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(FILED: SUFFOLK COUNTY CLERK 0270472013) INDEX NO. 001128/2013
NYSCEF DOC. NO. 14 RECEIVED NYSCEF: 02/04/2013
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF SUFFOLK
eee anne een nne en enn nnn enenen nnn nnennnnmnmnnnnn
U.S. Bank National Association, as Trustee for J.P. Index No.: 001128/2013
Morgan Acquisition Trust 2006-CW1
VERIFIED ANSWER
Plaintiff,
-against-
Charis Nicholson, Clerk of The Suffolk County District
Court, and “JOHN DOE #1” through “JOHN DOE #10”, the
last ten names being fictitious and unknown to the plaintiff,
the person or parties intended being the person or parties, if
any, having or claiming an interest in or lien upon the
mortgaged premises described in the complaint.
Defendants.
attorney, Litvin Law Firm, P.C., answer the allegations contained in plaintiff's complaint, as
follows:
1. Defendant denies knowledge and information sufficient to form a belief as to the
allegation contained in Paragraph “1” of the Complaint.
2. Defendant admits to the allegations contained in Paragraph “2” of the Complaint
3. Defendant admits that a Mortgage was delivered to America’s Wholesale Lender.
However, lacks knowledge or information sufficient to form a belicf as to the allegations
referring to MERS as nominee. Defendant demands Plaintiff prove and establish the role MERS
played in the transfer of ownership of the subject Mortgage.
4. Defendant lacks knowledge or information sufficient to form a belief as to the
validity of the allegations contained in Paragraph “4” of the Complaint. Defendant demands that
Plaintiff prove that the mortgaged referenced in this Paragraph was duly recorded,5.
response is required.
6. The al
response is required.
7 The al
response is required.
8. The all!
response is required. Defendant denies the a
9. The al
Defendant denies the
Defendant denies the
Defendant denies the al
The allegation contained in paragraph “5” is a lega
legation in paragraph *
legation contained in paragraph “6” is a legal
legation in paragrap
egation contained in paragraph “7” is a legal
legation in paragrap!
legation in paragrap
egation contained in paragraph “9” is a lega
response is required. Defendant denies the allegation in paragrap!
10. The al
response is required.
11. The all
response is required.
12. The ali
egation contained in paragraph “10” is a le
“5” of t
bh “6” of tl
“7” of t
legation contained in paragraph “8” is a legal conclusion and
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conclusion and
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therefore no
he Complaint.
therefore no
he Complaint.
therefore no
Complaint.
therefore no
e Complaint.
conclusion and therefore no
“9” of
Defendant denies the allegation in paragrap!
“10” of
he Complaint.
gal conclusion and therefore no
the Complaint.
legation contained in paragraph “11” is a legal conclusion and therefore no
Defendant denies the allegation in paragraph “11” of the Complaint.
legation contained in paragraph “12” is a legal conclusion and therefore no
response is required. Defendant denies the allegation in paragraph “12” of the Complaint.
13.
Defendant lacks knowledge or information sufficient to form a belief as to the
truth or validity to the allegation contained in Paragraph “13” of the Complaint
14,
Defendant lacks knowledge or information sufficient to form a belief as to the
truth or validity to the allegation contained in Paragraph “14” of the Complaint
15.
Defendant lacks knowledge or information sufficient to form a belief as to the
truth or validity to the allegation contained in Paragraph “15” of the Complaint16. The allegation contained in paragraph “16” is a legal conclusion and therefore no
response is required. Defendant denies the allegation in paragraph “16” of the Complaint.
17. The allegation contained in paragraph “17” is a legal conclusion and therefore no
response is required. Defendant denies the allegation in paragraph “17” of the Complaint.
18. The allegation contained in paragraph “18” is a legal conclusion and therefore no
response is required. Defendant denies the allegation in paragraph “18” of the Complaint.
19. The allegation contained in paragraph “19” is a legal conclusion and therefore no
response is required. Defendant denies the allegation in paragraph “19” of the Complaint.
