U.S. Bank, N.A. v Hetherington
Annotate this CaseDecided on February 13, 2019
Supreme Court, Suffolk County
U.S. Bank, National Association, as Trustee for the Holders of the Specialty Underwriting and Residential Finance Trust, Mortgage Loan Asset-Backed Certificates, Series 2006-BC5, Plaintiff,
against
John Hetherington; Teresa Hetherington; and "John Doe" and "Mary Doe," (Said names being fictitious, it being the intention of plaintiff to designate any and all occupants, tenants, persons or corporations, if any, having or claiming an interest in or lien upon the premises being foreclosed herein), Defendant(s).
601585/2015
FRENKEL LAMBERT WEISS WEISMAN & GORDON, LLC
Attorneys for Plaintiff
53 Gibson Street
Bay Shore, NY 11706
MAGGIO & MEYER
Attorney for Defendants
3100 Veterans Memorial Hwy
Bohemia, NY 11716
Robert F. Quinlan, J.
Upon the following papers read on plaintiff's motion for an order granting summary judgment and related relief; Notice of Motion dated May 5, 2016 and supporting papers; Defendant's Notice of Cross Motion dated June 8, 2016 and supporting papers; Affirmation in Opposition to Cross-Motion and in Further Support of Motion dated June 16, 2016 and supporting papers; and Reply affirmation dated June 21, 2016; it is
ORDERED that plaintiff's motion for summary judgment and related relief is denied; and it is further
ORDERED that defendant John Hetherington's motion to dismiss the complaint pursuant to CPLR 3211(a)(5) is granted; and it is further
ORDERED that defendant John Hetherington's motion to join an indispensable party is denied as moot; and it is further
ORDERED a conference is scheduled for Wednesday, May 29, 2019 at 9:30 AM in Part 27 to monitor the progress of the action, in Part 27, Arthur M. Cromarty Court Complex, 210 Center Drive, 4th floor, Rm 17, Riverhead, NY.
This is an action to foreclose a mortgage on residential real property known as 145 N. Railroad Avenue, Babylon, Suffolk County, New York given by defendants John Hetherington and Teresa Hetherington ("defendants") to Mortgage Electronic Registration Systems, Inc., as nominee for Wilmington Finance, Inc. ("Wilmington") on September 1, 2006. Defendants purportedly defaulted on the obligation and plaintiff U.S. Bank, National Association, as Trustee for the Holders of the Specialty Underwriting and Residential Finance Trust, Mortgage Loan Asset-Backed Certificates, Series 2006-BC5 ("plaintiff"), successor in interest to Wilmington, commenced this action by filing the summons, complaint and notice of pendency with the Suffolk County Clerk on February 17, 2015. Only defendant John Hetherington ("defendant") appeared by filing an answer dated March 18, 2015 consisting of general denials and nine affirmative defenses including plaintiff's lack of standing to commence the action (first and second affirmative defenses) failure to comply with the notice requirements set forth in RPAPL §1304 (third affirmative defense) and RPAPL §1303 (fourth affirmative defense), failure to serve a notice of default as required by the mortgage (fifth affirmative defense) and that the action is barred by the applicable statute of limitations (eighth affirmative defense). Plaintiff now moves for an order granting summary judgment against defendant, striking his answer and affirmative defenses, amending the caption, and for an order of reference appointing a referee to compute pursuant to RPAPL §1321 (#001). Defendant cross moves for summary judgment pursuant to CPLR 3212 and for dismissal arguing the action is time barred, or in the alternative for an order granting joinder of an indispensable party pursuant to CPLR 1001 (#002).
PRIOR HISTORY
Pursuant to Administrative Order No. 29-17 this action was transferred to this part and oral argument of the pending motions (#001 and #002) was calendared for June 5, 2017. On that date the action was conferenced and the parties advised the court of a pending motion to discontinue a related action (US Bank National Association as Trustee for the MLMI Surf Trust Series 2006-BC5 v Hetherington, Index No. 31050-2007) ("the 2007 Action") which involved the same property but was pending before another justice of this court (2007 Action, Mot. Seq. #005). The oral argument was adjourned and the 2007 Action was administratively transferred to this part pursuant to Administrative Order No. 68-17 dated June 7, 2017. Both actions were then scheduled for a special conference before this court on November 16, 2017. Due to a clerical error not all counsel received notice of the November 16, 2017 conference, it was rescheduled for December 13, 2017.
