Omitted Information in Notice of Intention to Foreclose Might Provide Basis for Liability Under New Jersey Truth-in-Consumer Contract, Warranty, and Notice Act

10.05.18

By: Thomas W. Halm, Jr., Esq.

 

In a written opinion approved for publication on October 4, 2018, the New Jersey Appellate Division held that a mortgage servicer’s failure to properly set forth the name and address of the lender in a Notice of Intention to Foreclose in violation of the Fair Foreclosure Act (“FFA”), N.J.S.A. 2A:50-53 to -68, might form the basis for a claim under the New Jersey Truth-In-Consumer Contract, Warranty, and Notice Act (“TCCWNA”), N.J.S.A. 56:12-14 to -18.  Wright v. Bank of America, N.A., 2018 WL 4779028.  The Court’s holding in Wright is a reminder of the importance of correctly including all required information in Notice of Intention letters and the risks in failing to do so.

 

In Wright, the borrower, Charles Wright (the “Borrower”), filed a complaint under the TCCWNA alleging damages arising from five Notices of Intention which were served on him in 2010 by defendant BAC Home Loans Servicing, LP (“BAC”), the alleged servicer of his home loan, which neglected to include the name and address of the lender, defendant Bank of America, N.A. (the “Bank”) in violation of the FFA. The Borrower did not contest the validity of any information set forth in the various Notices of Intention nor did he suggest that the content of the notices was otherwise false or misleading; just that the required disclosure of the lender’s name and address was omitted in violation of N.J.S.A. 2A:50-56(c)(11). Moreover, no foreclosure action was ever filed against him following the service of these notices. The trial court had dismissed the Borrower’s Complaint by applying the litigation privilege and by holding that the alleged FFA violation cannot support a TCCWNA claim.  The Appellate Division reversed rejecting that portion of the trial court’s decision related to the litigation privilege, and remanding the matter to allow the Borrower the opportunity to file an amended pleading expressing the true nature of his damage claim.

 

In rendering its decision, the Appellate Division noted that N.J.S.A. 56:12-15 provides that “[n]o . . . creditor . . . shall in the course of his business . . . give . . . [any] notice . . . after the effective date of this act which includes any provision that violates any clearly established legal right of a consumer . . . as established by State or Federal law at the time the . . . notice . . . is given . . . .” It then recognized that the New Jersey Supreme Court in U.S. Bank Nat’l Ass’n v. Guillaume, 209 N.J. 449, 474-75 (2012) ruled that a lender or its agent must accurately recite in any notice of intention to foreclose those things that the FFA specifically requires and held that the provisions of the FFA are not satisfied, for example, when only the name and address of the lender’s servicing agent is provided. 

 

While noting that the New Jersey Supreme Court’s recent holding in Spade v. Select Comfort Corp., 232 N.J. 504, 521 (2018) did not determine that an omission of information in a notice otherwise required by law would give rise to a TCCWNA claim, the Appellate Division found that the failure to include all required information under the FFA may support a TCCWNA claim because of the expansive language used by the Legislature to describe the consumers and potential consumers whom the statute was enacted to protect --  even though the contents of the Notices of Intention in question were not otherwise false or misleading. The Appellate Division noted that N.J.S.A. 56:12-17 permitted an “aggrieved consumer” to obtain an award of a “civil penalty of not less than $100 or actual damages, or both at the election of the consumer, together with reasonable attorneys’ fees and cost costs.” The Court, however, did not determine whether the Borrower in this case qualified as an “aggrieved consumer” under the provisions of the TCCWNA. The Supreme Court in Spade noted that, in order for a party to qualify as an “aggrieved consumer” under the TCCWNA, the consumer must have been harmed by a violation of N.J.S.A. 56:12-15.

 

The Appellate Division noted that, in this case, no foreclosure action was commenced after the Borrower was served with the pre-suit notices in question, so the damages alleged to have resulted from the FFA violations was not readily apparent or assumable even from an expansive view of the complaint’s contents.  In fact, the Court noted that the complaint in question only sought the statutory $100 penalty for each TCCWNA violation. The Appellate Division further noted that the Borrower might not even qualify as an aggrieved consumer entitled to any sort of penalty under the Supreme Court’s interpretation of the TCCWNA. As a result, the Appellate Division felt that the best course of action was to remand the case to allow the Borrower to file an amended complaint that would identify the alleged harm that he believes he was caused by the issuance of the defective pre-suit notices.

 

In addressing the trial court’s other grounds for dismissal of the complaint – the litigation privilege – the Appellate Division noted that this privilege was intended to apply to “statements” that would otherwise be defamatory which were made in the course of judicial, administrative, or legislative proceedings.  The Court noted that there was no defamatory statement made in this case; merely information required by the FFA which was omitted from the notices of intention. Since the omission of information cannot be the cause of a defamation action or other similar tort, the litigation privilege could not apply.

