Green Tree Servicing LLC v Inanir
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Green Tree Servicing LLC v Inanir 2018 NY Slip Op 30357(U) February 27, 2018 Supreme Court, Suffolk County Docket Number: 3621/2014 Judge: Howard H. Heckman Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various New York State and local government sources, including the New York State Unified Court System's eCourts Service. This opinion is uncorrected and not selected for official publication. [* 1] Short Form Order SUPREME COURT - STATE OF NEW YORK IAS PART 18 - SUFFOLK COUNTY PRESENT: HON. HOWARD H. HECKMAN JR., J.S.C. INDEx No.:3 ~a 112014 MOTION DATE: 0210912018 MOTION SEQ. NO.: 001 MG ----------------------------------------------------------------)( GREEN TREE SERVICING LLC, Plaintiffs, -againstKEMAL A. INANIR, NANCY A. INANIR, et.al., Defendants. ----------------------------------------------------------------X PLAINTIFF'S ATTORNEY: BERKMAN, HENOCH, PETERSON, PEDDY & FENCHEL, P.C. 100 GARDEN CITY PLAZA GARDEN CITY, NY 11530 DEFENDANTS' ATTORNEY: GUTTMANN & KELLNER, P.C. 25 WEST MAIN STREET SMITHTOWN, NY 11787 Upon the following papers numbered 1 to 24 read on this motion : Notice of Motion/ Order to Show Cause and supporting papers l 020 ; Notice of Cross Motion and supporting papers_ : Answering Aflidavits and supporting papers 21-22 ; Replying Affidavits and supporting papers 23-24 ; Other_ ; (and aner hearing counsel in support and opposed to the motion) it is, ORDERED that this motion by plaintiff Green Tree Servicing, LLC. seeking an order: 1) granting summary judgment striking the answer of defendants Kemal A. Inanir and Nancy A. Inanir; 2) discontinuing the action against defendants designated as "John Doe # 1" through "John Doe # 12"; 3) deeming all appearing and non-appearing defendants in default; 4) amending the caption; and 5) appointing a referee to compute the sums due and owing to the plaintiff in this mortgage foreclosure action is granted; and it is further ORDERED that p laintiff is directed to serve a copy of this order amending the caption upon the Calendar Clerk of the Court; and it is further ORDERED that plaintiff is directed to serve a copy of this order with notice of entry upon all parties who have appeared and not waived further notice pursuant to CPLR 2103(b)(l)(2) or (3) within thirty days of the date of this order and to promptly file the affidavits of service with the Clerk of the Court. Plaintiffs action seeks to foreclose a mortgage in the original sum of $3 33,700.00 executed by defendants Kemal A. Inanir and Nancy A. Inanir on January 3, 2005 in favor of USAA Federal Savings Bank. On the same date both defendants executed a promissory note promising to re-pay the entire amount of the indebtedness to the mortgage lender. By assignment dated August 19, 2013 the mortgage and note were assigned to plaintiff. Plaintiff claims that the defendants defaulted under the terms of the mortgages and note by failing to make timely monthly mortgage payments beginning February 1, 2012 and continuing to date. Plaintiff commenced this action by filing a summons, complaint and notice ofpendency in the Suffolk County Clerk's Office on February 20, 2014. [* 2] Defendants Kemal A. Inanir and Nancy A. lnanir served an answer dated March 11 , 2014 containing thirteen affirmative defenses and three counterclaims. Plaintiffs motion seeks an order granting summary judgment striking defendants' answer and for the appointment of a referee. In opposition to plaintiff's motion, defendants claim that: 1) plaintiff has fa iled to prove that it complied with the service requirements set forth pursuant to RPAPL 1304; and 2) plaintiff lacks standing to maintain this action. The proponent of a summary judgment motion must make a prima facie showing of entitlement to judgment as a matter of law, tendering sufficient evidence to eliminate any material question of fact from the case. Tue grant of summary judgment is appropriate only when it is clear that no material and triable issues of fact have been presented (Sillman v. Twentieth Century-Fox Film Corp., 3 NY2d 395 (1957)). The moving party bears the initial burden of proving entitlement to summary judgment (Wine grad v. NYU Medical