Preview
FILED: SUFFOLK COUNTY CLERK 11/30/2020 06:14 PM INDEX NO. 604405/2019
NYSCEF DOC. NO. 68 RECEIVED NYSCEF: 11/30/2020
EXHIBIT 14
FILED: SUFFOLK COUNTY CLERK 11/30/2020 06:14 PM INDEX NO. 604405/2019
NYSCEF Bank ofNO.
DOC. N.Y. 68
Mellon v Bak, 52 Misc.3d 1209(A) (2016) RECEIVED NYSCEF: 11/30/2020
41 N.Y.S.3d 718, 2016 N.Y. Slip Op. 51096(U)
Mortgages
Recording
Unreported Disposition
52 Misc.3d 1209(A), 41 N.Y.S.3d 718 (Table), 2016 Mortgages
WL 3767396 (N.Y.Sup.), 2016 N.Y. Slip Op. 51096(U) Foreclosure
Standing—Proof of Either Written Assignment or Physical
This opinion is uncorrected and will not be Delivery of Note
published in the printed Official Reports.
*1 The Bank of New York Mellon, FKA
Bank of N.Y. Mellon v Bak, 2016 NY Slip Op
THE BANK OF NEW YORK, AS TRUSTEE
51096(U). Mortgages—Recording. Mortgages—Foreclosure
FOR THE CERTIFICATEHOLDERS OF
—Standing—Proof of Either Written Assignment or Physical
CWALT, INC., ALTERNATIVE LOAN TRUST Delivery of Note. (Sup Ct, NY County, June 2, 2016,
2007-OA11, MORTGAGE PASS-THROUGH Lebovits, J.)
CERTIFICATES, SERIES 2007-OA11, Plaintiff,
v.
Mihwa Bak, BOARD OF MANAGERS OF
APPEARANCES OF COUNSEL
THE ATELIER CONDOMINIUM, NEW Eckert Seamans Cherin & Mellott, LLC, New York (Candace
YORK CITY ENVIRONMENTAL CONTROL E. Chun of counsel), for plaintiff.
BOARD, “JOHN DOE 1” to “JOHN DOE 25,” Kim, Choi & Kim, P.C.,New York (Dong Sung Kim of
said names being fictitious, the persons or counsel) for defendant Bak.
parties intended being the persons, parties,
OPINION OF THE COURT
corporation or entities, if any, having or claiming
an interest in or lien upon the mortgaged Gerald Lebovits, J.
premises described in the complaint, Defendants.
Recitation, as required by CPLR 2219 (a), of the papers
Supreme Court, New York County considered in reviewing plaintiffThe Bank of New York
810310/2011 Mellon's motion for summary judgment, for default judgment
Decided on June 2, 2016 and to appoint a referee; and defendant Mihwa Bak's
cross-motion for the court to approve a stipulation of
discontinuance, and summary judgment and dismiss the
CITE TITLE AS: Bank of N.Y. Mellon v Bak
complaint.
ABSTRACT
Papers Numbered
Plaintiff's Notice of Motion 1
Plaintiff's Memorandum of Law in Support 2
Plaintiff's Affidavit in Support 3
Defendant's Notice of Cross-motion 4
Plaintiff's Memorandum of Law in Opposition to Cross–Motion 5
Plaintiff's Affirmation in Opposition to Cross–Motion 6
DECISION/ORDER
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DOC. N.Y. 68
Mellon v Bak, 52 Misc.3d 1209(A) (2016) RECEIVED NYSCEF: 11/30/2020
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Gerald Lebovits, J. loan from Countrywide Bank, FSB (Countrywide) to Bak.
(Plaintiff'sAffidavit In Support, Exhibit 2.) Countrywide
Plaintiff,Bank of New York Mellon (BNY), moves for indorsed the Note without recourse to Countrywide Home
summary judgment and to strikedefendant, Mihwa Bak's Loans, Inc.,who then indorsed the Note in blank without
(Bak), answer and its affirmative defenses and counterclaims, recourse. (Plaintiff'sAffidavit In Support, Exhibit 2.).At
for a default judgment against the non-answering defendants, the same time that Bak executed the Note, Bak, in order to
the Board of Managers of the Atelier Condominium and the secure her promise under the Note, executed and delivered a
New York City Environmental Control Board, and for the mortgage (the Mortgage) to Mortgage Electronic Registration
court to appoint a referee to ascertain damages and issue a Systems, Inc. (MERS), as nominee for Countrywide, which
report for the court. Defendant Bak cross-moves to have the encumbered the premises located at 635 West 42nd Street,
court enforce a stipulation of discontinuance, grant summary Unit No.23D, in New York County. (Plaintiff's Affidavit In
judgment and dismiss the complaint. Support, Exhibit 3.) The mortgage was recorded on July 31,
2007. (Plaintiff's Affidavit In Support, Exhibit 3.)
BNY argues that it is entitled to summary judgment because
Bak defaulted under the terms of her note and mortgage and On or about October 1, 2007, BNY entered into a Pooling
it has provided the court both documents along with evidence and Servicing Agreement (the PSA) with CWALT, Inc., as
of default. Plaintiff also argues that it is entitled to default Depositor, Countrywide Home Loans, Inc., as Seller,Park
judgment against the non-answering defendants and seeks a Granada LLC, as Seller, Park Monaco Inc., as Seller, Park
referee to determine damages and to issue a report. Bak cross- Sienna LLC, as Seller, Countrywide Home Loans Servicing
moves for summary judgment on the grounds that plaintiff LP, as Master Servicer. (Plaintiff's
Affidavit In Support,
lacks standing to sue. The defendant also argues that the Exhibit 4.) BNY served as Trustee under the PSA. (Plaintiff's
court should discontinue the case and dismiss the complaint Affidavit In Support, Exhibit 4.) Article II, Section 2.01(c) of
because the parties had agreed to discontinue the case. the PSA, “Conveyance of Mortgage Loans” provides:
I. BNY's Summary-Judgment Motion and Baks' Cross- “In connection with the transfer and assignment set forth
Motion in clause (b) above, the Depositor has delivered or caused
to be delivered to Trustee (or, in the case of the Delay
BNY's motion for summary judgment is granted and Bak's Delivery Mortgage Loans that are Initial Mortgage Loans,
cross-motion for summary judgment is denied. For a court will deliver or cause to be delivered to the Trustee
to grant a summary-judgment motion, the proponent must within thirty (30) days following the Closing Date and
make a prima facie showing of entitlement to judgment as in the case of the Delay Delivery Mortgage Loans that
a matter of law, tendering sufficient evidence to eliminate are Supplemental Mortgage Loans, will deliver or cause
any material issue of fact about the claim or claims at issue. to be delivered to the Trustee within twenty (20) days
(Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986].) In a following the applicable Supplemental Transfer Date) for the
mortgage foreclosure action, a plaintiff moving for summary benefit of the Certificateholders the following documents or
judgment must provide proof of both the unpaid note and instruments with respect to each Mortgage Loan so assigned:
the underlying mortgage along with sufficient evidence to (i) (A) the original Mortgage Note endorsed by manual or
establish defendant's default. (See JP Morgan Chase Bank, facsimile signature in blank in the following form: Pay to the
Nat. Ass'n v Shapiro, 104 AD3d 411, 412 [1st Dept 2013]; order of _________ without recourse,' with all intervening
Deutsche Bank Natl. Trust Co. v Gordon, 84 AD3d 443, 443 endorsements showing a complete chain of endorsement
[1st Dept 2011]; Bank Leumi Trust Co. of NY v Lightning from the originator to the Person endorsing the Mortgage
Park, 626 N.Y.S.2d 202 [1st Dept 1995].) When a plaintiff has Note . . . .” (Plaintiff's Affidavit In Support, Exhibit 4.)
made this prima facie showing, the burden then shifts to the
defendant to raise a triable issue of fact. (JP Morgan Chase MERS, as Countrywide's nominee, executed an assignment
Bank, Nat. Ass'n, 104 AD3d at 412.) of the Mortgage on May 12, 2011 in order to memorialize
the purported transfer and assignment of both the Note and
The following facts are not in dispute. On or about July the Mortgage. (Plaintiff'sAffidavit In Support, Exhibit 5.)