20. Defendant lacks knowledge or information sufficient to form a_ belief as to the
truth or validity to the allegation contained in Paragraph “20” of the Complaint
21. Defendant lacks knowledge or information sufficient to form a belief as to the
truth or validity to the allegation contained in Paragraph “21” of the Complaint
22. Defendant lacks knowledge or information sufficient to form a belief as to the
truth or validity to the allegation contained in Paragraph “22” of the Complaint
23. Defendant lacks knowledge or information sufficient to form a belief as to the
truth or validity to the allegation contained in Paragraph “23” of the Complaint
24. Defendant lacks knowledge or information sufficient to form a belief as to the
trath or validity to the allegation contained in Paragraph “24” of the Complaint
AFFIRMATIVE DEFENSES
First Affirmative Defenses
Plaintiff Fails to State a Cause of Action
25. Upon information and belief and subject to further discovery, Defendant alleges
that Plaintiffs Complaint fails to annex an affirmation of due diligence.26. These answering defendant alleges that to the extent plaintiff seeks equitable
relief, plaintiff's inequitable conduct constitutes unclean hands and therefore bars the granting of
relief to defendants herein.
Second Affirmative Defense
Anticipatory Repudiation
27. These answering defendant is informed and believe and on such information and
belief allege that plaintiff breached its contract with defendants and that by reason of said breach
of contract, plaintiff has been excused of its duties to perform all obligations set forth in said
contract.
Third Affirmative Defense
Failure to Mitigate Damages
28. Upon information and belief, and subject to further discovery, Plaintiff has failed
to mitigate damages. Plaintiff has had ample opportunity to reduce any damages by either
modifying or refinancing its loan or to sell its collateral on the open market. However, Plaintiff
refuses to do so despite reasonable opportunities, and chooses to have the damages accumulate
and increase, and the end result will be less net return on Plaintiff's loan than what Plaintiff has
been offered since the alleged default, thereby increasing its own damages at the expense of the
Defendant.
29. It has been reported that the Plaintiff has received TARP (Troubled Asset Relief
Plan) funds under the Economic Stabilization Act of 2008 totaling over 6.5 billion dollars,
according to the United States Department of the Treasury §105(a) Troubled Asset Relief
Program (TARP) Report to Congress for the period April 1st, 2009 — April 30th 2009.
30. The purpose of the TARP funds as stated in Public Law 110-343 known as the
Economic Stabilization Act of 2008 is as stated below:“SEC. 2. PURPOSES.
The purposes of this Act are-—-
(1) to immediately provide authority and facilities that the
Secretary of the Treasury can use to restore liquidity and stability
to the financial system of the United States; and
(2) to ensure that such authority and such facilities are used in a
manner that—
(A) protects home values, college funds, retirement
accounts, and life savings;
(B) preserves homeownership and promotes jobs and
economic growth;
(C) maximizes overall returns to the taxpayers of the
United States; and
(D) provides public accountability for the exercise of such
authority.
31. In implementing the Act, the United States Treasury has instituted a number of
programs, including the ‘Making Homes Affordable’ Act, Capital Purchase Program and Capital
Assistance Program among others. See
http://www. financialstability.gov/roadtostability/programs.htm
32 Pursuant to the plans and the authority provided by H.R. 1424 Title 1 §109-110,
the United States Treasury has ordered as follows:
“Mortgage Foreclosure Mitigation: All recipients of
capital investments under the Financial Stability
Plan will be required to commit to participate
in mortgage foreclosure mitigation programs
consistent with guidelines Treasury released as part
of its Making Home Affordable Mortgage
Modification Program.
http://www.financialstability.gov/about/transparenc
yaccountability.html (April 16th, 2009)
33. Plaintiff as a recipient of TARP funds, is subject to the U.S. Treasury” loan
modification program guidelines for the Making Home Affordable Program which clearly
require “Any foreclosure action...be temporarily suspended during the trial period, or while
borrowers are considered for alternative foreclosure prevention options. In the event that theHome Affordable Modification or alternative foreclosure options fail, the foreclosure action may
be resumed.”
34. Plaintiff has already been remunerated for its troubled assets, has sought and been
given taxpayer money and agreed to undertake meaningful loan modification with their clients
who are facing foreclosure in return for billions of taxpayer dollars. Plaintiff taken the money
and now seeks to recover again from the homeowner through foreclosure even though it has not
complied with the loss mitigation requirements as required by the TARP.
