Opinion
Index No. 615714/2018
01-25-2022
WILMINGTON SAVINGS FUND SOCIETY, FSB, d/b/a Christiana Trust, Not Individually but AS TRUSTEE FOR PRETIUM MORTGAGE ACQUISITION TRUST, Plaintiff, v. Tonya DAMARO; The Villas at West Hills Home Owners Association, Inc.; CACH, LLC; "John Doe No.1" through "John Doe #10" inclusive the names of the ten last name, Defendants being fictitious, real names unknown to the Plaintiff, the parties intended being persons or corporations having an interest in, or tenants or persons in possession of, portions of the mortgaged premises described in the Complaint, Defendants.
KNUCKLES, KOMOSINSKI & MANFRO, LLP, Attorneys for Plaintiff, 565 Taxter Road., Suite 590, Elmsford, NY 10523 SCALZI & NOFI, PLLC, Attorneys for Defendant, Tonya Damaro, 16 E. Old Country Road, Hicksville, NY 11801
KNUCKLES, KOMOSINSKI & MANFRO, LLP, Attorneys for Plaintiff, 565 Taxter Road., Suite 590, Elmsford, NY 10523
SCALZI & NOFI, PLLC, Attorneys for Defendant, Tonya Damaro, 16 E. Old Country Road, Hicksville, NY 11801
Robert F. Quinlan, J.
Upon the following papers: Notice of Motion by Plaintiff, dated January 11, 2019, with supporting papers; Affirmation in Opposition by Defendant Tonya Damaro, dated March 8, 2019, with supporting papers; Reply Affirmation in by Plaintiff, dated March 26, 2019, with supporting papers; and upon due consideration; it is
ORDERED that this motion (Mot. Seq. #001) by plaintiff for an order: (1) pursuant to CPLR 3212 awarding summary judgment against defendant Tonya Damaro, striking her answer and dismissing its affirmative defenses; (2) pursuant to CPLR 3215 fixing the defaults of the non-answering defendants; (3) pursuant to RPAPL § 1321 appointing a referee to compute; and (4) amending the caption, is denied; and it is further
ORDERED that upon searching the record pursuant to CPLR 3212[b], summary judgment is granted to defendant Tonya Damaro and plaintiff's complaint is dismissed; and it is further
ORDERED that defendant Tonya Damaro is directed to serve a copy of this order with notice of entry upon plaintiff and all parties who have appeared herein, and to promptly file the affidavits of service with the Clerk of the Court.
This is an action to foreclose a mortgage on real property located in Suffolk County, New York. On September 24, 2009, defendant-mortgagor Tonya Damaro ("defendant") executed a consolidated promissory note in favor of plaintiff's predecessor Flagstar Bank, FSB ("Flagstar") in the amount of $425,500. To secure the note, on the same date, defendant executed a consolidated mortgage on the property and a Consolidation, Extension and Modification Agreement ("CEMA") in the lender's favor. Defendant allegedly defaulted on the consolidated note and mortgage by failing to make monthly payments of principal and interest which had come due on April 1, 2010. After defendant failed to cure the default in payment, the lender commenced an action in this Court entitled Flagstar Bank, FSB v Damaro, Index #2128/11 ("the prior action"). Following proceedings in the prior action which included a judgment of foreclosure and sale in plaintiff's favor, the Appellate Division, inter alia , reversed the judgment and dismissed the complaint due to plaintiff's failure to demonstrate compliance with the pre-foreclosure notice requirements of RPAPL 1304 ( Flagstar Bank, FSB v Damaro , 145 AD3d 858 [2d Dept 2016] ). After commencement of the prior action and prior to commencement of the present action, the subject note was transferred to plaintiff. Plaintiff commenced the present action by the filing of a notice of pendency, summons, complaint and accompanying certificate of merit on August 8, 2018. Issue was joined by the interposition of defendant's answer dated September 29, 2018. The remaining defendants have not answered the complaint.
By her answer, defendant generally denies the material allegations set forth in the complaint, and asserts ten affirmative defenses. In opposition to plaintiff's present motion, defendant argues that the action is time-barred under the applicable statute of limitations, plaintiff lacks standing, and plaintiff failed to comply with the pre-foreclosure notice requirements under the terms of the mortgage and RPAPL 1304. In his affirmation in opposition, defendant's counsel asks the court to search the record pursuant to CPLR 3212[b], and upon doing so, grant summary judgment to defendant dismissing the action.
