Bank of Am., N.A. v Rolf

Annotate this Case

Download PDF

Bank of Am., N.A. v Rolf 2018 NY Slip Op 31767(U) July 25, 2018 Supreme Court, Suffolk County Docket Number: 38412/2011 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] Shon Form UrJer S U PRE\1E COU RT - STA TE OF NE\\' YORK IAS PART 18 - SUFFOLK COUKTY PR ES ENT: fNDEXNO.: 38412/2011 .\10TION DATE: 7/3/'.2018 .\10Tl01\ SEQ. NO.: #004 MG HON. 110\VARD II. IIECKJ\1IAN, JR., J.S.C. ----------------------------------------------------------------)\ BA>JK OF AMERICA. N.A,. PLAINTIFF'S ATTORN'EY: KNUCKLES. KOMOSINSKI & MANFRO. LLP 565 TAXTER ROAD. SUITE 590 ELMSFO RD, NY 10523 Plaintiff. -against- DEFENDAI'\T'S ATTORNEY: CATAF AGO fINI LLP 350 flFTH AVENUE, SUITE 7710 NEW YORK. NY 10118 CHRISTO Pl fER ROLF. ct al.. Defendants. ----------------------------------------------------------------)( Upon the following papers numbered I to 35 read on this motion 1-8 : Notice of Motion/ Order 10 Show Cause and supporting papers_! _: Notice or Cross t\'lotion and supporting papers_ : Answering Affida\'its and supporting papers 9-14 : Replying Aflic.lnvits and supporting papers 25-29. 30-31. 33-35 : Other_: (and after hearing counsel in support and opposed to the motio n) it is. ORDERED that this motion by plaintiff Bank of America . N.A., for an order pursuant to CPLR I 018 & RP APL 13 71: 1) substituting U.S. Bank ational Association. not in its Individual Capacity. but solely as Legal Title Trustee for BCAT 20 I6-l 8TT as the named party plaintiff in place a nd stead of Bank of Amerfra. N.A.: 2) confirming the referee's report of sale dated August 23, 20 17: and 3) granting leave to enter a deficiency judgment against defendant/mortgagor Christopher Rolf is granted. Plaintiffs foreclosure action was commenced to foreclose a mortgage executed by defendant Christopher Rolf in the original sum of$1.480.000.00 on October 21. 2005. By Order (Jliou. J.) dated December 12. 2014, plaintiffs moti o n seeking an order granting summary judgment and for the appointment of a referee was granted. By O rder (Iliou . .J.) dated March 23, 20 15, defendant 's m otion seeking an order grant ing le:lve to r c31·gue the prior December l '.2. '.2014 Order was denied. A Judgment of Foreclosure and Sale was granted on February 22. 2017. The mortgaged premises were sold at public auction to Blake Stone. LLC. on July 7. 2017 for the sum of S 1.223. 79..J..32. Plaintiffs motion seeks an order substituting the named party plaintiff. confirming the referee's report of"sale and granting a deficiency judgment against the mortgagor/defendant Roll' in the sum of $970,0 16.80 with interest from August 23. 2017. In his opposition defendant Roi rc Iaims that: I) plaintiffs motion is a nullity since it was not served upon defendant RolCs counsel as statutorily required: 2) plaintiff failed to personally sen-e the deficiency motion upon Rolf and therefore the application must be denied as untimely: and J) the amount sought by the plaintiff as the deficiency is excessive since plaintiff misapplied the statutory formula for computing the deficiency .i udgmcnt. A judgment of foreclosure and sale entered against a defendant is final as to all questions at issue between the parties. and all matters of defense ,,·bich were or might have been litigated in the [* 2] foreclosure action are concluded (long Island Savings Bank'" .\fihalios, 269 AD2d 502, 704 NYS2d 483 (2"J Dept.. :WOO); Signature Bank'" Epstein. 95 AD3d 1199, 9.,i5 NYS2d 3.,i7 (2"d Dept. , 2012)). J urisdiction over the defendant Rolf has been established. as has the j udgment debtor's personal liability for entry of a deficiency judgment. Moreover. defendant/judgment debtor Rolf is not contesting the timeliness of plaintiffs application (i.e. \\'ithin ninety (90) days of the transfer of the deed) since the record is undisputed that the November 16. 2017 "nail and mail" service or this motion was done \\'ithin ninety days of the transfer of the deed on August 23. 