JP Morgan Chase Bank v Russo

Annotate this Case

Download PDF

JP Morgan Chase Bank v Russo 2012 NY Slip Op 31879(U) July 2, 2012 Sup Ct, Nassau County Docket Number: 14313/09 Judge: Michele M. Woodard Republished from New York State Unified Court System's E-Courts Service. Search E-Courts (http://www.nycourts.gov/ecourts) for any additional information on this case. This opinion is uncorrected and not selected for official publication. ... -------- - -- ----- --- --- ------------ - --- - - ---- - - - -- --- -- -- ---- ----------- - - )( [* 1] SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF NASSAU JPMORGAN CHASE BANK , NA TIONAL ASSOCIATION MICHELE M. WOODARD Plaintiff TRIAL/IAS Part 8 Index No. : 14313/09 Motion Seq. No. : 01 -against- DECISION AND ORDER MICHAEL RUSSO; JPMORGAN CHASE BANK NATIONAL ASSOCIATION SUCCESSOR IN INTEREST F/KI A WASHINGTON TO WASHINGTON MUTUAL BANK MUTUAL BANK , FA, AND " JOHN DOE#l" THROUGH JOHN DOE#10" , THE LAST TEN 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 MORTGAGED PREMISES DESCRIBED IN THE COMPLAINT Defendant. Papers Read on this Motion: Defendant Michael Russo s Order to Show Cause Plaintiff s Legal Memorandum Plaintiff s Affirmation Defendant Michael Russo moves to vacate the order of reference and judgment of default entered April14 , 2010 pursuant to CPLR 9317 , CPLR 92005 and CPLR 95015(a)(2), (3) and (4). BACKGROUND On April 20 , 2010 an order of reference was granted and a default judgment was entered against defendant mortgagor Michael Russo. Nineteen months after the default was entered , and foureen months after he claims to have leared of the default in September 2010 , defendant seeks to vacate the order of reference pursuant to CPLR 9317 , CPLR 92005 and CPLR 95015(a)(2), (3) and(4); file an answer with counterclaims; obtain discovery; and amend the caption. Defendant asserts that , based on a belief that a foreclosure action may have been commenced against him , he retained counsel in April 2009 to defend against the action and attempt to obtain a [* 2] mortgage modification. He learned , however , in September of 20 1 0 that his attorney never interposed an answer and failed to appear at a scheduled residential foreclosure conference on December 2 , 2009. Defendant contends that he is entitled to vacate the default judgment against him , file an answer conduct discovery and amend the caption to add the Federal National Mortgage Association (Fanie Mae) as a party based on the grounds of a reasonable e)(cuse for his default (law office failure) and a meritorious defense. In his defense , defendant claims that plaintiff fraudulently alleged ownership of the subject mortgage and promissory note which were , in fact , originated by Washington Mutual FA (W AMU). In reliance on Ban, Marchione 69 AD3d 204 , 207 (2d Dept 2009), Wells Fargo Bank, NA. defendant maintains that plaintiff Chase had neither a legal or equitable interest in his mortgage and lacked standing to commence a foreclosure action against him. ANAL YSIS Entitlement to a judgment of foreclosure may be established as a matter of law , where a mortgagee produces both the mortgage and unpaid note , together with evidence of the mortgagor default , thereby shifting the burden to the mortgagor to demonstrate through evidence any defense Us. Bank, Nat. Ass ' which could raise a question of fact. Sharif 89 AD3d 723 (2d Dept 2011) (citations and quotation marks omitted). However , foreclosure of a mortgage may not be brought by Kluge one who has no title to it. Fugazy, 145 AD2d 537 , 538 (2d Dept 1998). Where standing is raised as a defense by the defendant , the plaintiff is required to prove its standing before the question of entitlement to foreclosure is decided. Us. Bank, NA. Collymore 68 Ad3d 752 , 753 (2d Dept 2009). . In order to commence a foreclosure action , the plaintiff must have a legal or equitable interest in the mortgage. Aurora Loan Services, LLC Weisblum 85 AD3d 95 (2d Dept 2011). As long as the plaintiff can establish its lawful status as assignee , either by written assignment or physical delivery, prior to the fiing of the complaint , the recording of a written assignment after the commencement of [* 3] the action wil not defeat standing. Weisblum 85 AD3d 95 , 108 (2d Dept Aurora Loan Servs., LLC 2011). A plaintiff establishes standing in a mortgage foreclosure action by demonstrating that it is both the holder or assignee of the subject mortgage and underlying note either by physical delivery or written Citimortgage, Inc. assignment prior to commencement of the action. Stosel 89 AD3d 887 888 (2d Dept 2011) (citation and quotation marks omitted). Either a written assignment of the underlying note or the physical delivery of the note prior to commencement of the foreclosure action is sufficient to transfer the obligation and the mortgage passes with the debt as an inseparable incident. LLC GRP Loan, Taylor 