Opinion
Index No. 52211/2017
05-08-2019
CITIBANK, N.A., Plaintiff, v. MARGARITA SPINETTI a/k/a MARGARITA Q. SPINETTI, DISCOVER BANK, JOHN SPINETTI, Defendants.
NYSCEF DOC. NO. 75 To commence the statutory time for appeals as of right (CPLR 5513[a]), you are advised to serve a copy of this order, with notice of entry, upon all parties. DECISION and ORDER
Sequence No. 2 RUDERMAN, J.
The following papers were considered in connection with plaintiff's motion for an order confirming the referee's report, granting a judgment of foreclosure and sale, and related relief, and the cross-motion of defendant Margarita Spinetti ("defendant") for an order vacating her default in answering plaintiff's motion for summary judgment and vacating the order of reference, and for a stay of this action in order to allow her to sell the premises:
| Papers Numbered | |
|---|---|
| Notice of Motion, Affirmation and Exhibits A - I | 1 |
| Notice of Cross-Motion, Affirmation in Opposition to Motion andin Support of Cross-Motion, Exhibits A - I | 2 |
| Affirmation in Opposition to Cross-Motion and Reply, Exhibits A - B | 3 |
| Affirmation in Further Support of Cross-Motion, Exhibit A | 4 |
This mortgage foreclosure action was commenced following a default by defendant borrower on a home equity note in the principal sum of $100,000, secured by a mortgage on the subject premises located at 32 Claudet Way in Eastchester New York. Defendant filed her form answer to the complaint on March 3, 2017. After eight settlement conferences were unsuccessful, the action was released to litigation, and plaintiff moved for summary judgment on April 18, 2018. No opposition having been filed, this Court granted plaintiff's motion for summary judgment and appointment of a referee to compute. On September 25, 2018, plaintiff sent defendant a notice of computation dated September 20, 2018, indicating that defendant had until October 9, 2018 to serve objections to the proposed calculations. In the absence of any objections, the referee issued her report on October 11, 2018, finding that $72,061.46 remains due and owing on the note. Plaintiff then filed this motion to confirm the report and for a judgment of foreclosure and sale.
Defendant cross-moved to vacate her default in failing to oppose the summary judgment motion, and to vacate the award of summary judgment and the order of reference. Her excuse for the failure is her unrepresented status; her attorney states in his affirmation that she was unaware of the need to file formal written opposition to the motion. Counsel further asserts that there are valid defenses to the foreclosure, such as a failure to comply with conditions precedent, and that the Referee's report must be disaffirmed because the Referee did not hold a hearing and the computation was not based on proper evidence.
Defendant states in her affidavit dated January 14, 2019 that the house has been listed for sale since November 18, 2018 at a listing price of $975,000, and that there are multiple offers. She expects to be able to sell the house and pay the total debt of $72,061.46.
Plaintiff argues in opposition to the cross-motion that nothing submitted with the cross-motion establishes a basis to vacate defendant's default, and that there is no merit to defendant's other arguments.
In reply, defendant submits an executed contract of sale for the property, dated February 6, 2019, for a purchase price of $865,000.00, with a 45-day mortgage contingency period and a closing date of April 15, 2019.
As of the date of this decision, defendant has not filed any further submissions regarding whether a closing occurred on the sale contract.
Analysis
"In order to vacate a default in opposing a motion, the moving party is required to demonstrate a reasonable excuse for the default and a potentially meritorious opposition to the motion" (Wachovia Mtge., FSB v Coleman, ___ AD3d ___, 2019 NY Slip Op 02379, 2019 NY App Div LEXIS 2340, *3 [2d Dept 2019]). Defendant has not provided a reasonable excuse for her default on plaintiff's summary judgment motion. Her attorney's assertion that defendant, then unrepresented, did not realize she had to submit opposition to the summary judgment motion, may not be considered because it is not evidentiary in nature; in any event, the claim does not, in itself, constitute a valid excuse for defendant's default (see U.S. Bank Natl. Assn. v Slavinski, 78 AD3d 1167, 1167 [2d Dept 2010]).