At the December 13, 2017 conference counsel for plaintiff in the 2007 Action, US Bank National Association as Trustee for the MLMI Surf Trust Series 2006-BC5 ("MLMI"), presented [*2]a copy of a stipulation of discontinuance in that action dated November 23, 2016. According to MLMI's counsel because the stipulation of discontinuance had been rejected for filing on technical grounds by the County Clerk plaintiff filed the motion to discontinue (2007 Action, Mot. Seq. #005). The court marked the stipulation as "Exhibit 1" and based upon the stipulation granted plaintiff's motion to discontinue (Seq. #005) Action No. 1. Oral argument on the motions pending in this action (Seq. #001 and #002) was cancelled by the court, stating that instead the court would issue a written decision.
DISMISSAL PURSUANT TO CPLR 3211(a)(5) GRANTED
The court turns first to that part of defendant's motion for an order dismissing the complaint pursuant to CPLR 3211 (a)(5).
An action to foreclose a mortgage is subject to a six-year statute of limitations (see CPLR 213[4] ). That limitations period begins to run on the entire debt when the mortgagee elects to accelerate the mortgage (see U.S. Bank, N.A. v Martin, 144 AD3d 891 [2d Dept 2016]; EMC Mtge. Corp. v Smith, 18 AD3d 602 [2d Dept ]; Ventures Tr. 2013-I-H-R by MCM Capital Partners, LLC v Chitbahal, 167 AD3d 682 [2d Dept 2018]).
In resolving a motion to dismiss pursuant to CPLR 3211 (a)(5), the court must accept the facts in the complaint as true and accord every possible inference in favor of plaintiff (see Faison v Lewis, 25 N Y3d 220[2015]). Defendant bears the initial burden of showing that the time within which to bring the action has expired (see US Bank, NA v Gordon, 158 AD3d 832 [2d Dept 2018]). If the defendant satisfies this burden, the burden shifts to the plaintiff to provide evidentiary proof in admissible form establishing that the action was timely or which raise a triable question of fact as to whether the action was timely (see Wells Fargo Bank, N.A. v Burke, 155 AD3d at 668 [2d Dept 2017]). Plaintiff has the burden of establishing that the statute of limitations has not expired, that it is tolled, or that an exception to the statute of limitations applies (Wells Fargo Bank, N.A. v Burke, supra; JP Morgan Chase Bank, N.A. v Mbanefo, 166 AD3d 742 [2d Dept 2018]).
Here in support of his cross-motion defendant submits a copy of the complaint in the 2007 Action which was commenced by MLMI. In the complaint MLMI specifically states that it "hereby elects to declare immediately due and payable the entire unpaid balance of principal" secured by the mortgage. Thus defendant established, prima facie, that the mortgage debt was accelerated upon the commencement of the 2007 Action on October 4, 2007 (see Ventures trust 2013 I-H-R by MCM Capital Partners, LLC v Chitbahal, supra) and the six year statute of limitations expired on October 4, 2013. Since plaintiff did not commence this action until February 17, 2015, defendant has sustained his initial burden of demonstrating that the action was untimely.
In opposition plaintiff argues that the statute of limitations has not expired, but rather it was revived by defendant's acknowledgment of the mortgage debt (GOL §17-105). Plaintiff argues a loan modification application, dated July 15, 2010, "affirmed [defendant's] mortgage debt to the Plaintiff in writing, as well as his intent to modify and repay the amount due." In support plaintiff submits a three page hardship affidavit dated July 15, 2010, purportedly signed by defendant and submitted in connection with a modification application.