13, 2007, Bak executed an Adjustable Rate Note (the Note) Bak defaulted on the terms of both her note and underlying
in the principal amount of $900,000 as evidence of a mortgage by not tendering payment due on August 1, 2010,
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and any and all payments subsequently due. Because of the [2012], lv denied 20 NY3d 858 [2013]). Michelle Simon,
default, BAC Home Loans Servicing, LP (BAC) sent Bak a VP Consumer Ombudsman of Select Portfolio Servicing Inc.
demand letter on or around September 16, 2010 on BNY's (SPS), the servicing agent and attorney-in-fact for BNY,
behalf. (Plaintiff's
Affidavit In Support, Exhibit 6.) On or reviewed the “records that SPS maintains for [p]laintiff with
about January 5, 2011, BAC sent Bak a 90-day notice under respect to the mortgaged property.” (Plaintiff's Affidavit In
RPAPL § 1304. (Plaintiff's Affidavit In Support, Exhibit 7.) Support, ¶ 2.) Those records showed that the Note was
transferred to the plaintiffon or about October 30, 2007,
BNY has proven its prima facie case to entitle it to pursuant to the PSA dated October 1, 2007, and that the
summary judgment, but because Bak has raised standing as Note is currently in the possession of the plaintiff's counsel
an affirmative defense, BNY has the burden to prove standing in their offices based in Pittsburg, Pennsylvania. (Plaintiff's
to entitle it to summary judgment relief. (JP Morgan Chase Affidavit In Support, ¶¶ 11-13.) As the servicer of both the
Bank, Nat. Ass'n v. Hill, 133 AD3d 1057, 1057 [3d Dept Note and Mortgage for plaintiff, the records maintained by
2015] [internal citations and quotations omitted].) A plaintiff SPS qualify as business records and are therefore admissible
in a mortgage foreclosure action “has standing where it is to show delivery of the Note. (Deutsche Bank Nat. Trust Co.,
both the holder or assignee of the subject mortgage and the 131 AD3d at 739; see also CPLR 4518 [a]; Cratsley, 86 NY2d
holder or assignee of the underlying note at the time the at 90.)
action is commenced.” (Bank of New York v Silverberg, 86
AD3d 274, 279 [2d Dept 2011].) In New York, it is the note Bak relieson Bank of New York Mellon v Deane, 41
and not the mortgage thatis the “dispositive instrument,” Misc 3d 494 (2013) for the proposition that a plaintiffin
which confers standing in a foreclosure action. (Aurora Loan a mortgage foreclosure action must provide factual details
Servs., LLC v Taylor, 25 NY3d 355, 361 [2d Dept 2015].) relating to the physical delivery of the note in order to
In order to demonstrate that it is the holder or assignee of prove standing. Therefore, Bak argues that neither Michelle
a note, a plaintiffmust provide proof of eithera written Simon's affidavitnor any supporting documents are proof
assignment or physical delivery of the note. (U.S. Bank, N.A. that the Note was physically delivered to the plaintiff prior
v Adrian Collymore, 68 AD3d 752, 754 [2d Dept 2009].) to the commencement of the foreclosure action. (Defendant's
Where plaintiff is someone “other than the original mortgage Notice of Cross-Motion.) Defendant also argues that the
lender, a valid transfer of the note to the plaintiff prior to thePSA is not evidence of the delivery of the Note, but shows
commencement of the action . . . will resolve the standing only the “intent to indorse and physically deliver the notes
issue in favor of the plaintiff.” (Deutsche Bank Nat. Trust Co. and mortgages referred to.” (Defendant's Notice of Cross-
v Torres, 2014 NY Slip Op 51544[U], *2 [Sup Ct 2014].) Motion.)
a. Physical Delivery of Note But Bank of New York Mellon v Deane is distinguishable from
this case. In Bank of New York Mellon, as proof of assignment
Plaintiff provides sufficient evidence to show physical of the note, plaintiff offered into evidence only excerpts from
delivery of the Note before commencing this foreclosure the pooling and servicing agreement and did not include the
action against defendant. Where, in the regular course of signature pages. (41 Misc 3d at 498.) Also, the note was made
business, an entity merely files and maintains papers that it payable to the original lender and indorsed to a trustee other
has received on behalf of another entity, those documents than the plaintiff. (41 Misc 3d at 497.) No evidence existed
do not qualify as business records and are therefore not that the trustee indorsed the note “either to the order of another
admissible as evidence. (Deutsche Bank Nat. Trust Co. v special indorsee, or in blank, with no particular indorsee,
Monica, 131 AD3d 737, 739 [3d Dept 2015] quoting People in the lattercase transforming the [n]ote to an instrument
v Cratsley, 86 NY2d 81, 90 [1995] [internal quotation payable to bearer that could be further negotiated by delivery
marks and citation omitted].) The documents, however, alone.”' (Id. at 500, quoting UCC 3-204 [2].) Here, plaintiff
are admissible where “the recipient can establish personal attached the PSA in its entiretyas an exhibit to Michelle
knowledge of the maker's business practices and procedures, Simon's affidavit, and to authenticate the document, included
or that the records provided by the maker were incorporated the signature pages. (Plaintiff's Affidavit In Support, Exhibit
into the recipient's own records or routinely relied upon by 4.) The PSA specifically acknowledges that the notes have to
the recipient in itsbusiness.” (State of New York v 158th be delivered along with the underlying mortgages under the
St. & Riverside Dr. Hous. Co., Inc., 100 AD3d 1293, 1296 agreement. (Plaintiff's Affidavit In Support, Exhibit 4, Article
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II, Section 2.01 [c].) Furthermore, Countrywide indorsed the Covenants.) Under the PSA, in which Countrywide was
Note without recourse to Countrywide Home Loans, Inc., a party, the Mortgage was assigned to the plaintiff,as
who then *2 indorsed the Note in blank without recourse. the Trustee. In 2011, plaintiff memorialized the Mortgage's
(Plaintiff's
Affidavit In Support, Exhibit 2.)Countrywide's assignment in a separate document that was recorded with the
delivery of the Note in blank to BNY without any additional State of New York. (Plaintiff's Affidavit In Support, Exhibit
language on the Note was sufficient to make BNY the 5.)
Note's holder. Therefore, BNY has proven that the Note was
physically delivered to BNY. Citing Bank of New York v Silverberg, 86 AD3d 274
(2011) and IndyMac Fed. Bank, FSB v Meisels, 2012 NY
b. Written Assignment of Mortgage Slip Op 51902(U) (2012), Bak argues that,as the lender's
nominee, MERS did not have the authority to assign the
The assignment of the Mortgage from Countrywide to BNY mortgage; therefore the assignment is void. Defendant's
is valid. In a secured transaction, the security is incident to the
reliance on these cases is misguided. In both cases, MERS
debt. (Bank of New York, 86 AD3d at 282.) Once a promissory purportedly assigned both the note and the underlying
note passes to and is accepted by an assignee, “the mortgage mortgage; therefore, according to the court, this was beyond
passes as an incident to the note.” (Id.) Mortgage lenders and the limited scope of itsauthority as nominee. (See Bank
other entities use the MERS system to track the ownership of New York, 86 AD3d at 281; IndyMac Fed. Bank, FSB,
and transferof mortgages between various MERS-system 2012 NY Slip Op at *8.) Here, under the PSA, in which
members. (Id.) The Court of Appeals summarized MERS's Countrywide as the original lender was a party, the Mortgage
function as follows: was assigned to plaintiffas the trustee and the Note was
physically delivered to the plaintiffwithin the time frame
“The initial MERS mortgage is recorded in the County Clerk's specified in the PSA. (Plaintiff's *3 Affidavit In Support,
office with Mortgage Electronic Registration Systems, Inc.' Exhibit 4.) Therefore, the assignment of the Mortgage was
named as the lender's nominee or mortgagee of record on valid.
