Deutsche Bank Natl. Trust Co. v Sicuranza
Annotate this CaseDecided on September 16, 2020
Supreme Court, Suffolk County
Deutsche Bank National Trust Company, as Trustee for Indymac Residential Asset-Backed Trust Series 2004-LH1, Plaintiff,
against
Pasquale Joseph Sicuranza and "Janet" Sicuranza, Defendants.
612592/2015
RAS BORISKIN, LLC
Attorneys for Plaintiff
900 Merchants Concourse, Suite 106
Westbury, NY 11590
RONALD D. WEISS, P.C.
Attorneys for Defendant Pasquale Joseph Sicuranza
734 Walt Whitman Road, Suite 203
Melville, NY 11747
Robert F. Quinlan, J.
Upon the following papers read NYSCEF Docs # 48-89; plaintiff's motion for an order confirming the referee's report, granting a judgment of foreclosure and sale, directing distribution of the proceeds of sale, deeming a successive notice of pendency as filed nunc pro tunc and deeming a "Step 2 filing" as timely; plaintiff's notice of motion and supporting papers: NYSCEF Docs # 48-72; defendant's notice of cross-motion for a stay of the proceedings pending appeal or to set a referee's hearing and in opposition to plaintiff's motion: NYSCEF Docs #74-88; and plaintiff's affirmation in opposition to cross-motion: NYSCEF Doc. # 89;
UPON the telephone conference in this action held on September 8, 2020 between the court and parties in compliance with the requirements of AO/157/20 of the Chief Administrative Judge of the Courts, dated July 23, 2020, and counsel for both parties having appeared; it is
ORDERED that plaintiff Deutsche Bank National Trust Company, as Trustee for [*2]Indymac Residential Asset-Backed Trust Series 2004-LH1's motion for an order confirming the referee's report, granting a judgment of foreclosure and sale, directing distribution of the proceeds of sale, deeming a successive notice of pendency as filed nunc pro tunc and deeming a "Step 2 filing" as timely, is denied and plaintiff's proposed order is marked "Not Signed;" and it is further
ORDERED that defendant Pasquale Joseph Sicuranza' s cross motion seeking a stay of the action pending his appeal, or alternatively, to schedule a referee's hearing is denied; and it is further
ORDERED that upon review of the record herein, the order of this court dated March 23, 2019 which granted plaintiff Deutsche Bank National Trust Company, as Trustee for Indymac Residential Asset-Backed Trust Series 2004-LH1's motion (Mot. Seq. #001) an order of summary judgment dismissing Pasquale Joseph Sicuranza's affirmative defenses, striking his answer, setting the default of non-answering defendants, amending the caption, an order of reference appointing a referee to compute pursuant to RPAPL §1321, and which at the same time denied defendant's cross-motion seeking dismissal of complaint (Mot. Seq. #002), is hereby sua sponte recalled and vacated in its entirety; it is further
ORDERED that in place of the order of March 23, 2019 the court substitutes this order which denies plaintiff Deutsche Bank National Trust Company, as Trustee for Indymac Residential Asset-Backed Trust Series 2004-LH1's motion (Mot. Seq. #001) and grants that portion of defendant Pasquale Joseph Sicuranza's cross-motion (Mot. Seq. #002) which sought dismissal of the action for plaintiff's violation of the notice provisions of RPAPL § 1304; and it is further
ORDERED that plaintiff Deutsche Bank National Trust Company, as Trustee for Indymac Residential Asset-Backed Trust Series 2004-LH1's complaint is dismissed.
This is an action to foreclose a mortgage on residential real property known as 25 Vail Avenue, East Quogue, Suffolk County, New York ("the property") allegedly given by defendant Pasquale Joseph Sicuranza ("defendant") on October 8, 2004 to Indymac Bank, F.S.B. ("Indymac"), a predecessor in interest to plaintiff Deutsche Bank National Trust Company, as Trustee for Indymac Residential Asset-Backed Trust Series 2004-LH1's ("plaintiff"), to secure a note executed the same date by defendant to Indymac. Plaintiff commenced this action by filing the summons, complaint and notice of pendency with the Suffolk County Clerk on December 1, 2015 (NYSCEF Docs. # 1 and 3). Defendant appeared as a self-represented person by service of an answer upon plaintiff dated January 6, 2016 (see NYSCEF Doc. # 22, Exhibit "H"). Although the court can find no record of defendant filing a formal request for exemption from the requirements of "E-filing," it is clear to the court from the submissions and conduct of the parties, as well as the court (see NYSCEF Docs. # 24 and 36), that defendant's submissions were treated as if such request had been made.
