Opinion
Index No. 1132/2017 Mot. Seq. No. 1
08-17-2022
U.S. BANK, NATIONAL ASSOCIATION, AS TRUSTEE FOR LEHMAN XS TRUST MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-10N, Plaintiff, v. DAVID MARCIA, et. al., Defendants.
Unpublished Opinion
Motion Submitted: 5/12/22
FORECLOSURE PART
HON. DAVID P. SULLIVAN SUPREME COURT JUSTICE
The following papers were read on these motions:
Notice of Motion and Supporting Documents. . . . . . 1
Affirmation in Opposition and Supporting Documents. . . . . .2
Affirmation in Reply and Supporting Documents. . . . . . 3
Defendant David Marcia (hereinafter "Defendant") has moved by notice of motion for an order declaring his amended answer to have been properly interposed, and for an order dismissing the complaint as time-barred. Plaintiff opposed, Defendant replied, and the motion was deemed submitted on May 12, 2022.
Summary judgment is appropriate when there is no issue of material fact and the movant is entitled to judgment as a matter of law. CPLR § 3212; Zuckerman v New York, 49 N.Y.2d 557 (1980); St. Claire v Empire Gen. Contr. & Painting Corp., 33 A.D.3d 611 (2nd Dept. 2006). A movant has the initial burden of showing that no genuine issue of material fact exists. Alvarez v Prospect Hosp., 68 N.Y.2d 320 (1986). The burden then shifts to the party opposing the motion for summary judgment to come forth with evidence, in admissible form, showing the existence of a triable issue of fact. Bercy Invs. v Sun, 239 A.D.2d 161 (1st Dept. 1997); Federal Home Loan Mtge. Corp. v Karastathis, 237 A.D.2d 558 (2nd Dept 1997). Conclusory allegations unsupported by competent evidence are insufficient to defeat a motion for summary judgment. Alvarez v Prospect Hosp., supra; Zuckerman v New York, supra.
The Plaintiff commenced the underlying action to foreclose a mortgage covering real property known as 19 Wallace Street, Freeport, New York (hereinafter the "Property"). On or about April 4, 2006, Defendant executed a note (the "Note") in the amount of $380,000.00 payable to IndyMac Bank, F.S.B. Defendant also executed and delivered a mortgage (the "Mortgage") to Mortgage Electronic Registration Systems, Inc. as Nominee for IndyMac Bank, F.S.B. The Mortgage was subsequently transferred to plaintiff.
Plaintiff alleges that Defendant defaulted under the terms of the loan when he did not make the January 1, 2010 payment and every payment thereafter. As result of this alleged default, plaintiff commenced this action on February 24, 2017, by filing the summons and complaint.
Defendant contends that, inasmuch as plaintiffs predecessor, One West Bank, FSB ("OneWest") commenced a prior action to foreclose the Mortgage on June 4, 2010, under; i Index #11032/2010 (hereinafter the "2010 Action"), and that action was dismissed as abandoned, the statute of limitations has expired and the Mortgage is therefore unenforceable.
By Order dated February 14, 2014 and entered February 24, 2014, this court (Adams, J.) denied the motion of plaintiff in the 2010 Action for summary judgment with leave renew, specifically holding that "Renewal shall be within (60) days of the date hereof, in default of which the action may be deemed abandoned (See CPLR§ 3215(c))". No dismissal order was issued. On May 7, 2021, attorneys for plaintiff in the 2010 Action filed a Notice of Discontinuance in that action.
Plaintiff now argues that their predecessor, plaintiff in the 2010 Action OneWest, "voluntarily de facto discontinued the 2010 Action, and therefore, the Plaintiff voluntarily revoked the acceleration of the mortgage loan".
"A mortgage foreclosure action is subject to a six-year statute of limitations (see CPLR 213[4]). '[E]ven if a mortgage is payable in installments, once a mortgage debt is accelerated, the entire amount is due and the Statute of Limitations begins to run on the entire debt' (Nationstar Mtge., LLC v. Weisblum, 143 A.D.3d 866, 867, 39 N.Y.S.3d 491 [internal quotation marks omitted]; see Wells Fargo Bank, N.A. v. Burke, 94 A.D.3d 980, 982, 943 N.Y.S.2d 540). Acceleration occurs, inter alia, by the commencement of a foreclosure action (see Fannie Mae v. 133 Mgt., LLC, 126 A.D.3d 670, 670, 2 N.Y.S.3d 361; Clayton Natl. v. Guldi, 307 A.D.2d 982, 982, 763 N.Y.S.2d 493). 'A lender may revoke its election to accelerate the mortgage, but it must do so by an affirmative act of revocation occurring during the six-year statute of limitations period subsequent to the initiation of the prior foreclosure action' (NMNT Realty Corp. v. Knoxville 2012 Trust, 151 A.D.3d 1068, 1069-1070, 58 N.Y.S.3d 118; see Fed. Natl. Mtge. Assn. v. Schmitt, 172 A.D.3d 1324, 99 N.Y.S.3d 717 [2d Dept. 2019]; EMC Mtge. Corp. v. Patella, 279 A.D.2d 604, 606, 720 N.Y.S.2d 161)" (HSBC Bank, N.A. v. Vaswani, 174 A.D.3d 514 [2d. Dept. 2019][emphasis added]).
The Court of Appeals in Freedom Mortgage v. Engel, recently held that:
"[W]e are persuaded that, when a bank effectuated an acceleration via the commencement of a foreclosure action, a voluntary discontinuance of that action-i.e., the withdrawal of the complaint-constitutes a revocation of that acceleration. In such a circumstance, the note holder's withdrawal of its only demand for immediate payment of the full outstanding debt, made by the 'unequivocal overt act' of filing a foreclosure complaint, 'destroy[s] the effect' of the election (see Albertina, 258 N.Y. at 476, 180 N.E. 176). We disagree with the Appellate Division's characterization of such a stipulation as 'silent' with respect to revocation (Freedom Mtge. Corp., 163 A.D.3d at 633, 81 N.Y.S.3d 156). A voluntary discontinuance withdraws the complaint and, when the complaint is the only expression of a demand for immediate
payment of the entire debt, this is the functional equivalent of a statement by the lender that the acceleration is being revoked. Accordingly, we conclude that where acceleration occurred by virtue of the filing of a complaint in a foreclosure action, the noteholder's voluntary discontinuance of that action constitutes an affirmative act of revocation of that acceleration as a matter of law, absent an express, contemporaneous statement to the contrary by the noteholder" (37 N.Y.3d 1 [2021]).
The instant matter is wholly distinguishable from Engel in that, even if plaintiff were correct in claiming that the 2010 Action was "de facto discontinued", despite their own filing of the May 7, 2021 Notice of Discontinuance of that action, it cannot be stated that a de facto discontinuance is akin to a voluntary discontinuance for the purposes of deceleration of a debt as contemplated in Engel. (Id.) The Court in Engel held that the voluntary discontinuance of an action fulfilled the requirement of an affirmative act of deceleration. Abandonment of an action does not constitute an affirmative act of any sort. It must also be noted that, inasmuch as same was filed long after the expiration of the statute of limitations, the May 7, 2021 Notice of Discontinuance does not serve to decelerate the debt in any event. Therefore, the mortgage debt is unenforceable and the instant action must be dismissed.
Accordingly, it is hereby:
ORDERED, that defendant's motion is hereby granted in its entirety and the complaint filed under Index #1132/2017 is hereby dismissed.
This constitutes the decision and order of the Court.