Mortgage Foreclosure-Related Handdowns - January 13, 2022 Edition

First Department

Deutsche Bank Natl. Trust Co. v. Cruz, 2022 NY Slip Op 00246 (January 13, 2022)

The First Department found that the motion court correctly declined to address a defendant’s motion to dismiss for lack of personal jurisdiction because the death of a different defendant three years after the foreclosure action was commenced automatically divested it of jurisdiction.

Note: The Court noted that the applicability of CPLR 205(a) could be decided in the new action, as the motion court had granted leave to refile the action upon dismissal resulting from the death of the defendant and the failure to substitute a new defendant.

U.S. Bank N.A. v Rodriguez, 2022 NY Slip Op 00151 (January 11, 2022)

The First Department upheld the denial of a motion to vacate default and dismiss pursuant to CPLR 5015(a)(4) and CPLR 3211(a)(8). Failure to move to dismiss the action for lack of personal jurisdiction in a prior order to show cause failed to preserve the affirmative defense of personal jurisdiction.

Second Department

Bank of N.Y. Mellon v. Mor, 2022 NY Slip Op 00162 (January 12, 2022)

The Second Department found that the motion court did not err when it granted reargument, but that upon reargument, it should have adhered to its prior determination that the plaintiff was entitled to foreclose, as a letter issued prior to commencement of a prior action did not constitute an acceleration. Accordingly, the new action was not time-barred.

Note: the defendant did succeed in obtaining an order barring collection of installments prior to a certain date.

Bank of N.Y. Mellon v.Silverberg, 2022 NY Slip Op 00163 (January 12, 2022)

The Second Department found that the motion court properly denied a motion to dismiss on the basis of lack of personal jurisdiction, as the process server’s affidavit constituted prima facie evidence of valid service, and the affidavit submitted by defendant failed to rebut the affidavits of service. The court also found that Plaintiff had not violated CPLR 3012-b because “CPLR 3012-b authorizes, but does not require, dismissal of the action, 'without prejudice,' as a sanction for the 'willful[ ]' failure to provide copies of the necessary documents at the time of the filing of the complaint.” Here, BNYM had annexed copies of a CEMA and a consolidated note “endorsed in blank” to both the complaint and the certificate of merit.

Deutsche Bank Nat’l Trust Co. v. Ould-Khattri, 2022 NY Slip Op 00167, (January 12, 2022)

The Second Department reversed, in part, an order tolling interest on a first mortgage for the plaintiff’s delay in obtaining a judgment. The motion was filed by the successor-in-interest to the second mortgage. On appeal, the court found that “the Supreme Court properly found that the nearly 17-month delay in the plaintiff's service of the notice of entry of the order of reference entered April 30, 2014, was excessive,” and that additional tolling was warranted or the time periods in which the plaintiff made two motions for an order of reference after its initial motion for an order of reference was denied for administrative reasons.

HSBC Bank USA, N.A. v. Spitz, 2022 NY Slip Op 00170 (January 12, 2022)

The Second Department reversed an order that had denied summary judgment to plaintiff as well as an order denying the plaintiff’s motion to renew and reargue its summary judgment motion. The court found that the action was not time-barred by the six-year statute of limitations (CPLR 213[4]), because the plaintiff proved that MERS had lacked standing to foreclose in a prior action, as the original lender had physical possession of the promissory note at all time and MERS never had possession.

Nationstar Mtge., LLC v. Dalton, 2022 NY Slip Op 00181 (January 12, 2022)

The Second Department upheld an order discontinuing a foreclosure action without prejudice. "Generally such motions should be granted 'unless the discontinuance would prejudice a substantial right of another party, circumvent an order of the court, avoid the consequences of a potentially adverse determination, or produce other improper results.'"

U.S. Bank N.A. v. Crockett, 2022 NY Slip Op 00211 (January 12, 2022)

The Second Department reversed the motion court’s order denying default judgment pursuant to CPLR 3215 and granting a cross-motion to compel acceptance of a late answer. The court found that the defendant did not contend that the plaintiff’s motion was facially insufficient or that he was not in default; additionally, the court found that the defendant had not demonstrated that he had a reasonable excuse for his default in answering the complaint.

Note: this case also found that contentions improperly raised for the first time in reply should not be considered.

U.S. Bank N.A. v. Crockett, 2022 NY Slip Op 00212 (January 12, 2022)

This decision is a companion to U.S. Bank N.A. v Crockett, 2022 NY Slip Op 00211 (January 12, 2022). It reverses the defendant’s motion for summary judgment dismissing the complaint as time-barred.

U.S. Bank Trust, N.A. v Bank of Am., N.A., 2022 NY Slip Op 00213 (January 12, 2022)

Although the Second Department found that “as long as a defendant is not prejudiced by the inability to submit evidence directly to the referee, a referee's failure to notify a defendant and hold a hearing is not, by itself, a basis to reverse a judgment of foreclosure and sale and remit the matter for a hearing and a new determination of amounts owed,” it reversed the judgment of foreclosure and sale on Gordon grounds, finding that computations based on the review of unproduced business records amounts to inadmissible hearsay.