Defendant's answer consisted of general denials and sixteen affirmative defenses including plaintiff's lack of standing to commence the action (first, fourth, and ninth affirmative defenses), failure to serve a notice of default as required by the mortgage (fourteenth affirmative defense), and failure to comply with the notice requirements set forth in RPAPL §1304 (fifteenth affirmative defense). Nowhere in his answer, or affirmative defenses, did defendant raise a claim that plaintiff failed to comply with the requirements of RPAPL § 1303, or claim that the [*3]mortgage was ineffective as the legal description in the mortgage document was not that of the property.
Plaintiff subsequently moved for summary judgment, seeking an order striking defendant's answer and affirmative defenses, setting the default of non-answering defendants, amending the caption, and for an order of reference appointing a referee to compute pursuant to RPAPL §1321 (Mot. Seq. #001). This motion was originally noticed for November 21, 2016 and pursuant to Administrative Order of the District Administrative Judge, AO #29-17 dated February 28, 2017, the action and the pending motion were transferred to this part. The history of the motion is set forth in the decision and order of this court dated March 23, 2019 (NYSCEF Doc. # 38) which granted plaintiff summary judgment, struck defendant's answer and affirmative defenses, set the default of non-answering defendants, amended the caption, and appointed a referee to compute pursuant to RPAPL §1321.
The decision and order also denied defendant's cross-motion (Mot. Seq. #002), which sought summary judgment dismissing the complaint on various grounds. Although both defendant's notice of motion and "WHEREFORE" clause asked for summary judgment dismissing the action for, among other reasons, plaintiff's failure to comply with the conditions precedent contained in RPAPL § 1303, and failed to mention RPAPL § 1304, the court treated that reference as a typographical error, as RPAPL § 1303 had not been raised as an affirmative defense and in the body of his submissions defendant raised arguments relating to RPAPL § 1304 compliance, not RPAPL § 1303 compliance.
Subsequent to the court's order of March 23, 2019, defendant retained the services of his present counsel, who filed a notice of appearance with the court through NYSCEF on April 15, 2019 (NYSCEF Doc. # 41). Defendant's counsel filed a Notice of Appeal which raised the issue of the conflicting legal descriptions of the property in the mortgage and notice of pendency, an issue not addressed by the court in the decision of March 23, 2019.
Upon plaintiff submitting its present motion seeking a judgment of foreclosure and sale (Mot. Seq. # 003), defendant's counsel filed opposition to that motion and cross-moved (Mot. Seq. #004) seeking a stay of the action pending the determination of his appeal of the decision and order of March 3, 2019, and raised the issue of the conflicting legal descriptions. Upon defendant's present cross-motion, the court realized that it had failed to address defendant's arguments concerning the conflicting legal descriptions in rendering its decision of March 23, 2019. This inadvertence was in part because defendant had not raised the issue as an affirmative defense, it was not highlighted as a separate claim in defendant's cross-motion, only being referred to in the larger argument concerning plaintiff's standing and because plaintiff ignored the issue in its reply and opposition to defendant's cross-motion (NYSCEF Doc. # 25). Having now obtained the attention of the court on the issue, the court has taken a harder look at plaintiff's submissions, both on this motion and in Mot. Seq. #001, as well as defendant's present cross-motion and in Mot. Seq. #002. In addition to the discrepancies in the legal description of the property, this review has also revealed a significant deficiency in plaintiff's compliance with a condition precedent required by RPAPL § 1304, a basis for defendants original cross-motion (Mot. Seq. #002). For these reasons, the court has determined that the interests of fairness and justice require it to recall and vacate its decision and order of March 23, 2019 and in its place substitute this order dismissing plaintiff's complaint.
[*4]CONFLICTING LEGAL DESCRIPTIONS RAISE ISSUE OF FACT
It is now apparent to the court that the legal description of the property pledged in the mortgage as security (attached to the summons and complaint, NYSCEF Doc. #1, as well as to plaintiff's motion for summary judgment as Exhibit "B", NYSCEF Doc. #22) and the legal description of the property in the original notice of pendency filed at the time the complaint was filed (NYSCEF Doc. # 3) appear to describe different properties. A hard look also shows that the successive notice of pendency filed by plaintiff on March 8, 2019 (NYSCEF Doc. # 37) contains the same legal description as the original notice of pendency, not the mortgage; while the legal description of the property contained in plaintiff's proposed order was the same as that contained in the mortgage (NYSCEF Doc. # 49).
