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Superior Court of New Jersey, Appellate Division.

CAPITAL ONE BANK, Plaintiff–Respondent, v. DARYL C. FALLAS, Defendant–Appellant.

DOCKET NO. A–1242–12T4

    Decided: April 03, 2014

Before Judges Reisner and Carroll.Daryl Fallas, appellant pro se. Lyons, Doughty & Veldhuis, attorneys for respondent (Laurie H. Lyons, on the brief).

Defendant Daryl C. Fallas appeals from a November 8, 2012 Law Division order denying his motion to vacate judgment.   We affirm.

We briefly recount this matter's tortured procedural history to give context to the trial court's decision.   On October 12, 2007, plaintiff Capital One Bank obtained summary judgment against defendant on a credit card debt.   On October 31, 2007, defendant moved for reconsideration, and to dismiss plaintiff's complaint.   On November 16, 2007, the court denied defendant's motion.

Almost five years later, defendant moved to vacate the judgment under Rule 4:50–1(f), and again sought dismissal of plaintiff's complaint.   In a supporting brief, defendant asserted that his Customer Agreement (Agreement) with plaintiff, which he attached as an exhibit, contained a paragraph entitled “Governing Law,” that provided:  “This Agreement is made in Virginia.   It will be governed only by Federal law and Virginia law (to the extent not preempted by Federal law).”   Defendant argued that this provision deprived the court of jurisdiction over the matter.   Defendant's motion was denied on August 14, 2012.   In an attached rider, Judge Honora O'Brien Kilgallen found no basis to vacate the judgment or dismiss the complaint.   She noted that defendant knew that summary judgment had been entered against him, and that he had “filed a motion seeking reconsideration and to dismiss the complaint, no doubt for the same reason he argues here, [i.e.,] that the [c]ourt lacks jurisdiction.   This request was denied almost five years ago.”

Defendant immediately moved for reconsideration of the August 14, 2012 order.   He also filed additional motions (1) seeking assignment of counsel;  and (2) to compel plaintiff's attorney to provide proof of service of its opposition to defendant's motion to vacate the judgment and dismiss the complaint.   Judge Kilgallen denied the motions on September 25, 2012.   Amplifying her earlier statement of reasons, the judge noted that defendant's initial motion for reconsideration of the summary judgment should have included any defense concerning jurisdiction, and if defendant failed to raise it, it was deemed waived.   Defendant did not appeal from either the August 14 or September 25, 2012, orders.

Plaintiff moved to preclude defendant from filing further motions for reconsideration or to vacate judgment, which the court granted on October 4, 2012.   Judge Kilgallen's decision was again fully set forth in a written rider, which recounted the factual and procedural background of the case.   The judge concluded that defendant continued to file the same motions, without sufficient basis, and that his remedy if he still felt aggrieved was to appeal to the Appellate Division.

Rather than appeal, defendant again moved to vacate the judgment and dismiss plaintiff's complaint for lack of jurisdiction, contrary to the October 4, 2012 order.   Judge Kilgallen denied the motion on November 8, 2012, reiterating that defendant's sole option was to file an appeal.   The order also provided for the imposition of sanctions should defendant file any further motions in violation of the October 4, 2012 order.

Defendant now appeals, challenging only the November 8, 2012 order.   He argues that the Agreement contained language that it was to be governed only by Virginia or federal law, and therefore the trial court lacked jurisdiction over the case.   He further asserts, without additional explanation, that he is entitled to relief from judgment under Rule 4:50–1(f).  Based on our examination of the record and the applicable law, we have concluded that these arguments are without sufficient merit to warrant extended discussion.   R. 2:11–3(e)(1)(E).   We add the following comments.

Rule 4:50–1 provides in pertinent part that “[o]n motion, with briefs and upon such terms as are just, the court may relieve a party or the party's legal representative from a final judgment or order for the following reasons:  ․ (d) the judgment or order is void;  ․ or (f) any other reason justifying relief from the operation of the judgment or order.”   The rule is “designed to reconcile the strong interests in finality of judgments and judicial efficiency with the equitable notion that courts should have authority to avoid an unjust result in any given case.”  US Bank Nat. Ass'n v. Guillaume, 209 N.J. 449, 467 (2012) (internal quotation marks omitted).

We afford “substantial deference” to the trial judge and reverse only if the judge's determination amounts to a clear abuse of discretion.  Ibid. An abuse of discretion is when a decision is “made without a rational explanation, inexplicably departed from established policies, or rested on an impermissible basis.”  Ibid. (internal quotation marks omitted).

A judgment may be set aside under Rule 4:50–1(d) as void for lack of personal jurisdiction without the need for a defendant to establish a meritorious defense.  Jameson v. Great Atlantic and Pacific Tea Co., 363 N.J.Super. 419, 425 (App.Div.2003), certif. denied, 179 N.J. 309 (2004).   However, defendant does not deny that he is a New Jersey resident, or claim that the trial court lacked personal jurisdiction over him.   Rather, his jurisdictional attack rests solely on a misguided interpretation of the Agreement.   Contrary to defendant's assertion, the Agreement does not preclude suit in New Jersey.   Instead it merely provides that it will be governed by Virginia or federal law.   Thus, we find no basis to conclude that the trial court lacked jurisdiction.   Even if in originally entering judgment the court erred by applying New Jersey law, which defendant has not demonstrated, it would not render the judgment void under this rule.   See, e.g., Hendricks v. A.J. Ross Co., 232 N.J.Super. 243, 248–49 (App.Div.1989) (“[e]ven gross errors [of law] committed by a court in reaching a decision do not render the court's order or judgment void”).

Finally, we disagree that Rule 4:50–1(f) justifies vacation of the judgment.   This catchall provision “is available only when truly exceptional circumstances are present.”  Guillaume, supra, 209 N.J. at 484 (internal quotation marks omitted).   The applicability of this subsection is limited to “situations in which, were it not applied, a grave injustice would occur.”  Ibid. (internal quotation marks omitted).   On this record, defendant has not shown any such “exceptional circumstances.”



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