Lakeview Loan Servicing, LLC v Pryce-Breary

[*1] Lakeview Loan Servicing, LLC v Pryce-Breary 2020 NY Slip Op 50071(U) Decided on January 24, 2020 Supreme Court, Orange County Bartlett, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 January 24, 2020
Supreme Court, Orange County

Lakeview Loan Servicing, LLC, Plaintiff,

against

Gennivieve Pryce-Breary a/k/a GENNIVIEVE PRYCE BREARY, et al., Defendants.



EF002935-2019



For Plaintiff: Laura M. Strauss, Esq., Gross Polowy, LLC, Williamsville, NY

For Defendants: Crystal Beaumont, Esq., Queens Village, NY
Catherine M. Bartlett, J.

The following papers numbered 1 to 5 were read on Defendant's motion for an order vacating the CPLR §3217(b) order of discontinuance of this action:

Notice of Motion - Affirmation / Exhibits - Affidavit 1-3

Affirmation in Opposition / Exhibits 4

Reply Affirmation 5

Upon the foregoing papers, it is ORDERED that the motion is disposed of as follows:

A. Pertinent Factual and Procedural Background

This is an action to foreclose a mortgage. The action was commenced on April 15, 2019 by the filing of a summons and complaint. On May 23, 2019, Defendant filed a Verified Answer and asserted Counterclaims (1) for attorney's fees and costs pursuant to Real Property Law §282,

(2) for an alleged violation of the Fair Debt Collection Practices Act, and (3) for alleged viola- tions of 12 U.S.C. 1024.41 et seq. and 3 NYCRR 419 et seq. (dual tracking and manufactured default). The case was referred to, and resolved in, the foreclosure settlement conference part.

The "Notice of Completion of CPLR 3408 Settlement Conference", dated September 27, 2019 and electronically filed on September 30, 2019,[FN1] states:

The mandatory CPLR 3408 settlement conference has been held in this residential mortgage foreclosure action.The plaintiff is discontinuing the action because the issues have been resolved by a Loan Modification, a Reinstatement/Repayment, a Short Sale, or, a Deed in lieu of Foreclosure.

Among the boxes not checked on the Notice of Completion of CPLR 3408 Settlement Conference form was the following:

The defendant(s) has raised and wishes to pursue legal issues that cannot be resolved in the settlement conference part and the action is being transferred to an IAS Judge for further proceedings.

Contrary to Defendant's assertion, then, this matter was never released from the foreclosure settlement conference part and transferred to this Court for further proceedings.

By Notice of Motion dated September 25, 2019, timely served upon Defendant's attorney via electronic filing and regular mail, and returnable a month later on October 28, 2019, Plaintiff moved pursuant to CPLR §3217(b) to discontinue this action. The Notice of Motion sought:

...an order pursuant to CPLR §3217 and §6514 granting the following to the movant:Order Discontinuing Action and Canceling Notice of Pendency, without costs in favor of any party; that the Notice of Pendency...be cancelled and discharged of record...and for such other and further relief as the Court may deem just, equitable, and proper.

Plaintiff's attorney's supporting Affirmation states that "the Defendants/mortgagors entered into a workout agreement with the Plaintiff." The "Wherefore" clause of counsel's Affirmation states:

WHEREFORE, it is respectfully requested that the within action, and all causes of action alleged therein, be discontinued, and that any and all counterclaims and cross claims be dismissed, and the Notice of Pendency cancelled, together with such other and further relief as to the Court may seem just, equitable, and proper.

The proposed Order of Discontinuance, annexed as an exhibit to Plaintiff's motion papers, provides inter alia for relief as follows:

ORDERED, that the Plaintiff's Motion to Discontinue Action and Cancel Notice of Pendency is granted in all respects, and it is furtherORDERED, that the above entitled action, and all causes of action alleged therein, and any and all counterclaims and cross claims, be and the same hereby are discontinued [*2]without costs to either party as against the other; and it is further....