Center, 64 NY2d 851 ( 1985)). Once such proof has been proffered, the burden shifts to the opposing party who, to defeat the motion, must offer evidence in admissible form, and must set forth facts sufficient to require a trial of any issue of fact (CPLR 3212(b); Zuckerman v. City ofNew York, 49 NY2d 557 (1980)). Summary judgment shall only be granted when there are no issues of material fact and the evidence requires the court to direct a judgment in favor of the movant as a matter of law (Friends ofAnimals v. Associated Fur Manufacturers, 46 NY2d I 065 ( 1979)). Entitlement to summary judgment in favor of the foreclosing plaintiff is established, prima facie by the plaintiffs production of the mortgage and the unpaid note, and evidence of default in payment (see Wells Fargo Bank NA. v. Erobobo, 127 AD3d 1176, 9 NYS3d 312 (2"d Dept., 2015); Wells Fargo Bank, NA. v. Ali, 122 AD3d 726, 995 NYS2d 735 (2"d Dept., 2014)). Where the plaintiff's standing is placed in issue by the defendant's answer, the plaintiff must also establish its standing as part of its prima facie showing (Aurora Loan Services v. Taylor, 25 NY3 d 355, 12 NYS3d 612 (2015); Loancare v. Firshing, 130 AD3d 787, 14 NYS3d 410 (2"d Dept., 2015); HSBC Bank USA, NA. v. Baptiste, 128 AD3d 77, 10 NYS3d 255 (200 Dept., 2015)). In a foreclosure action, a plaintiff has standing if it is either the holder of, or the assignee of, the underlying note at the time that the action is commenced (Aurora Loan Services v. Taylor, supra.; Emigrant Bank v. Larizza, 129 AD3d 94, 13 NYS3d 129 (2"d Dept., 2015)). Either a written assignment of the note or the physical transfer of the note to the plaintiff prior to commencement of the action is sufficient to transfer the obligation and to provide standing (Wells Fargo Bank, NA. v. Parker, 125 AD3d 848, 5 NYS3d 130 (2"d Dept., 2015); US. Bank v. Guy, 125 AD3d 845, 5 NYS3d 116 (2"d Dept., 2015)). A plaintiff's attachment of a duly indorsed note to its complaint or to the certificate of merit required pursuant to CPLR 3012(b), coupled with an affidavit in which it alleges that it had possession of the note prior to the commencement of the action, has been held to constitute due proof of the plaintiffs standing to prosecute its claims for foreclosure and sale (JPMorgan Chase Bank, NA. v. Weinberger, 142 AD3d 643, 37 NYS3d 286 (2"d Dept., 2016); FNMA v. Yakaputz JI, Inc., 141 AD3d 506, 35 NYS3d 236 (2nd Dept., 2016); Deutsche Bank National Trust Co. v. Leigh, 137 AD3d 841, 28 NYS3d 86 (2nd Dept., 2016); Nationstar Mortgage LLC v. Catizone, 127 AD3d 1151, 9 NYS3d 315 (2"d Dept., 2015)). Proper service of RP APL 1304 notices on borrower(s) are conditions precedent to the commencement of a foreclosure action, and the plaintiff has the burden of establishing compliance with this condition (Aurora Loan Services, LLC v. Weisblum, 85 AD3d 95, 923 NYS2d 609 (2nd -2- [* 3] Dept., 2011); First National Bank ofChicago v. Silver, 73 AD3d 162, 899 NYS2d 256 (2°d Dept., 2010)). RP APL 1304(2) provides that notice be sent by registered or certified mail and by first-class mail to the last known address of the borrower(s), and if different, to the residence that is the subject of the mortgage. The notice is considered given as of the date it is mailed and must be sent in a separate envelope from any other mailing or notice and the notice must be in 14-point type. At issue is whether the evidence submitted by the plaintiff is sufficient to establish its right to foreclose. The defendants do not contest their failure to make timely payments due under the terms of the promissory note and mortgage agreements. Rather, the issues raised by the defendants concern whether the proof submitted by the mortgage lender provides sufficient admissible evidence to prove its entitlement to summary judgment based upon defendants' continuing default, plaintiffs compliance with statutory pre-foreclosure notice requirements, and plaintiffs standing to maintain this action. CPLR 4518 provides: Business records. (a) Generally. Any writing or record, whether in the form of an entry in a book or otherwise, made as a memorandum or record of any act, transaction, occurrence or event, shall be admissible in evidence in proof of