U.S. Bank N.A. v Milstein

[*1] U.S. Bank N.A. v Milstein 2015 NY Slip Op 51868(U) Decided on December 21, 2015 Supreme Court, Kings County Rivera, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on December 21, 2015
Supreme Court, Kings County

U.S. Bank National Association, as Trustee for CSMC 2006-6, Plaintiff,

against

Laya Milstein, et al, Defendants.



5876/2009



Attorney for Plaintiff

Frenkel, Lambert, Weiss, Weisman & Gordon, LLP

53 Gibson Street

Bayshore, New York 11706

Attorney for Defendant

Alexander Levkovich, Esq.

1479 East 34th Street

Brooklyn, New York 11234
Francois A. Rivera, J.

Recitation in accordance with CPLR 2219 (a) of the papers considered on the motion of plaintiff, US Bank National Association, as Trustee for CSMC 2006-6 (hereinafter USBNA or the plaintiff), filed on December 12, 2013, under motion sequence number four, for an order: (1) striking the answer and granting USBNA summary judgment on liability against defendant Laya Milstein (hereinafter Milstein) pursuant to CPLR 3212; (2) granting a default judgment against all the defendants pursuant to CPLR 3215; (3) appointing a referee to compute pursuant to the RPAPL 1321; (4) amending the caption to reflect the plaintiff's complete name of US Bank [*2]National Association, as Trustee for Credit Suisse First/Boston Mortgage Securities Corp., CSM Mortgage-Back Pass-Through Certificates Series 2006; and (5) and striking the John Doe defendants.

Notice of Motion

Affirmation of regularity

Affidavit of merit

Exhibit A—Q

Proposed order of reference

Affidavit of non-military service

USBNA's affirmation in opposition

USBNA's Reply

Recitation in accordance with CPLR 2219 (a) of the papers considered on the cross motion of defendant Milstein filed on May 23, 2014, under motion sequence number five, for an order: (1) granting summary judgment in her favor and dismissing the complaint due to USBNA's lack of standing and to its failure to provide proper notices pursuant to the mortgage and note; (2) Staying the proceedings to permit discovery; and (3) granting legal fees pursuant to Real Property Law § 282.

Notice of Cross-Motion and opposition to the motion

Affirmation in support

Exhibit A—M

BACKGROUND

On March 11, 2009, plaintiff commenced the instant residential mortgage foreclosure action by filing a summons, complaint and a notice of pendency (hereinafter the commencement papers) with the Kings County Clerk's office.

The complaint alleges in pertinent part that on May 22, 2006, defendant Milstein (hereinafter Milstein) executed a note (the subject note) in favor of the plaintiff's predecessor in interest in the amount of $400,000.00 secured by a mortgage on certain real property known as 1046 East 31st Street, Brooklyn, New York, 11210 Block 7612 Lot 63 (hereinafter the subject property) and thereafter defaulted on making payments due and owing on said note. USBNA was subsequently assigned the subject mortgage. Plaintiff allegedly sent Milstein a notice of default and of its intent to accelerate the total amount due on the subject note if the default was not cured. Milstein did not cure the default.

By answer dated March 30, 2009, Milstein joined issue. Milstein's answer asserts six affirmative defenses which include that plaintiff lacks standing.

No other defendant has answered the complaint or submitted opposition to the instant motion.

By notice of motion filed on August 31, 2009, under motion sequence number one, plaintiff had moved for an order: (1) striking Milstein's answer; (2) granting summary judgment in its favor as against Milstein; (3) granting a default judgment against all the defendants; and (4) [*3]appointing a referee to compute pursuant to the RPAPL 1321 (hereinafter the prior motion).

By decision and order dated December 4, 2009, and entered with notice of entry with the KCCO on February 2, 2010, the Court denied plaintiff's motion for summary judgment and an order of reference based on plaintiff's failure to establish that it gave Milstein adequate notice of default as required by the subject note (hereinafter the December 2009 order).

By notice of cross motion filed on April 29, 2010, under motion sequence number three, Milstein moved for an order: (1) granting summary judgment in her favor and dismissing the complaint based on plaintiff's lack of standing and based on the doctrine of law of the case and the court's decision dated December 4, 2009 (hereinafter the prior cross motion).

By decision and order dated June 3, 2011, and entered with notice of entry with the KCCO on July 12, 2011, the Court denied Milstein's motion for summary judgment based on Milstein's failure to annex the pleadings as required by CPLR 3212 (b).