2017. The issues Rolf is contesting is more specifically whether plaintiffs actual service of the deficiency motion provided adequate notice to the judgment debtor pursuant to RPAPL 1371(2). and whether plaintiffs computation of the amount due the mortgage lender representing the deficiency judgment is corTect. RPAPL 1355(2) provides in pertinent part: Report of sale; confirmation 2. A motion to confirm such report of sale shall not be made within three months afte r the fil ing of the report and shall in any event be made not later than four months after the filing of such report, except that if there be no surplus moneys arising from the sale of the mortgaged premises under such judgment, an application for confirmation of the report of sale may be made at any time after the report shall have been filed eight days ...... . RP APL 13 71 provides in pertinent part: Deficiency judgment I. If a person who is liable to the plaintiff for the payment of the debt secured by the mo11gage is made a defendant in the action. and has appeared or has been personally served with the summons, the fi na l j udgment may award payment by him of the whole residue. or so much thereof as the court may determine to be just and equitable, of the debt remaining unsati s fied. after a sale of the mortgaged property and the application of the proceeds, pursuant to the directions contained in such judgment. the amount thereof to be determined by the court as herein provided. Simultaneously with the making of a motion for an order confirming the sale. provided such motion is made within ninety days after the date of the consummation of the sale by the delivery of the proper deed of conveyance to the purchaser. the party to whom such residue shalI be owing may make a motion in the action for leave to enter a deficiency judgment upon notice to the party against whom such judgment is sought or the attorney who shall have appeared for such party in such action. Such notice shall be served personal ly or in such other maimer as the court may direct. Upon such motion the court. whether or not the respondent appears. shal I determine. upon affida\·it or otherwise as it shall direct. the fair and reasonable market Yalue of the mortgaged premises as the date such premises were bid in at auction or such nearest earlier date as there shall have been any market value thereof and shall make an order directing the entry of a deficiency judgment. Such deficiency judgment shall be for an amount equal to the sum or the amount owing by the party liable as <letcnnined by the 1 or -2- [* 3] judgment \Vith interest. plus the amount O\Ying on all prior liens and encumbrances with interest. plus costs and disbursements of the action including the referee's fee and disbursements. less the market value as determined by the court or the sale price of the property whichever shal l be higher. RPAPL 1371 does not inflexibly require that service be personal; it states that service may be made in such other manner as the court may direct. and cases interpreting this provision have not required that a court rati !)• another form of service beforehand but have allowed subsequent court appro\'al nunc pro tune. RP APL 1371 (2) has been liberally construed to require only ··substantial compliance.. where actual notice of the underlying application has been timely received (Bianco v. Coles et al.. 131 AD2d 10, 520 NYS2d 261 (3'd Dept.. 1987 ); Catholic Wo111en 's Benev. Legion v. Burke et al.. 253 AD26 l. J NYS2d 720 (l 51 Dept., 1938 ); Columbus Realty investment Corp. v. Weng-Heng Tsiong. 226 A02d 259, 641 NYS2d 265 ( 1~ 1 Dept.. 1996); Sarasota Inc. '" Homestead .Acres at Greenport. Inc., 249 AD2d 290, 670 NYS2d 878 (2"c1 Dept.. 1998); Heritgage Savings Bank '" Grabowski, 70 AD2d 989, 417 NYS2d 802 (3"<l Dept., 1979); FDIC v. S teele. 1993 WL 246331 (U.S.D.C., S.D. N.Y., 1993); Mortgagee Affiliates, inc. '" Jerder Realty Corp.. 62 AD2d 591, 406 NYS2d 326 (2"d Dept.. 1978): see also 1././ Bleecker Street Corp. v. Souto Geffen Co .. 277 AD2d 133, 717 NYS2d 013 (I s• Dept., 2000); Gateway State Bank v. Puma, 220 AD2d 3 73, 644 NYS2d 560 (2"d Dept., 1996)) since the statute '·was not designed to provide loopholes to a mo11gagor to escape an obligation assumed by him.. (Catholic Women's Benerolent Legion r. Burke, supra pg. 26-1). A motion to confirm a referee's report of sale pursuant to RP APL l 355(2) is primarily relevant in two situations: the first. where surplus moneys remain after the sale requiring the referee to submit additional documents relevant to determine the disposition of those remaining funds; and the second. where plaintiff is seeking a deficiency judgment. In this case plaintiff is seeking a deficiency judgment and is therefore required to make a motion to confirm the referee ·s report of sale together with a motion seeking a deficiency judgment. As a result plaintiff served a combined motion to confirm the referee's report of sale and for leave to enter a deficiency judgment. RP APL 1371(2) specifically provides for a timely combination motion to be '·simultaneously'' served "upon notice to the party against whom such judgment is sought or the attorney who shall have appeared for such party in such action ...... with such notice req uired to be served ·'personally or in such