Defendant did not oppose Plaintiff's motion. On October 29, 2019 the Court signed the proposed Order discontinuing the action and all counterclaims. The Order was served upon Defendant's attorney with Notice of Entry on November 5, 2019.

B. Defendant's Motion To Vacate The Order Of Discontinuance

By Notice of Motion dated November 26, 2019, but neither filed nor served until December 20, 2019, Defendant moved pursuant to CPLR §§ 3217(b), 5015(a)(4) and 2221(a)

to vacate/modify the October 29, 2019 Order of Discontinuance.

It is important, in the first instance, to delineate the issues which are properly before the Court on Defendant's motion. Defendant acknowledges that inasmuch as she did not oppose Plaintiff's motion in the first instance, she is barred from moving to renew or reargue the motion. See, Bank of New York v. Young, 123 AD3d 1068, 1069 (2d Dept. 2014); Schenk v. Staten Island University Hospital, 108 AD3d 661, 662 (2d Dept. 2013). Furthermore, Defendant has not moved pursuant to CPLR §5015(1) to vacate the October 29, 2019 Order of Discontinuance on grounds of excusable default, and in any event has not even attempted to proffer a reasonable excuse for her failure to oppose Plaintiff's motion. See, Bank of New York v. Young, supra.

Perforce, then, Defendant's motion may be predicated solely on the ground that this

Court lacked jurisdiction to issue an Order discontinuing Defendant's counterclaims. See,

CPLR §5015(4). In this regard, Defendant argues that the Court's order was impermissible because (1) the request for dismissal of Defendant's counterclaims was not specifically stated in Plaintiff's Notice of Motion, and (2) CPLR §3217(b) did not authorize the dismissal of Defendant's counterclaims at Plaintiff's behest.

C. Legal Analysis

1. Under The Circumstances, The Defect In Plaintiff's Notice Of Motion Did Not Deprive The Court Of Jurisdiction To Issue The Proposed Order Of Discontinuance

CPLR §2214(a) provides that "[a] notice of motion shall specify...the relief demanded and the grounds therefor." It is well settled, moreover, that "'[a] court lacks jurisdiction to grant relief against a defaulting party where that relief is not requested in the moving papers' (NYCTL 1998-1 Trust v. Prol Props. Corp., 18 AD3d 525, 527...; see CPLR 2214[a])." McGuire v. McGuire, 29 AD3d 963, 965 (2d Dept. 2006). See, Tirado v. Miller, 75 AD3d 153, 158

(2d Dept. 2010). Here, however, (1) the Notice of Motion contained a general request "for such other and further relief as the Court may deem just, equitable, and proper," and (2) the dismissal of Defendant's counterclaims was explicitly requested in Plaintiff's moving papers, both in the "Wherefore" clause of counsel's supporting affirmation and in the proposed order annexed to the motion. Hence, the sole defect was a lack of specificity in the Notice of Motion itself.

Where the notice of motion contains a general prayer for relief, courts retain jurisdiction to entertain requests for affirmative relief despite a failure to comply with the specificity requirements of CPLR §§ 2214, especially where, as here, prejudice is obviated because the [*3]motion's supporting papers give fair notice of the relief the movant is seeking. See, Nehmadi v. Davis, 95 AD3d 1181, 1184 (2d Dept. 2012). See generally, Abizadeh v. Abizadeh, 159 AD3d 856, 857 (2d Dept. 2018); Fried v. Jacob Holding, Inc., 110 AD3d 56, 65 (2d Dept. 2013). Cf.,

Arriaga v. Michael Laub Co., 233 AD2d 244, 245 (1st Dept. 1996) (court properly refused to strike counterclaim where plaintiff failed to demand that relief either in notice of motion or "wherefore" clause of supporting affirmation).

