US Bank N.A. v Lavey

[*1] US Bank N.A. v Lavey 2019 NY Slip Op 52109(U) Decided on November 22, 2019 Justice Court Of The Village Of Catskill, Greene County Elliott III, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on November 22, 2019
Justice Court of the Village of Catskill, Greene County

US Bank National Association, NOT IN ITS INDIVIDUAL CAPACITY BUT SOLELY AS TRUSTEE FOR THE RMAC TRUST, SERIES 2016-CTT, Plaintiff, ORDER GRANTING SUMMARY JUDGMENT AND ORDER OF REFERENCE

against

Roberta Lavey, INDIVIDUALLY AND AS VOLUNTARY ADMINISTRATRIX OF THE ESTATE OF GARY LEWKOWICZ; RACHEL LAVEY; SAMUEL LAVEY; GENNIE LAVEY BOUNOCOURE; "JOHN DOE No.1" through "JOHN DOE #10" inclusive the names of the ten last name, Defendants being fictitious, real names unknown to the Plaintiff, the parties intended being persons or corporations having an interest in, or tenants or person in possession of, portions of the mortgaged premises described in Complaint, Defendant.



0186-19



MICHAEL J. KENNEY, ESQ.

Knuckles, Komosinski & Manfro, LLP

300 Westage Business Center Drive, Suite 160

Fishkill, NY 12524

Attorney for Plaintiff

MARK HUS, ESQ.

Law Offices of Mark Hus

45018 Court Square — Suite 400

Long Island City, New York 11101

Attorney for Defendants Roberta Lavey, Gennie Lavey, Rachel Lavey and Samuel Lavey
Raymond J. Elliott III, J.

Plaintiff commenced this action by Summons and Complaint on February 28, 2019. Defendants Roberta Lavey, Gennie Lavey, Rachel Lavey and Samuel Lavey (hereinafter collectively Defendants) joined issue on June 3, 2019. Before the Court now is Plaintiff's Motion for Summary Judgment. Defendants oppose the motion. While conceding that Plaintiff has established it is the holder of the note and mortgage and there was a default, Defendants assert that there remains a question of fact regarding unclean hands.

Summary judgment is a drastic remedy which will be granted only when the party seeking summary judgment has established prima facie entitlement to judgment as a matter of law by presenting competent evidence that there is no doubt as to the absence of a triable issue of fact (see Alvarez v Prospect Hospital, 68 NY2d 320, 324 [1986]; McDay v State, 138 AD3d 1359, 1359 [3d Dept 2016]). It is well established that on a motion for summary judgment, "[t]he court's function on a motion for summary judgment is issue finding not issue determination" (Gadani v Dormitory Auth. of State of NY, 43 AD3d 1218, 1219 [3d 2007]; see Lacasse v Sorbello, 121 AD3d 1241, 1242 [3d Dept 2014]), and this Court "must view the evidence in the light most favorable to the nonmoving party and accord such party the benefit of every reasonable inference that can be drawn therefrom" (Aretakis v Cole's Collision, 165 AD3d 1458, 1459 [3d 2018]; see Healthcare Professionals Ins. Co. v Parentis, 165 AD3d 1558, 1565 [3d 2018]).

The burden then shifts to the nonmoving party to establish by admissible proof, the existence of genuine issues of fact (see Zuckerman v City of New York, 49 NY2d 557, 562 [1980]; Davis v EAB-TAB Enters., 166 AD3d 1449, 1450 [3d Dept 2018]). However, in opposing a motion for summary judgment, the nonmoving party "must produce evidentiary proof in admissible form . . . or must demonstrate acceptable excuse for his [or her] failure to meet the requirement of tender in admissible form; mere conclusions, expressions of hope or unsubstantiated allegations or assertions are insufficient" (Zuckerman v City of New York, 49 NY2d at 562; accord Miller v Lu-Whitney, 61 AD3d 1043, 1047 [3d Dept 2009]; see Banco Popular North America v Victory Taxi Management, Inc., 1 NY3d 381, 383 [2004] ["[A]verments merely stating conclusions, of fact or of law, are insufficient" to "defeat summary judgment"]).