95 AD3d 1172 , 1173 (2d Dept 2012). Under the September 25 2008 Purchase and Assumption Agreement between plaintiff and the FDIC , plaintiff acquired all ofWAMU' s loans and commitments from WAMU and its various entities. As a result , plaintiff Chase acquired the servicing rights to defendant's loan. There is no requirement that the FDIC as receiver , endorse or assign the note and mortgage to plaintiff as defendant erroneously asserts. jp Morgan Chase Bank NA. Miodownik 92 AD3d 546 547 (1 st Dept 2012). Defendant offers no evidence to rebut this fact. Inasmuch as plaintiff did not commence this foreclosure action based on " constructive possession" of the mortgage and note , but rather based on the physical possession of the note and mortgage , defendant's arguments in this regard , based on an erroneous assumption , are unavailing. Defendant offers no viable rebuttal to the fact that the Fanie Mae guidelines provide for the transfer of the note and mortgage to the servicer and provide that a foreclosure action be commenced in the servicer s name against a defaulting borrower. Pursuant to CPLR 9317 " a person served with a summons other than by personal delivery to him ( or her) or to his (or her) agent for service designated under Rule 318 , . . . may be allowed to [* 4] defend the action " by seeking to vacate a default judgment within one year of learning of the judgment M Baking Matter of Rockland Bakery, Inc. upon demonstrating a potentially meritorious defense. Co. , Inc. 83 AD3d 1080 , 1081 (2d Dept 2011). In support of such a request , a pary must demonstrate and the cour must find , that the pary did not receive actual notice of the summons and complaint in time to defend the action. Elburg, LLC 94 AD3d 753 , 754 (2d Dept 2010) (citations and Wassertheil quotation marks omitted). By defendant's own admission , he became aware of the default judgment and order of reference in September 2010 but did not fie the instant application until November 2011 , more than one year later. The mere denial of receipt of the summons and complaint is insufficient to establish a lack of Wassertheil actual notice for the purpose of CPLR 9317. Elburg, LLC, supra prima facie The affdavit of the process server constitutes and , therefore , gives rise to a presumption of proper service. at p. 754. evidence as to the method of service Holt 71 AD3d Washington Mut. Bank 670 (2d Dept 2010). Defendant' s unsubstantiated denial of service is insuffcient llresumption of proper service. Mortgage Elec. Registration Sys., Inc. to rebut the Schotter 50 AD3d 983 (2d Dept 2008). Defendant has failed to submit a sworn denial of service or specific facts to rebut the process server s affidavit. The bare unsubstantiated allegation that defendant was not served with the summons and complaint is insufficient to rebut the presumption of proper service of the complaint in a mortgage foreclosure action. Beneficial Homeowner Serv Corp. Girault 60 AD3d 984 (2d Dept 2009). CPLR 95015(a)(3) provides that a court may vacate a judgment on the grounds of " fraud misrepresentation or other misconduct of an adverse part. " The movant must articulate a fraud not in the inducement of the documents , which form ' the basis for the complaint , but in the procurement of the judgment. Tribeca Lending Corp. Crawford 79 AD3d 1018 , 1020 (2d Dept 2010), Iv to appeal [* 5] 16 NY3d 783 (2010). No viable allegations of either e)(trinsic or intrinsic fraud have been dismissed proffered by defendant. Defendant has failed to offer any evidence that the underlying mortgage and note are invalid that there was no default in payment , or that he has any viable defense to foreclosure. As such, he has failed to present a potentially meritorious defense sufficient to satisfy the requirements of CPLR 9317 or CPLR 92005. Castanos 71 AD3d 880 2d Dept 2010. Zarzuela Having failed to demonstrate any " newly discovered" evidence , fraud , misrepresentation or other misconduct of the adverse part; and having failed to adequately rebut the presumption of proper service , defendant cannot obtain relief under CPLR 9317 , CPLR 95015(a)(2), (3), or (4). As such , it is hereby ORDERED , that the defendants ' application to vacate the order of reference and default denied judgments is in its entirety. This constitutes the Decision and Order of the Court. DATED: July 2 , 2012 Mineola , N. Y. 11501 ENTER: HON. MICHELE M. WOODA XXX F:\DECISION - DEFAULT JUDGMENTPMorgan Chase v Russo CAK. wpd ENTERED JUL 06 2012 NASSAU COUNTY COUNTY CLERK'S OFFICE CPLR 2005 provides as follows: Upon an application satisfying the requirements of subdivision (d) of section 3012 or subdivision (a) of rule 5015 , the court shall not , as a matter oflaw , be precluded from e)(ercising its discretion in the interests of justice to e)(cuse delay or default resulting from law office failure.

Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.