Opinion
614047-2016
04-25-2018
NIC HOLDING CORP., Plaintiff, v. Erich Peter EISENEGGER a/k/a Erich P. Eisenegger, United States of America (Eastern District), Clerk of the Suffolk County Traffic & Parking Violations Agency, Capital One Bank USA, "John Doe #1" through "John Doe #10," the last twenty(sic) names being fictitious and unknown to the Plaintiff, the person or parties intended being the person or parties, if any, having or claiming an interest in or lien upon the mortgage premises described in the Complaint, Defendants.
Lazer, Aptheker, Rosella & Yedid, P.C., Attorneys for Plaintiff, 225 Old Country Road, Melville, New York 11747-2719 Radow Law Group, P.C., Attorneys for Defendant Eisenegger, 1010 Northern Boulevard, Suite 304, Great Neck, New York 11021
Lazer, Aptheker, Rosella & Yedid, P.C., Attorneys for Plaintiff, 225 Old Country Road, Melville, New York 11747-2719
Radow Law Group, P.C., Attorneys for Defendant Eisenegger, 1010 Northern Boulevard, Suite 304, Great Neck, New York 11021
Peter H. Mayer, J.
Upon the reading and filing of the following papers in this matter: (1) Notice of Motion by the plaintiff, dated December 9, 2016, and supporting papers; (2) Affirmation in Opposition by the defendant, dated January 17, 2016 (sic), and supporting papers; (3) Reply Affirmation by the plaintiff, dated January 20, 2017, and supporting papers; and now
UPON DUE DELIBERATION AND CONSIDERATION BY THE COURT of the foregoing papers, the motion is decided as follows: it is
ORDERED that, after conference with the Court and counsel for the parties on April 24, 2018 pursuant to this Court's January 10, 2018 Order (as adjourned from March 13, 2018), the motion (seq. # 001) by the plaintiff, which seeks an order pursuant to CPLR 3212, granting plaintiff summary judgment and an order of reference, is granted; and it is further
ORDERED that counsel for plaintiff is directed to submit to Chambers a proposed Order of Reference, strictly limited to the relief requested in the motion, and including a paragraph directing the movant to promptly serve a copy of said order, as well as a copy of this Memorandum Decision, upon all appearing parties, or their attorneys if represented by counsel, via First Class mail and to promptly thereafter file the affidavit(s) of such service with the County Clerk; and it is further
ORDERED that counsel for plaintiff shall promptly serve a copy of this Order upon all parties via First Class mail and shall thereafter promptly file the affidavit(s) of such service with the County Clerk.
In moving for summary judgment in an action to foreclose a mortgage, a plaintiff establishes its case as a matter of law through the production of the mortgage, the unpaid note, and the evidence of default (see Coppa v. Fabozzi , 5 AD3d 718, 773 NYS2d 604 2d Dept 2004]; EMC Mortgage Corp. v. Riverdale Assocs ., 291 AD2d 370, 737 NYS2d 114 [2d Dept 2002] ; Republic Nat'l Bank of NY v. Zito , 280 AD2d 657, 721 NYS2d 244 [2d Dept 2001] ; Green Point Savings Bank v. Spivey , 253 AD2d 410, 676 NYS2d 228 [2d Dept 1998] ; Fairfield Affiliates v. Rosenbaum , 232 AD2d 522, 648 NYS2d 975 [2d Dept 1996] ). The burden then shifts to the mortgagor to demonstrate, by admissible evidence, that there are genuine issues of material fact with respect to his or her alleged affirmative defenses which require a trial (see Union State Bank v. Blankfort, 222 AD2d 430, 635 NYS2d 517 [2d Dept 1995] ).
A plaintiff bank seeking summary judgment in a foreclosure action must make a prima facie showing of entitlement to a judgment of foreclosure as a matter of law by offering proof that the mortgagor executed the loan documents and defaulted on the payments (see Green Point Savings Bank v. Spivey , 253 AD2d 410, 676 NYS2d 228 [2d Dept 1998] ; Fairfield Affiliates v. Rosenbaum , 232 AD2d 522, 648 NYS2d 975 [2d Dept 1996] ). The burden then shifts to the mortgagor to demonstrate, by admissible evidence, that there are genuine issues of material fact with respect to his or her alleged affirmative defenses which require a trial (see Union State Bank v. Blankfort, 222 AD2d 430, 635 NYS2d 517 [2d Dept 1995] ). In this regard, a mortgagor's mere conclusory allegations are insufficient to defeat a motion for summary judgment (see , Parker v. Top Homes, Inc ., 58 AD3d 817, 873 NYS2d 112 [2d Dept 2009] ; European Am. Bank v. Abramoff, 201 AD2d 611, 608 NYS2d 233 [2d Dept 1994] ).