LAW AND APPLICATION

USBNA's Motion to Amend Its Name

The only branch of USBNA's instant motion which was not previously requested in the prior motion is the request to amend its name in the caption. Through the affirmation of its counsel, USBNA has alleged that its name is truncated and should be amended to full version of "US Bank National Association, as Trustee for Credit Suisse First/Boston Mortgage Securities Corp., CSM Mortgage-Back Pass-Through Certificates Series 2006" pursuant to CPLR 2001. USBNA, however, has submitted no documentary evidence establishing that the name it seeks to use is in fact the correct version of its name. The assignments of mortgage that it has annexed to its motion reflects the contrary and is consistent with the name already set forth in the instant caption.

CPLR 3025 (b) enables parties to amend their pleadings at any time with leave of court, which leave shall be freely given, "provided the amendment is not palpably insufficient, does not prejudice or surprise the opposing party, and is not patently devoid of merit" (Ortega v Bisogno & Meyerson, 2 AD3d 607, 609 [2nd Dept 2003]). Defendant Milstein's answer has asserted as an affirmative defense that the plaintiff does not have standing and has also cross moved to dismiss the complaint on this basis. Under these circumstances, plaintiff's request to amend the caption by changing its name cannot be said to be without prejudice and should be supported by documentary evidence. It is, therefore, denied without prejudice.

USBNA's Motion for an Accelerated Judgment and a Referee to Compute

The balance of USBNA's motion seeks the exact same relief that it sought in the prior motion filed under motion sequence number one. By the December 2009 order, the Court denied the prior motion based on plaintiff's failure to establish that it gave Milstein adequate notice of default as required by the subject note.

CPLR 2221 sets forth the procedure for making a motion affecting a prior order and states the following:

CPLR Rule 2221. Motion affecting prior order.

(d) A motion for leave to reargue: 1. shall be identified specifically as such; 2. shall be based upon matters of fact or law allegedly overlooked or misapprehended by the court in determining the prior motion, but shall not include any matters of fact not offered on the [*4]prior motion; and 3. shall be made within thirty days after service of a copy of the order determining the prior motion and written notice of its entry.(e) A motion for leave to renew: 1. shall be identified specifically as such; 2. shall be based upon new facts not offered on the prior motion that would change the prior determination or shall demonstrate that there has been a change in the law that would change the prior determination; and 3. shall contain reasonable justification for the failure to present such facts on the prior motion.(f) A combined motion for leave to reargue and leave to renew shall identify separately and support separately each item of relief sought. The court, in determining a combined motion for leave to reargue and leave to renew, shall decide each part of the motion as if it were separately made. If a motion for leave to reargue or leave to renew is granted, the court may adhere to the determination on the original motion or may alter that determination.

By the December 2009 order, the Court has already denied all other relief request by USBNA in the prior motion.

USBNA did comply with the procedural requirements of CPLR 2221 to address the relief that had already been denied in the prior order. Rather it made the instant motion without seeking to reargue or renew the prior motion which yielded the December 2009 order. USBNA did not claim that the Court misapprehended the facts or the law in reaching its prior determination. Nor did it claim that it was offering new evidence for the Court's consideration. Furthermore, it did not annex the complete set of motion papers considered by the Court in yielding the December 2009 order. Moreover, as the plaintiff had previously moved for summary judgment against Milstein pursuant to CPLR 3212, the instant motion violated the general proscription against successive summary judgment motions absent a showing of newly discovered evidence or other sufficient cause (see Tolpygina v Teper 63 AD3d 722 [2nd Dept 2009] citing Lapadula v Sang Shing Kwok, 304 AD2d 798, 798 [2nd Dept 2003]).

The remainder of the instant motion is, therefore, denied as being either a procedurally defective motion under CPLR 2221 or an improper successive summary judgment motion.

The Cross Motion

Milstein seeks an order pursuant to CPLR 3212 dismissing the complaint based on USBNA's lack of standing and based on plaintiff's failure to give adequate notice of default as required by the subject note. Milstein also moves to stay the proceedings to permit CPLR Article 31 discovery and for legal fees pursuant to Real Property Law § 282.