the instrument. During the lifetime of the mortgage, the
beneficial ownership interest or servicing rights may be II. BNY's Motion For Default Judgment Against Non-
transferred among MERS members (MERS assignments), Answering Defendants
but these assignments are not publicly recorded; instead
they are tracked electronically in MERS's private system. In BNY's motion for a default judgment against the non-
the MERS system, the mortgagor is notified of transfers of answering defendants is granted. A default judgment is
servicing rights pursuant to the Truth in Lending Act, but not appropriate when “a defendant has failed to appear, plead
necessarily of assignments of the beneficialinterest in the or proceed to trial of an action reached and called for trial,
mortgage.” (Matter of MERSCORP, Inc. v Romaine, 8 NY3d or when the court orders a dismissal for any other neglect
90, 96 [2006].) to proceed.” (CPLR 3215 [a].)On a motion for default
judgment, plaintiff must “file proof of service of the summons
A “nominee” is one who is designated to act on an and the complaint, or a summons and notice served pursuant
individual or entity'sbehalf as a representative, but with to subdivision (b) of rule 305 or subdivision (a) of rule 316
limited authority. (Black's Law Dictionary 1076 [8th Ed of this chapter, and proof of the facts constituting the claim,
2004].) Here, the initialmortgage was between Bak, as the default and the amount due by affidavit made by the
borrower and Countrywide as lender. (Plaintiff'sAffidavit party . . . .” (CPLR 3215 [f].) If a corporate defendant fails
In Support, Exhibit 3.) The Mortgage provides that MERS to appear and plaintiff has properly served a summons and
is “a separate corporation thatis acting solely as nominee complaint on the corporate defendant, “an affidavit shall be
for Lender and Lender's successors and assigns . .. FOR submitted that an additional service of the summons by first
PURPOSES OF RECORDING THIS MORTGAGE, MERS class mail has been made upon the defendant corporation at
IS THE MORTGAGEE OF RECORD.” (Plaintiff's Affidavit its last known address at least twenty days before the entry
In Support, Exhibit 3.) Further, under the terms of the of judgment.” (CPLR 3215 [g] [4] [i].) Here, BNY submitted
Mortgage, “[t]he Note, or an interest in the Note, together proof of service of the summons and complaint as well
with the Security Instrument, may be sold one or more the affidavit of Michelle Simon. The evidence demonstrates
times . .. .” (Plaintiff'sAffidavit In Support, Exhibit 3, the present foreclosure action as well as the defendant's
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default on the terms of the Note and Mortgage and the and that the only issue remaining between the parties was
outstanding amount that Bak owes. (Plaintiff's Affidavit in whether or not the case would be discontinued with or
Support.) Plaintiff has also provided evidence that it served without prejudice; BNY's former counsel did not sign the
the non-moving defendants, Board of Managers of the Atelier order. (Notice of Cross-Motion, Exhibits C.) BNY argues
Condominium and the New York City Environmental Control that “no stipulationof discontinuance was ever signed or
Board, with an additional summons at least 20 days before the filed in this case.” (Memorandum of Law in Opposition to
entry of judgment. (Plaintiff's Notice of Motion, Exhibit K.) defendant Mihwa Bak's Cross-Motion.) Further, the signed
Therefore, plaintiff is entitled to default judgment against the affirmation from plaintiff'sformer counsel does not attach
non-answering defendants. an executed stipulation of discontinuance, even though the
document makes thisreference. (Notice of Cross-Motion,
III. Bak's Remaining Cross-Claims and Affirmative Defenses Exhibit D.) According to BNY's current counsel, “[i]t appears
as though this affirmation was prepared during the course of
a. Bak's Cross-Claims settlement negotiations between the parties in 2013, though
the parties never reached an agreement.” (Memorandum of
Bak's cross-motion to dismiss the complaint under CPLR Law in Opposition to defendant Mihwa Bak's Cross-Motion.)
3211 (3) is denied. CPLR 3211 (3) states that a party may have Therefore, Bak's motions under CPLR 3217 and CPLR 3211
a cause of action dismissed if “the party asserting the cause of (5) are denied.
action has not legal capacity to sue.” Here, BNY has proven
standing by showing that the Note was physically delivered to b. Bak's Affirmative Defenses
BNY and that the assignment of the underlying mortgage was
valid. Therefore Bak's cross-motion to dismiss the complaint Bak's first through fourth affirmative defenses, lack of legal
under CPLR 3211 (3) is denied. capacity to sue, lack of standing, that plaintiffhas no
beneficial interest in this action and that plaintiffhas no
Defendant's cross-motion for the court approve a stipulation proof of authority to foreclose, are all variations of the
of discontinuance under CPLR 3217 and dismissing the same defense, namely, that BNY lacks standing to bring the
complaint under CPLR 3211 (5) is denied. CPLR 3217 (a) foreclosure action. For the reasons stated above, these four
provides that “[a]ny party asserting a claim may discontinue affirmative defenses are without merit and are dismissed.
it without an order . . . by filing with the clerk of the
court before the case has been submitted to the court or Bak's fifth affirmative defense alleging that BNY improperly
jury a stipulation in writing signed by the attorneys of served the default notice iswithout merit. BAC, the prior
record for all parties .. ..” CPLR 3217 (b) provides that servicer of the Note and Mortgage, served Bak with a
“[e]xcept as provided in subdivision (a), an action shall not demand letter, pursuant to the terms of the Mortgage, which
be discontinued by a party asserting a claim except upon explained in detail the reasons for Bak's default and gave Bak
order of the court and upon terms and conditions, as the court an opportunity to cure the default. (Plaintiff'sAffidavit In
deems proper. After the cause has been submitted to the court Support, Exhibit 7). Therefore, defendant's firth affirmative
or jury to determine the facts the court may not order an defense is dismissed.
action discontinued except upon the stipulation of all parties
appearing in the action.” Bak's sixth affirmative defense alleging that the BNY is not
the holder in due course of the note is without merit. Under the
Bak relies on a compliance-conference order from Supreme Uniform Commercial Code, a holder in due course is one who
Court, Hon. Paul Wooten, *4 dated August 14, 2013, and takes an instrument “(a) for value; and (b) in good faith; and
an attorney affirmation from BNY's former counsel. Bak (c) without notice that it is overdue or has been dishonored
argues that BNY agreed to discontinue this foreclosure action. or of any defense against or claim to it on the part of any
(Notice of Cross-Motion, Exhibits C & D.) The attorney person.” (UCC 3-302 [1].) As stated above, BNY proved
affirmation provides the following: “attached is a copy of the that it is the holder in due course of both the Note and the
stipulation od discontinuance.” (Cite.) But neither the order Mortgage. Therefore, defendant's sixth affirmative defense is
nor the attorney affirmation demonstrate that BNY intended dismissed.
to discontinue this case. The order provides that plaintiff
did not appear for the scheduled compliance conference
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and the New York City Environmental Control Board, is
Defendant has provided insufficient evidence, beyond
granted; and it is further
conclusory statements, to support the seventh through tenth
affirmative defenses: unclean hands, estoppel, statute of
ORDERED that a referee be appointed to compute the
frauds, and failure to join a necessary party. Therefore, those
damages due from Bak and report to the court its conclusions.
defenses are dismissed.
This constitutes the court's decision and order.
ORDERED that plaintiff's motion for summary judgment and
striking Bak's affirmative defenses is granted; and it is further
Dated: June 2, 2016
ORDERED that defendant's cross-motion isdenied in its
J.S.C.
entirety; and it is further
ORDERED that plaintiff'smotion for default judgment Copr. (C) 2020, Secretary of State, State of New York
against the Board of Managers of the Atelier Condominium
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NYSCEF Deutsche
DOC. NO.Bank
68 Nat. Trust Co. v. Campbell, 26 Misc.3d 1206(A) (2009) RECEIVED NYSCEF: 11/30/2020
906 N.Y.S.2d 779, 2009 WL 5213682, 2009 N.Y. Slip Op. 52678(U)
and note by failingto make the payment due on January
1, 2008, resulting in the acceleration of the loan with an
26 Misc.3d 1206(A)
unpaid balance of $560,991.61 plus interestthereon from
Unreported Disposition
December 1, 2007. In her verified answer, Campbell sets forth
(The decision of the Court is referenced
affirmative defenses of lack of personal jurisdiction and lack
in a table in the New York Supplement.)
of standing and interposes combined affirmative defenses
Supreme Court, Kings County, New York.
and counterclaims alleging predatory lending (under Real
DEUTSCHE BANK NATIONAL TRUST Property Actions and Proceedings Law [RPAPL] § 1302[2]
COMPANY, As Trustee Under the Pooling and Banking Law § 6–l), violation of the truth in Lending Act
and Servicing Agreement Relating to Impac (TILA), fraud, and rescission.
Secured Assets Corp., Mortgage Pass–
“It issettled that in moving for summary judgment in an
Through Certificates, Series 2007–2, Plaintiffs,
action to foreclose a mortgage, a plaintiff establishes its case
v.
as a matter of law through the production of the mortgage,
Lorraine CAMPBELL, et. al., Defendants. the unpaid note, and evidence of default ... When a plaintiff
does so, itis incumbent upon the defendant to assert any
No. 17216/08.
defenses which could properly raisea viable question of
|
fact as to his [or her] default” (Village Bank v. Wild Oaks
Dec. 23, 2009.
