New Jersey Lawyer & Attorney : Stark & Stark Law Firm : New Jersey Law Blog

When negotiating the terms of a redevelopment agreement with a redevelopment entity it is crucial to pay close attention to the wording of the redevelopment entity’s remedies upon default, especially if the redevelopment project is going to involve mortgage financing. Indeed, in such instance, a redeveloper should try to avoid including a provision in the redevelopment agreement that subjects its interest in whatever property it might acquire within the redevelopment project area to forfeiture upon default. However, if the redevelopment entity insists upon having such a remedy, then it should be made subject to the redeveloper’s right of redemption under any mortgage. Otherwise, a redeveloper runs the risk of losing title to property previously conveyed to it by the redevelopment entity upon default under the redevelopment agreement (whether or not the redeveloper is in default under the mortgage at the time the redevelopment entity seeks reversion of title). This situation was recently addressed by the Appellate Division of the New Jersey Superior Court in Mercer County Improvement Authority v. Trenton Studios, Inc. in an unpublished case decided on August 21, 2008.

 

In Trenton Studios , a redevelopment entity initiated foreclosure proceedings and sought reversion of title, among other relief, after the redeveloper had defaulted under a mortgage held by the redevelopment entity and the redevelopment agreement. The redeveloper claimed, among other things, that enforcement of the redevelopment agreement’s forfeiture remedy impermissibly interfered with the redeveloper’s equitable right of redemption. In evaluating this issue, the Appellate Division agreed with the redeveloper’s position “that a remedy which flows from the [m]ortgage due to a default under the [m]ortgage cannot clog the equity of redemption.” However, the Court rejected the redeveloper’s assertion that the redevelopment entity was limited the those remedies, such as foreclosure, that flow from the mortgage. In this regard, the Court observed that since the redevelopment agreement “does not incorporate the default events” contained in the mortgage and has “separate and independent conditions, obligations and events of default[,]” it is a “distinct instrument[]” that is neither subject to nor intertwined with the mortgage. “Therefore, while reconveyance of title and possession is not a viable remedy under the [m]ortgage because it would clog the equity of redemption, it does not prevent plaintiff from seeking that remedy under the terms of the [r]edevelopment [a]greement.”

• Email This
• Print
• Comments
• Trackbacks

Often times parties leave deciding the issue of who will have parenting time with the children during the holidays until the last minute. Maybe the parties are dreading the argument that will inevitably ensue.  Maybe the rush of the holiday season has put this issue on the back burner.  However, any delay in addressing this issue is a mistake. 

Dividing the holidays between parents is perhaps one of the most difficult aspects of any divorce.  Understandably, both parents would like to spend the holidays with the children.  The parties are free to come to an agreement between themselves.  Perhaps the Father spends Christmas Eve with the children and the Mother spends Christmas Day with the children or vice versa.  If the parties are able to amicably decide this issue- Great!  Problem solved.  However, many times, it is not quite that simple...

Parties that are unable to arrive at an agreement must apply to the Court to decide this issue.  However, in the situations where there is an existing Final Judgment of Divorce, the parties should first refer to their Property Settlement Agreement.  This Agreement should address the issue of holiday parenting time.  The provision in the Property Settlement Agreement controls. 

However, parties that are currently going through a divorce or parties that have a Property Settlement Agreement silent on the issue have a more difficult challenge.  They must either come to an agreement between themselves or apply to the Court to decide who gets the children for the holidays.   This is where any delay will hurt you. 

Pursuant to the New Jersey Court Rules, a motion must be filed at least twenty four days in advance of the return date (i.e. the Court date on which the issue will be heard).  Therefore, a motion to address the issue of holiday parenting time must be filed well in advance of the holiday itself.
       
Many times, parties wait to contact a divorce attorney until the week before the holiday.  The attorney must then file an emergent application with the Court.  These emergent applications are seldomly successful because the party must show that “irreparable harm” will occur if their application is not granted.  That is a very, very high burden of proof to meet.  If the Court does not agree that irreparable harm will occur of the parent is not awarded holiday parenting time, it will refuse to consider the application, and you are right back where you started.
                       
