Fulton Dev. Corp. v A-1 Reliable Constr. Co., Inc.
Annotate this CaseDecided on October 19, 2004
Supreme Court, Kings County
Fulton Development Corp., Plaintiff, -
against
A-1 Reliable Construction Co., Inc., Defendant.
32267/03
Francois A. Rivera, J.
By notice of motion plaintiff moves pursuant to CPLR §3212 for an order granting plaintiff summary judgment cancelling a mortgage, or an order finding defendant to be in default. Defendant opposes the motion.
On September 4, 2003, plaintiff commenced an action against the defendant by service of a summons and verified complaint on the Secretary of State pursuant to Business Corporation Law §306. On October 31, 2003, the defendant appeared in the action by the notice of appearance of Mr. Marquez Osson, Esq.
Plaintiff's verified complaint contains five allegations of fact. The complaint alleges that on June 19, 1985, it entered into a mortgage with Charles Fairbanks. On March 9, 1988, Mr. Fairbanks assigned the mortgage to the defendant. Pursuant to the terms of the mortgage, final payment was due on May 1, 1992. Plaintiff seeks a discharge and or cancellation of the mortgage contending that the statute of limitations to commence a foreclosure action has expired. Plaintiff's motion references as exhibit A, the mortgage and the assignment of mortgage. The exhibit, however, is a photocopy of only a portion of the mortgage note, namely paragraph twenty-six and twenty-seven of the document. The remainder of the document appears to have been inadvertently obscured in the act of photocopying the document. Paragraph twenty-seven of the document contains the terms of payment of said note.
Defendant opposes the motion with seven allegations of fact and a memorandum of law. Defendant admits that on March 9, 1988, Charles Fairbanks assigned the mortgage to defendant in consideration for twelve thousand dollars ($12,000.00). Since the assignment, defendant contends that plaintiff has not made any mortgage payments to the defendant. Defendant asserts [*2]that the plaintiff has no contractual privity with the defendant. Defendant claims that on March 20, 1991, it brought a proceeding in Kings County Supreme Court under index number 7271/91 to foreclose on the mortgage. Defendant's memorandum of law stresses that the plaintiff, as named in the instant caption, is Fulton Development Corporation while the entity named as mortgagor in the mortgage instrument is Fulton East Development Corporation.
The undisputed facts establish that on June 19, 1985, plaintiff mortgaged its property known as 7 Convent Avenue, Brooklyn, New York to secure a debt of twenty-nine thousand dollars ($29,000.00) to its mortgagee, Charles Fairbanks. Defendant's assertions contained in their memorandum of law confirm the terms of the mortgage as set forth in paragraph twenty-seven of the mortgage note. The mortgage was to be paid in equal monthly installments of $193.00 for a period of twelve (12) months beginning June 1, 1986, through and including May 1, 1987. Thereafter, payments were to be made in equal monthly installments of $582.02 for a period of sixty (60) months, beginning June 1, 1987 through and including May 1, 1992, at which time the balance, if any, shall become due and payable.
It is noted that the parties pleadings do not establish a procedural history of the action. Also noted is that defendant's affirmation in opposition to the instant motion relies heavily on the difference between the plaintiff's name in the caption and the mortgagor's name in the mortgage instrument. However, plaintiff's pleadings unequivocally allege that plaintiff is the mortgagor in the instrument in question and defendant has offered no evidence to the contrary.
Defendant's affirmation in opposition alleges that it commenced an action to foreclose the mortgage in question on March 20, 1991 under index number 7271/91. Defendant, however, does not state how the action was commenced, whether service was completed on any of the named defendants, or the current status of the action. Plaintiff contends that it was not served with any papers relating to the alleged foreclosure action under index number 7271/91. Defendant does not dispute this contention.
Business Corporation Law §306(b) (1) provides as follows:
that service of process on the secretary of state as agent of a domestic or authorized foreign corporation shall be made by personally delivering to and leaving with the secretary of state or a deputy, or with any person authorized by the secretary of state to receive such service, at the office of the department of state in the city of Albany, duplicate copies of such process together with the statutory fee, which fee shall be a taxable disbursement. Service of process on such corporation shall be complete when the secretary of state is so served.
Pursuant to CPLR § 213(4) an action upon a bond or note, the payment of which is secured by a mortgage upon real property, or upon a bond or note and mortgage so secured, or upon a mortgage of real property, or any interest therein must be commenced within six years.