Moreover, defendant has failed to establish that she has a meritorious defense to the motion or this foreclosure action. She does not dispute the debt or her default. There is no merit to the defense that plaintiff failed to comply with the conditions precedent created by RPAPL 1304 and the mortgage's requirement of a notice of default. While the plaintiff's burden in this regard is not satisfied by an affiant's "unsubstantiated and conclusory statement" that the notices were sent (see e.g. Cenlar, FSB v Weisz, 136 AD3d 855, 856 [2d Dept 2016]), there are a number of ways to prove the requisite mailings. It may be established with "[p]roof of the actual mailings, such as affidavits of mailing or domestic return receipts with attendant signatures, or proof of a standard office mailing procedure designed to ensure that items are properly address and mailed, sworn to by someone with personal knowledge of the procedure" (Wells Fargo Bank v Mandrin, 160 AD3d 1014, 1015 [2d Dept 2018]); it may also be demonstrated where the plaintiff offers its correspondence log, and the affidavit of a document control officer stating that plaintiff's "'standard business procedure regarding all notices to the borrower(s)' is to enter mailing information in the correspondence log" (see Citimortgage, Inc. v Espinal, 134 AD3d 876, 878 [2d Dept 2015]).
Here, plaintiff did not merely rely on a conclusory and unsubstantiated assertion that the notices were sent as required. The affidavit of Michelle Roark, which was submitted with the summary judgment motion, discussed and annexed Exhibit 7, a copy of "a business record whose entries were created at the time of the mailings of the notice by first class regular mail and by certified mail, and is maintained in the regular course of business of CitiMortgage, Inc.," which document indicates that the 1304 notices were mailed on January 8, 2016 by first class and certified mail. This sufficiently substantiates the assertion that the necessary notices were mailed to defendant in the required manner.
Nor has defendant offered an effective challenge to the referee's report. The lack of an evidentiary hearing does not invalidate the report. An evidentiary hearing may not be required where the defendant, having received notice of the hearing date, does not file objections or appear on the scheduled date (see FDIC v 65 Lenox Rd. Owners Corp., 270 AD2d 303, 304 [2d Dept 2000]). Moreover, this Court could make new findings or direct a hearing if defendant had offered evidence creating an issue of fact regarding whether the Referee's calculations were correct (id.), but in the absence of a showing of what evidence the Court or the Referee should consider, no further review is necessary.
Finally, defendant seeks an indefinite stay of the action to give her time to sell the property and pay off the accelerated debt in full. While this Court has the authority to, in its discretion, grant a stay of proceedings "upon such terms as may be just" (see CPLR 2201), defendant has not established that the equities are in her favor. This action was commenced over two years ago, and defendant has had it in her power since that time to take those steps to pay off the undisputed debt. By failing to do so, she effectively forced plaintiff to proceed to litigate its claim, which has now advanced to the point where plaintiff is entitled to the entry of a judgment of foreclosure and sale. At this juncture, plaintiff's interest in finally collecting the full amount due under the note and mortgage is no less pressing than defendant's interest in protecting the equity in her house by effectuating a private sale and retaining the remainder of the sale price.
Moreover, the assertion that the house has been on the market since November 18, 2018 fails to establish that defendant will successfully sell it. Even the existence of an executed contract of sale does not establish that the sale on the contract will close, timely or otherwise.
In sum, in the face of plaintiff's entitlement to entry of a judgment of foreclosure and sale, defendant's belated intention to sell the property does not, in itself, entitle defendant to stay the litigation process, including entry of the judgment and the subsequent steps necessary to scheduling and eventually conducting a foreclosure sale.
Of course, defendant continues to be entitled to pay off the debt if she succeeds in selling the property for an amount greater than the debt, up to the point that the foreclosure sale is actually held. However, her present cross-motion has not established that the equities entitle her to a stay.
Any argument not specifically discussed herein is deemed to have been considered and rejected.
Accordingly, it is
ORDERED that plaintiff's motion is granted, and the referee's report is confirmed, and it is further
ORDERED that defendant's cross-motion is denied in its entirety.
Judgment of foreclosure and sale signed. Dated: White Plains, New York
May 8, 2019
/s/_________
HON. TERRY JANE RUDERMAN, J.S.C.