Cross Motion Based on USBNA's Lack of Standing

It is well established that summary judgment may be granted only when it is clear that no triable issue of fact exists (Alvarez v Prospect Hospital, 68 NY2d 320 [1986]). The burden is upon the moving party to make a prima facie showing that he or she is entitled to summary judgment as a matter of law by presenting evidence in admissible form demonstrating the absence of any material facts (Giuffrida v Citibank, 100 NY2d 72 [2003]). The prima facie showing which a defendant must make on a motion for summary judgment is governed by the allegations of liability made by the plaintiff in the pleadings (Miller v Village of E. Hampton, 98 AD3d 1007 [2nd Dept 2012] citing Foster v Herbert Slepoy Corp., 76 AD3d 210, 214 [2nd Dept 2010]). A failure to make that showing requires the denial of that summary judgment motion, [*5]regardless of the adequacy of the opposing papers (Ayotte v Gervasio, 81 NY2d 923 [1993]). If a prima facie showing has been made the burden shifts to the opposing party to produce evidentiary proof sufficient to establish the existence of material issues of fact (Alvarez v Prospect Hospital, 68 NY2d 320 at 324 [1986]).

A party opposing a motion for summary judgment is obligated "to lay bare his proofs" to sufficiently demonstrate, with admissible evidence, that a triable issue of fact will exist (Friends of Animals, Inc. v Associated for Manufacturers, Inc., 46 NY2d 1065 [1979] ). A genuine issue of fact may not be demonstrated by using mere conclusions, expressions of hope or unsubstantiated allegations or assertions (Amatulli v Delhi Constr. Corp., 77 NY2d 525 [1991]).

"Pursuant to CPLR 3212 (b) a court will grant a motion for summary judgment upon a determination that the movant's papers justify holding, as a matter of law, "that there is no defense to the cause of action or that the cause of action or defense has no merit." Further, all of the evidence must be viewed in the light most favorable to the opponent of the motion (People ex rel. Spitzer v Grasso, 50 AD3d 535, 544 [1st Dept 2008]; citing Marine Midland Bank v Dino & Artie's Automatic Transmission Co., 168 AD2d 610 [2nd Dept 1990]).

On a defendant's motion to dismiss the complaint based upon the plaintiff's alleged lack of standing, the burden is on the moving defendant to establish, prima facie, the plaintiff's lack of standing as a matter of law (HSBC Bank USA, Nat. Ass'n v Roumiantseva, 130 AD3d 983 [2nd Dept 2015] citing HSBC Mtge. Corp. [USA] v MacPherson, 89 AD3d 1061, 1062 [2nd Dept 2011]).

Defendant Milstein points to discrepancies in the affidavits of merit that plaintiff has submitted in the instant motion and in its prior motions. She also points to alleged irregularities pertaining to an allonge of the subject note. Milstein contends that the plaintiff has submitted evidence of an assignment of the mortgage but not an assignment of the subject note prior to the commencement of the instant action. She also contends that the Pooling and Servicing Agreement used to set up a Real Estate Mortgage Investment Conduit (REMIC) could not have properly taken ownership of the subject note after June 29, 2008, the closing date of the trust because it would have created devastating tax consequences to the trust.

As a general rule, a party does not carry its burden in moving for summary judgment by pointing to gaps in its opponent's proof, but must affirmatively demonstrate the merit of its claim or defense (Ranno v Cantor, 129 AD3d 699 [2nd Dept 2015]). Milstein's arguments mostly fall into the category of pointing to gaps in plaintiff's proof. Furthermore, Milstein, as a mortgagor whose loan is owned by a trust, does not have standing to challenge the plaintiff's possession or status as assignee of the note and mortgage based on purported noncompliance with certain provisions of the PSA (see Wells Fargo Bank N.A. v Erobobo 127 AD3d 1176 [2nd Dept 2015]).

Cross Motion Based on USBNA's Failure to Send Adequate Notice of Default

Milstein argues that the Court's December 2009 order is law of the case and supports dismissal of the complaint. The December 2009 order denied USBNA's prior motion for summary judgment based on its failure to establish that it gave Milstein adequate notice of default as required by the subject note. Milstein has solely relied on the December 2009 order and the doctrine of law of the case to support her application to dismiss the complaint. However, [*6]a court's denial of a motion for summary judgment establishes nothing except that summary judgment was not warranted when the motion was made (Baker v R.T. Vanderbilt Co. Inc., 260 AD2d 750, 751-752 citing Siegel, NY Prac. § 287, at 487 [5th ed.] [3rd Dept 1999]). Consequently, this branch of Milstein's motion is unsupported and must be denied.

