini v. EDS ex. rel. N.J. Auto Full Ins. Underwriting Ass'n, 132 N.J. 330, 334 (1993). Furthermore, "it has long been the law of New Jersey that an application to open, vacate or otherwise set aside a foreclosure judgment . . . is subject to an abuse of discretion standard." U.S. Dep't of Agric. v. Scurry, 193 N.J. 492, 502 (2008).
It is undisputed that defendants retained an attorney in response to the foreclosure complaint and that he filed an answer and counterclaim on their behalf. In his motion to vacate, Sergio certified that his failure to comply with discovery was the result of an inability to communicate with his attorney because of his language barrier, as his attorney did not speak Spanish, Sergio's native language, and that he was unable to hire a different attorney due to financial trouble, which he claimed was precipitated by plaintiff.
The facts, as established during the lengthy testimony before the court, demonstrate otherwise. As Judge Olivieri found, Sergio understood English and was involved in a variety of real estate ventures in which all the documents he signed were in English. Moreover, from the closing of this transaction through the motion to vacate the default, defendants consistently hired attorneys who did not speak Spanish. The judge elaborated:
During Mr. Zequiera's testimony before the court it became apparent to the court, and the court made notes contemporaneous with Mr. Zequiera's testimony, that Mr. Zequiera understands English. He may not understand every single syllable of every single word that was uttered in this courtroom in English, but there were numerous times when this court admonished Mr. Zequiera—parenthetically, the court made arrangements to have a Spanish Interpreter present for his entire testimony, but there were a number of times when Mr. Zequiera would hear the question in English and respond before the question was interpreted from English into Spanish.
. . . .
[T]o underscore what this court believes and finds regarding the so-called language barrier between Mr. Zequiera's Spanish and his understanding English, he hired 2 other attorneys, Mr. Lynch and Mr. Sarsano, to represent him in various transactions, including the 3rd Street project, and neither of those attorneys speaks or understands the Spanish language as well. He also hired Mr. LaRusso, who did not speak Spanish. In fact, in this litigation, for this motion, he hired Mr. Mazawey, who does not speak Spanish.
. . . .
This is an action to vacate a judgment under 4:50-l. This court does not find any excusable neglect. This court heard much testimony about Mr. Zaquiera's understanding of the English language and his own actions, not only in my court, but his interaction with several lawyers who represented him over the years in these transactions, and it reflects an individual who, quite frankly, understands the English language.
It is axiomatic that we defer to the credibility and factual findings of the trial judge who had the opportunity to observe the testimony and demeanor of the witness provided the record support the findings. See Caldwell v. Haynes, 136 N.J. 422, 432 (1994); Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 483-84 (1974). Defendants failed to provide transcripts of the hearings2 and did not dispute the court's findings other than to argue that the fact Sergio "speaks decent English does not evidence that he understands the legal process or legal documents that are much more complex tha[n] conversational English." That generalized argument is an insufficient basis for us to question the validity of the court's detailed findings of fact and credibility.
Defendants' asserted meritorious defense was that plaintiff failed to live up to its end of the construction loan agreement by failing to provide promised construction funding in the amount of $4,000,000. Defendants' sole basis for the allegation was that the collateral in consideration of the loan were mortgages on four of defendants' properties that they estimated to be over $4,000,000. As noted by the judge, however, defendant not only presented no documents or testimony evidencing such a commitment by plaintiff, but the evidence was to the contrary. Plaintiff presented testimony that prior to the closing, Sergio was informed it would not lend construction money for a thirty-unit project at the subject premises. Plaintiff also presented testimony from its loan officer that neither he nor its principal ever made a commitment or promise to loan defendants that sum of money, and defendant Figueredo testified he never saw any document reflecting such a commitment. Thus, this bald allegation was insufficient to even raise the specter of a meritorious defense to the foreclosure complaint.
Defendants' broad brush allegation of fraudulent conduct on the part of plaintiff is equally deficient. To succeed on a claim of fraud, a party "must allege with specificity the representation, its falsity, materiality, the speaker's knowledge or ignorance, and reliance." Palko v. Palko, 73 N.J. 395, 401 (1977).
Affirmed.
