Midland Funding LLC v. Carl Albern, Jr.

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-0562-12T4

MIDLAND FUNDING LLC,
APPROVED FOR PUBLICATION
Plaintiff-Respondent,
December 23, 2013
v.
APPELLATE DIVISION

CARL ALBERN, JR.,

Defendant-Appellant.

_________________________________________________________

Submitted December 3, 2013 – Decided December 23, 2013

Before Judges Fisher, Espinosa and Koblitz.

On appeal from the Superior Court of New
Jersey, Law Division, Monmouth County,
Docket No. L-2833-11.

Carl Albern Jr., appellant pro se.

Pressler and Pressler, L.L.P., attorneys for
respondent (Lawrence J. McDermott, Jr., on
the brief).

The opinion of the court was delivered by

FISHER, P.J.A.D.

This appeal presents a procedural question: is a

defendant, who, in responding to a complaint, moved for

dismissal but did not file an answer after the motion was

denied, entitled to notice of a plaintiff's request for default?

Because the applicable rules of procedure do not expressly
authorize an ex parte request for default in this unusual

circumstance, and because the rules are based on a policy

favoring the disposition of cases on their merits, we reverse

the denial of defendant's Rule 4:50 motion to vacate both the

default and the default judgment later entered.

I

On June 15, 2011, plaintiff Midland Funding LLC commenced

this action against defendant Carl Albern, Jr., on an alleged

outstanding credit card account. The summons contained the

customary admonition that defendant was required to answer or

otherwise move within the time allotted or default would be

entered against him. Defendant timely responded by filing a pro

se motion to dismiss, which was denied on October 6, 2011. The

judge's order did not specify a time within which defendant was

required to file an answer nor did it refer to defendant's need

to file an answer. Rule 4:6-1(b) allots ten days to file an

answer after denial of a motion to dismiss. Defendant did not

file an answer within that time period.

On December 1, 2011, plaintiff submitted to the Clerk an ex

parte application for entry of default, claiming "no defendant

named herein has answered or otherwise moved." This

representation was incorrect because, as mentioned, defendant

had "otherwise moved," albeit unsuccessfully. Plaintiff did

2 A-0562-12T4
correctly assert that defendant had not filed an answer and the

time to do so had expired. Default was entered against

defendant in early December 2011.1

Although not included in either party's appendix, we are

told plaintiff applied for the Clerk's entry of default judgment

on March 15, 2012. Whatever plaintiff submitted at the time was

apparently also served on defendant, who quickly submitted

written opposition to the Clerk on March 19, 2012, claiming: he

had not been served with an application to enter default; he had

"filed an answer in the form of a motion to dismiss"; and

plaintiff did not have standing to sue. The Clerk entered

default judgment against defendant in the amount of $19,366.77,

with costs taxed in the amount of $269.12, on March 21, 2012.

We assume the Clerk did not consider – perhaps she did not

receive – defendant's written response because defendant's

opposition was not mentioned in the judgment and because the

normal course, upon receipt of opposition, would have required

the Clerk to refer the matter to the court for disposition.

On May 14, 2012, shortly after plaintiff sought discovery

of defendant's assets, defendant moved for relief pursuant to

1
The copy of the pleading contained in the appendix is only
partially legible and does not reveal the date default was
entered. The judge's August 6, 2012 written opinion notes that
default was entered on December 6, 2011.

3 A-0562-12T4
Rule 4:50-1. The trial judge denied this motion for reasons set

forth in a written opinion, concluding that defendant had not

shown his failure to file an answer was excusable because he

should have understood his earlier unsuccessful motion would not

be viewed as an answer. The judge also determined that

defendant failed to present a meritorious defense, finding the

allegation of plaintiff's lack of standing insufficient in this

regard.2

II

In this pro se appeal, defendant argues: (1) an ex parte

application for entry of default in these circumstances was not

permitted; (2) he was wrongfully denied oral argument on the

return date of his Rule 4:50-1 motion; (3) the trial judge held

him "to a more stringent standard" than plaintiff; and (4)

plaintiff "has provided no credible evidence that [it] ha[d]

standing to file this action." Because we agree plaintiff was

not entitled to apply for default without notifying defendant

and because defendant presented a meritorious defense – even

though he was not obligated to do so under these circumstances –

2
That is, we discern from the record that the judge did not
reject the standing argument on its merits, but only held that
it did not constitute an adequate defense to plaintiff's claim.

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we reverse without considering defendant's second and third

points.

A

Although the trial judge couched defendant's motion as

resting on the excusable-neglect provision in Rule 4:50-1(a),

the essence of the motion was that plaintiff had proceeded

improperly in seeking default. Accordingly, the motion more

logically rested on the void-judgment provision in Rule 4:50-

1(d).3 We thus look to the procedure adopted by plaintiff in

seeking defendant's default.

Default was sought on the basis of Rule 4:43-1, which

allows a plaintiff to make an ex parte request of the Clerk for

default if the defendant "has failed to plead or otherwise

defend as provided by these rules or court order, or if the

answer has been stricken with prejudice." Defendant fit neither

of these two descriptions. He had "otherwise defend[ed]"

because he had moved for dismissal, and he was not "a party . .

