A state Supreme Court Justice Robert Berliner has vacated the Cole-Hatchard families confession of judgment signed by James Nicholson admitting he owed family members $931,724.

The decision - which takes effect on Sept. 15 to give the family a chance to appeal – puts Ann and Doris Cole-Hatchard back in line with hundreds of other investors seeking money from the accused financial scammer.

Nicholson, 42,  who grew up in Haverstraw and lived in Stony Point before moving to a multi-million mansion in Saddle River, N.J., faces federal fraud charges of stealing $160 million from more than 400 investors through a Ponzi scheme using his 11 hedge funds. He’s scheduled to appear in federal court in Manhattan tomorrow for a case conference.

Stephen Cole-Hatchard, a police officer, lawyer and elected official, convinced Nicholson to sign the judgment in February confessing he owed Ann and Doris Cole-Hatchard the money based on their investments with Nicholson’s hedge funds. Ann Cole-Hatchard is his wife, while Doris is his mother.

The  federal court appointed receiver, Lee Richards of Manhattan, challenged the confession of judgment signed by Nicholson.

Richards is assigned to search for Nicholson’s wealth and dispose of his properties in an effort to repay investors. His first report found Nicholson has little financial assets – $8,000 in cash  and $39.5 million worth of property – much of which has mortgages and other costs. Richards oversaw the sale of Nicholson’s Southampton house for $25 million – from which nearly $1 million in fees for Richards and others will be paid.

In his decision, Berliner calls Nicholson “Rockland County’s Bernard Madoff.”

As far as the confession of judgment, Berliner wrote in his Aug. 31 decision that the Cole-Hatchard document wrongly cited thousands of dollars in “fictitious” profits orchestrated by Nicholson, rather than just the initial investment. The judge estimated 25 percent was actually money lost, as opposed to alleged profits cited by Nicholson.

The judge also noted the judgment cited Nicholson and his wife, rather than the hedge funds and maangement company that took the investments. He noted there was no evidence the money was given personally to Nicholson to invest.

Nicholson signed the document at his Pearl River office five days before being arrested on federal charges. He came under investigation weeks earlier the Rockland District Attorney’s Office investigators and federal officials because many of his investment checks bounced.

In court papers, the Cole-Hatchards and Richards exchanged allegations of impropriety and questioned each other’s motives. Berliner wrote he would not discuss those issues and just focus on the legal questions.