OneWest Bank, FSB v Grillo

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OneWest Bank, FSB v Grillo 2019 NY Slip Op 30426(U) February 22, 2019 Supreme Court, Suffolk County Docket Number: 18686/2012 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 Order SUPREME COURT - STATE OF NEW YORK IAS PART 18 - SUFFOLK COUNTY PRESENT: HON. HOW ARD H. HECKMAN JR., J .S.C. INDEX NO.: 18686/2012 MOTION DATE: 1118/2019 MOTION SEQ. NO.: #002 MG ----------------------------------------------------------------X PLAINTIFF'S ATTORNEY: ONEWEST BANK, FSB, Plaintiff, MCCABE WEISBERG & CONWAY, P.C. 145 HUGUENOT ST. SUITE 210 NEW ROCHELLE, NY 10801 -against- DEFENDANT'S ATTORNEY: MATTHEW GRILLO, et al., Defendants. RICHARD J. SULLIVAN, ESQ. P.O. BOX 582 PT JEFFERSON, NY 11777 ----------------------------------------------------------------X Upon the following papers numbered I to 14 read on this motion 1-1 0 : Notice of Motion/ Order to Show Cause and su pporting papers_; Notice of Cross Motion and supporting papers_ ; Answering Affidavits and supporting papers I 1- I2 : Rep ly ing Affidav its and supporting pape rs I 3- I 4 ; Other_ ; (and after hearing co unst: I in support and opposed to the motion) it is. ORDERED that this motion by plaintiff OneWest Bank, FSB, seeking an order: 1) granting summary judgment striking the answer of defendant Kirsten Grillo ; 2) substituting Ocwen Loan Servicing LLC as the named party plaintiff in place and stead of plaintiff OneWest Bank, FSB; 3) substituting Gabrielle Rivera, Dawn Trypaluk, and Brandon Rivera as named party defendants in place and stead of defendants designated as "Jane Doe # l ", "Jane Doe #2" and "John Doe # I" and discontinuing the action against defendants designated as "John Doe #2" through "John Doe #5" and "Jane Doe #3" through "Jane Doe #5"; 4) deeming all appearing and non-appearing defendants in defau lt; 5) amend ing the caption; and 6) 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 plaintiff 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)( 1)(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 $195,000.00 executed by defendants Matthew Grillo and Kirsten Grillo on April 23, 2003 in favo r of IndyMac Federal Bank. On the same date both mortgagors executed a promissory note promising to re-pay the entire amount of the indebtedness to the mortgage lender. Defendants/mortgagors subsequently executed a Consolidated Extension and Modification Agreement (CEMA) and promissory note dated April 26, [* 2] 2004 creating a single lien in the sum of $238,000.00. The mortgage and note were subsequently assigned to plaintiff One West Bank by assignment dated February 28, 2010 and thereafter assigned to Ocwen Loan Servicing, LLC on September 8, 2013. Plaintiff claims that defendants defaulted under the terms of the mortgage and note by fai ling to make timely monthly mortgage payments beginning July 1, 2009 and continuing to date. Plaintiff commenced this action by filing a summons, complaint and notice of pendency in the Suffolk County Clerk's Office on June 19, 2012. Defendant Kirsten Grillo served an answer dated July 11, 2012 asserting seven affirmative defenses. By Order (Murphy, J.) dated September 24, 2015 plaintiffs motion seeking an order granting summary judgment and appointing ·a referee to compute the sums due and owing to the mortgage lender was denied. Acting Justice Murphy's decision determined that plaintiff had failed to submit sufficient, admissible evidence to prove its entitlement to foreclose the mo1tgage. Plaintiffs renewed motion seeks an order granting summary judgment striking defendant's answer and for the appointment of a referee. In opposition defendant Kirsten G1illo submits an attorney's affirmation claiming that plaintiff has failed to submit sufficient admissible evidence to prove plaintiffs standing to maintain this foreclosure action and to prove the defendants have defaulted in making timely payments. Plaintiffs renewed motion was served on May 4, 2016 and made originally returnable on May 25, 2016. The motion remained sub judice in IAS Part 25 until this action and the underlying motion were reassigned to this IAS Part 18 by Administrative Order 114-18 (Hinrichs, J.) dated December 11, 2018. Upon transfer of the file and assemblage of motion papers the motion was submitted in IAS Part 18 on January 18, 2019. 