other manner as the court may direct." The importance of this service provision is re fl ected in the requirement that the combination application be served timely and ··personally.. or in a manner directed by the court. Clearly the statutory scheme reflects an intent, in si tuations where there are no surplus monies but where there is a likelihood that a deficiency judgment will be sought. to permit these additional service requirement options. Defendantfjudgment debtor claims that the motions must be served separately to the extent that service of the RP APL 1355(2) motion be ser\'ed on counsel only and argues that plaintiffs service of the combination motion on the defendant rendered plaintiffs application a ··nullity... Ho\.vever to interpret the statutes service requirements as wholl y separate (as derendant(judgment debtor advocates) in this situation (i.e . to limit service by mail on delcnsc counsel for the RP/\PL 1355 application: and to require a different method for the RPAPL 1371 ··simultaneous" application) would frustrate legislative intent and alter the legislative design. l !ndcr these circumstances the statutes should not be interpreted so as to create unreasonable. mischievous or absurd results (see McKinney's Consolidated Laws of New York Book I. Statutes ections 73. 76. 92. 95. 143. 145 & 1-+8) and striking plaintiffs application as a ··nullity.. is clearly un\\'arranted and \\'ithout legal authority. .., -.)- [* 4] With respect to the issue of the actual service of the combination motion. as recited above. RP APL 1371(2). as interpreted by the relevant case law. sets forth the requirements fo r service of a motion seeking leave to obtain a deficiency judgment. The statute provides the motion must be served personally or in such manner as the court directs. and the law provides that in situations where the judgment debtor has actual notice of a timely application seeking a deficiency judgment the judgment creditor must ··substantially comply"' with those service requirements (Bianco v. Coles et al.. supra.). The service requirements are thus clearly not as stringent as the personal jurisdictional requirements set forth for commencing an action which is reasonable given the fact that the judgment debtor's liability has been established and the only remaining issue to be determined is the amount of damages due the mortgage lender with the proofs involved limited to the judgment amount (previously established in the judgment of foreclosure itself minus the fair market value of the mortgaged premises or sales price (established by confirmation of the referee's report of sale). whichever is higher. With respect to consideration of whether plaintiff has complied with RPAPL 1371(2) service requirements, the law concerning ''personal" service in the jurisdictional sense (which is not determinative in this application) provides that service pursuant to CPLR 308(4) may be used only where personal service under CPLR 308(1) & 308(2) cannot be made with "due diligence" (CPLR 308(4); Amtrust-NP SFR, LLC '" Emmel. 140 AD3d 993. 34 NYS3d 163 (2"d Dept., 2016); LaSalle Bank, NA. v. Hudson, 139 AD3d 811. 31 NYS3d 188 (2"d Dept., 2016)). The term ''due di ligence'' is not defined by statute, but has been interpreted and applied on a case-by-case basis (Estate of Waterman v. Jones. 46 AD3d 63, 843 NYS2d 462 (2 11d Dept., 2007)). Ordinarily a process server's affidavit of service constitutes prima facie evidence of proper service (US. Bank, NA. v. Tauber, 140 AD3d 1154, 36 NYS3d 144 (2"d Dept., 2016); NYCTL v. Tmfatinos, 101AD3d1092, 956 NYS2d 571 (2nd Dept.. 2012)). A defendant may rebut the process server's affidavit by submitting an affidavit containing specific and detailed contradictions of the claims in the process server's affidavit, but bare, conclusory and unsubstantiated denials of service are insufficient to rebut the presumption of proper service (US Bank. NA . v. Tate. 102 AD3d 859, 958 NYS2d 722 (2"d Dept., 2013): Beneficial Homeowner Serv. Corp. v. Girault. 60 AD3d 984, 875 NYS2d 815 (2nd Dept., 2009)). In this case the process server· s affidavit states that he visited the judgment debtor's residential premises in lower Manhattan on five separate occasions during different hours of the day and that on one visit a voice on the intercom identifying himself as the defendant stated that he would not accept any papers. The affidavit goes on to state that service was done by "nail and mail.. on November 16. 2017 at 9:02 p.m. \.Vith the required first class mai li ng completed on November 21. 