Clearly only one legal description can be correct, but there is no evidence presented in admissible form by either party, in any of the dueling motions, to allow the court to determine which is the correct legal description. In response to defendant's present cross-motion, plaintiff ignores this issue, as it did in response to defendant's original cross-motion, even though such a claim goes to the essence of plaintiff's action. Defendant offers no proof in admissible form to support his claim that the legal description in the mortgage is the incorrect one, not even in his affidavit submitted in support of his present cross-motion and in opposition to plaintiff's present motion. He relies only upon the hearsay statement made in his counsel's affirmation that the property described in the mortgage is a commercial property near defendant's home. Counsel submits no proof in evidentiary form to support his claim. An affirmation of counsel who has not established personal knowledge of the facts is without probative value (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]; Bank of NY Mellon v Aiello, 164 AD3d 632 [2d Dept, 2018]).
This issue cannot be resolved either in reconsidering Mot. Seq. # 001 and #002, nor on the present motions, as there is clearly a question of fact as to which legal description of the property is correct. The identity of the correct legal description can only be determined after a hearing before the court. The issue is one which goes to the heart of the ability of plaintiff to enforce its mortgage. Where there is a discrepancy between a street address and the legal description of real property, it is the legal description which controls (see Wells Fargo Bank, N.A. v Podeswik, 115 AD3d 207 [4th Dept 2014]; SRP 2012-5, LLC v Corrao, 167 AD3d 798 [2d Dept 2018]).
If the incorrect legal description is in the notice of pendency, then the granting of a judgment of foreclosure would be precluded at this time, although such an error could be corrected pursuant to CPLR 2001 or CPLR 6516 (a) (see Beltway Capital, LLC v Gutierrez, 140 AD3d 998 [2d Dept 2016]), and a judgment issued, provided all requirements in the RPAPL for a foreclosure have been met.
If the incorrect legal description is the one filed with the mortgage, plaintiff is faced with a more difficult problem, as an attempt to reform such a contractual error must generally be brought within six years of the occurrence of the mistake, or be barred by the statute of limitations (CPLR § 213 [6]; see Stidolph v 771620 Equities Corp., 103 AD3d 705 [2d Dept 2013]; Nationstar Mortgage, LLC v Hilpershauser, 156 AD3d 1052 [2d Dept 2017]).
Although this issue must ultimately be resolved for plaintiff to proceed to foreclose upon [*5]this mortgage, it is not ripe for resolution at this time, nor is setting the issue for a hearing to establish the correct legal description necessary, for plaintiff's action must be dismissed for failure to comply with a condition precedent required by RPAPL § 1304 (2).
FAILURE TO COMPLY WITH RPAPL § 1304 (2) REQUIRES DISMISSAL
In giving plaintiff's submissions in Mot. Seq. #001, as well as its submissions is support of its present motion, a hard look upon the court's recall and vacatur of the decision and order of March 23, 2019 the court has found that the notices required by RPAPL § 1304 (2) are fatally deficient.
Where, as here, a defendant has properly asserted non-compliance with the notice requirements of RPAPL § 1304 as a defense or raised it in a response to plaintiff's motion, plaintiff must adduce proof that the pre-action foreclosure 90 day notice requirements have been satisfied (see Deutsche Bank Natl. Trust Co. v Spanos, 102 AD3d 909 [2d Dept 2013]; Bank of New York v. Aquino, 131 AD3d 1186 [2d Dept 2015]; Cenlar FSB v. Weisz, 136 AD3d 855 [2d Dept 2016]; Bank of New York Mellon v Zavolunov, 157 AD3d 754 [2d Dept 2018]; Deutsche Bank Natl. Trust Co. v Starr, 173 AD3d 836 [2d Dept 2019]).
Proper service of the information required by RPAPL §1304 on defendant is a condition precedent to the commencement of a foreclosure action, and in support of its motion plaintiff must provide sufficient admissible evidence to prove its strict compliance with the mandates of the statute, failure to do so requires denial of its motion (see Aurora Loan Services v. Weisblum, 85 AD3d 95 [2d Dept 2011]).
Unlike most cases seen by this court involving RPAPL § 1304 compliance, the issue before the court in plaintiff's first motion was not proof of mailing, as plaintiff provided a sufficient affidavit of mailing of the notices required by RPAPL § 1304 by both regular and certified mail (NYSCEF Doc. # 22, within Exhibit "C"; see JPMorgan Chase Bank, NA v Schott, 130 AD3d 875 [2d Dept 2015]; Wells Fargo v Moza, 129 AD3d 946 [2d Dept 2015]). Rather the issue was statutory compliance with the provisions of RPAPL § 1304 (2). As in effect at the time of the mailings in 2015, that portion of the statute required that the notices contain a list of at least "five housing counseling agencies as designated by the division of housing and community renewal, that serve the region where the borrower resides." Two sets of notices were sent to defendant, one at the property and another at a residence address; both addresses were in East Quogue, Suffolk County. Enclosed with each notice was a list of five housing counseling agencies, all in the western portion of Central New York (NYSCEF Doc. # 31, Exhibit "F"). Having been closely involved in foreclosure actions since 2013, the court is aware that at one time, prior to 2015, Suffolk and Nassau Counties had been part of a "region" that included New York City, the lower Hudson Vallley, but never Central New York.