The action was originally assigned to another judge of this court (Hudson, A.S.J.), but reassigned to this part in June of this year by an order of the District Administrative Judge (Crecca, J.). As defendant had filed a "Covid - 19 Hardship Declaration" on February 3, 2021 (NYSCEF Doc. # 48), all proceedings were stayed until the expiration of the enacting legislation and relevant administrative orders on January 15, 2022, allowing the motion to now be decided.
Plaintiff's motion is denied. To establish prima facie entitlement to judgment as a matter of law in an action to foreclose a residential mortgage, a plaintiff must produce the mortgage, the unpaid note, and evidence of default (see FederalNatl. Mortgage Assn. v Onuoha , 172 AD3d 1170 [2d Dept 2019] ; Bank of New York Mellon v Zavolunov , 157 AD3d 754 [2d Dept 2018] ). Plaintiff has produced the mortgages, the notes and consolidations, but it fails to submit evidence in admissible form to establish the default in payment. To support its claim of non-payment, plaintiff submits the affidavit (NYSCEF Doc. # 30) of an employee of its servicer Rushmore Loan Management Services, LLC ("Rushmore"). Although that affiant establishes his ability to testify to the business records of his employer pursuant to CPLR 4518 (a), as well as under the principles set forth in Bank of New York Mellon v Gordon , 171 AD3d 197 (2d Dept 2019), he fails to provide copies of the business records that he relied upon to make his otherwise inadmissible hearsay statements that defendant was in default in payment and of the amount allegedly due admissibile pursuant to CPLR 4518 (a) (see U.S. Bank Trust, N.A. v Bank of Am., N.A. ––– AD3d ––––, 2022 NY Slip Op 00213 [2d Dept 2022] ; Bank of NY Mellon v Deas , ––– AD3d ––––, 2021 NY Slip Op 07536 [2d Dept 2021] ; Deutsche Bank Trust Co. Ams. v Miller , 198 AD3d 865 [2d Dept 2021] ; Bank of New York Mellon v Gordon , id). Without these business records, plaintiff has failed to establish defendants default in payment.
Additionally, as to compliance with the mailing requirements of the notices required by RPAPL § 1304, plaintiff's submits the same affidavit of the employee of Rushmore, which also fails to establish the mailings required by the statute, as although it attempts to set forth the mailing process used, it again fails to provide the business records reviewed which would make his otherwise inadmissible hearsay claims admissible pursuant to CPLR 4518 (a) (see Deutsche Bank Trust Company Americas v. Miller , 196 AD3d 867 [2d Dept 2021]; Wilmington Trust, N.A. v Jiminez , 194 AD3d 988 [2d Dept 2021] ; Citimortgage, Inc. v Goldberg , 179 AD3d 1006 [2d Dept 2020] ). The same failure of proof applies to plaintiff's attempt to establish mailing of the notice of default required by the mortgage. These deficiencies further mandate the denial of plaintiff's motion.
But even more fatal to plaintiff's action is that fact that the mailings of the RPAPL § 1304 notices include other notices in violation of the prohibition in RPAPL § 1304 (2) (see NYSCEF Doc. # 32). The Second Department has recently held that inclusion of any material in the separate envelope sent to the borrower under RPAPL 1304 that is not expressly delineated in these provisions constitutes a violation of the separate envelope requirement of RPAPL 1304(2) (see Citimortgage, Inc. v Dente , ––– AD3d ––––, 2021 NY Slip Op 07538 [2d Dept 2021] ; Wells Fargo Bank, N.A. v DeFeo , ––– AD3d ––––, 2021 NY Slip Op 07577 [2d Dept, 2021] ; Bank of America, N.A. v. Kessler , ––– AD3d ––––, 2021 NY Slip Op 06979 [2d Dept 2021] ). This "strict approach" provides clear guidelines that any "additional material" violates the requirements of RPAPL § 1304. Here, the additional material provides a separate notice which is not within the section's language. Strict compliance with RPAPL § 1304 is a condition precedent for the commencement of a foreclosure action ( H & R Block Bank, FSB v. Liles , 186 AD3d 813 [2d Dept. 2020] ). Having failed to establish compliance, plaintiff's motion must be denied.
Furthermore, upon searching the record ( CPLR 3212[b] ), in light of the aforementioned determination that the notices required under RPAPL § 1304 were improper and failed to met the condition precedent, summary judgment must be awarded to defendant, dismissing the action (compare Bank of America, N.A. v. Kessler , supra., with U.S. Bank National Association v. Ehrlich , 195 AD3d 765 [2d Dept. 2021] ).