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. The 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 (Winegrad 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 ofNe-.v 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 Jaw (Friends ofAnimals v. Associated Fur Manufacturers, 46 NY2d 1065 (1979)). Entitlement to summary judgment in favor of the foreclosing plaintiff is established, prima facie by the plaintiff's 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); JiVells Fargo Bank, NA. v. Ali, 122 AD3d 726, 995 NYS2d 735 (2nd Dept., 2014)). Where the plaintiffs standing is placed in issue by the defendant's answer, the plaintiff must also establish its standing as pa11 of its prima facie showing (Aurora Loan Services v. Taylor, 25 NY3d 355, I 2 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 (2 d 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. Tay lor, supra.: Emigrant Bank v. 11 -2- [* 3] Larizza, 129 AD3d 94, 13 NYS3d 129 (2nd 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. Mandrin, 160 AD3d 1014 (2nd Dept. , 2018) Tribeca Lending Corp. v. Lawson, 159 AD3d 936 (2"d Dept. , 2018); Deutsche Bank National Trust Co. v. Jarrobino, 159 AD3d 670 (2"d Dept., 2018); Central Mortgage Company v. Davis, 149 AD3d 898 (2"d Dept. , 2017); US. Bank, NA. v. Ehrenfeld, 144 AD3d 893, 41 NYS3d 269 (2"d Dept., 2016); JP1\tforgan Chase Bank v. Weinberger, 142 AD3d 643, 37 NYS3d 286 (2nd Dept., 2016); CitiMortgage, inc. v. Klein, 140 AD3d 913, 33 NYS3d 432 (2"d Dept. , 2016); US. Bank, NA. v. Godwin. 137 AD3d 1260, 28 NYS3d 450 (2"d Dept., 2016); Wells Fargo Bank, NA. v. Joseph, 137 AD3d 896, 26 NYS3d 583 (2"d Dept., 2016); Emigrant Bank v. Larizza, supra.; Deutsche Bank National Trust Co. v. Whalen, 107 AD3d 931, 969 NYS2d 82 (2"d Dept., 2013); 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 11d Dept., 2015)). A plaintiff's attachment of a duly indorsed note to its complaint or to the certificate of merit required pursuant to CPLR 30 12(b), has been held to constitute due proof of the plaintiffs standing to prosecute its claims for foreclosure and sale (Nationstar Mortgage, LLC v. LaPorte, 162 AD3d 784, 75 NYS3d 432 (2"d Dept., 2018); Bank of New York Mellon v. Theobalds, 161AD3d1137 (2"d Dept., 2018); HSBC Bank USA, NA. v. Oscar, 161 AD3d 1055, 78 NYS3d 428 (2"d Dept., 2018); CitiMortgage, Inc. v. McKenzie, 161 AD3d 1040, 78 NYS3d 200 (2nd Dept., 2018); US Bank, NA. v. Duthie, 161 AD3d 809, 76 NYS3d 226 (2"d Dept., 2018); Bank of New York Mellon v. Genova, 159 AD3d I 009, 74 NYS3d 64 (2"d Dept., 2018); Mariners At/. Portfolio, LLC v. Hector, 159 AD3d 686, 69 NYS3d 5.02 (2"d Dept., 2018); Bank of New York Mellon v. Burke, 155 AD3d 932, 64 NYS3d 114 (2"d Dept., 2017); 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 (2"d Dept. , 2016); Deutsche Bank National Tl:ust Co. v. Leigh, 137 AD3d 841, 28 NYS3d 86 (2"d Dept., 2016); Nationstar Mortgage LLC v. Catizone, 127 AD3d 1151, 9 NYS3d 315 (2"d Dept., 2015)). At issue is whether the evidence submitted by the plaintiff is sufficient to establish its right to foreclose. The defendant does not contest her failure to make timely payments due under the terms of the promissory note and mortgage agreement for nearly the past decade. Rather, the issues raised by the defendant concerns whether the proof submitted by the mortgage lender provides sufficient admissible evidence to prove its entitlement to summary judgment based upon defendant's continuing default and plaintiff's 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 -3- [* 4] 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, 510 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 fairly 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, 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. I 58'" 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. Country-Wide Insurance Company, 25 NY3d 498, 14 NYS3d 283 (2015); Deutsche Bank National Trust Co. v. Monica, 131 AD3d 737, 15 NYS3d (3rd Dept., 2015); People v. DiSalvo, 284 A02d 54 7, 727 NYS2d 146 (2nd Dept., 200 I); 1\1/atter (~l Carothers v. GEICO, 79 AD3d 864, 914 NYS2d 199 (2nd Dept., 2010) ). The statute (CPLR 4518) clearly does not require a person to have personal knowledge of each and every entry contained in a business record (see Citibank N. A. v. Abrams, 144 AD3d 1212, 4 0 NYS3d 653 ( 3'd Dept., 