"'In a foreclosure action, a mortgagee producing evidence of the mortgage, unpaid note and the mortgagor's default will be entitled to summary judgment'" Maidman Family Parking, L.P. v Wallace Indus., Inc., 155 AD3d 1162, 1164 [3d Dept 2017], quoting HSBC Bank USA, N.A. v Sage, 112 AD3d 1126, 1127 [3d Dept 2013], lvs dismissed 22 NY3d 1015, 1172 [2014]; see Bank of NY Mellon v Cronin, 151 AD3d 1504, 1505 [3d Dept 2017]). Plaintiff has submitted prima facie proof of the mortgage, note, and default and Defendants do not contest this evidence.

Defendants sole argument against the Motion for Summary Judgment is that Plaintiff secured the property and subsequently a third party allegedly damaged the premises and removed valuables. In support of this argument, Defendants submit the Affidavit of Roberta Lavey. Lavey swears that her husband, the mortgagor, passed away suddenly. She attempted to deal with his estate, but her attorney also passed away before securing her the right to sell the premises.Subsequently, at some unknown point in 2016, over a year after the mortgagor's death, Plaintiff [*2]allegedly secured the premises. Lavey further swears that at some unknown date after this, vandals "literally tore the inside of the house apart," which diminished the value of the property. Additionally, Lavey swears that both sentimental and financially valuable items were destroyed.

In reply, Plaintiff notes that the Mortgage specifically states, "Lender may do and pay for whatever is reasonable or appropriate to protect Lender's interest in the Property and Lender's rights under this Security Instrument." The Mortgage further states that "Lender's actions may include, but are not limited to: . . . (b) securing and/or repairing the property . . . Lender can also enter the Property to make repairs, change locks, replace or board up doors and windows, drain water from pipes, eliminate building or other code violations or dangerous conditions, have utilities turned on or off and take any other action to secure the Property."

A defense based on unclean hands requires "immoral or unconscionable" actions by the opposing party (PHH Mtge. Corp. v Davis, 111 AD3d 1110, 1112 [3d Dept 2013], lv dismissed 23 NY3d 940 [2014]; see Bank of Smithtown v 264 W. 124 LLC, 105 AD3d 468, 469 [1st Dept 2013]). "Notably, in order to establish the affirmative defense of unclean hands, the conduct relied on must be directly related to the subject matter of the litigation," which in this case is the default (Blueberry Invs. Co. v Ilana Realty, 184 AD2d 906, 907 [3d Dept 1992]; see PHH Mtge. Corp. v Davis, 111 AD3d at 1112). Further, significant case law implies that it may not even be available as a defense to a foreclosure action, to the extent it does exist, "[n]o decision has yet found such an interposed defense to both meet the definition of the doctrine and establish the requisite detriment to the asserting party" (1 Bergman on New York Mortgage Foreclosures § 5.08 [2019]).

The clear public policy of this state is to encourage mortgagees to secure properties that are not occupied during the pendency of foreclosure. As the sponsor's memo of on recent bill extending such requirement on banks states, "Vacant and abandoned residential properties have become a significant issue in New York. Many times these properties are abandoned by their owner during a pending foreclosure. These properties then become 'zombie properties' with no entity responsible for their upkeep during the pending foreclosure. Often these properties become dilapidated and blighted before the foreclosure is finalized" (Sponsor's Mem, Bill Jacket, L 2019, ch 168).

Several facts weigh against considering Plaintiff's alleged conduct as immoral or unconscionable. The property was not a primary residence. The mortgage executed by Defendant Lavey's deceased husband specifically authorized Plaintiff to secure the premises. Plaintiff is not alleged to have moved in hastily to secure the property, but rather only acted more than a year after the death of the mortgager and more than six months after the default. Defendants have offered no evidence besides conclusory allegations that Plaintiff's conduct was in any way connected to the actions of unknown third-parties who damaged the property.

Most significantly, there is no connection between the default, which concededly took place on June 1, 2015, and the alleged immoral or unconscionable conduct of Plaintiff, which took place on some unknown date in 2016.