Holding, 196 A.D.2d 812, 812 [1993] ). Plaintiff's submission
Opinion of copies of the mortgage and note, each bearing Campbell's
signature, along with the affidavit of Ms. Dawson, establishes
ROBERT J. MILLER, J. prima facie entitlement to foreclosure as a matter of law
(see Wasserman v. Harriman, 234 A.D.2d 596, 597 [1996];
*1 PlaintiffDeutsche Bank National Trust Company, as
FGH Rlty. Credit Corp. v. VRD Rlty. Corp., 231 A.D.2d 489,
Trustee under the Pooling and Servicing Agreement relating
490 [1996] ). Further, Campbell does not dispute thatshe
to Impac Secured Assets Corp., Mortgage Pass–Through
defaulted in payment. The burden now shiftsto Campbell
Certificates, Series 2007–1 moves for an order granting
to come forward with evidence to support her defenses and
summary judgment, striking the answer of defendant Lorraine
counterclaims (see Chemical Bank v. Bowers, 228 A.D.2d 407
Campbell, appointing a referee to compute the sums due
[1996] ).
under the subject mortgage and amending the caption to
delete defendants “John Doe No. 3” through “John Doe # 10.”
Personal Jurisdiction
Plaintiffcommenced this action to foreclose a mortgage *2 “It is axiomatic that the failure to serve process in an
encumbering the subject premises at 371 Elton Street in action leaves the court without personal jurisdictionover
Brooklyn. The mortgage was executed by Campbell on the defendant, and all subsequent proceedings are thereby
February 23, 2007 to secure a loan from Impac Funding rendered null and void” (Krisilas v. Mount Sinai Hosp., 63
Corporation d/b/a Impac Lending Group (Impac) in the AD3d 887, 889 [2009] quoting McMullen v. Arnone, 79
amount of $561,000.00. The mortgage was executed in favor A.D.2d 496, 499 [1981]; see Khanal v. Sheldon, 55 AD3d
of and delivered to Mortgage Electronic Registration Systems 684 [2008] ). Such a defect is not cured by the defendant's
(MERS) as nominee for Impac. By assignment dated June 12, subsequent receipt of actual notice of the action, “since notice
2008, the mortgage and note were assigned to plaintiff. received by means other than those authorized by statute
cannot serve to bring a defendant within the jurisdiction of the
Under the terms of the mortgage and adjustable rate note, court” (Feinstein v. Bergner, 48 N.Y.2d 234, 241 [1979] ).
Campbell was obligated to make monthly payments in the
amount of $3,417.77 from April 1, 2007 until the “Change According to the affidavit of service executed by plaintiff's
Date” of March 1, 2012, at which time the rate of interest process server, dated June 24, 2008, Campbell was served
may be adjusted under the London Interbank Offered Rate by delivery of the summons and complaint to a person of
(LIBOR) index. According to the complaint and the affidavit suitable age and discretion at the subject property, to wit,
of Kimberly Dawson, who avers to be plaintiff'sservicer “AKEILAH CAMPBELL, CO–RESIDENT,” at 5:55 AM on
and attorney in fact, Campbell defaulted under the mortgage
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DOC. NO.Bank
68 Nat. Trust Co. v. Campbell, 26 Misc.3d 1206(A) (2009) RECEIVED NYSCEF: 11/30/2020
906 N.Y.S.2d 779, 2009 WL 5213682, 2009 N.Y. Slip Op. 52678(U)
June 21, 2008, and by mailing copies of the summons and the assignment, plaintiffhas proper standing (see Federal
complaint to the subject address on June 24, 2008. Natl. Mtge. Assn. v. Youkelsone, 303 A.D.2d 546, 546–
547 [2003] ).Although the complaint caption incorrectly
In her affidavit in opposition, dated February 2, 2007, identified plaintiff's servicer, Countrywide Home Loans, Inc.,
Campbell averred that she only learned of the instant action as the named plaintiff, the caption on the summons is correct,
when she found the summons and complaint “stuffed between and Campbell does not allege that she was prejudiced by
the bars of the gate in front of [her] house” on the afternoon this mistake. As a result, this irregularity may be disregarded
of June 21, 2008. In a separate affidavit, Akeilah Campbell (CPLR 2001).
(Akeilah), the individual alleged by the process server to have
received process, avers that she never received the summons
and complaint as she was still asleep at 5:55 AM on June 21, RPAPL § 1302 & Banking Law § 6–l
2008. Akeilah further states that the individual described in Campbell is not entitled to the protection of RPAPL 1302(2)
the affidavit of service does not match her description. and Banking Law 6–l. RPAPL § 1302(2) provides a defense to
an action to foreclose a mortgage for a high-cost home loan or
Ordinarily, a process server's affidavit of service establishes subprime home loan where the terms of the home loan or the
a prima facie case as to the method of service and, therefore, actions of the lender violate any provision Banking Law § 6–
gives rise to a presumption of proper service (see Household l. However, in order for a mortgage to fall within the threshold
Fin. Realty Corp. of N.Y. v. Brown, 13 AD3d 340 [2004]; limits of Banking Law § 6–l, the mortgage must be considered
Bankers Trust Co. of Cal. v. Tsoukas, 303 A.D.2d 343 [2003]; a “high-cost home loan” which under the law in effect at the
Frankel v. Schilling, 149 A.D.2d 657, 659 [1989]; see also time of this transaction required that “[t]he principal amount
New Is. Invs. v. Wynne, 251 A.D.2d 560 [1998] ). Where there of the loan does not exceed the lesser of:(A) conforming
is a sworn denial that a defendant was served with process, the loan size limit for a comparable dwelling as established from
affidavit of service is rebutted, and the plaintiff must establishtime to time by the federal national mortgage association;
jurisdiction at a hearing by a preponderance of the evidence or (B) three hundred thousand dollars” (Banking Law § 6–
(see Bankers Trust Co. of Cal., 303 A.D.2d at 344; Kingsland l former [1][e] ). The principal amount of the mortgage
Group v. Pose, 296 A.D.2d 440 [2002]; Balancio v. Santorelli, being foreclosed in this matter, $561,000.00, clearly exceeds
267 A.D.2d 189 [1999]; New Is. Invs. v. Wynne, 251 A.D.2d the statutory maximum. Accordingly, Campbell's third
560 [1998] ). However, to raise an issue of fact with respect affirmative defense/first counterclaim and sixth affirmative
to service, the defendant must set forthspecific probative defense/fourth counterclaim, which rely on the provisions of
facts; unsubstantiated and conclusory denials of receipt are the aforesaid statutes, are without merit.
insufficient (see Rosario v. Beverly Rd. Realty Co., 38 AD3d
875 [2007]; American Savings & Loan Association v. Twin
TILA
Eagles Bruce, Inc., 208 A.D.2d 446 [1994] ).