 

The Appellate Division’s holding in Wright serves as a wake-up call to lenders and servicers of the importance in “getting it right” when issuing Notice of Intention letters under the Fair Foreclosure Act. It reminds the creditor’s bar that, while errors in Notice of Intention letters may be “cured” by the reissuance of these notices as permitted by the New Jersey Supreme Court in Guillaume, the mere issuance of faulty Notices of Intention may still lead to civil liability under the New Jersey Truth-In-Consumer Contract, Warranty, and Notice Act.  The attorneys at Halm Law Group specialize in representing lenders and servicers in foreclosure actions in New Jersey and are intimately familiar with the requirements of both the FFA and the TCCWNA.  If you have any questions or concerns about the Wright decision, the FFA, or the TCCWNA, please feel free to contact us.

 

ABOUT THE AUTHOR:     Thomas W. Halm, Jr., Esq. is the founding partner of Halm Law Group, a boutique law firm specializing in creditor’s rights and commercial law, located in Hamilton, New Jersey. Tom has almost twenty-five (25) years of experience exclusively representing lenders and servicers in residential and commercial foreclosure, bankruptcy, and creditor’s rights matters in New Jersey. After spending his career working at some of the largest law firms in the country, he opened Halm Law Group in 2018 to provide his clients with a different, more personalized experience.  

Halm Law Group Welcomes Director of Administration and Marketing

09.05.18

Halm Law Group, LLC is excited to announce the addition of Monica Sargent to our leadership team.  As our new Director of Administration and Marketing, Monica is responsible for all finance, administration, human resources, strategic marketing and communications efforts including brand management, public relations, and community outreach.

She joined the Firm with a strong background in law firm management.  With over 30 years of accounting and law firm administration and marketing experience, Monica is proud to work with the dedicated staff and attorneys at Halm Law Group.  Ms. Sargent’s ability to easily work closely with both staff and attorneys enables the Firm to maintain a positive work environment.  Monica believes this positive environment shows in the way that clients are treated and served by the Firm.

 

In addition to her work at Halm Law Group, Monica is heavily involved in community organization fundraising and has held various positions serving on the Board of Directors at Trenton Catholic Academy (“TCA”), Member of TCA’s Gala Fundraising Committee, Alumni Committee and Marketing Committee and Past Member of the American Cancer Society Gala Committee.

“Monica brings with her a wealth of knowledge and experience in law firm management after spending 25 years at Hill Wallack.  She will be instrumental in our continued growth in the private sector,” said Thomas W. Halm, Jr., Managing Partner of the Halm Law Group. 

Halm Law Group Welcomes Creditors’ Rights/Bankruptcy Attorney

06.25.18

Halm Law Group, LLC welcomes Patricia A. Lauch to the firm as Counsel in its Hamilton, NJ office.  The addition of Patricia is a part of the firm’s ongoing growth and commitment to the development of new attorneys.  She will practice in the firm’s Creditors’ Rights/Bankruptcy Practice Group.

“We are pleased to welcome Patricia to our team, and fully expect that she will use her experience and work ethic to achieve the best results for our clients”, says Firm Managing Partner, Thomas W. Halm, Jr.  “She is a talented lawyer, who will strengthen our firm and provide valuable skills to our clients.”

Ms. Lauch brings with her nearly ten years’ experience as in-house counsel for Santander Bank, N.A., where she provided litigation and bankruptcy support for the commercial workout division, conducted due diligence in connection with the sale of distressed debt, and negotiated the resolution of defaulted loans.  During her tenure at the bank, Ms. Lauch also provided general litigation support to the bank’s Court Order Processing department and contracts support to various lines of business, specializing in the negotiation of affiliate transactions. Prior to her employment at Santander Bank, N.A., Ms. Lauch was an associate at Buchanan Ingersoll & Rooney PC, where she practiced in the Financial Institutions Section with a focus on creditors’ rights and bankruptcy, and an associate at Pepper Hamilton, LLP, where she practiced in the Commercial Litigation Department. 

 

Ms. Lauch is admitted to practice law in the states of New Jersey and New York and federal court in the District of New Jersey.  She earned her law degree with honors from Brooklyn Law School, where she was awarded the Prof. Philip K. Yonge Memorial Prize for exceptional achievement in Commercial Law or Bankruptcy, and her undergraduate degree with honors from Seton Hall University.

 

Additional accomplishments include earning the credentials of Certified Fraud Examiner and Certified Anti-Money Laundering Specialist.

Halm Law Group Celebrates Grand Opening of New Law Office

05.14.18

Halm Law Group, a new law firm in Hamilton, New Jersey is pleased to announce the grand opening of its state of the art, innovative new location at Studio Park, 1800 East State Street, Suite 136.  A grand opening celebration took place on Thursday, May 10, 2018. 

