U.S. Bank Natl. Assn. v RIY REALTY LLC

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U.S. Bank Natl. Assn. v RIY REALTY LLC 2021 NY Slip Op 32711(U) December 14, 2021 Supreme Court, Kings County Docket Number: lndex No. 518629/20 Judge: Lawrence S. Knipel 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. [*FILED: 1] KINGS COUNTY CLERK 12/16/2021 02:07 PM NYSCEF DOC. NO. 34 INDEX NO. 518629/2020 RECEIVED NYSCEF: 12/16/2021 At an JAS Terin, Comniercial Part 6 of the Supreme Cami .of the State of New York, held in and for the County of Kings, at the Courthouse, at 36() Adams Street, Brooklyn; New York, on the 14th day of December, 2021. PRESENT: HON, LAWRENCE KNIPEL, Justice. _.._ _ _.........,______,.----X U.S.BANKNATib'NAL ASSOCIATION1 as Trustee for VELOCITY COMMERCIAL CAPITAL LOAN TIUJST 2016-2, Plaintiff; DECISION AND.ORDER -against~ lndexNo. 518629/20 RlY REAL'fY LLC; Mot Seq. No. 1-2 .RITAYAKHNIS; AVRAHAM AMQUYAL a/Ida A YI AMOUYAL; BOARD OF MANAGERS 0FTHI! L559EAST 1JT11 STREET CONDOMINIUM; and JOHN DOE (said name being fictitious to represent 1iriknown tenaitts/occupants.ofthe subject property and any other party or entity of ai1y kind, if any, having or claiming an interest or lien upon themortgaged prnperty), Defendants. --------------· ----. -- .. --------------- .- - - - - - - - - X The following e-filed papers read hereii1: NYSCEF Doc No.: Notice ofMoticin/Cross Motion;Affirmation, and Exhibits Annexed _ _ _ _ _ _ _ _ _ _ _ _ _ __ 14-20· 24-29 Reply Affirmations _ _ _ _ _ _ _ _ _ _ _ _ _ __ ln this action to foreclose a mortgage on commercial real property owned by defendant RlY Realty LLC {the "borrowetdefenda:rtt"), as well ·as to collect on the loan guarantee executed by the corporate defendant's managing member, defendant Rita Yakhnis. (the "guarantoi- defendant"), plaintiffU.S. Bank NationFil Association, as trustee for Velocity Co1mncrcial Capital Loan Trust 2016-2 (the "pbdntiff'), moves iri Seq. No. 1 1 of 8 [*FILED: 2] KINGS COUNTY CLERK 12/16/2021 02:07 PM NYSCEF DOC. NO. 34 INDEX NO. 518629/2020 RECEIVED NYSCEF: 12/16/2021 for an order: (1) pursuant to CPLR 3212, granting it summary judgment and striking the defenses/counterclaims of the borrower and guarantor defendants; (2) pursuant to RPAPL 1311 (1), substituting Occupational Therapy Services, PC (an alleged tenant in possession of the underlying property) in place of the "John Doe>' defendants; (3) pursuant tn CPLR 3215, entering a default judgment against non-answering defendants Avraham Amouyal, also known as Avi Amouyal, and the Board of Managers of the 1559 . . East 13 th Street Condominium (collectively, the "non-answering defendants"); (4) pursuant to RPAPL 1321 (1), appointing a referee to compute the amount ducto plaintiff; and (5) pursuant to RPAPL 1325, appointing a receiver; The borrower and guarantor defendantsjointly cross-move ir.1 Seq. No.2 for an order, putsuantto CPLR3212, as well as pursuant to CPLR 3211 {a) (1), (2), (7), and (8), dismissing the action as against each of them. Background In July 2016, the borrower defendant executed and delivered a promissory note in the principal amount of $420,000 in favor of Velocity Commercial Capital, LLC (''Velocity"), which was secured by a mortgage on a commercial condominium unit known as Cl in the building located at 1559 East 13 th Street in Brooklyn, New York (the ''underlying property''). The guarantor defendant personally guaranteed the loan by executing and delivering to Velocity ap Utilitrtited Guaranty (the "guaranty"). The note, mortgage, and guaranty were iater assigned by·Velocity to the plaintiff. In October 2020, the plainti ff commenced this action to foreclose the .mortgage against ( among others} the. bmtower defendant, as well as to collect on the guaranty against the gtiarantor defendant. 