The moral of the story?  Be sure to contact a divorce attorney to address any holiday parenting time issues well in advance of the holiday itself.

• Email This
• Print
• Comments
• Trackbacks

A. Christopher Florio, Shareholder and member of Stark & Stark's Community Associations group, was appointed to serve on the Community Association Institute of New Jersey's 2009 Board of Directors, and was named as President-Elect for 2010.  CAI-NJ is the New Jersey Chapter of the Community Associations Institute (CAI), a national non-profit organization dedicated to fostering vibrant, responsive, competent community associations and helping them promote harmony, community and responsible leadership.  CAI-NJ is the second largest chapter (of 56 chapters) in the United States and provides continuous education and resources to help our nearly 2,000 members, including 1,200 community association volunteer leaders, stay abreast of current community association issues and events in the State of New Jersey.

Mr. Florio has extensive experience in the negotiation of loan transactions, work-outs, and real estate law including foreclosures. Mr. Florio also has substantial experience in floor-plan financing.

Mr. Florio also serves as a member of the New Jersey Assembly Task Force, which is commissioned to study community associations in New Jersey. He was appointed to the position by General Assembly Speaker Chuck Haytaian and again by General Assembly Speaker Jack Collins. Additionally, Mr. Florio is President of CA-PAC, the New Jersey Chapter of the Community Associations Institute Political Action Committee.

• Email This
• Print
• Comments
• Trackbacks

I Have a Court Order, but My Ex-Spouse is Ignoring It!  Now What?

Unfortunately, obtaining a Court Order in New Jersey does not necessarily mean that both parties will comply with that Order.  All too often, child support and alimony obligations are ignored and the obligor accrues a substantial amount of arrears.  The Parent of Primary Residence is left financially struggling.  Or perhaps there is an Order that addresses parenting time or custody issues, and the other party refuses to comply.  After a while, you begin to think that you don’t have any options left.  After all, you already have an Order from the Court....

These situations are not uncommon.  The Court issues Orders, but rarely, if ever, polices them.  The Court is just too busy.  It is up to the parties themselves to enforce the Orders.  The parties know whether the other party is complying or not.   If one party to the litigation is not complying, they must bring it to the Court’s attention.  How do you do this, you ask?

By filing a motion.  A party seeking to enforce an Order must file a Motion to Enforce that Order in the Family Part of your County.  Although you can file these motions pro se (without an attorney), it is always advisable to retain a divorce attorney.  The New Jersey Rules of Court are very specific, and it is difficult to ensure that you have met every requirement.  A Court can deny your motion on procedural grounds if all of the requirements of the Court Rules are not met.  A divorce attorney knows these requirements and will ensure that these requirements are satisfied and that your motion will not be dismissed on procedural grounds.   

If the Judge deciding your motion finds that the other party is not complying with a previous Court Order, he or she may award you counsel fees if you have an attorney, and may even impose sanctions on the non-compliant party. 

• Email This
• Print
• Comments
• Trackbacks

Each day we read of more lay offs; wholesale lay offs in major financial institutions, retailers and the manufacturing industry. Each day we hear of more corporate bankruptcies. Major financial institutions that have the hallmark of financial stability suddenly no longer exist nor dot their thousands of jobs. Each day we hear differing projections as to whether we are in a "recession" and/or how long it will last.

Now we are told that the nation's unemployment rate has hit an all time high--higher in actual numbers than any time in our history including the "Great Depression". What does this mean to divorced persons who are paying child support or alimony, and now find themselves unemployed? I still hear Courts saying that several month's of unemployment is not "a change of circumstances", it is simply a "temporary" situation.  "Temporary" is a very relative term to a person seeking employment in an economic environment where virtually every business is laying people off and no one is hiring.

I still see Courts continuing to impute income to persons who have no realistic likelihood of ever returning to their prior employment or former level of income. A worthy concept when people choose not to work, but how relevant is it when there is simply no work to be had? I still see Courts ordering the payment of support from IRA or investment accounts that have already been ravaged by the market. What resources will those persons have to support themselves in the years to come?