. [whose] answer ha[d] been stricken with prejudice" because he

had not filed an answer. Defendant's peculiar status as a party

who had once defended but did not answer is not expressly

3
Regardless of those provisions upon which defendant expressly
based his motion, the court was required to apply those that
were actually implicated by the motion. Baumann v. Marinaro, 95
N.J. 380, 390 (1984).

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encompassed by Rule 4:43-1.4 Because that rule delineates all

the circumstances upon which an ex parte default may be

requested, it stands to reason that plaintiff was required to

request default by motion on notice to defendant.

Our procedural rules were designed to be "a means to the

end of obtaining just and expeditious determinations between the

parties on the ultimate merits," Ragusa v. Lau, 119 N.J. 276,

284 (1990) (quoting Tumarkin v. Friedman, 17 N.J. Super. 20, 27

(App. Div. 1951), certif. denied, 9 N.J. 287 (1952)), a policy

that requires rejection of plaintiff's invitation to interpret

Rule 4:43-1 broadly. The absence of express authority in Rule

4:43-1, in light of the "strong preference for adjudication on

the merits rather than final disposition for procedural

reasons," Galik v. Clara Maass Med. Ctr., 167 N.J. 341, 356

(2001) (quoting Mayfield v. Cmty. Med. Assocs., P.A., 335 N.J.

Super. 198, 207 (App. Div. 2000)), demands that the unauthorized

ex parte default – and the subsequent judgment based on that

default – be vacated and that defendant be given an opportunity

to file an answer and defend against plaintiff's claim.

4
Whether we have properly interpreted the breadth of Rule 4:43-1
is a matter which the Supreme Court's Civil Practice Committee
may wish to consider.

6 A-0562-12T4
 B

We further observe that defendant took the position his

motion constituted an answer to the complaint. The trial judge

held that defendant's assumption was not reasonable or

excusable; defendant could not, in the judge's view, reasonably

believe his motion constituted an answer mainly because the

motion was denied. We conclude that the judge too strictly

interpreted defendant's actions and his reasonable expectations

in the aftermath of the denial of the motion to dismiss.

The motion to dismiss asserted plaintiff lacked standing to

sue, and the judge – in denying that motion – certainly never

ruled on the merits of the standing question. Instead, the

judge first wrote in the margin of the order that "the complaint

on its face sets forth a cause of action and [d]efendant's

motion must thus be denied." The second and last sentence of

this handwritten decision requires closer analysis. That

sentence referred to the rejected text of defendant's proposed

order, which sought from plaintiff, among other things, "the

actual contract of assignment," the contract upon which the

claim was based, and "the original creditor[']s last billing

statement." In the second and last sentence of the judge's

written disposition of the motion to dismiss, she concluded:

"Defendant may receive the documents upon which [p]laintiff

7 A-0562-12T4
relies in this matter in discovery, upon request by

[d]efendant."

Although an attorney would understand, upon denial of the

dismissal motion, that defendant was still required to file an

answer and any affirmative defenses, it was not unreasonable for

this pro se defendant to assume nothing further was required of

him in light of the judge's ruling on standing, and it was not

unreasonable for defendant to assume from the order that the

parties would thereafter engage in discovery.5 See Rubin v.

Rubin, 188 N.J. Super. 155, 159 (App. Div. 1982) (recognizing

that, although pro se litigants are not entitled to greater

rights than represented litigants, due process principles permit

the imposition of a procedural bar only after consideration of

the pro se litigant's "reasonabl[e] expect[ations]" about what

had occurred). This circumstance formed a sound basis for

relief pursuant to the excusable-neglect provision in Rule 4:50-

1(a). In short, the judge was required but failed to liberally

indulge defendant's assertions "to the end that a just result is

reached." Marder v. Realty Constr. Co., 84 N.J. Super. 313, 319

(App. Div.), aff’d, 43 N.J. 508 (1964); see also Mancini v. EDS

5
The order denying the motion to dismiss neither directed the
filing of an answer nor set forth a deadline for that filing.

8 A-0562-12T4
ex rel. N.J. Auto. Full Ins. Underwriting Ass'n, 132 N.J. 330,

334 (1993).

C

The trial judge also denied defendant's Rule 4:50-1 motion

because she determined defendant had not presented a meritorious

defense. In seeking relief from a void judgment, however, a

movant is not required to demonstrate a meritorious defense.

See Peralta v. Heights Med. Ctr., Inc., 485 U.S. 80, 86, 108 S.

Ct. 896, 899-900, 99 L. Ed. 2d 75, 81-82 (1988); City of Passaic

v. Shennett, 390 N.J. Super. 475, 486 (App. Div. 2007). But,

even if we were to conclude otherwise, defendant's claim of

plaintiff's lack of standing constituted a legitimate defense to

the claim asserted in plaintiff's complaint.

III

For these reasons, we reverse the order denying defendant's

motion to vacate the default and the default judgment, and we

remand for entry of an order providing defendant with a fair and

adequate time to file an answer to the complaint.

Reversed and remanded. We do not retain jurisdiction.

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