2 2 of 8 [*FILED: 3] KINGS COUNTY CLERK 12/16/2021 02:07 PM NYSCEF DOC. NO. 34 INDEX NO. 518629/2020 RECEIVED NYSCEF: 12/16/2021 In theirjoint answer,. the borrower and guarantor defendants (collectively, the "answering defendants''} asserted 16 affirmative defenses, including that.the plaintiff lacked standing to commence the action. Thereafter, the plaintiff moved for, among other relief, summary judgment on the complaint as against the answering defend&nts. The latter opposed the motion and cross-moved, pursuant to CPLR 3212 and 3211, to dismiss the complaint insofar as asserted against each of them. In their ctoss motion, the answering defendants contended, among other things, that the complaint as against the guarantor defendant should be dismissed because of the plaintiffs failure to serve her with process in accordance with tpe guaranty. Discussion "In niOving for summary judgment in an action to foreclose a mortgage,a plaintiff generally establishes its prima facie case through the production of the mortgage, the unpaid note, and evidem:e of default" (Central Mtge. Co. v Resheff, _ AD3d _., 2021 NY Slip Op 06670, *3 [2d Dept 2021]). ·'[W]here, as here, a plaintiff's standing to commence a foreclosure action is placed in issue by a defendant, the plaintiff must also prove its standing as part of its prima facic showing" (HSBC Bank USA, N.A. v Oscar, 161 AD3d l 055, 1056 [2d Dept 2018]). A plaintiff has standing to commence a foreclosure action where, among other things, ''the note underlying an action was assigneci to the plait1ti ff prior to the date of' comrnencement of the action'' ( Wi Im ington Sav. Fund Socy., FSB v Matamoro, 200 Ab3d ·79, 91 [2d Dept 202 l]). 3 3 of 8 [*FILED: 4] KINGS COUNTY CLERK 12/16/2021 02:07 PM NYSCEF DOC. NO. 34 INDEX NO. 518629/2020 RECEIVED NYSCEF: 12/16/2021 The Borrower Defendant Herc; the plaintiff has established standing, as again.st the borrower defendant; based on the assignment of the mortgage by Velocity to the plaintiffun January 31, 2017, inasmuch as the same assigrunent also assigned the note to the plaintiff (see Cen/ar FSB v Glauber, 188 AD3d 1141, 1143 [2d Dept 2020]). The plaintiff also has establishedits prima facic entitlement to judgment as a matter of law; as against the borrower defendant~ by submitting copies of the mortgage; unpaid note, and evidence of the loan default (see Deutsche Bank Natl. Tr. Co. v Finger, 195 AD3d 789, 791 [2d Dept 2021]). In opposition to the plaintiffs prima facie showing, the borrower defendant has failed to raise a triable issue of fact. The borrower defendant's contention that the plaintiff's summary judgment motion Was premature is without merit. ' 1A party who seeks a finding that a summary judgment motion is premature: is required to pttt forth some cvidentiary basis to suggest that discovery might lead to relevant evidence or that the facts essential to justify opposition to the motion were exclusively within the knowledge and control of the movanf' (Vikram Const., Inc, v Everest Nat: Ins. Co., 139 AD3d 720, 721 [2d Dept 2016]). "The mere, hope or speculation that evidence sufficient to defeat a motion for summary j4dgment may be uncovered during the discovery process is insufficient to deny the moti'on" (Wells rargo Bank, NA. v Gontalez1 174 AD3d 555, 558 [2d Dept 2019] [iritental quotation i11atks ornitted]}. Here, $ee Assignment of ComrnerciaJ MortgEi:ge; Sec;urity Agreement and Assignment .of Le.ases and Rents("Together with the note[s} and obllgations therein described or referred to~ the money due and to become due- thereon, with interest; and• all. rights.accrued or to accrue under said.dotiJh1ent ·1 referenced above'') (emphasis added). A copy of the assigrunent is annexed to the complaint ExhibitE (NYSCEF Doc No. l). . 4 4 of 8 aj; [*FILED: 5] KINGS COUNTY CLERK 12/16/2021 02:07 PM INDEX NO. 518629/2020 NYSCEF DOC. NO. 34 RECEIVED NYSCEF: 12/16/2021 the borrower defendant has failed to satisfy its burden (see e.g. Ocwen Loan Serv., LLC v Fitzgerald, 168 AD3d 964, 966 [2d Dept 2019]). Lastly, the plaintiff is entitled to the appointment of a receiver pursuant to section 4.2. (f) of the mortg~ge and the implementing provision of RPAPL 1325 (l) ("Where the action is for the foreclpsure of a m011gage providing that a receiver may be appointed without notice, notice of a motion for such appointment shall not be required."). Pursuant to CPLR 6403, the receiver ·'shall give an undertaking in an amount to be fixed by the court making the appointment, that he [or she] will faithfully discharge . . his [or her] duties." The Guarantor Defendant The guaranty provides, in relevant part, that: "Guarantor [i.e., the guaranty defendant] irrevocably submits to the nonexclusive jurisdiction of any Federal or state court sitting in New York, over any suit, action or proceeding arising out of or relating to this Guaranty. Guarantor irrevocably waives, to the fullest extent it may effectively do so