Once a plaintiff in a foreclosure action makes a prima facie showing of entitlement to summary judgment as a matter of law, it is incumbent upon the answering defendants to submit proof sufficient to raise questions of fact to rebut the plaintiff's prima facie showing, or in support of the affirmative defenses and counterclaims asserted in their answer (see Grogg Assocs. v. South Rd. Assocs ., 74 AD3d 1021, 907 NYS2d 22 [2d Dept 2010] ; Washington Mut. Bank v. O'Connor , 63 AD3d 832, 880 NYS2d 696 [2d Dept 2009] ; J.P. Morgan Chase Bank, NA v. Agnello , 62 AD3d 662, 878 NYS2d 397 [2d Dept 2009] ).
In this action, plaintiff seeks to foreclose upon a note and mortgage given by plaintiff to defendant, Erich Peter Eisenegger, in the principal amount of $1,050,000.00 for purchase of his home, located at 82 Huntington Road, Cold Spring Harbor, New York. Plaintiff now moves for summary judgment and an order of reference to compute. In opposition, defendant contends that plaintiff's failure to serve a 90 day notice, which is mandated by RPAPL § 1304 prior to commencement of a foreclosure action, requires denial of plaintiff's motion, as well as dismissal of plaintiff's complaint. Plaintiff, however, notes that it was not obligated to provide defendant with a RPAPL 1304 notice prior to commencing this action, because "[it] is not a ‘lender, assignee or mortgage loan servicer’ as defined in Section 1304 of [RPAPL ]."
In relevant part, RPAPL § 1304(1), provides "with regard to a home loan, at least ninety days before a lender ... commences legal action against the borrower ... including mortgage foreclosure, such lender ... shall give notice to the borrower" in the manner and form specified in the statute. The term "lender" is defined in RPAPL § 1304(6)(b) as "a mortgage banker as defined in [§ 590(1)(f) ] of the banking law or an exempt organization as defined in [§ 590(1)(e) ] of the banking law." Banking Law § 590(1)(f) defines "mortgage banker" as "a person or entity who or which is licensed pursuant to [ Banking Law § 591 ] to engage in the business of making mortgage loans in this state." Pursuant to Banking Law § 590(1)(e), "exempt organization" means "any insurance company, banking organization, foreign banking corporation licensed by the superintendent or the comptroller of the currency to transact business in this state, national bank, federal savings bank, federal savings and loan association, federal credit union, or any bank, trust company, savings bank, savings and loan association, or credit union organized under the laws of any other state, or any instrumentality created by the United States or any state with the power to make mortgage loans...."
In a sworn affidavit, plaintiff's corporate controller, Steven A. Lessmann, avers that plaintiff is in the petroleum business and is not in the business of giving loans collateralized by mortgages for the purchase of residential homes. According to Mr. Lessmann Plaintiff is actually involved in regulated commodity futures exchanges and, as such, is a member of the New York Mercantile Exchange. One of plaintiff's traders, Donald England, was relocating to Oklahoma and defendant, an attorney at a Madison Avenue law firm, wished to purchase the subject property from Mr. England and his wife. As an accommodation to Mr. England, to facilitate a quicker sale, plaintiff agreed to provide the funds for the sale of the property to the defendant, a partner in a Madison Avenue law firm at the time. In this regard, plaintiff agreed to hold a mortgage against the property and a 5 year balloon note $1,050,000.00 with a maturity date of October 1, 2017.
Where a plaintiff sells the subject property to the defendant borrower and gives a mortgage in connection with the sale, the plaintiff is not required to serve the borrower with the statutory 90-day notice prior to commencement of a foreclosure action, unless the plaintiff is "lender, assignee, or mortgage loan servicer" within meaning of a RPAPL § 1304(1) (see Kehoe v. Harvest Moon Beach House, LLC , 142 AD3d 1142, 38 NYS3d 69 [2d Dept 2016] ). Accordingly, where a private lender as mortgagee is not a lender, assignee, or mortgage loan servicer within meaning of statute governing mortgage foreclosure requirements, such mortgagee is not required to serve mortgagors with statutory 90-day notice prior to commencement of foreclosure action (see Banking Law § 590[1][e], [f] ; RPAPL § 1304 ; Kehoe v. Harvest Moon Beach House, LLC , 142 AD3d 1142, 38 NYS3d 69 [2d Dept 2016] ; Manitoli, LLC v. Hartwell , 140 AD3d 710, 33 NYS3d 367 [2d Dept 2016] ). Therefore, the plaintiff's motion is granted.
Submit Order of Reference on notice.
This constitutes the Decision and Order of the Court.