Cross Motion for a Stay of Proceedings

Milstein's motion requests a stay of the proceedings to conduct discovery. CPLR 3124 (b) provides in pertinent part that service of a notice of motion under rule 3211, 3212, or section 3213 stays disclosure until determination of the motion unless the court orders otherwise. In accordance with CPLR 3214 (b) discovery had been stayed pending the court's determination of USBNA's motion and Milstein's cross motion for summary judgment. Now that both branches of the parties CPLR 3212 motions have been decided by the instant decision and order, the statutorily imposed stay is hereby lifted. The Court agrees that discovery is appropriate but sees no legal or factual basis to continue a stay while discovery occurs. The parties are directed to appear for a preliminary conference on January 19, 2016 to set up a disclosure schedule. Furthermore, by order of this Court, the automatic stay provision of CPLR 3124 (b) will not apply to any future notice of motions made in this case.

Cross Motion for Legal Fees Pursuant to Real Property Law § 282

Real Property Law § 282 pertains to a mortgagor's right to recover attorneys' fees in actions or proceedings arising out of foreclosures of residential property and provides in pertinent part as follows:

Whenever a covenant contained in a mortgage on residential real property shall provide that in any action or proceeding to foreclose the mortgage that the mortgagee may recover attorneys' fees and/or expenses incurred as the result of the failure of the mortgagor to perform any covenant or agreement contained in such mortgage, or that amounts paid by the mortgagee therefor shall be paid by the mortgagor as additional payment, there shall be implied in such mortgage a covenant by the mortgagee to pay to the mortgagor the reasonable attorneys' fees and/or expenses incurred by the mortgagor as the result of the failure of the mortgagee to perform any covenant or agreement on its part to be performed under the mortgage or in the successful defense of any action or proceeding commenced by the mortgagee against the mortgagor arising out of the contract, and an agreement that such fees and expenses may be recovered as provided by law in an action commenced against the mortgagee or by way of counterclaim in any action or proceeding commenced by the mortgagee against the mortgagor. Any waiver of this section shall be void as against public policy.

Milstein has referenced "Section 14 Loan Charges" in the subject mortgage as the section giving the lender the right to recover attorneys' fees and/or expenses incurred as the result of the failure of the mortgagor to perform any covenant or agreement contained in the mortgage. By virtue of Real Property Law § 282, she contends that she has a right to an award of attorney's fees and cost. In order to be entitled to attorney's fees and expenses pursuant to Real Property Law § 282, however, Milstein must establish that USBNA has failed to perform any covenant or agreement on its part to be performed under the mortgage. Neither USBNA's motion nor Milstein's cross motion has established that fact. Therefore, this branch of Milstein's motion is [*7]denied without prejudice.

CONCLUSION

The portion of USBNA's motion seeking an order striking Milstein's answer is denied without prejudice.

The portion of USBNA's motion seeking an order granting USBNA summary judgment on liability against defendant Milstein pursuant to CPLR 3212 is denied without prejudice.

The portion of USBNA's motion seeking an order granting a default judgment against all the other defendants pursuant to CPLR 3215 is denied without prejudice.

That portion of USBNA's motion seeking an order appointment of a referee to compute pursuant to the RPAPL 1321 is denied without prejudice.

That portion of USBNA's motion seeking to amend the name of the plaintiff to US Bank National Association, as Trustee for Wachovia Mortgage Loan Trust, Asset Backed certificate 2006-ALT1 is denied without prejudice.

That portion of defendant Milstein's motion seeking an order granting summary judgment in her favor and dismissing the complaint due to USBNA's lack of standing is denied without prejudice.

That portion of defendant Milstein's motion seeking an order granting summary judgment in her favor and dismissing the complaint due to USBNA's failure to provide proper default notice pursuant to the mortgage and note is denied without prejudice.

That portion of defendant Milstein's motion seeking an order staying the proceedings to permit discovery is denied in part and granted in part:

The parties are directed to appear for a preliminary conference on January 19, 2016 to set up a disclosure schedule. Furthermore, going forward, the automatic stay provision of CPLR 3124 (b) will not be applied to any future notice of motions made in this case.

That portion of defendant Milstein's motion seeking an order granting legal fees pursuant to Real Property Law § 282 is denied without prejudice.

The foregoing constitutes the decision and order of this Court.

Enter:December 21, 2015

J.S.C.