Thus, in Nehmadi v. Davis, supra, the Second Department held:

"The court may grant relief, pursuant to a general prayer contained in the notice of motion [or] order to show cause, other than that specifically asked for, to such extent as is warranted by the facts plainly appearing [in] the papers on both sides. It may do so if the relief granted is not too dramatically unlike the relief sought, and if the proof offered supports it and the court is satisfied that no one has been prejudiced by the formal omission to demand it specifically (Siegel, Practice Commentaries, McKinney's Cons. Laws of NY, Book 7B, CPLR C2214:5 at 84). Whether to grant such relief is discretionary with the court" (HCE Assoc. v. 3000 Watermill Lane Realty Corp., 173 AD2d 774, 774-775...; see Tirado v. Miller, 75 AD3d 153...).

Nehmadi v. Davis, supra, 95 AD3d at 1184. See also, Geffner v. Mercy Medical Center,

83 AD3d 998, 999 (2d Dept. 2011); Shaw v. RPA Associates, LLC, 75 AD3d 634, 635-636

(2d Dept. 2010); Frankel v. Stavsky, 40 AD3d 918, 918-919 (2d Dept. 2007).

Here, Plaintiff's request that the action, all causes of action alleged and all counterclaims be discontinued was prominently set forth in the "Wherefore" clause of counsel's supporting affidavit and in the proposed Order of Discontinuance. This relief in its entirety appeared to be warranted as part and parcel of the parties' resolution of the case in the foreclosure settlement part. According to Plaintiff's counsel's affirmation and the Notice of Completion of CPLR 3408 Settlement Conference, the case had been resolved by agreement of the parties. The Notice of Completion of CPLR 3408 Settlement Conference further indicated that Defendant raised no legal issues that could not be resolved in the Settlement Conference Part, and hence the action was never transferred to this Court for further proceedings. Finally, Defendant despite ample notice of Plaintiff's motion did not oppose its request for inter alia the discontinuance of her counterclaims. The Court notes in this regard that it is not at all uncommon for residential foreclosure Defendants to interpose counterclaims that are never pursued once the action is resolved by agreement short of a judgment of foreclose and sale. In view of the circumstances, Defendant cannot legitimately claim to have been prejudiced by Plaintiff's "formal omission" to request the dismissal of counterclaims in its notice of motion.

Hence, the Court concludes per Nehmadi v. Davis, supra and the other authority cited above that it retained jurisdiction to issue the proposed Order of Discontinuance despite the lack of specificity in the Plaintiff's Notice of Motion. Inasmuch as Defendant defaulted in opposing Plaintiff's motion and that default has not been vacated, the question whether this Court properly exercised its discretion in entertaining Plaintiff's request for dismissal of the counterclaims is simply not before the Court on the present application.

2. This Court Possessed Jurisdiction To Enter An Order Of Discontinuance [*4]Pursuant To CPLR §3217(b), And Its Error, If Any, In Applying That Statute Does Not Constitute Grounds For Vacatur Under CPLR §5015(4)

CPLR §3217 ("Voluntary discontinuance") provides in pertinent part as follows:

(a) Without an order. Any party asserting a claim may discontinue it without an order:1. by serving upon all parties to the action a notice of discontinuance at any time before a responsive pleading is served...; or2. by filing with the clerk of the court before the case has been submitted to the court or jury a stipulation in writing signed by the attorneys of record for all parties...; or3....(b) By order of court. Except as provided in subdivision (a), an action shall not be discontinued by a party asserting a claim except upon order of the court and upon terms and conditions, as the court deems proper. After the cause has been submitted to the court or jury to determine the facts the court may not order an action discontinued except upon the stipulation of all parties appearing in the action.

According to Defendant, CPLR §3217(b) precluded this Court from ordering a discontinuance "except upon the stipulation of all parties appearing in the action" once she

had filed her answer and counterclaims. That is a patent misreading of the statute. Defendant's service of a responsive pleading terminated Plaintiff's power under CPLR §3217(a)(1) to discontinue the action without a court order merely by serving a notice of discontinuance.

However, it is not the interposition of a responsive pleading, but rather the submission of the case "to the court or jury to determine the facts" that terminates the Court's power to order a discontinuance under CPLR §3217(b) except upon the stipulation of the parties. This case was never submitted to the court or jury to determine the facts. As noted above, it was never even released from the foreclosure settlement part: per the Notice of Completion of CPLR 3408 Settlement Conference, the action was to be discontinued because the issues had been resolved by agreement of the parties.