Campbell alleges that plaintiff violated TILA by failing to
provide her with a copy of the mortgage application (which
The affidavit of Akelilah constitutes nothing more than a bare
she states falsely inflated her sources of income) or a copy
denial of service. Akeilah does not deny that she was present
of the Good Faith Estimate. Under the Truth in Lending Act
at the property the morning service was alleged. Moreover,
(TILA) and Regulation Z, the required “material disclosures”
while Akeilah states that the individual described i
Preview
FILED: SUFFOLK COUNTY CLERK 11/30/2020 06:14 PM INDEX NO. 604405/2019 NYSCEF DOC. NO. 68 RECEIVED NYSCEF: 11/30/2020 EXHIBIT 14 FILED: SUFFOLK COUNTY CLERK 11/30/2020 06:14 PM INDEX NO. 604405/2019 NYSCEF Bank ofNO. DOC. N.Y. 68 Mellon v Bak, 52 Misc.3d 1209(A) (2016) RECEIVED NYSCEF: 11/30/2020 41 N.Y.S.3d 718, 2016 N.Y. Slip Op. 51096(U) Mortgages Recording Unreported Disposition 52 Misc.3d 1209(A), 41 N.Y.S.3d 718 (Table), 2016 Mortgages WL 3767396 (N.Y.Sup.), 2016 N.Y. Slip Op. 51096(U) Foreclosure Standing—Proof of Either Written Assignment or Physical This opinion is uncorrected and will not be Delivery of Note published in the printed Official Reports. *1 The Bank of New York Mellon, FKA Bank of N.Y. Mellon v Bak, 2016 NY Slip Op THE BANK OF NEW YORK, AS TRUSTEE 51096(U). Mortgages—Recording. Mortgages—Foreclosure FOR THE CERTIFICATEHOLDERS OF —Standing—Proof of Either Written Assignment or Physical CWALT, INC., ALTERNATIVE LOAN TRUST Delivery of Note. (Sup Ct, NY County, June 2, 2016, 2007-OA11, MORTGAGE PASS-THROUGH Lebovits, J.) CERTIFICATES, SERIES 2007-OA11, Plaintiff, v. Mihwa Bak, BOARD OF MANAGERS OF APPEARANCES OF COUNSEL THE ATELIER CONDOMINIUM, NEW Eckert Seamans Cherin & Mellott, LLC, New York (Candace YORK CITY ENVIRONMENTAL CONTROL E. Chun of counsel), for plaintiff. BOARD, “JOHN DOE 1” to “JOHN DOE 25,” Kim, Choi & Kim, P.C.,New York (Dong Sung Kim of said names being fictitious, the persons or counsel) for defendant Bak. parties intended being the persons, parties, OPINION OF THE COURT corporation or entities, if any, having or claiming an interest in or lien upon the mortgaged Gerald Lebovits, J. premises described in the complaint, Defendants. Recitation, as required by CPLR 2219 (a), of the papers Supreme Court, New York County considered in reviewing plaintiffThe Bank of New York 810310/2011 Mellon's motion for summary judgment, for default judgment Decided on June 2, 2016 and to appoint a referee; and defendant Mihwa Bak's cross-motion for the court to approve a stipulation of discontinuance, and summary judgment and dismiss the CITE TITLE AS: Bank of N.Y. Mellon v Bak complaint. ABSTRACT Papers Numbered Plaintiff's Notice of Motion 1 Plaintiff's Memorandum of Law in Support 2 Plaintiff's Affidavit in Support 3 Defendant's Notice of Cross-motion 4 Plaintiff's Memorandum of Law in Opposition to Cross–Motion 5 Plaintiff's Affirmation in Opposition to Cross–Motion 6 DECISION/ORDER © 2020 Thomson Reuters. No claim to original U.S. Government Works. 1 FILED: SUFFOLK COUNTY CLERK 11/30/2020 06:14 PM INDEX NO. 604405/2019 NYSCEF Bank ofNO. DOC. N.Y. 68 Mellon v Bak, 52 Misc.3d 1209(A) (2016) RECEIVED NYSCEF: 11/30/2020 41 N.Y.S.3d 718, 2016 N.Y. Slip Op. 51096(U) Gerald Lebovits, J. loan from Countrywide Bank, FSB (Countrywide) to Bak. (Plaintiff'sAffidavit In Support, Exhibit 2.) Countrywide Plaintiff,Bank of New York Mellon (BNY), moves for indorsed the Note without recourse to Countrywide Home summary judgment and to strikedefendant, Mihwa Bak's Loans, Inc.,who then indorsed the Note in blank without (Bak), answer and its affirmative defenses and counterclaims, recourse. (Plaintiff'sAffidavit In Support, Exhibit 2.).At for a default judgment against the non-answering defendants, the same time that Bak executed the Note, Bak, in order to the Board of Managers of the Atelier Condominium and the secure her promise under the Note, executed and delivered a New York City Environmental Control Board, and for the mortgage (the Mortgage) to Mortgage Electronic Registration court to appoint a referee to ascertain damages and issue a Systems, Inc. (MERS), as nominee for Countrywide, which report for the court. Defendant Bak cross-moves to have the encumbered the premises located at 635 West 42nd Street, court enforce a stipulation of discontinuance, grant summary Unit No.23D, in New York County. (Plaintiff's Affidavit In judgment and dismiss the complaint. Support, Exhibit 3.) The mortgage was recorded on July 31, 2007. (Plaintiff's Affidavit In Support, Exhibit 3.) BNY argues that it is entitled to summary judgment because Bak defaulted under the terms of her note and mortgage and On or about October 1, 2007, BNY entered into a Pooling it has provided the court both documents along with evidence and Servicing Agreement (the PSA) with CWALT, Inc., as of default. Plaintiff also argues that it is entitled to default Depositor, Countrywide Home Loans, Inc., as Seller,Park judgment against the non-answering defendants and seeks a Granada LLC, as Seller, Park Monaco Inc., as Seller, Park referee to determine damages and to issue a report. Bak cross- Sienna LLC, as Seller, Countrywide Home Loans Servicing moves for summary judgment on the grounds that plaintiff LP, as Master Servicer. (Plaintiff's Affidavit In Support, lacks standing to sue. The defendant also argues that the Exhibit 4.) BNY served as Trustee under the PSA. (Plaintiff's court should discontinue the case and dismiss the complaint Affidavit In Support, Exhibit 4.) Article II, Section 2.01(c) of because the parties had agreed to discontinue the case. the PSA, “Conveyance of Mortgage Loans” provides: I. BNY's Summary-Judgment Motion and Baks' Cross- “In connection with the transfer and assignment set forth Motion in clause (b) above, the Depositor has delivered or caused to be delivered to Trustee (or, in the case of the Delay BNY's motion for summary judgment is granted and Bak's Delivery Mortgage Loans that are Initial Mortgage Loans, cross-motion for summary judgment is denied. For a court will deliver or cause to be delivered to the Trustee to grant a summary-judgment motion, the proponent must within thirty (30) days following the Closing Date and make a prima facie showing of entitlement to judgment as in the case of the Delay Delivery Mortgage Loans that a matter of law, tendering sufficient evidence to eliminate are Supplemental Mortgage Loans, will deliver or cause any material issue of fact about the claim or claims at issue. to be delivered to the Trustee within twenty (20) days (Alvarez v Prospect Hosp., 68 NY2d 320, 324 [1986].) In a following the applicable Supplemental Transfer Date) for the mortgage foreclosure action, a plaintiff moving for summary benefit of the Certificateholders the following documents or judgment must provide proof of both the unpaid note and instruments with respect to each Mortgage Loan so assigned: the underlying mortgage along with sufficient evidence to (i) (A) the original Mortgage Note endorsed by manual or establish defendant's default. (See JP Morgan Chase Bank, facsimile signature in blank in the following form: Pay to the Nat. Ass'n v Shapiro, 104 AD3d 411, 412 [1st Dept 2013]; order of _________ without recourse,' with all intervening Deutsche Bank Natl. Trust Co. v Gordon, 84 AD3d 443, 443 endorsements showing a complete chain of endorsement [1st Dept 2011]; Bank Leumi Trust Co. of NY v Lightning from the originator to the Person endorsing the Mortgage Park, 626 N.Y.S.2d 202 [1st Dept 1995].) When a plaintiff has Note . . . .” (Plaintiff's Affidavit In Support, Exhibit 4.) made this prima facie showing, the burden then shifts to the defendant to raise a triable issue of fact. (JP Morgan Chase MERS, as Countrywide's nominee, executed an assignment Bank, Nat. Ass'n, 104 AD3d at 412.) of the Mortgage on May 12, 2011 in order to memorialize the purported transfer and assignment of both the Note and The following facts are not in dispute. On or about July the Mortgage. (Plaintiff'sAffidavit In Support, Exhibit 5.) 13, 2007, Bak executed an Adjustable Rate Note (the Note) Bak defaulted on the terms of both her note and underlying in the principal amount of $900,000 as evidence of a mortgage by not tendering payment due on August 1, 2010, © 2020 Thomson Reuters. No claim to original U.S. Government Works. 