Why? Certainly not because the Courts are not aware of what we all read and hear or simply to be arbitrary, but because the children and the dependent spouses still have expenses. Still have expenses, which no one has yet figured

out how to address in this economy. What do we do when the primary breadwinner is no longer employed, has no reasonable prospect of regaining employment and has drastically diminished assets? Family Courts are Courts of equity, and it is incumbent upon all who are involved in this process to seek and do equity to all concerned. Family Court Judges, Family Court attorneys and will intended persons associated with our system must address this issue and address it sooner rather than later.

Extreme caution and good judgment must be exercised to do equity when required and, at the same time, prevent malingerers from avoiding justly due and payable obligations basis of contrived economic hardships. Delay will simply work hardships, which may not be able to be resolved after the fact.

• Email This
• Print
• Comments
• Trackbacks

Timothy P. Duggan, Shareholder of Stark & Stark's Bankruptcy & Creditor's Rights group, was interviewed for an NJN News story discussing Governor Corzine's economic stimulus bill and the recent rise of unemployment and personal bankruptcies in New Jersey. As the number of Chapter 7 bankruptcies more than doubled from 7,200 in 2006 to 16,955 in 2008, Mr. Duggan states that people are just not able to make mortgage payments in addition to their every day living expenses, and are therefore forced into bankruptcy.

You can watch the full story here.

• Email This
• Print
• Comments
• Trackbacks

Deficiency actions to recover balances owed after a consumer foreclosure action are not favored in New Jersey Courts.  Although, such actions are permitted under New Jersey law, it is in very limited circumstances and may be difficult to obtain.  Under New Jersey law, a judgment for deficiency may not be brought in the same action to foreclosure the residential mortgage (a separate action must be brought); this preclusion also includes claims on any personal guarantees. Foreclosure deficiency actions can be brought only once the mortgage is foreclosed; must be brought within three (3) months from the date of the sale and can not be brought against any party who was not a party to the foreclosure action.  The deficiency balance sought must be the difference between the foreclosure judgment amount and the fair market value of the property at the time of the sale.

The public policy behind the legislation was to protect the homeowners from losing their homes and then to have a judgment against them for a deficiency which could be as much as the full amount of the mortgage plus additional costs and attorney’s fees.

The protection afforded by New Jersey’s deficiency statutes does not extend to business or commercial loans, one to four family residential dwellings owner occupied at the time the deficiency action is commenced where the mortgage is not the primary security for the debt or where there is a second mortgage lender and the mortgage is subject to a prior lien(s) not held by the same lender.  It is a common misconception that these statutes protect all residential homeowners.  For example the protection would not apply to a second mortgage held by a different lender than the one who holds the first mortgage, provided the first mortgage has already completed its sale; a single family dwelling where the owner or family does not occupy the property or a single family dwelling which secures a commercial loan.

Although, the amount of the foreclosure judgment is binding on all parties to the foreclosure action, the defendant in the deficiency action may still dispute the amount of the debt in the deficiency action. The main thrust of the statute’s protection is found in the ability of the mortgagors to dispute the amount of the fair market value of the property at the time of the foreclosure sale. 

A deficiency action can not be brought if a deed in lieu of foreclosure is accepted.  It must be remembered that an action to recover a deficiency balance will open the foreclosure and sale of the subject property and extend the homeowners right or his assignee to redeem the property for six months, by paying the full amount determined in the foreclosure action.

• Email This
• Print
• Comments
• Trackbacks

With today’s turbulent economy, the challenges associated with a divorce litigation are growing to be more complicated than ever.  I have prepared the following practical tips in an effort to aid litigants through this difficult period:

Update Your Finances
Being that the average divorce litigation spans the course of close to a full calendar year, it is important that you work with your attorney and periodically update your financial data.  Various investment accounts that had high values when the litigation commenced, may have decreased significantly due to recent market conditions.

While I know that it remains painful to open up your investment account statements these days, it is imperative that you stay informed of your investment position.  It is impractical and expensive for your attorney to piece together a comprehensive settlement proposal without a true and accurate accounting of your assets and liabilities.  Staying informed will save both time and most importantly, litigation costs.

