NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION
DOCKET NO. A-4696-08T2

U.S. BANK NATIONAL ASSOCIATION,

TRUSTEE FOR LEHMAN BROTHERS-
STRUCTURED ASSET INVESTMENTS
LOAN TRUST SAIL 2005-7,

Plaintiff-Respondent,

vs.

PHILIP J. BERG,

Defendant-Appellant,

and

MRS. PHILIP BERG, his wife and

UNITED STATES OF AMERICA,

Defendants.

__________________________________

Argued: September 15, 2010 - Decided: October 5, 2010

Before Judges Cuff and Fisher.

On appeal from the Superior Court of New

Jersey, Chancery Division, Atlantic County,
Docket No. F-1888-07.

Philip Berg argued the cause pro se.

Vladimir Palma argued the cause for

respondent (Phelan Hallinan & Schmieg, PC,
attorneys; Mr. Palma, on the brief).

PER CURIAM
 This is a mortgage foreclosure action. Nearly five months

after the Sheriff's Sale, defendant Philip Berg filed a motion

to vacate default, the default judgment, and the Sheriff's Sale,

to void the deed, and to stay eviction. Defendant argued that

plaintiff U.S. Bank National Association (U.S. Bank) lacked

standing to file the complaint in foreclosure because it did not

possess the note at the time it filed the complaint. Judge

William Todd held that U.S. Bank need only gain possession of

the note before entry of the judgment of foreclosure, and found

that it had possession at that time. He, therefore, denied

relief to defendant and also vacated the stay of eviction.

On appeal, defendant reiterates this argument. In doing

so, he calls to our attention a recent unpublished decision1 by

Judge Todd which held that the mortgagee must be in possession

of the note at the time it files its complaint in foreclosure in

order to have standing. U.S. Bank responds that it held the

note at the time it filed the complaint. Furthermore, it

contends that the motion to vacate the series of defaults and

Sheriff's Sale is untimely and would prejudice the innocent

third party to whom U.S. Bank sold the property. We affirm.

1
Bank of New York v. Michael J. Raftogianis, Docket No. F-7356-
09 (Ch. Div. June 29, 2010).

2 A-4696-08T2
 On November 29, 2005, defendant filed for protection under

Chapter 13 of the United States Bankruptcy Code, 11 U.S.C.A. §§

1301-1330. At the time, he had defaulted on his obligations on

a note and mortgage given by him on real property in Atlantic

County. He listed the property that is the subject of this

foreclosure action as part of his bankruptcy estate and noted

U.S. Bank's servicer as a secured creditor. Defendant and U.S.

Bank entered a settlement stipulation in which defendant

acknowledged the debt, and that he had defaulted on his payment

obligations under the mortgage loan and on his obligations

assumed in the bankruptcy proceeding. Following defendant's

further default of the settlement agreement, U.S. Bank obtained

an order dated May 21, 2007, granting relief from the automatic

stay.

On July 31, 2007, U.S. Bank filed a foreclosure complaint.

Defendant filed a notice of appearance on October 16, 2007, in

which he did not challenge U.S. Bank's standing; the filing was

deemed a non-conforming answer. On November 14, 2007, U.S. Bank

filed its certification in support of default, followed by its

proofs in support of final judgment, which was entered on March

14, 2008.

Thereafter, U.S. Bank scheduled a Sheriff's Sale for May 8,

2008. After exercising his rights to two adjournments and an

3 A-4696-08T2
additional thirty days granted by U.S. Bank to allow defendant

to satisfy the mortgage, the property was scheduled to be sold

on July 10, 2008. On July 9, 2008, defendant applied to the

court for a sixty-day stay; the court awarded a week stay of

sale. After more requests by defendant for time to satisfy the

loan, the Sheriff's Sale eventually proceeded on October 23,

2008. U.S. Bank purchased the property for the minimum bid of

$100. Defendant failed to redeem the mortgage, the Sheriff

issued a deed, and U.S. Bank recorded the deed on November 26,

2008. At no time did defendant challenge U.S. Bank's standing

to initiate the foreclosure proceedings.

Thereafter, on March 17, 2009, nearly five months after the

Sheriff's Sale, defendant filed a motion challenging U.S. Bank's

standing to file the complaint. He sought vacation of default,

default judgment and the Sheriff's Sale. He also sought to void

the Sheriff's deed and to stay his eviction. Judge Todd denied

all relief, including a stay of eviction. This court also

denied a stay of eviction pending appeal. U.S. Bank advised us

at oral argument that the property has been sold to a third

party.