More serious is an issue which Defendant has not raised. In Shamley v. ITT Corporation,

67 NY2d 910 (1986), an action for employment discrimination, the plaintiff upon dismissal of his complaint moved for the return of a security bond posted pursuant to CPLR §8501(a) and stated that he would refile in federal court. Upon the defendants' cross-motion pursuant to

CPLR §3217(b), the trial court entered an order dismissing the plaintiff's action "with prejudice." Id., 67 NY2d at 911. Reversing, the Court of Appeals wrote: CPLR 3217 authorizes a voluntary discontinuance by court order on motion of "a party asserting a claim" (CPLR 3217[b]). This provision cannot be the basis for a dismissal motion by a party defending a claim unless the party asserting the claim consents or joins in the motion (see, CPLR 3217[b]; Recommendations Relating to Voluntary Discontinu-ance, 19th Ann. Report of NY Judicial Council, 1953, at 201, 207;...[cit.om.]. Plaintiff did not request a discontinuance when he moved to recover his security bond; indeed he clearly opposed defendants' cross motion in his answering affidavit. Thus, there was no basis for Special Term to apply the statute relating to voluntary discontinuances and apply [*5]it as one authorizing involuntary dismissals.

Id., 67 NY2d at 911-912.

Here, then, CPLR §3217(b) authorized a dismissal of Defendant's counterclaims at Plaintiff's behest only if Defendant "consent[ed] or join[ed] in the motion." See, id. Query, whether this Court lacked jurisdiction to issue the Section 3217(b) order discontinuing Defendant's counterclaims in the absence of her express consent or joinder in the motion?

Longstanding New York jurisprudence, dating back to the Court of Appeals' decision in Lacks v. Lacks, 41 NY2d 71 (1976), narrowly limits the scope of relief available pursuant to CPLR §5015(a)(4) for "lack of jurisdiction to render the judgment or order." In Lacks, the Court of Appeals wrote:

A statement that a court lacks "jurisdiction" to decide a case may, in reality, mean that elements of a cause of action are absent [cit.om.]. Similarly, questions of mootness and standing of parties may be characterized as raising questions of subject matter jurisdiction[cit.om.]. But these are not the kinds of judicial infirmities to which CPLR 5015 (subd. [a], par. 4) is addressed. That provision is designed to preserve objections so funda- mental to the power of adjudication of a court that they survive even a final judgment

or order [cit.om.].

In Thrasher v. United States Liab. Ins. Co., 19 NY2d 159, 166..., this court, in discussing subject matter jurisdiction, drew a clear distinction between a court's competence to entertain an action and its power to render a judgment on the merits [cit.om.]. Absence of competence to entertain an action deprives the court of "subject matter jurisdiction"; absence of power to reach the merits does not.

.... "the Supreme Court is a court of original, unlimited and unqualified jurisdiction" and "competent to entertain all causes of action unless its jurisdiction has been specifically proscribed" [cit.om.].Against the State Constitution's broad grant of jurisdiction to the Supreme Court, defendant offers the language of Section 230 of the Domestic Relations Law. It provides merely that "an action***for divorce or separation my be maintained only when" the residence requirements are met. Not even the catchall word "jurisdiction" appears in the statute, much less an explicit limitation on the court's competence to entertain the action. In no way do these limitations on the cause of action circumscribe the power of the court in the sense of competence to adjudicate causes in the matri-monial categories. That a court has no "right" to adjudicate erroneously is no circum-scription of its power to decide, rightly or wrongly.Hence, any error of law or fact which might have been committed in the divorce action did not deprive the court of jurisdiction to adjudicate the case, CPLR 5015 (subd. [a], par. 4) is inapplicable, and Special Term erroneously vacated the final judgment.In sum, the overly stated principle that lack of subject matter jurisdiction makes a final judgment absolutely void is not applicable to cases which, upon analysis, do not involve jurisdiction, but merely substantive elements of a cause for relief. To do so would be to undermine significantly the doctrine of res judicata, and to eliminate the certainty and finality in the law and in litigation which the doctrine is designed to protect.