One Household vs. Two Households
While it may not be the ideal situation, it is becoming more common for parties that are getting divorced to live under the same roof.  It is a financial reality that most couples are barely making ends meet while they are married.  For one party to move out of the former marital residence during an expensive divorce litigation creates an additional stain on the budget that may not be economically feasible during these recession-laden times.

If you are forced to reside in the same household as your soon to be ex-spouse, I recommend that you formalize an agreement regarding payment of the necessary carrying expenses of the residence.  This will save you the headache of fighting at the end of each month regarding who is responsible for the cable bill or payment for the groceries.

For accounting purposes, it might be a good idea to open up a new joint checking account that is used to solely pay your household expenses during this period.  This will ensure that both parties have a receipt of what bills were paid and the source of the deposited funds to pay such expenses can be easily recorded.

If you have children, I strongly suggest that you and your spouse work out a provisional parenting plan.  While it may seem unnecessary and burdensome to have set parenting time while residing under the same roof, it has been my experience that these type of agreements are worth their weight in gold.  Make sure to properly assign the time that each parent will spend with the children.  Therefore, if it is your designated weekend, there will be no dispute when you take the children with you for a day full of activities.  During the holiday season, having an assigned schedule for parenting and vacation is even more worthwhile.  Most importantly, having set parenting time while living together will aid your children with the difficult transition when one parent vacates the residence.   

Acceptance Of The Situation
I find that many soon-to-be divorced individuals find it particularly difficult to accept the grim financial reality that is sweeping across our nation.  Many projections of alimony awards and child support obligations may have to be significantly modified due to the economic crisis.  Salaries are getting slashed, jobs are being cut and bonuses are becoming a rare commodity.  It is important to realize that your spouse’s reduction in pay may not be his/her fault and is more than likely tied directly to the widespread financial downturn.  Remember that if you and your spouse were still married, there would be a need for implemented household and lifestyle budget cuts.  In order to save large litigation costs, it reasonable to accept the notion that your needs during your divorce litigation might have to be modified accordingly.

• Email This
• Print
• Comments
• Trackbacks

Under the Local Redevelopment and Housing Law a municipality may declare private property to be blighted if “[t]he generality of buildings are substandard . . . dilapidated, or obsolescent . . . or are so lacking in light, air, or space,” and such conditions are “[c]onducive to unwholesome living or working conditions.” This is the first of eight enumerated criteria set forth in the statute, which is sometimes referred to as the “a” criteria (because it is codified at N.J.S.A. 40A:12A-5a).

 

In order to prove that property within a redevelopment study area meets the “a” criteria it is essential for municipal officials to do their homework and actually document findings of fact that support both prongs of the “a” criteria test. In 2005, the Appellate Division of the New Jersey Superior Court in case entitled ERTEC v. City of Perth Amboy, which is reported at 381 N.J.Super. 268, identified the types of data that need to be collected and analyzed in evaluating whether property satisfies the first prong of the “a” criteria - that is whether “[t]he generality of buildings are substandard . . . dilapidated, or obsolescent . . . or are so lacking in light, air, or space[.]” Among these data items are (i) land use and topographic information, (ii) environmental conditions (iii) building and fire code violations, (iv) exterior and interior building conditions and (v) building permit data. As for the second prong of the “a” criteria, that being the linkage between substandard, dilapidated, obsolescent or overcrowded conditions and “unwholesome living or working conditions,” the Court suggested in ERTEC that municipal officials undertaking a redevelopment study look at such things as “occupancy rates” within the study area. Indeed, if a “dilapidated” area, which may be “lacking in light, air, or space” is, nevertheless, a functional commercial, residential or mixed use neighborhood, it may not be declared in need of redevelopment under the “a” criteria.