The issue of standing to initiate a mortgage foreclosure

action has emerged as a "hot topic" in the wake of the sub-prime

mortgage market collapse and the vast number of mortgage

4 A-4696-08T2
foreclosures filed nationwide. For example, a federal district

court judge dismissed twenty-seven mortgage foreclosure cases

because plaintiffs had failed to submit evidence of standing at

the time they filed the complaints. In re Foreclosure Cases,

521 F. Supp. 2d 650 (N.D. Ohio 2007). The court also held that

to demonstrate standing a mortgagee must demonstrate that it was

the holder of the note and mortgage at the time the complaint is

filed. Id. at 654-55. In New Jersey, no appellate opinion has

addressed the issue. As noted, Judge Todd has recently issued

an unreported opinion in which he opined that the mortgagee must

have possession of the note at the time it files the complaint.

Bank of New York, supra, slip op. at 36. A noted commentator

writes that mere delivery of the note will suffice to establish

standing. 30 New Jersey Practice, Law of Mortgages § 28.9, at

504 (Myron C. Weinstein) (2d ed. 2001). If the mortgage has

been assigned, the assignment is not required to be recorded to

be effective. Ibid. See also, 29 New Jersey Practice, Law of

Mortgages § 11.3, at 792 (Myron C. Weinstein) (2d ed. 2001).

Here, however, we need not decide the standing issue for

several reasons. First, the record demonstrates to our

satisfaction that U.S. Bank possessed the note when it filed the

complaint. Second, at various times and in various contexts,

defendant acknowledged the validity of the note and mortgage.

5 A-4696-08T2
Third, defendant did not move to vacate the judgment and sale

within a reasonable time.

In its complaint, U.S. Bank stated that the mortgage had

been assigned to it but not yet recorded. In its certification

in opposition to defendant's motion to vacate the judgment and

Sheriff's Sale, U.S. Bank reported that it acquired the note and

mortgage on July 1, 2005. It filed that complaint on July 31,

2007. Furthermore, defendant has continually acknowledged the

validity of the note and mortgage and his default.

Defendant's motion to vacate all prior orders in this

matter is also out-of-time. Rule 4:50-1 permits a party to be

relieved from a final judgment for several reasons. Defendant

argues the judgment is void because U.S. Bank lacked standing.

R. 4:50-1(d). A party must still move to set aside a void

judgment within a reasonable time. R. 4:50-2. What is a

reasonable time depends on the circumstances of a given case.

Notably, when a party seeks to set aside a judgment and the

relief would interfere with rights acquired by innocent third

parties in the interim, relief will be denied. Friedman v.

Monaco & Brown Corp., 258 N.J. Super. 539, 543 (App. Div. 1992);

City of Newark v. (497) Block 1854, 244 N.J. Super. 402, 408

(App. Div. 1990)

6 A-4696-08T2
 In City of Newark, a property owner sought to vacate a

judgment entered in an in rem foreclosure proceeding. Id. at

404. The property owner argued that it had never been served

with the tax foreclosure complaint. Ibid. It waited three

years after it learned the property had been sold for unpaid

taxes to file its motion to vacate the judgment. Id. at 405.

When it filed its motion, a third party was on the verge of

acquiring the property. Id. at 406. We held that the property

owner was not entitled to relief "where [it] waited almost three

years after learning that its properties had been acquired by

the City, acted in a manner that appeared to concede the

validity of the judgment which had divested it of its property,

and attacked the judgment only when the property was about to be

conveyed to a contract purchaser." Id. at 408. See also,

Friedman, supra, 258 N.J. Super. at 545 (motion to vacate a

judgment denied to the sole heir of a woman who had owned

waterfront property but lost it due to unpaid taxes when relief

sought fifty years later).

Here, defendant acted at all times in a manner that

recognized not only the validity of the note and mortgage but

also U.S. Bank's right to collect the funds owed to it and to

foreclose on default. In bankruptcy proceedings, defendant

listed the debt to U.S. Bank and entered a settlement agreement

7 A-4696-08T2
with U.S. Bank concerning the property in that proceeding. He

did not contest U.S. Bank's standing when it filed the complaint

in July 2007. Following entry of final judgment in March 2008

and throughout the time he sought to delay the Sheriff's Sale,

defendant did not contest U.S. Bank's standing to pursue the

matter. Rather, defendant acted at all times as if the judgment

was valid. Under these circumstances, the delay in questioning

the standing of U.S. Bank to file its complaint in foreclosure

until five months after the Sheriff's Sale is simply too late.

Furthermore, we have been informed that the property has been

sold to a third party.

We, therefore, affirm the April 17, 2009 order.

Affirmed.

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