Pursuant to CPLR § 3215(a) when a defendant has failed to appear, plead or proceed to trial of an action reached and called for trial, or when the court orders a dismissal for any other neglect to proceed, the plaintiff may seek a default judgment against him. [*3]
Pursuant to CPLR § 3215 (c), if the plaintiff fails to take proceedings for the entry of judgment within one year after the default, the court shall not enter judgment but shall dismiss the complaint as abandoned, without costs, upon its own initiative or on motion, unless sufficient cause is shown why the complaint should not be dismissed. A motion by the defendant under this subdivision does not constitute an appearance in the action.
It is well settled that a party moving for summary judgment must make a prima facie showing that it is entitled to judgment as a matter of law (Alvarez v. Prospect Hospital 68 NY2d 923-926 [1986]; see also Zarr v. Riccio, 180 AD2d 734 [2nd Dept. 1992]). Once a showing has been made, the burden shifts to the party opposing the motion to produce evidentiary proof, in admissible form, sufficient to establish the existence of material issues of fact which require a trial of the action (Romano v. St. Vincent's Medical Center of Richmond, 178 AD2d 467 [2nd Dept. 1991]).
Despite the aforementioned deficiencies in the parties pleadings, the undisputed evidence contained therein permits the court to resolve the instant motion. The plaintiff is the mortgagor of the mortgage note in question. That mortgage, by its terms, was set to expire on May 1, 1992, the date the last installment became due and payable. That date is the commencement date for computing the statute of limitations.
The statute of limitations in a mortgage foreclosure action begins to run six years from the due date for each unpaid installment, or the time the mortgagee is entitled to demand full payment, or when the mortgage has been accelerated by a demand, or an action is brought ( Saini v. Cinelli Enterprises Inc. 289 AD2d 770 [3rd Dept.2001], cert denied 98 NY2d 602 [2002]; see also Lavin v. Elmakiss, 302 AD2d 638, 639,(N.Y.A.D. 3 Dept. 2003). In the case at bar, the statute of limitations therefore expired on May 1, 1996.
Although the defendant contend that it commenced a foreclosure action on March 20, 1991, under index number 7271/91, the defendant does not state how the action was commenced, whether service was completed on any of the named defendants, or the current status of the action. Effective July 1, 1992, the method of commencing an action in New York Supreme and County Courts was changed by the Legislature from a commencement-by-service to a commencement-by-filing system making the payment of a filing fee and filing of the initiatory papers the acts that commence an action (Gershell v. Porr 89 NY2d 327-331 [1996]). As amended, CPLR 203(b) and 203 (c) set forth the methods for determining when a claim against a defendant is deemed interposed for Statute of Limitations purposes. The 1992 amendments expressly provide that they "shall apply to actions commenced on or after" July 1, 1992. (L.1992, ch. 216, § 27.) Thus, even subsequent to the July 1, 1992 effective date of the commencement by filing system, actions commenced by service of process prior to June 30, 1992 continue to be deemed commenced by service and are governed by CPLR 203 (b) Westnine Associates v. West 109th Street Associates 247 AD2d 76-80 [1st Dept. 1998]).
CPLR 203(b)(1) provides, in pertinent part, that in an action commenced by service, a claim asserted in the complaint is interposed against the defendant or co-defendant united in interest with such defendant when the summons is served upon the defendant. The court has reviewed the Kings County Court Clerk file of the 1991 action. The file demonstrates that on March 20, 1991, A-1 Reliable Construction Co., Inc., filed a summons and complaint and a notice of pendency against Fulton East Development Corporation and other named defendants [*4]with the Kings County Clerk. The Kings County Clerk file did not include an affidavit of service. Plaintiff's contention that it was not served under the alleged foreclosure action under index number 7271/91 is not controverted. The court, therefore, does not find that a mortgage foreclosure action was properly commenced before the expiration of the statute of limitations.
Inasmuch as any action to foreclose the mortgage in question is time barred, there is no need to address the issue of defendant's alleged default on the plaintiff's underlying action. The undisputed evidence establishes plaintiff's entitled to judgment as a matter of law to discharge the mortgage as time barred. The defendant did not meet its burden to produce evidentiary proof, in admissible form, sufficient to establish the existence of material issues of fact which require a trial of the action. Therefore, plaintiff's request for summary judgment to cancel the mortgage in question is granted.
The foregoing constitutes the decision and order of this court.
Dated: October 19, 2004
J.S.C.
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.