that act, transaction, occurrence or event, if the judge finds that it was made in the regular course of any business and that it was the regular course of such business to make it, at the time of the act, transaction, occurrence or event, or within a reasonable time thereafter. The Court of Appeals in People v. Guidice, 83 NY2d 630, 635, 612 NYS2d 350 (1994) explained that "the essence of the business records exception to the hearsay rule is that records systematically made for the conduct of business ... are inherently highly trustworthy because they are routine reflections of day-to-day operations and because the entrant's obligation is to have them truthful and accurate for purposes of the conduct of the enterprise." (quoting People v. Kennedy, 68 NY2d 569, 579, 5 10 NYS2d 853 (1986)). It is a unique hearsay exception since it represents hearsay deliberately created and differs from all other hearsay exceptions which assume that declarations which come within them were not made deliberately with litigation in mind. Since a business record keeping system may be designed to meet the hearsay exception, it is important to provide predictability in this area and discretion should not normally be exercised to exclude such evidence on grounds not foreseeable at the time the record was made (see Trotti v. Estate of Buchanan, 272 AD2d 660, 706 NYS2d 534 (3rd Dept., 2000)). The three foundational requirements of CPLR 4518(a) are: 1) the record must be made in the regular course of business- reflecting a routine, regularly conducted business activity, needed and relied upon in the performance of business functions; 2) it must be the regular course of business to make the records- (i.e. the record is made in accordance with established procedures for the routine, systematic making of the record); and 3) the record must have been made at the time of the act, transaction, occurrence or event, or within a reasonable time thereafter, assuring that the recollection is fa irly accurate and the entries routinely made (see People v. Kennedy, supra @ pp. 579-580)). The "mere filing of papers received from other entities, even if such papers are retained in the regular course of business, is insufficient to qualify the documents as business records." (People v. Cratsley, -3- [* 4] 86 NY2d 81, 90, 629 NYS2d 992 (1995)). The records will be admissible "if the recipient can establish personal knowledge of the maker's business practices and procedures, or that the records provided by the maker were incorporated into the recipient's own records or routinely relied upon by the recipient in its business." (State ofNew York v. 158'" Street & Riverside Drive Housing Company, Inc. , 100AD3d 1293, 1296, 956 NYS2d 196 (2012); leave denied, 20 NY3d 858 (2013); see also Viviane Etienne Medical Care, P.C. v. Countly-Wide Insurance Company, 25 NY3d 498, 14 NYS3d 283 (2015); Deutsche Bank National Trust Co. v. 1 \1onica, 131 AD3d 737, 15 NYS3d (3rd Dept., 2015); People v. DiSalvo, 284 AD2d 547, 727 NYS2d 146 (2n Dept., 2001); Matter of d Carothers v. GEICO, 79 AD3d 864, 914 NYS2d 199 (2nd Dept., 2010) ). In this regard, with respect to mortgage foreclosures, a loan servicer's employee may testify on behalf of the mortgage lender and a representative of an assignee of the original lender can rely upon business records of the original lender to establish its claims for recovery of amounts due from the borrowers provided the assignee/plaintiff establishes that it incorporated the original records into its own records and relied upon those records in the regular course of business (Landmark Capital Inv. Inc. v. Li-Shan Wang, 94 AD3d 418, 941NYS2d144 (1 51 Dept., 2012); Portfolio Recove1yAssociates, LLC. v. Lall, 127 AD3d 576, 8 NYS3d 101 (1 st Dept., 2015); Merrill Ly nch Business Financial Services, Inc. v. Trataros Construction, Inc., 30 AD3d 336, 819 NYS2d 223 (151 Dept., 2006)). The statute (CPLR 4518) cl early does not require a person to have personal knowledge of each and every entry contained in a business record (see Citibank NA. v. Abrams, 144 AD3d 1212, 40 NYS3d 653 (3rd Dept., 2016); HSBC Bank USA, NA. v. Sage, 112 AD3d 1126, 977 NYS2d 446 (3rd Dept., 2013); Landmark Capital Inv. Inc. v. LI-Shan