By SHERRI RUGGIERI
In New Jersey, Chancery Court has full control over equitable actions and the foreclosure sale process. As explained in HSBC Bank USA, N.A. v. Vasquez, 15 N.J. 342, 346 (N.J. 1954), “Independent of statue or rule of court, the Court of Chancery has inherent power to order a sale of mortgage premises and to control its process directed to that end, and this inherent power of the court has never been doubted.” The exercise of the Court’s equitable powers to overturn a foreclosure “is discretionary and must be based on considerations of equity and justice” First Trust Nat’l Ass’n v. Merola, 724 A.3d 858, 861 (App. Div. 1999). See also Crane v. Bielski, 15 N.J. 342 (1954). The standard to set aside or vacate a judicial sale, as listed in East Jersey Savings and Loan Ass’n v. Shatto, 226 N.J.Super 473, 476 (Ch. Div. 1987) requires a (1) showing of fraud, (2) accident, (3) surprise or mistake, and (4) irregularities in the sale. The decision to set aside a sale is used only when there are compelling reasons. Id. at 476. Recently, I represented homeowners that were requesting a second chance to enter the foreclosure mediation program. Despite my oral argument, the Judge sided with the bank and refused to vacate the default Judgment. I always thought that programs, like the one for foreclosure mediation, were enacted to benefit homeowners.
What happened to second chances? Isn’t there a strong public policy to prevent homelessness? What do you do when the rule of law fails?
Sherri Ruggieri is the managing editor of Empire State News. A practicing attorney for over 20 years, Ms. Ruggieri is also chairperson of Edison Township’s Planning Board. Additionally, she has served as a college professor, with nearly a decade of experience in teaching law and political science courses.
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