 

More recently, on August 7, 2008, in an unreported decision entitled City of Long Branch v. Anzalone, the Appellate Division, among other things, examined the methodology of obtaining and evaluating evidence to support a redevelopment designation using the “a” criteria and the quality of such evidence. In that case, municipal officials conducted a “windshield” survey of exterior conditions of properties being considered for redevelopment using six assessment criteria derived from city and state building codes that included “broken windows; ‘deteriorating’ paint; exterior columns that were falling or rotten; masonry veneer that was cracked or chipped; structural parts like walls, roofs, stairs, porches, balconies, and siding that showed ‘evidence of deterioration’; and ‘evidence of apparent defects’ in gutters, leaders, drains, window frames and doors.” According to the city’s data evaluation methodology, a building that satisfied one or two of these criteria would be categorized as “fair” and a building that satisfied three or more of these criteria would be considered in poor condition. The Court in Anzalone found the city’s system to be wholly deficient criticizing the city’s procurement of data through a windshield survey and its examination of property characteristics that “might well be deemed more cosmetic than substantial.” The Court was also concerned about the lack any “expert opinion setting forth standards by which blighted structures should be gauged.”

 

In light of the foregoing, there is little doubt that the task of delineating a redevelopment zone using the “a” criterial is a formidable one that requires a clear methodology for obtaining and evaluating relevant data that establishes the required linkage between certain deleterious property characteristics and unwholesome living and working conditions.

• Email This
• Print
• Comments
• Trackbacks

Securities shareholder Bill Singer's Broke and Broker blog was recently cited in an article by The Associated Press regarding the unfolding securities fraud scandal involving Bernard L. Madoff.  Madoff is accused of securities fraud for allegedly running a phony investment business that lost at least $50 billion. 

Mr. Singer's comments discussed how the securities industry's self policing agency, the Financial Industry Regulatory Authority (FINRA), was unable to prevent a scam of this magnitude from taking place.

UPDATED: 12.15.08: Watch Bill Singer's interview about the Madoff scandal with CBC's Jacquie Perrin here (runs 4:41).

UPDATED: 12.16.08: Listen to Bill Singer's interview with Marketplace's Jeremy Hobson here. (runs 3:20).

• Email This
• Print
• Comments
• Trackbacks

A Trial Court refused to enforce the payment of child support because of the recipient's seven year delay in bringing the Motion for Collection. (Faro v. Vonder Hayden, decided 12/5/2008). The Appellate Court then reversed that finding and held that the delinquent child support could be collected despite the seven year delay.

The Appellate Court focused on the father's history of non-payment, his prior non-compliance with Court Orders and his failure to show that the enforcement would be unfair. The moral of the story would seem to be that a person who has been defiant of prior Court Orders can not find solace from the Court simply because of a delay by the other party. Seemingly a reinforcement of the old principles that those who seek equity must have done equity or that those seeking the aid of the Court must come "with clean hands"..

• Email This
• Print
• Comments
• Trackbacks

The December 2008 issue of Newsweek published a scintillating article entitled Our Mutual Joy by Lisa Miller, which focuses on debunking religious rhetoric in the gay marriage debate.  Gay marriage is an important issue in our society, and involves similar constitutional issues to those raised at the time of abolition. The article nicely outlines the limited discussion of homosexuality contained in the actual text of the Bible. Just as other similar debates involves out of context statements, Ms. Miller notes that much of the discussion of homosexuality utilized as religious rhetoric raised against gay marriage is contained in the book of Leviticus (King James version).  Interestingly, the larger focus of Leviticus is aimed at establishing rules to live by for survival in the ancient Jewish world, many of which are inapplicable, outdated and/or simply ignored by our communities and society today.  Thus, Ms. Miller’s point is well taken: “Why would we regard [the Bible’s, specifically the book of Leviticus’s] condemnation of homosexuality with more seriousness than we regard its advice, which is far lengthier, on the best price to pay for a slave.” 

In New Jersey, Civil Unions are available to homosexual couples, but not marriage, as in several other states.  However, Massachusetts and Connecticut now both offer homosexual couples the option of marriage, as did California before the ballot initiative.  The information set forth in Ms. Miller’s article is thought provoking and promotes the larger biblical themes that remain pertinent to the 21st Century, specifically the message of acceptance for all.