2 FILED: SUFFOLK COUNTY CLERK 11/30/2020 06:14 PM INDEX NO. 604405/2019 NYSCEF Bank ofNO. DOC. N.Y. 68 Mellon v Bak, 52 Misc.3d 1209(A) (2016) RECEIVED NYSCEF: 11/30/2020 41 N.Y.S.3d 718, 2016 N.Y. Slip Op. 51096(U) and any and all payments subsequently due. Because of the [2012], lv denied 20 NY3d 858 [2013]). Michelle Simon, default, BAC Home Loans Servicing, LP (BAC) sent Bak a VP Consumer Ombudsman of Select Portfolio Servicing Inc. demand letter on or around September 16, 2010 on BNY's (SPS), the servicing agent and attorney-in-fact for BNY, behalf. (Plaintiff's Affidavit In Support, Exhibit 6.) On or reviewed the “records that SPS maintains for [p]laintiff with about January 5, 2011, BAC sent Bak a 90-day notice under respect to the mortgaged property.” (Plaintiff's Affidavit In RPAPL § 1304. (Plaintiff's Affidavit In Support, Exhibit 7.) Support, ¶ 2.) Those records showed that the Note was transferred to the plaintiffon or about October 30, 2007, BNY has proven its prima facie case to entitle it to pursuant to the PSA dated October 1, 2007, and that the summary judgment, but because Bak has raised standing as Note is currently in the possession of the plaintiff's counsel an affirmative defense, BNY has the burden to prove standing in their offices based in Pittsburg, Pennsylvania. (Plaintiff's to entitle it to summary judgment relief. (JP Morgan Chase Affidavit In Support, ¶¶ 11-13.) As the servicer of both the Bank, Nat. Ass'n v. Hill, 133 AD3d 1057, 1057 [3d Dept Note and Mortgage for plaintiff, the records maintained by 2015] [internal citations and quotations omitted].) A plaintiff SPS qualify as business records and are therefore admissible in a mortgage foreclosure action “has standing where it is to show delivery of the Note. (Deutsche Bank Nat. Trust Co., both the holder or assignee of the subject mortgage and the 131 AD3d at 739; see also CPLR 4518 [a]; Cratsley, 86 NY2d holder or assignee of the underlying note at the time the at 90.) action is commenced.” (Bank of New York v Silverberg, 86 AD3d 274, 279 [2d Dept 2011].) In New York, it is the note Bak relieson Bank of New York Mellon v Deane, 41 and not the mortgage thatis the “dispositive instrument,” Misc 3d 494 (2013) for the proposition that a plaintiffin which confers standing in a foreclosure action. (Aurora Loan a mortgage foreclosure action must provide factual details Servs., LLC v Taylor, 25 NY3d 355, 361 [2d Dept 2015].) relating to the physical delivery of the note in order to In order to demonstrate that it is the holder or assignee of prove standing. Therefore, Bak argues that neither Michelle a note, a plaintiffmust provide proof of eithera written Simon's affidavitnor any supporting documents are proof assignment or physical delivery of the note. (U.S. Bank, N.A. that the Note was physically delivered to the plaintiff prior v Adrian Collymore, 68 AD3d 752, 754 [2d Dept 2009].) to the commencement of the foreclosure action. (Defendant's Where plaintiff is someone “other than the original mortgage Notice of Cross-Motion.) Defendant also argues that the lender, a valid transfer of the note to the plaintiff prior to thePSA is not evidence of the delivery of the Note, but shows commencement of the action . . . will resolve the standing only the “intent to indorse and physically deliver the notes issue in favor of the plaintiff.” (Deutsche Bank Nat. Trust Co. and mortgages referred to.” (Defendant's Notice of Cross- v Torres, 2014 NY Slip Op 51544[U], *2 [Sup Ct 2014].) Motion.) a. Physical Delivery of Note But Bank of New York Mellon v Deane is distinguishable from this case. In Bank of New York Mellon, as proof of assignment Plaintiff provides sufficient evidence to show physical of the note, plaintiff offered into evidence only excerpts from delivery of the Note before commencing this foreclosure the pooling and servicing agreement and did not include the action against defendant. Where, in the regular course of signature pages. (41 Misc 3d at 498.) Also, the note was made business, an entity merely files and maintains papers that it payable to the original lender and indorsed to a trustee other has received on behalf of another entity, those documents than the plaintiff. (41 Misc 3d at 497.) No evidence existed do not qualify as business records and are therefore not that the trustee indorsed the note “either to the order of another admissible as evidence. (Deutsche Bank Nat. Trust Co. v special indorsee, or in blank, with no particular indorsee, Monica, 131 AD3d 737, 739 [3d Dept 2015] quoting People in the lattercase transforming the [n]ote to an instrument v Cratsley, 86 NY2d 81, 90 [1995] [internal quotation payable to bearer that could be further negotiated by delivery marks and citation omitted].) The documents, however, alone.”' (Id. at 500, quoting UCC 3-204 [2].) Here, plaintiff are admissible where “the recipient can establish personal attached the PSA in its entiretyas an exhibit to Michelle knowledge of the maker's business practices and procedures, Simon's affidavit, and to authenticate the document, included or that the records provided by the maker were incorporated the signature pages. (Plaintiff's Affidavit In Support, Exhibit into the recipient's own records or routinely relied upon by 4.) The PSA specifically acknowledges that the notes have to the recipient in itsbusiness.” (State of New York v 158th be delivered along with the underlying mortgages under the St. & Riverside Dr. Hous. Co., Inc., 100 AD3d 1293, 1296 agreement. (Plaintiff's Affidavit In Support, Exhibit 4, Article © 2020 Thomson Reuters. No claim to original U.S. Government Works. 3 FILED: SUFFOLK COUNTY CLERK 11/30/2020 06:14 PM INDEX NO. 604405/2019 NYSCEF Bank ofNO. DOC. N.Y. 68 Mellon v Bak, 52 Misc.3d 1209(A) (2016) RECEIVED NYSCEF: 11/30/2020 41 N.Y.S.3d 718, 2016 N.Y. Slip Op. 51096(U) II, Section 2.01 [c].) Furthermore, Countrywide indorsed the Covenants.) Under the PSA, in which Countrywide was Note without recourse to Countrywide Home Loans, Inc., a party, the Mortgage was assigned to the plaintiff,as who then *2 indorsed the Note in blank without recourse. the Trustee. In 2011, plaintiff memorialized the Mortgage's (Plaintiff's Affidavit In Support, Exhibit 2.)Countrywide's assignment in a separate document that was recorded with the delivery of the Note in blank to BNY without any additional State of New York. (Plaintiff's Affidavit In Support, Exhibit language on the Note was sufficient to make BNY the 5.) Note's holder. Therefore, BNY has proven that the Note was physically delivered to BNY. Citing Bank of New York v Silverberg, 86 AD3d 274 (2011) and IndyMac Fed. Bank, FSB v Meisels, 2012 NY b. Written Assignment of Mortgage Slip Op 51902(U) (2012), Bak argues that,as the lender's nominee, MERS did not have the authority to assign the The assignment of the Mortgage from Countrywide to BNY mortgage; therefore the assignment is void. Defendant's is valid. In a secured transaction, the security is incident to the reliance on these cases is misguided. In both cases, MERS debt. (Bank of New York, 86 AD3d at 282.) Once a promissory purportedly assigned both the note and the underlying note passes to and is accepted by an assignee, “the mortgage mortgage; therefore, according to the court, this was beyond passes as an incident to the note.” (Id.) Mortgage lenders and the limited scope of itsauthority as nominee. (See Bank other entities use the MERS system to track the ownership of New York, 86 AD3d at 281; IndyMac Fed. Bank, FSB, and transferof mortgages between various MERS-system 2012 NY Slip Op at *8.) Here, under the PSA, in which members. (Id.) The Court of Appeals summarized MERS's Countrywide as the original lender was a party, the Mortgage function as follows: was assigned to plaintiffas the trustee and the Note was physically delivered to the plaintiffwithin the time frame “The initial MERS mortgage is recorded in the County Clerk's specified in the PSA. (Plaintiff's *3 Affidavit In Support, office with Mortgage Electronic Registration Systems, Inc.' Exhibit 4.) Therefore, the assignment of the Mortgage was named as the lender's nominee or mortgagee of record on valid. the instrument. During the lifetime of the mortgage, the beneficial ownership interest or servicing rights may be II. BNY's Motion For Default Judgment Against Non- transferred among MERS members (MERS assignments), Answering Defendants but these assignments are not publicly recorded; instead they are tracked electronically in MERS's private system. In BNY's motion for a default judgment against the non- the MERS system, the mortgagor is notified of transfers of answering defendants is granted. A default judgment is servicing rights pursuant to the Truth in Lending Act, but not appropriate when “a defendant has failed to appear, plead necessarily of assignments of the beneficialinterest in the