under applicable law, any objection it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in any such court and any claim that the same has been brought in an inconvenient forum. Guarantor hereby consents to arty and all process which may be served in any such suit, action or proceeding; (i) by mailinga copy thereof by-registered anc/ certified mail,postage prepaid, returnreceiptrequested, to the Guarantor's address shown below ... and (ii) by serving the same upon the Guarantor in any other manner otherwise permittecl by law, and agrees that such service shall in every respect be deemed effective service upon thc·Guarantor.'; (Guaranty at 3~4 [emphasis addedJ). Although the guaranty defendant ~onh'actually consented to personal jurisdiction, she is still e;ntiUcd to be served with ptocess iri accordance wjth the italicized terms ofthc 5 5 of 8 [*FILED: 6] KINGS COUNTY CLERK 12/16/2021 02:07 PM NYSCEF DOC. NO. 34 INDEX NO. 518629/2020 RECEIVED NYSCEF: 12/16/2021 guaranty (see Brooklyn Fed. Sav. Bank v 140 W Assoc., LLC; 29 Misc 3d 1237{A], 2010 NY Slip Op 52186[UJ, *6 [Sup Ct, Kings County 2010, Demarest, J.] [collecting authorities]). Herc, the affidavits of service establish that the guaranty defendant was served with process by personal service in accordance with CPLR 308 (1), as well as by . . ·. first-class mail (NYSCEF Doc No. 7~8). No service of process by registered/certified mail as requited by the guaranty was effectuated on the _guaranty defendant In light of the plaintiffs failure to Coinply with the aforementioned contractual requfrc1nent, the Court lacks personaljurisdiction over the guaranty defendant Conclusion Accordingly, it is ORDERED that the plaintiffs motion in Seq. No. 1 is granted to the extent that: (l) pursuant to CPLR 3212, the plaintiff is granted summary judgment as against RIY Realty LLC only, and the affirmative clcfcnses/counterclaims of RIY Realty LLC are stricken; (2) pursuant to RP APL 1311 (l ), Occupational Therapy Services, PC is substituted in place of the "John Doe'; defendants; (3) pursuant to CPLR 3215, a default judgment is entered against non-answering defendants A vraham Amouyal, also known as Avi Amouyal, and the Board of Managers of the 1559 East 13th Street Condominium; (4) pursuant to RP APL 1321 (l), a referee is appointed, as more fully set forth below, to compute the amount due to plaintiff; and (5) pursuant to RPAPL 1325, a receiver is appointed, as more fully set forth below, to collect rents generated by· the underlying property; and the remainder of the plaintiffs motion as against Rita Yakhnis only is denied;·and it is fudher 6 6 of 8 [*FILED: 7] KINGS COUNTY CLERK 12/16/2021 02:07 PM NYSCEF DOC. NO. 34 INDEX NO. 518629/2020 RECEIVED NYSCEF: 12/16/2021 ORDERED that the answering defendantf cross motion in Seq. No. 2 is granted to the extent that the complaint as against Rita Yak/mis only is dismissed, pursuant to CPLR 3211 (a) (8), for lack of personal jurisdiction; and the remainder of their cross motion is denied; and it is further ORDERED th;it an order shall be submitted on notice for the appointment of a receiver;and it is further ORDERED that an order shall be submitted on notice for the appointment of a referee to compute; and it is further ORDERED that Occupational Therapy Services, PC is substituted as a party defendant in place of the "John Doe" defendants; and it is further 7 7 of 8 [*FILED: 8] KINGS COUNTY CLERK 12/16/2021 02:07 PM NYSCEF DOC. NO. 34 INDEX NO. 518629/2020 RECEIVED NYSCEF: 12/16/2021 ORDERED that the caption is amended to read in its entirety as follows: ----· ·------- ·------------·---..c..~---'-----. --- . -----X U;S. I3ANK NATIONAL.ASSOCJATION, as Trustee for VELOCITY COMMERCIAL CAPITAL LOAN TRUST 2016~2, Plaintiff, -against- Index NO. 5 l 8629/20 RIY REALTY LLC; A VRAHAM AMOUYAL a/k/a Av1 AMOUYAL; 1559 EAST l 3111 STREET BOARD OF MANAGERS OF THE C()NDOMINIUM; and. OCCUPATIONAL THi::RAPY SERVICES, PC, Defendants. -.-----------------. -------.- - - - - - - - - -... ---· .--- .------X The plaintiffs counsel is directed to electronically serve a copy of this decision and order with notice of entry and to electronically file an affidavit of service thereof with the Kings County Clerk, This constitutes the decision and order ofthe Court. HON. l~WRENGE KNIPEL ADMlNloTRATJVE JUDGE 8 8 of 8

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