Wang, supra.)). As the Appellate Division, Second Department recently stated in Citigroup v. Kopelowitz, 147 AD3d 1014, 48 NYS3d 223 (2nd Dept., 2017): "There is no requirement that a plaintiff in a foreclosure action rely on a particular set of business records to establish a prima facie case, so long as the plaintiff satisfies the admissibility requirements of CPLR 4518(a) and the records themselves actually evince the facts for which they are relied upon." Decisions interpreting CPLR 4518 are consistent to the extent that the three foundational requirements: 1) that the record be made in the regular course of business; 2) that it is in the regular course of business to make the record; and 3) that the record must be made at or near the time the transaction occurred. - if demonstrated, make the records admissible since such records are considered trustworthy and reliable. Moreover, the language contained in the statute specifically authorizes the court discretion to determine admissibility by stating "if the judge finds" that the three foundational requirements are satisfied the evidence shall be admissible. The affidavit submitted from the mortgage lender' s assistant vice president provides the evidentiary foundation for establishing the mortgage lender's right to foreclose. The affidavit sets forth the employee's review of the business records maintained by the plaintiff; the fact that the books and records are made in the regular course ofDitech's business; that it was Ditech's regular course of business to maintain such records; that the records were made at or near the time the underlying transactions took place; and that the records were created by an individual with personal knowledge of the underlying transactions. Based upon the submission of this affidavit, the plaintiff has provided an admissible evidentiary foundation which satisfies the business records exception to the hearsay rule with respect to the issues raised in this summary judgment application. With respect to the issue of standing, plaintiff's representative's affidavit together with documentary evidence reveals that plaintiff's agent/custodian has retained continuous possession of the indorsed in blank original promissory note since January 26, 2005, which was prior to the date -4- [* 5] this action was commenced thereby establishing plaintiff's standing to prosecute this action (Aurora Loan Services v. Taylor, supra.; Wells Fargo Bank, NA. v. Parker, supra.; US. Bank, NA. v. Ehrenfeld, 144 AD3d 893, 41NYS3d269 (2"d Dept., 2016); GMAC Mortgage, LLC v. Sidbeny, 144 AD3d 863, 40 NYS3d 783 (2"d Dept., 2016)). In addition, the plaintiff has attached a copy of the indorsed in blank promissory note to the complaint, together with the certificate of merit (CPLR 3012-b). Such evidence of possession establishes the plaintiffs standing to prosecute this foreclosure action (see JPMorgan Chase Bank, NA. v. Weinberger, supra.,· Nationstar Mortgage LLC v. Catizone, supra.). With respect to the issue of the defendants' default in making payments, in order to establish prima facie entitlement to judgment as a matter of law in a foreclosure action, the plaintiff must submit the mortgage, the unpaid note and admissible evidence to show default (see PennyMac Holdings, Inc. V Tomanelli, 139 AD3d 688, 32 NYS3d 181 (2"d Dept., 2016),· North American Savings Bank v. Esposito-Como, 141 AD3d 706, 35 NYS3d 491 (2"d Dept., 2016); Washington Mutual Bank v. Schenk, 112 AD3d 615, 975 NYS2d 902 (2"d Dept., 2013)). Plaintiff has provided admissible evidence in the form of a copy of the note and mortgage, and an affidavit attesting to the defendants' undisputed default in making timely mortgage payments sufficient to sustain its burden to prove defendants have defaulted under the terms of the parties agreement by fai ling to make timely payments since February I , 2012 (CPLR 4518; see Wells Fargo Bank, NA. v. Thomas, supra.; Citigroup v. Kopelowitz, supra.)). Accordingly, and in the absence of any proof to raise an issue of fact concerning the Inanirs' continuing default, plaintiffs application for summary judgment based upon defendants ' breach of the mortgage agreement and promissory note must be granted. With respect to service of the pre-foreclosure RP APL 1304 90-day notices, the proof required to prove strict compliance with the statute (RP APL 1304) can be satisfied: 1) by plaintiffs submission of an affidavit of service of the notices (see CitiMortgage, Inc. v. Pappas, 147 AD3d 900, 4 7 NYS3d 415 (2"d Dept., 2017); Bank of New York Mellon v. Aquino, 131 AD3d 1186, 16 NYS3d 770 (2"d Dept., 2015); Deutsche Bank National Trust Co. v. Spanos, 102 AD3d 909, 961 NYS2d 200 (2"d Dept., 2013)); or 2) by plaintiff's submission of sufficient proof to establish proof of mailing by the post office (see HSBC Bank USA, NA. v. Ozcan, 154 AD3d 822. 