I get many calls each week from folks looking to Vacate a New Jersey Default Judgment. Often these calls come in shortly after one is served with an Information Subpeona from the original judgment creditor, or from a “new” creditor who has purchased the old judgment.
Below is a helpful Frequently Asked Questions (FAQ) post which answers some of the most common questions I receive about Vacating NJ Default Judgments:
Q: How long do I have to vacate a NJ Default Judgment?
A: Under NJ Court Rule 4:50-1, you have one year from the date the judgment is entered to move to vacate, provided you are basing your motion to vacate default on grounds of one of the following subsections of the Rule:
(a) mistake, inadvertence, surprise, or excusable neglect;
(b) newly discovered evidence which would probably alter the judgment or order and which by due diligence could not have been discovered in time to move for a new trial under R. 4:49;
(c) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party;
It is ALWAYS best to make a Motion to Vacate Default Judgment as soon as possible and within one year from the date the default judgment was entered. Motions made within one year of default have a MUCH higher chance of being granted by the Court.
Sadly, I receive many calls from potential clients with judgments that were entered several years ago, and in some cases more than 10 years ago. This is because:
A) A robust debt re-sale market exists where old judgments are sold or assigned, often for a small fraction of the dollar amount or “face value” of the judgment,
So what can you do if more than one year has passed since the default judgment against you was entered?
Under NJ Court Rule 4:50-1, the one-year time limit only applies to motions to vacate that are based on subsections “a”, “b”, and “c,” of Rule 4:50-1, which I listed above in this blog post.
Subsections “d,” “e” and “f” of NJ Court Rule 4:50-1 do not have a one-year time limit, but rather the rule states that a Motion to Vacate Default Judgment brought under these subsections be brought within a “reasonable time.” Below are the relevant grounds to vacate a default if more than one year has elapsed since the judgment was entered:
(d) the [default] judgment or order is void;
(e) the [default] judgment or order has been satisfied, released or discharged, or a prior judgment or order upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment or order should have prospective application; or
(f) any other reason justifying relief from the operation of the judgment or order.
Whew- what a lot of legalese! Let me put the above subsections into plain English and explain what they really mean in practice, and what upper-level NJ Appellate Courts have had to say about them:
Subsection “e,” allows a default judgment to be vacated if “the judgment or order is void.” So what makes a judgment or order “void?” In almost every case, the judgment was declared “void” because the defendant was never properly served with the Complaint. To prevail under this subsection is not easy, however, because under the NJ Special Civil Part Rules, complaints are served by the Court via both regular and certified mail. If you fail to sign for the certified mail, but the REGULAR MAIL copy is not returned to the Court as “undelivered” by the Post Office, then you have been properly served. To prove that you were not served, you would need evidence that you did not live at the address where the complaint was served at the time the complaint was served. Good ways to prove non-residence are military deployment paperwork, proof you were incarcerated, etc.
Subsection “e” would apply if you have since settled the judgment in full, or if you settled the substance of the judgment with a prior assignee or the original creditor. You will need written proof that any previous settlement of the judgment was a “full” satisfaction of the judgment. I had this situation recently with a client who had been sued by an assignee of BMW Auto Credit. Turns out the debt had been assigned several times hence, and he saved his paperwork. I was able to quickly get the case dismissed, and the judgment off his credit report. It also happens that debts/judgments previously discharged in bankruptcy occasionally “fall thru the cracks” and get sued upon by mistake.
Subsection “f” is a “catch-all” provision that looks nice on paper, but is much more difficult (and rarely granted) in practice than it appears. Whether or not a judgment is vacated under subsection “F” must be addressed on a case-by-case basis.
In closing, here is the “good news” that could result in you paying far less (or nothing at all) on an old NJ judgment:
1. Being represented by a competent New Jersey collections defense attorney in a Motion to Vacate Default Judgment matter assures that the paperwork is filed properly, the correct legal arguments are presented and made, and the relevant or “on-point” cases are both properly cited and applicable to your case. The NJ Special Civil Part is a very busy place, and judges and court staff have little patience for a layperson’s unfamiliarity with the Court rules or irrelevant arguments/evidence.
2. Sometimes the mere filing by an attorney of a Motion to Vacate Default will result in calls from the creditor offering to settle the case at a substantial discount. Buying old “zombie” debt is a high-volume business model which counts on defendants ignoring their notices and/or improperly opposing their case. Angry calls and threats from debtors/defendants don’t phase or scare them a bit, but a properly filed and argued NJ Motion to Vacate Default drafted by an experienced defense attorney usually gets their attention in a hurry. When the collectors see an attorney is involved, they often fear possible FDCPA complaints and other headaches, as well as the expense of time/effort into writing an opposition and appearing in Court. They immediatley realize that threats and bullying will no longer work, and that the case will be decided solely on its legal merits (or, often, lack thereof).
3. If a Motion to Vacate Default is granted, this means that your original case is “re-opened,” and the process starts over from scratch. You may file an Answer, contest the merits of the plaintiff’s case, serve interrogatories, and take other steps to make them prove the debt is valid and that they have the right to collect.
Call me today at 908-782-5313 to discuss your case, and check out my YouTube video below. And remember, its always better to retain an attorney as soon as possible when you are served with a NJ Special Civil Part complaint, as opposing the case from the get-go is always easier (and cheaper) than vacating a default motion.
NOTHING IN THIS POST CONSTITUTES LEGAL ADVICE. ALSO, BE ADVISED THAT CONTACTING OUR FIRM THROUGH THE “CONTACT US” FEATURE DOES NOT CREATE AN ATTORNEY-CLIENT RELATIONSHIP.