or proceed to trial of an action reached and called for trial, mortgage.” (Matter of MERSCORP, Inc. v Romaine, 8 NY3d or when the court orders a dismissal for any other neglect 90, 96 [2006].) to proceed.” (CPLR 3215 [a].)On a motion for default judgment, plaintiff must “file proof of service of the summons A “nominee” is one who is designated to act on an and the complaint, or a summons and notice served pursuant individual or entity'sbehalf as a representative, but with to subdivision (b) of rule 305 or subdivision (a) of rule 316 limited authority. (Black's Law Dictionary 1076 [8th Ed of this chapter, and proof of the facts constituting the claim, 2004].) Here, the initialmortgage was between Bak, as the default and the amount due by affidavit made by the borrower and Countrywide as lender. (Plaintiff'sAffidavit party . . . .” (CPLR 3215 [f].) If a corporate defendant fails In Support, Exhibit 3.) The Mortgage provides that MERS to appear and plaintiff has properly served a summons and is “a separate corporation thatis acting solely as nominee complaint on the corporate defendant, “an affidavit shall be for Lender and Lender's successors and assigns . .. FOR submitted that an additional service of the summons by first PURPOSES OF RECORDING THIS MORTGAGE, MERS class mail has been made upon the defendant corporation at IS THE MORTGAGEE OF RECORD.” (Plaintiff's Affidavit its last known address at least twenty days before the entry In Support, Exhibit 3.) Further, under the terms of the of judgment.” (CPLR 3215 [g] [4] [i].) Here, BNY submitted Mortgage, “[t]he Note, or an interest in the Note, together proof of service of the summons and complaint as well with the Security Instrument, may be sold one or more the affidavit of Michelle Simon. The evidence demonstrates times . .. .” (Plaintiff'sAffidavit In Support, Exhibit 3, the present foreclosure action as well as the defendant's © 2020 Thomson Reuters. No claim to original U.S. Government Works. 4 FILED: SUFFOLK COUNTY CLERK 11/30/2020 06:14 PM INDEX NO. 604405/2019 NYSCEF Bank ofNO. DOC. N.Y. 68 Mellon v Bak, 52 Misc.3d 1209(A) (2016) RECEIVED NYSCEF: 11/30/2020 41 N.Y.S.3d 718, 2016 N.Y. Slip Op. 51096(U) default on the terms of the Note and Mortgage and the and that the only issue remaining between the parties was outstanding amount that Bak owes. (Plaintiff's Affidavit in whether or not the case would be discontinued with or Support.) Plaintiff has also provided evidence that it served without prejudice; BNY's former counsel did not sign the the non-moving defendants, Board of Managers of the Atelier order. (Notice of Cross-Motion, Exhibits C.) BNY argues Condominium and the New York City Environmental Control that “no stipulationof discontinuance was ever signed or Board, with an additional summons at least 20 days before the filed in this case.” (Memorandum of Law in Opposition to entry of judgment. (Plaintiff's Notice of Motion, Exhibit K.) defendant Mihwa Bak's Cross-Motion.) Further, the signed Therefore, plaintiff is entitled to default judgment against the affirmation from plaintiff'sformer counsel does not attach non-answering defendants. an executed stipulation of discontinuance, even though the document makes thisreference. (Notice of Cross-Motion, III. Bak's Remaining Cross-Claims and Affirmative Defenses Exhibit D.) According to BNY's current counsel, “[i]t appears as though this affirmation was prepared during the course of a. Bak's Cross-Claims settlement negotiations between the parties in 2013, though the parties never reached an agreement.” (Memorandum of Bak's cross-motion to dismiss the complaint under CPLR Law in Opposition to defendant Mihwa Bak's Cross-Motion.) 3211 (3) is denied. CPLR 3211 (3) states that a party may have Therefore, Bak's motions under CPLR 3217 and CPLR 3211 a cause of action dismissed if “the party asserting the cause of (5) are denied. action has not legal capacity to sue.” Here, BNY has proven standing by showing that the Note was physically delivered to b. Bak's Affirmative Defenses BNY and that the assignment of the underlying mortgage was valid. Therefore Bak's cross-motion to dismiss the complaint Bak's first through fourth affirmative defenses, lack of legal under CPLR 3211 (3) is denied. capacity to sue, lack of standing, that plaintiffhas no beneficial interest in this action and that plaintiffhas no Defendant's cross-motion for the court approve a stipulation proof of authority to foreclose, are all variations of the of discontinuance under CPLR 3217 and dismissing the same defense, namely, that BNY lacks standing to bring the complaint under CPLR 3211 (5) is denied. CPLR 3217 (a) foreclosure action. For the reasons stated above, these four provides that “[a]ny party asserting a claim may discontinue affirmative defenses are without merit and are dismissed. it without an order . . . by filing with the clerk of the court before the case has been submitted to the court or Bak's fifth affirmative defense alleging that BNY improperly jury a stipulation in writing signed by the attorneys of served the default notice iswithout merit. BAC, the prior record for all parties .. ..” CPLR 3217 (b) provides that servicer of the Note and Mortgage, served Bak with a “[e]xcept as provided in subdivision (a), an action shall not demand letter, pursuant to the terms of the Mortgage, which be discontinued by a party asserting a claim except upon explained in detail the reasons for Bak's default and gave Bak order of the court and upon terms and conditions, as the court an opportunity to cure the default. (Plaintiff'sAffidavit In deems proper. After the cause has been submitted to the court Support, Exhibit 7). Therefore, defendant's firth affirmative or jury to determine the facts the court may not order an defense is dismissed. action discontinued except upon the stipulation of all parties appearing in the action.” Bak's sixth affirmative defense alleging that the BNY is not the holder in due course of the note is without merit. Under the Bak relies on a compliance-conference order from Supreme Uniform Commercial Code, a holder in due course is one who Court, Hon. Paul Wooten, *4 dated August 14, 2013, and takes an instrument “(a) for value; and (b) in good faith; and an attorney affirmation from BNY's former counsel. Bak (c) without notice that it is overdue or has been dishonored argues that BNY agreed to discontinue this foreclosure action. or of any defense against or claim to it on the part of any (Notice of Cross-Motion, Exhibits C & D.) The attorney person.” (UCC 3-302 [1].) As stated above, BNY proved affirmation provides the following: “attached is a copy of the that it is the holder in due course of both the Note and the stipulation od discontinuance.” (Cite.) But neither the order Mortgage. Therefore, defendant's sixth affirmative defense is nor the attorney affirmation demonstrate that BNY intended dismissed. to discontinue this case. The order provides that plaintiff did not appear for the scheduled compliance conference © 2020 Thomson Reuters. No claim to original U.S. Government Works. 5 FILED: SUFFOLK COUNTY CLERK 11/30/2020 06:14 PM INDEX NO. 604405/2019 NYSCEF Bank ofNO. DOC. N.Y. 68 Mellon v Bak, 52 Misc.3d 1209(A) (2016) RECEIVED NYSCEF: 11/30/2020 41 N.Y.S.3d 718, 2016 N.Y. Slip Op. 51096(U) and the New York City Environmental Control Board, is Defendant has provided insufficient evidence, beyond granted; and it is further conclusory statements, to support the seventh through tenth affirmative defenses: unclean hands, estoppel, statute of ORDERED that a referee be appointed to compute the frauds, and failure to join a necessary party. Therefore, those damages due from Bak and report to the court its conclusions. defenses are dismissed. This constitutes the court's decision and order. ORDERED that plaintiff's motion for summary judgment and striking Bak's affirmative defenses is granted; and it is further Dated: June 2, 2016 ORDERED that defendant's cross-motion isdenied in its J.S.C. entirety; and it is further ORDERED that plaintiff'smotion for default judgment Copr. (C) 2020, Secretary of State, State of New York against the Board of Managers of the Atelier Condominium End of Document © 2020 Thomson Reuters. No claim to original U.S. Government Works. © 2020 Thomson Reuters. No claim to original U.S. Government Works. 