In searching the record ( CPLR 3212[b] ), the court also addresses defendant's claim that the statute of limitations bars plaintiff's claim and requires dismissal. The court agrees with defendant's position. Plaintiff had a full opportunity to address the issue, as defendant raised it in her answer as the third affirmative defense, and plaintiff addressed it in its memorandum of law as well as its affirmation in reply to defendant's opposition. Additionally, the relief requested by defendant is directly interrelated with the relief sought in plaintiff's motion. Therefore in its discretion and in the interest of judicial economy, the court deems defendant's request to be a motion (see Fried v Jacob Holding, Inc. , 110 AD3d 56, [2d Dept 2013] ).
The filing of the prior action in 2011 accelerated the entire debt due under the note and mortgage, commencing the running of the statute of limitations (see Freedom Mortgage Corp. v Engel , 37 NY3d 1 [2021] ). The submissions herein have established prima facie , that the time within which plaintiff could have commenced the action expired in 2017 (see U.S. Bank N.A. v Gordon , 158 AD3d 832 [2d Dept 2018] ). Once the debt is accelerated by the filing of the first lawsuit, either Flagstar or plaintiff must have taken affirmative action to revoke that acceleration before the six year statute of limitation ran. Here defendant establishes a prima facie case that the note had been accelerated more than six years before this action was commence, requiring plaintiff to raise a triable issue of fact or face dismissal (see US Bank, N.A. v Salvodon , 189 AD3d 925 [2d Dept 2020]; 21st Mtge. Corp. v Balliraj , 177 AD3d 687 [2d Dept 2019] ; Bank of New York Mellon v. Alli ,175 AD3d 1472 [2d Dept 2019] ). Plaintiff has failed to meet that burden.
If Flagstar had lacked standing to bring the action, then the filing of that action was a nullity and the debt had not been accelerated (see 21st Mtge. Corp. v Rudman , ––– AD3d ––––, 2022 NY Slip Op 00031 [2d Dept 2022] ; HSBC Bank USA, N.A. v Spitz , ––– AD3d ––––, 156 N.Y.S.3d 867 [2d Dept 2022] ), but here there can be no claim that there was a lack of standing in the 2011 action. The record demonstrates that plaintiff's predecessor in interest had standing to commence the 2011 action, as a copy of the consolidated note endorsed to Flagstar was attached to the certificate of merit filed with the summons and complaint (see Deutsche Bank Natl. Trust Co. v Smartenko, 199 AD3d 643 [2d Dept 2021] ). Plaintiff claims it has standing to commence the present action, and even if defendant raised triable issues of facts as to plaintiff's standing, she failed to present evidence that plaintiff had no standing as required for dismissal of the complaint (see Wells Fargo Bank, N.A. v Lefkowitz , 171 AD3d 843 [2d Dept 2019] ). There is no proof, or claim, of a voluntary discontinuance of the 2011 action as in Freedom Mortgage Corp. v Engel , supra.
Instead, plaintiff argues that the 2011 action was a nullity by virtue of being dismissed by the Appellate Division "for improper acceleration," and therefore, in the absence of an acceleration of the entire debt, plaintiff was free to commence a new action. That argument is rejected. Contrary to plaintiff's characterization, the dismissal of the prior action was for failure to comply with the pre-foreclosure notice requirements of RPAPL § 1304, not for improper acceleration. The mere dismissal of an action has been held not be an act revoking acceleration (see Federal Natl. Mtge. Assn. v Woolstone , 196 AD3d 548 [2d Dept 2021] ; Nationstar Mtge., LLC v Weisz , 195 AD3d 934 [2d Dept 2021] ; HSBC Bank USA, N.A. v Hochstrasser , 193 AD3d 915 [2d Dept 2021] ; see also 53rd Street, LLC v. U.S. Bank National Association , 8 F4th 74 [2d Cir, 2021] ). While compliance with RPAPL § 1304 is a condition precedent to the commencement of a foreclosure action, it is not part of plaintiff's prima facie case and is not jurisdictional (see Bank of Am., N.A. v Cord , 168 AD3d 896 [2d Dept 2019] ; U.S. Bank N.A. v Carey , 137 AD3d 894 [2d Dept 2016] ). The court could find no authority holding that dismissal on RPAPL § 1304 grounds is an affirmative act of revocation of acceleration or renders the action a nullity as would lack of standing. In fact, dismissal of an action for failure to meet a condition precedent does not render it a nullity (see generally Parker v Mack , 61 NY2d 114 [1984] ; Carrick v Central Gen. Hosp. , 51 NY2d 242 [1980] ). Plaintiff has therefore failed to rebut defendant's prima facie showing, requiring dismissal of the action.
Accordingly, plaintiff's motion is denied and upon searching the record, the Court dismisses plaintiff's complaint. Plaintiff's proposed order is marked "Not Signed."
The foregoing constitutes the decision and order of the Court.