Deutsche Bank Nation Trust Co. v HSBC Fin. Corp.

Deutsche Bank Nation Trust Co. v HSBC Fin. Corp.

2025 NY Slip Op 01865

Decided on March 27, 2025

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 and Entered: March 27, 2025
Before: Kern, J.P., Friedman, Kapnick, Mendez, Higgitt, JJ.

Index No. 651627/13|Appeal No. 3998|Case No. 2024-03807|

[*1]Deutsche Bank Nation Trust Company, etc., Plaintiff-Respondent-Appellant,

v

HSBC Finance Corporation, Defendant-Respondent, Decision One Mortgage Company, LLC, et al., Defendants-Appellants-Respondents.

Mayer Brown LLP, New York (Henninger S. Bullock of counsel), for appellants-respondents.

Kobre & Kim LLP, New York (Zachary D. Rosenbaum of counsel), for respondent-appellant.

Order, Supreme Court, New York County (Robert R. Reed, J.), entered May 13, 2024, which granted in part and denied in part defendants' motion to dismiss the second amended complaint, unanimously modified, on the law, to grant the motion in its entirety, and otherwise affirmed, without costs. The Clerk is directed to enter judgment accordingly.

Under the applicable agreements, defendants had a "sole remedy" repurchase obligation that included an unambiguous notice provision. Therefore, the failure-to-notify (FTN) claims should have been dismissed, as they are derivative causes of action, not independent ones (see U.S. Bank N. A. v EquiFirst Corp., 234 AD3d 463 [1st Dept 2025]; Bank of N.Y. Mellon v WMC Mtge., LLC, 151 AD3d 72, 81 [1st Dept 2017]; see also Matter of Part 60 RMBS Put-Back Litig., 195 AD3d 40, 54-55 [1st Dept 2021]).

Because no FTN claims lie against defendants, we need not address whether Supreme Court was correct in finding that plaintiff otherwise adequately stated timely FTN claims, or whether the court correctly dismissed plaintiff's indemnification and alter ego liability claims.

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

ENTERED: March 27, 2025