6 FILED: SUFFOLK COUNTY CLERK 11/30/2020 06:14 PM INDEX NO. 604405/2019 NYSCEF Deutsche DOC. NO.Bank 68 Nat. Trust Co. v. Campbell, 26 Misc.3d 1206(A) (2009) RECEIVED NYSCEF: 11/30/2020 906 N.Y.S.2d 779, 2009 WL 5213682, 2009 N.Y. Slip Op. 52678(U) and note by failingto make the payment due on January 1, 2008, resulting in the acceleration of the loan with an 26 Misc.3d 1206(A) unpaid balance of $560,991.61 plus interestthereon from Unreported Disposition December 1, 2007. In her verified answer, Campbell sets forth (The decision of the Court is referenced affirmative defenses of lack of personal jurisdiction and lack in a table in the New York Supplement.) of standing and interposes combined affirmative defenses Supreme Court, Kings County, New York. and counterclaims alleging predatory lending (under Real DEUTSCHE BANK NATIONAL TRUST Property Actions and Proceedings Law [RPAPL] § 1302[2] COMPANY, As Trustee Under the Pooling and Banking Law § 6–l), violation of the truth in Lending Act and Servicing Agreement Relating to Impac (TILA), fraud, and rescission. Secured Assets Corp., Mortgage Pass– “It issettled that in moving for summary judgment in an Through Certificates, Series 2007–2, Plaintiffs, action to foreclose a mortgage, a plaintiff establishes its case v. as a matter of law through the production of the mortgage, Lorraine CAMPBELL, et. al., Defendants. the unpaid note, and evidence of default ... When a plaintiff does so, itis incumbent upon the defendant to assert any No. 17216/08. defenses which could properly raisea viable question of | fact as to his [or her] default” (Village Bank v. Wild Oaks Dec. 23, 2009. Holding, 196 A.D.2d 812, 812 [1993] ). Plaintiff's submission Opinion of copies of the mortgage and note, each bearing Campbell's signature, along with the affidavit of Ms. Dawson, establishes ROBERT J. MILLER, J. prima facie entitlement to foreclosure as a matter of law (see Wasserman v. Harriman, 234 A.D.2d 596, 597 [1996]; *1 PlaintiffDeutsche Bank National Trust Company, as FGH Rlty. Credit Corp. v. VRD Rlty. Corp., 231 A.D.2d 489, Trustee under the Pooling and Servicing Agreement relating 490 [1996] ). Further, Campbell does not dispute thatshe to Impac Secured Assets Corp., Mortgage Pass–Through defaulted in payment. The burden now shiftsto Campbell Certificates, Series 2007–1 moves for an order granting to come forward with evidence to support her defenses and summary judgment, striking the answer of defendant Lorraine counterclaims (see Chemical Bank v. Bowers, 228 A.D.2d 407 Campbell, appointing a referee to compute the sums due [1996] ). under the subject mortgage and amending the caption to delete defendants “John Doe No. 3” through “John Doe # 10.” Personal Jurisdiction Plaintiffcommenced this action to foreclose a mortgage *2 “It is axiomatic that the failure to serve process in an encumbering the subject premises at 371 Elton Street in action leaves the court without personal jurisdictionover Brooklyn. The mortgage was executed by Campbell on the defendant, and all subsequent proceedings are thereby February 23, 2007 to secure a loan from Impac Funding rendered null and void” (Krisilas v. Mount Sinai Hosp., 63 Corporation d/b/a Impac Lending Group (Impac) in the AD3d 887, 889 [2009] quoting McMullen v. Arnone, 79 amount of $561,000.00. The mortgage was executed in favor A.D.2d 496, 499 [1981]; see Khanal v. Sheldon, 55 AD3d of and delivered to Mortgage Electronic Registration Systems 684 [2008] ). Such a defect is not cured by the defendant's (MERS) as nominee for Impac. By assignment dated June 12, subsequent receipt of actual notice of the action, “since notice 2008, the mortgage and note were assigned to plaintiff. received by means other than those authorized by statute cannot serve to bring a defendant within the jurisdiction of the Under the terms of the mortgage and adjustable rate note, court” (Feinstein v. Bergner, 48 N.Y.2d 234, 241 [1979] ). Campbell was obligated to make monthly payments in the amount of $3,417.77 from April 1, 2007 until the “Change According to the affidavit of service executed by plaintiff's Date” of March 1, 2012, at which time the rate of interest process server, dated June 24, 2008, Campbell was served may be adjusted under the London Interbank Offered Rate by delivery of the summons and complaint to a person of (LIBOR) index. According to the complaint and the affidavit suitable age and discretion at the subject property, to wit, of Kimberly Dawson, who avers to be plaintiff'sservicer “AKEILAH CAMPBELL, CO–RESIDENT,” at 5:55 AM on and attorney in fact, Campbell defaulted under the mortgage © 2020 Thomson Reuters. No claim to original U.S. Government Works. 1 FILED: SUFFOLK COUNTY CLERK 11/30/2020 06:14 PM INDEX NO. 604405/2019 NYSCEF Deutsche DOC. NO.Bank 68 Nat. Trust Co. v. Campbell, 26 Misc.3d 1206(A) (2009) RECEIVED NYSCEF: 11/30/2020 906 N.Y.S.2d 779, 2009 WL 5213682, 2009 N.Y. Slip Op. 52678(U) June 21, 2008, and by mailing copies of the summons and the assignment, plaintiffhas proper standing (see Federal complaint to the subject address on June 24, 2008. Natl. Mtge. Assn. v. Youkelsone, 303 A.D.2d 546, 546– 547 [2003] ).Although the complaint caption incorrectly In her affidavit in opposition, dated February 2, 2007, identified plaintiff's servicer, Countrywide Home Loans, Inc., Campbell averred that she only learned of the instant action as the named plaintiff, the caption on the summons is correct, when she found the summons and complaint “stuffed between and Campbell does not allege that she was prejudiced by the bars of the gate in front of [her] house” on the afternoon this mistake. As a result, this irregularity may be disregarded of June 21, 2008. In a separate affidavit, Akeilah Campbell (CPLR 2001). (Akeilah), the individual alleged by the process server to have received process, avers that she never received the summons and complaint as she was still asleep at 5:55 AM on June 21, RPAPL § 1302 & Banking Law § 6–l 2008. Akeilah further states that the individual described in Campbell is not entitled to the protection of RPAPL 1302(2) the affidavit of service does not match her description. and Banking Law 6–l. RPAPL § 1302(2) provides a defense to an action to foreclose a mortgage for a high-cost home loan or Ordinarily, a process server's affidavit of service establishes subprime home loan where the terms of the home loan or the a prima facie case as to the method of service and, therefore, actions of the lender violate any provision Banking Law § 6– gives rise to a presumption of proper service (see Household l. However, in order for a mortgage to fall within the threshold Fin. Realty Corp. of N.Y. v. Brown, 13 AD3d 340 [2004]; limits of Banking Law § 6–l, the mortgage must be considered Bankers Trust Co. of Cal. v. Tsoukas, 303 A.D.2d 343 [2003]; a “high-cost home loan” which under the law in effect at the Frankel v. Schilling, 149 A.D.2d 657, 659 [1989]; see also time of this transaction required that “[t]he principal amount New Is. Invs. v. Wynne, 251 A.D.2d 560 [1998] ). Where there of the loan does not exceed the lesser of:(A) conforming is a sworn denial that a defendant was served with process, the loan size limit for a comparable dwelling as established from affidavit of service is rebutted, and the plaintiff must establishtime to time by the federal national mortgage association; jurisdiction at a hearing by a preponderance of the evidence or (B) three hundred thousand dollars” (Banking Law § 6– (see Bankers Trust Co. of Cal., 303 A.D.2d at 344; Kingsland l former [1][e] ). The principal amount of the mortgage Group v. Pose, 296 A.D.2d 440 [2002]; Balancio v. Santorelli, being foreclosed in this matter, $561,000.00, clearly exceeds 267 A.D.2d 189 [1999]; New Is. Invs. v. Wynne, 251 A.D.2d the statutory maximum. Accordingly, Campbell's third 560 [1998] ). However, to raise an issue of fact with respect affirmative defense/first counterclaim and sixth affirmative to service, the defendant must set forthspecific probative defense/fourth counterclaim, which rely on the provisions of facts; unsubstantiated and conclusory denials of receipt are the aforesaid statutes, are without merit. insufficient (see Rosario v. Beverly Rd. Realty Co., 38 AD3d 875 [2007]; American Savings & Loan Association v. Twin TILA Eagles Bruce, Inc., 208 A.D.2d 446 [1994] ). Campbell alleges that plaintiff violated TILA by failing to provide her with a copy of the mortgage application (which The affidavit of Akelilah constitutes nothing more than a bare she states falsely inflated her sources of income) or a copy denial of service. Akeilah does not deny that she was present of the Good Faith Estimate. Under the Truth in Lending Act at the property the morning service was alleged. Moreover, (TILA) and Regulation Z, the required “material disclosures” while Akeilah states that the individual described i