• Email This
• Print
• Comments
• Trackbacks

Thomas B. Lewis, Shareholder and member of Stark & Stark's Employment Litigation group, and Michael J. Brittan, member of Stark & Stark's Employment Litigation group, authored the article The Eroding ‘At-Will' Employment Doctrine for the December 8, 2008 edition of the New Jersey Law Journal.

The article discusses the history and basic principles of an "at-will" employee relationship. The article also stresses the need for employers to include a prominent, clear and conspicuous disclaimer at the beginning of their employee handbook, and any other relevant documents, stating that nothing in the handbook or other documents changes the “at-will” nature of the employment relationship, nor does it create a contract for employment.

You can read the full article here. (PDF)

• Email This
• Print
• Comments
• Trackbacks

Thomas B. Lewis, Shareholder and Chair of Stark & Stark's Employment Litigation group, was quoted in the December 2, 2008 Reuters.com article, Financial advisory firms sign pact to ease poaching. Mr. Lewis comments on the recent independent advisory firms who are rushing to sign an agreement that bars lawsuits between signatories that hire away each other's brokers.

Mr. Lewis states that with the new agreement, also commonly referred to as broker recruitment protocol, registered investment adviser firms can now recruit with less fear of litigation from a major house with deep pockets.

You can read the full article here.

• Email This
• Print
• Comments
• Trackbacks

In a recent Hudson County case (Smith v. Smith, dec'd December 1, 2008) a father sued his ex-wife and her parents for conduct which he alleged alienated him from his children. The ex-wife and her parents defended, in part, on the basis of the "Heart Balm Act" which bans actions for "alienation of affection" in NJ. 
 

An earlier case in Morris County had dismissed  a claim similar to Mr. Smith's  on the basis that the Heart Balm Act was applicable. The Morris County Court found that the father's claims for the alienation of his children were prohibited under the Heart Balm Act.
 

However, the Hudson County Court held that Mr. Smith's claims were not for alienation, but were, instead,  for the intentional or negligent infliction of emotional distress.
 

It is important to note that the Hudson County Court did NOT find that Mr. Smith had a valid or compensable claim. It  merely refused to grant the Motions to Dismiss filed by the ex wife and her parents and allowed the matter to proceed toward trial.
 

The fact that we now have two diametrically opposing decision from  2 Trial Courts in Morris and Hudson Counties is  almost certainly a precursor for a future ruling on the issue by a New Jersey Appellate Court. 
 

Although the  Morris or Hudson County cases are interesting, neither are binding on other Trial Courts and the rights of divorced or  estranged parents will have to await binding determination by an eventual Appellate Court decision.
 

However, at least a warning bell has been sounded. Parents who behave in ways which alienate the other parent from their children are not only doing their children a great disservice, but may now find themselves financially accountable for their conduct.

• Email This
• Print
• Comments
• Trackbacks

Bill Singer, Shareholder of Stark & Stark's Securities group, was a featured panelist for the November 25, 2008 Forbes.com article What To Tell Your Kids About The Markets. The article addresses the rising concerns both parents and children are facing when it comes to payment for college tuition.

Mr. Singer advises parents to diversify their child's college funds by investing in various large-cap exchange-traded funds (ETFs), or maybe a diversified water fund. Mr. Singer also advises parents to urge their children to get part-time jobs now, in case that still is not enough.

You can read the full article here.

• Email This
• Print
• Comments
• Trackbacks

A redevelopment entity may not condemn private property for redevelopment, unless it has first complied with all of the statutory procedures set forth in the Local Redevelopment and Housing Law (“LRHL”) and the Eminent Domain Act of 1971. Under the LRHL, basic pre-condemnation prerequisites include the municipal governing body’s designation of the subject property as blighted and adoption of a redevelopment plan by ordinance for the designated area. The redevelopment plan must identify the property being condemned as one that is to be acquired and explain why it is “necessary for the redevelopment project.” N.J.S.A. 40A:12A-8c. In order to withstand a challenge, the necessity of the taking must be backed up by substantial, credible evidence, unless its necessity is made plainly obvious by the circumstances of the matter at hand.

• Email This
• Print
• Comments
• Trackbacks