U.S. District Judge Robert Kugler

A federal judge in Camden, New Jersey, has refused motions by a former president of the New Jersey State Bar Association to halt foreclosure on more than $1 million in loans to his law firm.

U.S. District Judge Robert Kugler granted partial summary judgment to the bank in its action to foreclose on a house in Ocean City, New Jersey, and a building in Bridgeton, New Jersey, owned by Kevin McCann. The judge denied McCann's cross-claims for fraud and breach of contract against the bank in its action to foreclose on McCann's summer house in Ocean City and a building in Bridgeton where McCann's law office is located.

The case stems from two loans made on Feb. 11, 2010, by Sun National Bank to McCann's law firm, Chance & McCann. One, for $975,000, was secured by the Ocean City house and the commercial property in Bridgeton and by leases and rents for those properties. A second loan for $100,000 was secured by McCann's home in Bridgeton. Court documents do not indicate the purpose of the loans.

In 2015, Sun assigned the loans to American First Federal Inc. of Fallon, Nevada, which filed suit against McCann, his wife Sheila, and Chance & McCann in March 2017. The suit seeks to foreclose on the Ocean City property and the commercial property in Bridgeton but not the couple's residence.

Kugler granted the plaintiff's motion for summary judgment on its claims that the defendants are in breach of the two notes and their guarantees. The defendants presented no material evidence to the contrary, obviating the need for discovery on the issue, Kugler said.

Kugler rejected the defendants' counterclaim for fraud in the inducement.

The attorney representing the McCanns and Chance & McCann, Dennis Drasco of Lum, Danzis & Positan in Roseland, New Jersey, did not return a call.

McCann said the 2010 loans from Sun were to refinance the Ocean City house, which he said his family has owned for many years. He said when Sun faced financial difficulties it sold the mortgage to American First Federal. Although Kugler's opinion says Sun made the loans to McCann's law firm, McCann disputes that and says the loan was made to him and his wife.

McCann said American First Federal has “played hardball” but he added that he expects to resolve the dispute without losing either the Ocean City house or the Bridgeton building.

OceanFirst Financial Corp. of Toms River completed its acquisition of Mount Laurel-based Sun in January.

Jonathan Vuotto of McAndrew Vuotto in Cedar Knolls, New Jersey, who represents American First Federal, declined to comment.