The mandate that 5 housing counseling agencies in the region where defendant resided must be included along with the notice must be fully met. Here, it is clear from plaintiff's submissions that there was no compliance with that condition precedent. Defects in the content of the mailing required by RPAPL § 1304 (2), except in rare circumstances not present here, are not errors or omissions that may be disregarded by the court pursuant to CPLR 2001 (see Aurora Loan Services v. Weisblum, 85 AD3d at 107, 108). Defendant raised the claim, in both his opposition to the plaintiff's motion and in support of his cross-motion, that plaintiff failed to comply with the requirements of RPAPL § 1304, although not specifically noting this deficiency. Strict compliance with the requirements of RPAPL § 1304 is required, failure to do so will result in denial of summary judgment, no matter the sufficiency of opposing papers (see Hudson City Savings Bank v. DePasquale, 113 AD3d 595 [2d Dept 2014]; Flagstar Bank v Damaro, 145 AD 858 [2d Dept 2016]). Based on the same defect, defendant's cross-motion for summary judgment must be granted (see Hudson City Savings Bank v. DePasquale, supra; Flagstar Bank v Damaro, supra).
JUDGMENT OF FORECLOSURE WOULD HAVE BEEN DENIED
Even if the above errors had not appeared, the court would have denied plaintiff's motion for a judgment of foreclosure and sale for plaintiff's failure to comply with the procedures set forth in the orders of March 23, 2019. From plaintiff's submissions, it appears that plaintiff's counsel "overlooked" the court's decision and order of March 23, 2019 (NYSCEF Doc. # 38), and the modifications the court made to plaintiff's proposed order of reference (NYSCEF Doc. # 40). These contained specific directives as to how the order of reference was to proceed, as well as setting the authority and duties of the referee, setting a schedule for the submission by plaintiff of the documents necessary for the referee to perform his duties, and the submission of objections to the referee by defendant to plaintiff's submissions; limited the authority of the referee to report, required that defendant submit his objections to the referee and that upon the motion for a judgment of foreclosure and sale to submit those same objections to the court to allow the court to make a determination as to their validity. These specific directives were made in order to avoid an unnecessary and burdensome, evidentiary hearing before the referee, allow a process where defendant could raise appropriate objectives and then contest them before the court. In order for this process to have effect and be fair, the parties were required to follow it. Plaintiff appears to have disregarded its directives, which would have resulted in the court denying its motion.
Additionally, even though plaintiff's mailing failed to follow the court's directives, plaintiff failed to send what notices it sent to the referee to defendant's counsel (CPLR 2103 [b]), instead sending them to defendant directly on May 23, 2019 (NYSCEF Doc. # 47). As noted above, defendant's counsel filed his notice of appearance on April 15, 2019 (NYSCEF Doc. # 41). As notices of new filings in NYSCEF are given to registered counsel, such as plaintiff, plaintiff should have been aware of defendant's counsel's appearance by the time the notices were sent to the referee and defendant.
An additional problem is that inexplicably the referee's oath and report are dated "5/21/19" (NYSCEF Doc. # 67) two days before the mailings to defendant which purported to give him the opportunity to contest the submissions to the referee. So even if it could be argued that defendant's counsel should have been aware of the "mailings" to his client contained in NYSCEF Doc. #47, as he should have received notice of the filing through NYSCEF, such notice would have been two days late to submit any objections.Under the circumstances before the court, it is unnecessary to address plaintiff's application for an order to nunc pro tunc the successive notice of pendency to cover the gap between the expiration of the original notice of pendency or to deem its "Step 2 Application" as timely filed, both of which would have been denied if considered.
Plaintiff's proposed order is marked "Not Signed."
In light of the court's decision granting defendant's original cross-motion to dismiss, [*6]defendant's application to stay the action pending the appeal of that order pursuant to CPLR 5519 ( c) or 2201 is denied as moot.
This constitutes the decision and order of the Court.
Dated: September 16, 2020
Hon. Robert F. Quinlan, J.S.C.
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