2017. In opposition. defendant/judgment debtor Rolf. his son and his personal assistant submit affidavits claiming that the process server's affidavit is "false"'; that process was never served; that none or the three heard the ·'buzzer ring on any of (the five) days'': that the process server never spoke with Rolf: and that since Rolf is a paraplegic he is unable to physically access the intercom. Based upon this record the affidavit of the process server consti tutes prima facie evidence of proper service pursuant to CPLR 308( 4) given the claim that service was attempted on five separate occasions during different hours or the day. Defendant/judgment debtor' s submission of afiidavits claiming the process server's affidavit is totally false raise issues of credibility which. if submitted solely with respect to the issue of persona l jurisdiction and without any factual inconsistencies. might be sufficient to contradict the process server's claims. However a close reading of defendant's affidavit reveals a crucial inconsistency which belies the judgment debtor's claim that the process -.+- [* 5] server is a "habitual liar'' and that his affidavit is a total fabrication and establishes that Rolf had timely and actual prior notice of plaintiffs motion sufficient to prove plaintiff's substantial compliance with RPAPL 1371 service prerequisites. Paragraph nine (9) of Rolfs affidavit concedes that the judgment debtor "received a partial copy of the instant moving papers: which were left on my door.·' This admission wholly contradicts the tlu·ee affidavits submitted by the defaulting mortgagor and his non-party witnesses since, in its limited fashion, it is a concession that the process server \vas in New York City and did in fact attempt to serve the motion papers outside Rolf's Manhattan apartment. And in this context the inquiry is not. as defendant argues, whether CPLR 308( 4) was "violated" because defendant "never received a complete of the motion (sic) (papers), since the issue is not one of personal service, but rather goes to the question of whether plaintiff substantially complied with RPAPl 1371 service requirements. Defendant' s admission establishes that the judgment debtor had actual notice of plaintifrs motion well within the ninety (90) day period which is all that is required to establish substantial compliance with the RP APL 13 71 service requirements (Bianco v. Coles, supra.: Catholic Women 's Benevolent Legion v. Burke, supra.; Heritage Savings Bank v. Grabowski. supra.). While the m ethod of service in this case was not improper, this court retains the inherent authority to validate plaintiffs service nunc pro tune (Bianco v. Coles, supra.). In view of the fact that the judgment debtor concedes having received timely notice of this motion; was thereafter afforded the right to contest the merits of plaintiffs application by submitting opposition to plaintiff's motion; and has not been prejudiced in his ability to oppose plaintiff's motion, plaintiff's service of the motion was in such manner as this court would direct and therefore no basis exists to deny plaintiffs application. With respect to computation of the amount of the deficiency judgment, the statute is clear that the deficiency is determined by subtracting the greater of the fair market value and the auction sale price (known formally as the subtrahend) from the amount set forth in the judgment (known as the minuend). with the result being the deficiency amount (known as the difference). In this case the subtrahend would be the sum of $1.970,000.00 (the greater of the fair market value over the auction sale price) and the minuend is the sum of $2,286,777.52 (the judgment amount) which results in the difference (the deficiency) in the sum of $316,777.52 with interest from August 23, 2017. To the extent that defendant has raised an objection to the plaintiff's computation of the deficiency judgment amount. defendan t/judgment debtor's objection is su stained . Defendant/judgment debtor's remaining argument claiming that plaintiffs service of an IRS Form 1099-C form resulted in a waiver of plainti ffs right to seek a deficiency is equally without merit and provides no justification fo r denying plai ntiff' a deliciency judgment. Accord ingly, plaintiff's motion for an order confirming the referee's report of sale and fo r leave to enter a deficiency judgment is granted to the extent indicated hereinabove. Plaintiff is directed to submit and serve the proposed judgment on notice to the defendant/judgment debtor within ten days ot· the date o f this order w ith notice of entry. HON. HO\iVARD H. HECKMAN, JR. Dated: July 2'.\ 2018 J.S.C . -5-

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.