64 NYS3d 38 (2"d Dept., 2017); CitiMortgage, Inc. v. Pappas, supra pg. 901; see Wells Fargo Bank, NA. v. Trupia, 150 AD3d 1049, 55 NYS3d 134 (2"d Dept., 2017)). Once either method is established a presumption ofreceipt arises (see Viviane Etienne Medical Care. P.C. v. Counlfy-Wide Insurance Co., supra.: Flagstar Bank v. Mendoza, 139 AD3d 898, 32 NYS3d 278 (2"d Dept., 2016); Residential Holding Corp. v. Scoflsdale Insurance Co., 286 AD2d 679, 729 NYS2d 766 (2"d Dept., 2001)). In this case, the record shows that there is sufficient evidence to prove that mailing by certified and first class mail was done by the post office. Plaintiff has submitted proof in the form of an affidavit from the mortgage representative confirming that the mailings were done more than 90 days prior to commencing this action on April 11, 2013; together with a total of eight copies of the 90 day notices, four of which contain certified article (tracking) numbers addressed to the mortgaged premises and a second residential address; together with copies of the United States Postal Service proof of mailing green card receipts addressed to the mortgagors with the article numbers attached; and the RP APL 1306 filing statements with the New York State Department of Financial Services confirming step one mailing on April 11 , 2013 and step two mailing on February 20, 2014 on both defendants/mortgagors. Such proof establishes the plaintiffs compliance with statutory requirements (see HSBC Bank USA v. Ozcan, supra.). Defendant Kemal A Inanir's and defense counsel's -5- [* 6] conclusory denial of service, is not supported by any relevant, admissible evidence sufficient to raise a genuine issue of fact which would defeat plaintiffs summary judgment motion (see PHH Mortgage Corp., v. Muricy, 135 AD3d 725, 24 NYS3d 137 (2"d Dept., 2016); HSBC Bank v. Espinal, 137 AD3d 1079, 28 NYS3d 107 (2"d Dept., 2016)). Similarly (and although defendants do not contest this issue), the plaintiff has submitted sufficient proof of service of the mortgage default notice as required under the terms of the mortgage by submission of the mortgage representative's affidavit attesting to timely service together with a copy of the mortgage default notice addressed to the borrower at the mortgaged premises and dated June 11 , 2013. Such proof establishes plaintiffs compliance with mortgage requirements and defendants' failure to deny ofreceipt of the mortgage default notice fails to raise any genuine issue of fact sufficient to defeat plaintiffs summary judgment motion (see PHH Mortgage Corp. v. Muricy, supra.) With respect to defendants' remaining claims of bad faith, there is no relevant, admissible evidence submitted to support such claims. Finally, the defendants have failed to raise any admissible evidence to support any of their remaining thirteen affirmative defenses and three counterclaims in opposition to plaintiffs motion. Accordingly those defenses and counterclaims must be deemed abandoned and are hereby dismissed (see Kronick v. L.P. Therault Co. , Inc., 70 AD3d 648, 892 NYS2d 85 (2"d Dept., 2010); Citibank, N A, v. Van Brunt Properties, LLC, 95 AD3d 1158, 945 NYS2d 330 (2"d Dept., 2012); Flagstar Bank v. Bellafiore, 94 AD3d 0144, 943 NYS2d 551 (2"d Dept., 2012); Wells Fargo Bank Minnesota, NA . v. Perez, 41 AD3d 590, 837 NYS2d 877 (2"d Dept., 2007)). Accordingly, plaintiff's motion seeking summary judgment is granted. The proposed order of reference has been signed simultaneously with execution of this order. HON. HOWARD H. HECKMAN, J~ Dated: February 27, 2018 J.S.C. -6-
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