Lacks v. Lacks, supra, 41 NY2d at 74-77 (emphasis added).

Accordingly, the Court of Appeals in Manhattan Telecommunications Corp. v. H & A Locksmith, Inc., 21 NY3d 200 (2013), in denying an application to vacate a default judgment, held that non-compliance with the CPLR §3215(f) requirement that the movant file "proof of the facts constituting the claim" was not a jurisdictional defect. Id., at 202. The Court observed that a claim of lack of subject matter jurisdiction hinges on "objections that are 'fundamental to the power of adjudication of a court'" [citing Lacks, 41 NY2d at 74], and reasoned:

"Lack of jurisdiction" should not be used to mean merely "that elements of a cause ofaction are absent" (id.), but that the matter before the court was not the kind of matter on which the court had power to rule. The defect in the default judgment before us is not jurisdictional in this sense. A failure to submit the proof required by CPLR 3215(f) should lead a court to deny an application for a default judgment, but a court that does not comply with this rule has merely committed an error — it has not usurped a power it does not have.

Manhattan Telecommunications Corp. v. H & A Locksmith, Inc., supra, 21 NY3d at 203-204. See also, Garcia v. Government Employees Ins. Co., 130 AD3d 870, 871 (2d Dept. 2015); Wells Fargo Bank Minnesota, N.A. v. Mastropaolo, 42 AD3d 239, 243-244 (2d Dept. 2007) (lack of standing to prosecute mortgage foreclosure action not a jurisdictional defect); Adams v. Adams,

255 AD2d 535, 536 (2d Dept. 1998).

This Court is a court of original, unlimited and unqualified jurisdiction. A CPLR §3217 application for discontinuance of claims pending before this Court is the kind of matter on which this Court has power to rule. Moreover, the Court of Appeals has recognized that CPLR §3217(b) authorizes a discontinuance of one party's claims at another's behest if the affected party "consents or joins in the motion." See, Shamley v. ITT Corporation, supra, 67 NY2d at 911-912. Arguably, Defendant here implicitly consented to or joined in Plaintiff's Section 3217(b) application by (1) failing to request the transfer of her counterclaims from the foreclosure settlement part to this Court for further proceedings, and/or (2) failing to interpose any opposition to Plaintiff's motion for a discontinuance of the counterclaims. Error on this score, if error there was, was invited by Defendant herself. Under Lacks and its progeny, the resulting Order of Discontinuance cannot be deemed jurisdictionally defective.

Indeed, even if express consent or joinder by Defendant were required under Shamley v. ITT Corporation, supra, for a discontinuance of her counterclaims at Plaintiff's behest, this Court still possessed jurisdiction to act under CPLR §3217(b). Confronted in Shamley with one party's express objection to the other party's use of Section 3217(b) to secure a discontinuance of his [*6]claims, the Court of Appeals recognized that the trial court's error in misapplying the statute was an "abuse of discretion" and not a matter of acting in excess of its jurisdiction. See, id., 67 NY2d at 911. Once again, the question whether this Court properly exercised its discretion in entertaining Plaintiff's request for dismissal of the counterclaims is simply not before the Court on Defendant's application, limited as it is to CPLR §5015(a)(4).

It is therefore

ORDERED, that Defendant's motion is denied.

The foregoing constitutes the decision and order of the Court.

E N T E R

Dated: January 24, 2020

Goshen, New York

______________________________________

HON. CATHERINE M. BARTLETT, A.J.S.C. Footnotes

Footnote 1:Although the Notice of CPLR 3408 Settlement Conference form was not included in the parties' motion papers, it was incorporated in the electronic docket of this case, and notice thereof was by operation of the NYSCEF system provided to counsel for the Plaintiff and Defendant. This Court may properly take judicial notice of the official court file in this action.