The hardship affidavit which plaintiff relies on in support of its argument is not properly before the court as it is not accompanied by an affidavit from someone establishing its [*3]admissibility as a business record under (CPLR 4518). As presented the hardship affidavit identifies BAC Home Loans Servicing, LP ("BAC") as "Servicer" however, plaintiff does not submit the affidavit of someone personally familiar with the record-keeping practices and procedures of BAC. Here the only proof in support of plaintiff's theory that the statute of limitations was "revived" is the affirmation of plaintiff's counsel, who has no personal knowledge of the facts, is without probative value and insufficient to defeat the motion (see Matter of Zlomek, 40 AD3d 774 [2d Dept 2007]; Barcov Holding Corp. v Bexin Realty Corp., 16 AD3d 282 [1st Dept 2005]; US National Bank Assn. v Melton, 90 AD3d 742 [2d Dept 2011]).
Notwithstanding the foregoing, even if plaintiff's proof was considered, it was insufficient to raise a question of fact as to whether the statute of limitations was revived. Here the court is presented with a hardship affidavit which it presumes was part of a loan modification application. There is no proof that a loan modification application was completed and submitted for review, nor is there proof of a determination on any loan modification application. Courts have held that loan modification applications, standing alone, do not serve to revive the statute of limitations (see McQueen v Bank of New York, 57 Misc 3d 481 [Sup Ct. Kings Co. 2017] (an application was a request for a modification, not an offer to pay); see also Costa v Deutsche Bank Nat'l Trust Co., 247 F. Supp. 3d [SDNY 2017] [a loan modification application did not unconditionally acknowledge an intent to pay but was merely an implied offer of settlement]; Reiss v Deutsche Bank Nat. Trust Co., 53 Misc 3d 752 [Sup. Ct. Westchester Co. 2016] [denying defendant's motion to dismiss a quiet title action stating that a hardship affidavit is merely a conditional promise to pay, if and when they agree to a modification]).
The court notes the 2007 action was commenced by MLMI, a different legal entity from plaintiff. While it is unclear from the submissions the basis for discontinuing the 2007 action, where plaintiff in a prior action lacked standing to commence the prior action, any purported acceleration of the note is a nullity and the statute of limitations does not begin to run (see EMC Mtge Corp. v Suarez, 49 AD3d 592 [2d Dept 2008]; Wells Fargo Bank, N.A. v Burke, 94 AD3d 980 [2d Dept 2012]). However, plaintiff has made no such argument here and presented no proof that could raise a triable issue of fact that MLMI lacked standing to commence the 2007 action. It has long been recognized as a general principle of summary judgment that a movant, as well as an opponent, is required to assemble and lay bare all its proof in support, or opposition, of the motion (see Maurice O'Meara Co. v. National Park Bank of New York, 239 NY 386 [1925]; Friends of Animals, Inc. v Associated Fur Manufacturers, Inc., 46 NY2d 1065 [1979]; Zuckerman v City of New York, 49 NY2d 557 [1980]). An opponent to summary judgment has to produce evidentiary proof in admissible form sufficient to demonstrate the existence of a triable issue of fact , failure to do so is done at its own risk (see, Washington Mut. Bank v Valencia, 92 AD3d 774 [2d Dept 2012]; Winegrad v New York Univ. Med. Ctr., 64 NY2d 851 [1985]; Zuckerman v. City of New York, supra).
As plaintiff has failed to raise a question of fact on the proof submitted, defendant's motion to dismiss the complaint as to him based upon his affirmative defense that the statute of limitations has expired is granted, making it unnecessary to discuss that part of defendant's motion to join an indispensable party.
Plaintiff's motion for summary judgment is denied.
A conference is scheduled for Wednesday, May 29, 2019 at 9:30 AM in Part 27 to [*4]monitor the progress of the action. The court notes since plaintiff did not move for entry of default as to the non-appearing, non-answering defendant Teresa Hetherington, the action continues as against her.
Defendant John Hetherington is directed to submit judgment on notice within 45 days of the date of entry of this order.
Plaintiff's proposed order is marked "not signed."
This constitutes the Order and decision of the Court.
Dated: February 13, 2019
Hon. Robert F. Quinlan, J.S.C.
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