Hamilton Township Mayor Kelly A. Yaede commemorated the celebration with a ribbon cutting ceremony, followed by guest speakers, food truck refreshments, and an office tour. 

Halm Law Group was formed in 2018 with the goal of providing unparalleled legal services in a unique firm business structure.  Areas of concentration include Creditor’s Rights/Bankruptcy, Business/Commercial Services, Finance/Commercial Lending, and Real Estate/Land Use.  The opening of Halm Law Group will allow for the firm to better serve and more efficiently handle its New Jersey case load as the firm continues to grow. The professsionals at Halm Law Group are aggressive, imaginative, goal-oriented and responsive to their client’s needs. The firm’s strategy and approach to handling all matters provides their client base with aggressive yet cost effective representation.  The firm’s lawyers and staff will work closely with each client to ensure highly personalized, accessible, and responsive representation is provided.   

Thomas W. Halm, Jr. is the founding partner of the firm and concentrates his practice in the Creditors’ Rights/Bankruptcy practice.  He has previously been a partner at Greenberg Traurig LLP, Buchanan Ingersoll & Rooney, PC and Hill Wallack LLP, prior to opening the Halm Law Group.  He has also previously served as the Chair of Hill Wallack’s Creditor’s Rights Department and the firm’s Chief Information Security Officer, where he was responsible for achieving and maintaining the firm’s ISO 27001 Certification.  ISO 27001 is the leading standard for information security management systems (ISMS), the purpose of which is to protect client data.  Halm Law Group is currently in the process of obtaining its ISO 27001 Certification.

​Mr. Halm was recognized as a New Jersey Super Lawyer in 2018 in the area of Creditor’s Rights.  In 2006 and 2007, Mr. Halm was recognized by New Jersey Super Lawyers as a Rising Star in the field of bankruptcy law.  Mr. Halm is admitted to practice law in the State of New Jersey and the Commonwealth of Pennsylvania (1994). Following law school, Mr. Halm served as a judicial law clerk to the Honorable James P. Courtney, Jr., Superior Court of New Jersey, Law Division, Ocean County. An honors graduate of Seton Hall University, Mr. Halm received his law degree from Seton Hall University School of Law.

Halm Law Group Founder Named as NJ Super Lawyer

05.03.18

Halm Law Group is pleased to announce that its founding partner, Thomas W. Halm, Jr., has been selected to the 2018 Super Lawyers List, an honor reserved for those lawyers who exhibit excellence in practice.  Each year, only 5% of attorneys in New Jersey receive this distinction.   Super Lawyers is a rating service of outstanding lawyers from more than 70 practice areas who have attained a high degree of peer recognition and professional development. 

Thomas W. Halm, Jr. is the founding partner of the firm and concentrates his practice in the Creditors’ Rights/Bankruptcy practice.  He has previously been a partner at Greenberg Traurig LLP, Buchanan Ingersoll & Rooney, PC and Hill Wallack LLP, prior to opening the Halm Law Group.  He has also previously served as the Chair of Hill Wallack’s Creditor’s Rights Department and the firm’s Chief Information Security Officer, where he was responsible for achieving and maintaining the firm’s ISO 27001 Certification.  ISO 27001 is the leading standard for information security management systems (ISMS), the purpose of which is to protect client data.  Halm Law Group is currently in the process of obtaining its ISO 27001 Certification.

In 2006 and 2007, Mr. Halm was recognized by New Jersey Super Lawyers as a Rising Star in the field of bankruptcy law.  Mr. Halm is admitted to practice law in the State of New Jersey and the Commonwealth of Pennsylvania (1994). Following law school, Mr. Halm served as a judicial law clerk to the Honorable James P. Courtney, Jr., Superior Court of New Jersey, Law Division, Ocean County. An honors graduate of Seton Hall University, Mr. Halm received his law degree from Seton Hall University School of Law.

 

The annual Super Lawyer selections are made using a statewide survey of lawyers, an independent research evaluation of candidates, and peer reviews by practice area.  The result is a credible, comprehensive and diverse listing of exceptional attorneys. The Super Lawyers lists are published nationwide in Super Lawyers Magazines and in leading city and regional magazines and newspapers across the country. Super Lawyers Magazines also feature editorial profiles of attorneys who embody excellence in the practice of law. For more information about Super Lawyers, visit SuperLawyers.com.

Contact

609-212-0300

2360 Route 33 - Suite 112 - Box 134 - Robbinsville, NJ 08691

Follow

©2018 by Halm Law Group, LLC. 

Please be advised that a portion of this firm's business is the collection of consumer debt.  Pursuant to the Fair Debt Collection Practices Act, you are advised that this office may be deemed to be a debt collector and any information obtained may be used for that purpose.