ACCORDINGLY UPON the Summons, Complaint and Notice of Pendency of action all duly filed herein on the 28th day of February, 2019, and upon reading the Affidavit in Support of Summary Judgment of Mike Ruiz sworn to the 20th day of May, 2019, and upon reading and filing the Affirmation in Support of Summary Judgment, and supporting Memorandum of Law of Michael J. Kenney, Esq., dated June 18, 2019, and upon the Affidavits of Service and the Answer annexed thereto and or heretofore filed herein, and on motion of Knuckles, Komosinski [*3]& Manfro, LLP, attorneys for Plaintiff, and said motion having come on to be heard before this Court on September 27, 2019, and after reviewing the opposition of Defendants Roberta Lavey, Gennie Lavey, Rachel Lavey and Samuel Lavey, and after due deliberation; it is

ORDERED, that the motion is granted; and it is further

ORDERED that the Answer of Defendants Roberta Lavey, Gennie Lavey, Rachel Lavey and Samuel Lavey be stricken and dismissed and the appearance of such parties be limited to a Notice of Appearance and waiver of service of all papers and notices of all proceedings in said action except copy of Referee's Oath and Report of Amount due, copy of Judgment of Foreclosure and Sale, Notice of Entry of Judgment, Notice of Sale, copy of Referee's Report of Sale and notice of proceedings to obtain surplus monies; and it is further

ORDERED that a default judgment be entered against all not appearing parties; and it is further

ORDERED, this action be, and the same is hereby referred to Ann M. Weaver Esq. of 7466 Broadway, Red Hook, NY 12571; (T) 518-822-1176, as Referee to ascertain and compute the amount due, except for attorneys' fees, to the Plaintiff for principal, interest and other disbursements advanced as provided for in the note and mortgage upon which this action was brought, to examine and report whether or not the mortgaged premises can be sold in parcels, and that the referee make his/her report to the Court with all convenient speed; and it is further

ORDERED, that if required, said Referee take testimony pursuant to RPAPL 1321; and it is further

ORDERED, that the caption of this action and all papers previous field herein shall be amended by striking therefrom the defendants sued herein as "John Doe #1" through "John Doe #10" all without prejudice to the proceeding heretofore had herein; and it is further

ORDERED, that the caption of this action as amended shall read as follows:

U.S. BANK NATIONAL ASSOCIATION, NOT IN ITS INDIVIDUAL CAPACITY BUT SOLELY AS TRUSTEE FOR THE RMAC TRUST, SERIES 2016-CTT,

Plaintiff,

against-

ROBERTA LAVEY, INDIVIDUALLY AND AS VOLUNTARY ADMINISTRATRIX OF THE ESTATE OF GARY LEWKOWICZ; RACHEL LAVEY; SAMUEL LAVEY; GENNIE LAVEY BOUNOCOURE,Defendants.

Index No.: 0186-2019

; and it is further

ORDERED, that by accepting this appointment the Referee certifies that he/she is in compliance with Part 36 of the Rules of the Chief Judge (22 NYCRR Part 36), including, but not [*4]limited to, §36.2(c) ("Disqualifications from Appointment"), and §36.2(d) ("Limitations on Appointments Based upon Compensation"); and it is further

ORDERED that pursuant to CPLR 8003(a) and a fee of $350.00 shall be paid to the Referee upon the filing of her report, and in accordance with CPLR 8003(b), the statutory fee shall be paid to the referee at the time of the foreclosure sale, and it is further

ORDERED, that the Referee is prohibited from accepting or retaining any funds for him/herself or paying funds to herself without compliance with Part 36 of the Rules of the Chief Administrative Judge.

This shall constitute the Decision, Order and Judgment of the court. This Decision, Order and Judgment is being returned to the attorney for Plaintiff. All original supporting documentation is being filed with the Greene County Clerk's Office. The signing of this Decision, Order and Judgment shall not constitute entry or filing under CPLR 2220. Counsel is not relieved from the applicable provision of that rule relating to filing, entry and notice of entry.

SO ORDERED AND ADJUDGED

ENTER.

Dated: November 22, 2019

Catskill, New York

RAYMOND J. ELLIOTT, III

Supreme Court Justice

Papers Considered:

Plaintiff's Notice of Motion in Support of Summary Judgment dated June 18, 2019; Attorney Affirmation dated June 18, 2019; Affidavit of Mike Ruiz sworn on May 20, 2019; Memorandum of Law in Support of Plaintiff's Motion for Summary Judgment dated June 18, 2019; Annexed Exhibits A-L.

Defendant Affidavit in Opposition to the Motion for Summary Judgment sworn September 16, 2019; Attorney Affirmation dated September 16, 2019; Memorandum of Law in Opposition to Plaintiff's Motion for Summary Judgment dated September 17, 2019.

Plaintiff's Attorney Affirmation is Reply dated September 18, 2019.