Wells Fargo Bank, N.A. v Van Dyke

Wells Fargo Bank, N.A. v Van Dyke 2012 NY Slip Op 09164 Decided on December 27, 2012 Appellate Division, First Department Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and subject to revision before publication in the Official Reports.

Decided on December 27, 2012
Friedman, J.P., Acosta, Renwick, Richter, Román, JJ.
8893 382738/09

[*1]Wells Fargo Bank, N.A., etc., Plaintiff-Respondent,

v

June Joan Van Dyke, et al., Defendants-Appellants, New York City Environmental Control Board, et al., Defendants. Legal Services NYC, South Brooklyn Legal Services, Legal Services NYC- Bronx, MFY Legal Services, Inc., Staten Island Legal Services, Queens Legal Services, Bedford-Stuyvesant Community Legal Services, JASA/Legal Services for the Elderly in Queens, Empire Justice Center, and Neighborhood Economic Development Project (NEDAP), Amici Curiae.




Thomas M. Curtis, New York, for appellants.
Hogan Lovells US LLP, New York (David Dunn of counsel),
for respondent.
Jacob Inwald, New York, for Legal Services NYC, amicus
curiae.
Shira Galinsky, Meghan Faux and Pavita Krishnaswamy,
Brooklyn, for South Brooklyn Legal Services, amicus curiae.
James Jantarasami, Bronx, for Legal Services NYC-Bronx,
amicus curiae.
Jeanette Zelhof, New York (Renee Cadmus and Linda Jun of
counsel), for MFY Legal Services, Inc., amicus curiae.
Margaret Becker, Staten Island, for Staten Island Legal
Services, amicus curiae.
Franklin Romeo, Jamaica, for Queens Legal Services, amicus
curiae. [*2]
Hon. Betty Staton, Brooklyn (Catherine P. Isobe of counsel), for
Bedford-Stuyvesant Community Legal Services, amicus curiae.
Donna Dougherty, Rego Park, for JASA/Legal Services for the
Elderly in Queens, amicus curiae.
Rebecca Case-Grammatico, Rochester, for Empire Justice
Center, amicus curiae.
Josh Zinner, New York, for Neighborhood Economic
Development Project (NEDAP), amicus curiae.

Order, Supreme Court, Bronx County (Robert E. Torres, J.), entered August 25, 2011, which denied the Van Dyke defendants' motion to dismiss the complaint as against them, unanimously affirmed, without costs.

Defendants failed to demonstrate that plaintiff's representative was not fully authorized to negotiate a settlement of this residential foreclosure action on plaintiff's behalf or that the negotiations that were had were a sham (see CPLR 3408). Contrary to defendants' apparent belief, plaintiff was not required by CPLR 3408 to offer them a settlement. While the aspirational goal of CPLR 3408 negotiations is that the parties "reach a mutually agreeable resolution to help the defendant avoid losing his or her home" (CPLR 3408[a]), the statute requires only that the parties enter into and conduct negotiations in good faith (see subd [f]). As the motion court found, there are situations in which the statutory goal is simply not financially feasible for either party. Defendant June Van Dyke, while asserting that nearly two thirds of her income was rental property, produced no lease, no affidavits by tenants, and no bank statements showing funds traceable to the rents she alleges she has been collecting for a number of years. The bank statements she submitted covered a mere three months. Under the circumstances, it was not unreasonable for plaintiff to resist using her purported rental income in its loan modification calculations. In any event, even if the rental income were used, plaintiff would be ineligible for available modifications. Contrary to defendants' apparent contention, the mere fact that plaintiff refused to consider a reduction in principal or interest rate does not establish that it was not negotiating in good faith. Nothing in CPLR 3408 requires plaintiff to make the exact offer desired by defendants, and plaintiff's failure to make that offer cannot be interpreted as a lack of good faith.

While it does not affect the result in this case, we reject plaintiff's contention that compliance with the good faith requirement of CPLR 3408 is established merely by proving the absence of fraud or malice on the part of the lender. Any determination of good faith must be based on the totality of the circumstances. In this regard we note that CPLR 3408 is a remedial statute. [*3]

We have considered defendants' remaining arguments and find them unavailing.

THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: DECEMBER 27, 2012

CLERK