2016) ; HSBC Bank USA, N.A . v. S age, 112 AD3d l 126 , 977 NYS2d 4 4 6 (3rd Dept., 2013 ); Landmark Capital Inv. Inc. v. LI-Shan Wang, supra. )). As the Appellate Division, Second Department stated in Citigroup v. Kopelowitz, 147 AD3d 1014, 48 NYS3d 223 (2"d Dept., 2_017) : "There is no requirement that a plaintiff in a foreclosure action rely on a particular set of business records to establish a prima faci e case, so long as the plaintiff satisfies the admissibility requirements of CPLR 45 l 8(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 foundati onal 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.fudge.finds" that the tlu·ee foundational requirements are satisfied the evidence shall be admissible . The affidavit submitted from the mortgage servicer's (Seterus, Incorporated's) fo reclosure -4- [* 5] specialist dated February 29, 2016 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 mortgage servicer; the fact that the books and records are made in the regular course of Seterus's business; that it was Seterus'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, 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 has proven standing by submission of the affidavit from the mortgage servicer' s foreclosure specialist attesting to plaintiffs possession of the original consolidated note prior to the date this action was commenced on June 19, 2012, together with submission of a copy of the consolidated promissory note signed by the mortgagors with an attached allonge which contains an indorsement in blank signed by Lee Ann Itaya, as assistant vice president ofindyMac Bank, FSB. Such proof establishes plaintiffs standing to maintain this action · (Aurora Loan Services v. Taylor, supra.; Wells Fargo Bank, NA v. Parker, supra.; US Bank, NA. v. Ehrenfeld, 144 AD3d 893, 41 NYS3d 269 (2"d Dept., 2016); GMAC v. Sidberry, 144 AD3d 863, 40 NYS3d 783 (2"d Dept., 2016); US Bank, NA. v. Carnivale, 138 AD3d 1220 (3rd Dept., 2016)). Any alleged issues concerning the mortgage assignment is therefore irrelevant to the issue of standing since plaintiff has established possession of the promissory note prior to commencing this action (FNMA v. Yakaputz JI, Inc., 141 AD3d 506, 35 NYS3d 236 (2nd Dept., 2016); Deutsche Bank National Trust Company v. Leigh, 137 AD3d 841 , 28 NYS3d 86 (2"d Dept., 2016)). With respect to the issue of the defendant's default in making payments, in order to establish prima facie entitlement to judgment as a matter of law in a forec!osure action, the plaintiff must submit the mortgage, the u'npaid note and admissible evidence to show default (see Property Asset Management, Inc. v. Souffrant et al., 162 AD3d 919, 75 NYS3d 432 (2"d Dept. , 2018); PennyMac Holdings, Inc. V Tomanelli. 139 AD3d 688, 32 NYS3d 181 (211d 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 (2nd Dept. , 2013)). Plaintiff has provided admissible evidence in the form of a copy of the note and mortgage, and an affidavit attesting to the mortgagors undisputed default in making timely mortgage payments sufficient to sustain its burden to prove this defendant has defaulted under the terms of the parties agreement by failing to make timely payments since July 1, 2009 (CPLR 4518; see Wells Fargo Bank, N.A. v. Thomas, supra.: Citigroup v. Kopelowitz, supra.)). Accordingly, and in the absence of any proof to raise an issue of fact concerning the mortgagors' continuing default, plaintiffs application for summary judgment based upon the mo11gagors' breach of the mortgage agreement and promissory note must be granted. Finally, defendant Grillo has failed to submit any admissible evidence to support her remaining affirmative defenses in opposition to plaintitrs motion. Accordingly, those defenses 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., 20 1O); Citibank. N.A, v. Van Brunt Properties, LLC, 95 AD3d 1158, 945 NYS2d 330 (2"d Dept., 201 2); Ffagstar Bank v. Bellqfiore, 94 AD3d 0 144, 943 NYS2d 551 (2"d Dept., 2012); Wells Fargo Bank Nfinnesota, N A. v. Perez, 41 AD3d 590, 837 NYS2d 877 (2"d Dept. , 2007)). -5- [* 6] Accordingly, plaintiff's motion seeking an order granting summary judgment is granted. The proposed order ofreference has been signed simultaneously with execution of this order. HON. HOWARD H. HECKMAN, JR. Dated: February lZ) 2019 J.S.C. -6-

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