Fourth Affirmative Defense
Unlawful Collection of Fees
35. Upon information and belief and subject to further discovery, the Defendant
believes the Plaintiff has charged and/or collected payments from Defendant for attomey fees,
legal fees, foreclosure costs, other fees and charges including inspection fees and late fees and
has wrongfully added and continues to unilaterally add these charges to the balance Plaintiff
claims is due and owing under the subject note and mortgage.
Fifth Affirmative Defense
Equitable Estoppel
36. Plaintiff is estopped or has waived its right to foreclose and is otherwise before
this Court with unclean hands. Plaintiff is barred by reason of acts, omissions, representations
and courses of action as to the value and affordability of the property sued upon, which
Defendants were led to rely on to their detriment, thereby barring, under the doctrine of equitable
estoppel, any causes of action asserted by the Plaintiff against the Defendant.
Sixth Affirmative Defense
Failing to File the RJI pursuant to 22 NYCRR §202.12-a)b)
37. Plaintiff failed to file with the proof of service the specialized RJI required by theUniform Rules for the New York State Trial Courts §202.12-a(b), which deprives defendant of
their right to the statutorily mandated settlement conference under CPLR §3408
38. Civil Practice Law and Rules §3408 is a case management remedy against unfair
or unconscionable debt collection practices and permits the borrower to exercise his right to
avail himself of the statutorily mandated settlement conference.
39. Plaintiff's unlawful conduct prevents borrowers from working with their lenders,
their loan servicing companies, and/or the foreclosing plaintiff directly to resolve alleged
delinquencies on their mortgage loans because lenders, loan servicing companies, and/or
foreclosing plaintiff generally will not modify mortgage loans once the homeowner is in
foreclosure unless required to do so by law.
40. Plaintiffs unlawful conduct causes borrowers to incur increased loan balances
because every day between the filing of proof of service and the filing of the specialized RJ! is
an additional day of unnecessary delinquency, causing the accrual of unnecessary fees and
expenses to accrue and be assessed against the borrowers’ loan account, which would not occur
absent plaintiff's unjustified and improper delay in filing the specialized RJI.
41. Plaintiff's violation of the Uniform Rules §202.12-a(b) is a deceptive act and/or
practice because, inter alia, it prevents homeowners from resolving the alleged delinquency on
their mortgage loans expeditiously by availing themselves of their statutory right to an in-person
settlement conference pursuant to CPLR §3408. Plaintiff's conduct delays the foreclosure action
simultaneously the homeowner’s loan balance increases because of unnecessary fees, delinquent
interest, and foreclosure-related costs and fees are assessed against homeowner’s accounts. Such
increased loan balances render it more difficult for homeowners to obtain loan workouts.Seventh Affirmative Defense
Failure to Serve Notice Pursuant to RPAPL 1308 and 1309
42. Plaintiff failed to serve Notice pursuant to RPAPL §1308 (I)allowing the
foreclosing party in a residential action relief in state court;(2) postpone a judgment of
foreclosure for 90 days under this act and allow a nine month abeyance of any foreclosure action
if the homeowner receives counseling and participates in a mandatory settlement conference
pursuant to this act. The abeyance is solely for the purpose to come to a settlement with the
foreclosing party to keep the homeowner in their home; (3) waive all fees associated with the
filing of a foreclosure action pursuant to this act; (4) establish the minimum requirements to be
met in filing a foreclosure action; (5) and (6) allow the court officer presiding over the settlement
conference to continue fo pay the mortgage actionable in the foreclosure so as to preserve the
financial interest of the homeowner in the property until a settlement can be reached. This
payment schedule shall last for no more than one year without a re-examination of the
circumstances, and failure to adhere to such a payment schedule may result in foreclosure or
termination of the abeyance; (7) allow for any party to apply to the court officer or mediator for a
revision of such payment schedule based on the fact that the terms of the payment plan are no
longer just and equitable. Plaintiff also failed to include RPAPL §1309 which states that all
actions to foreclose a mortgage contain an affirmative allegation or affidavit that the mortgage
banker or broker complied with all sections of the amended Banking Law 6-1.
Eighth Affirmative Defense
Ongoing Discovery
43. Discovery is ongoing at this time and Defendant reserves the right to add
additional affirmative defenses as they become known in discovery.Ninth Affirmative Defense
Defective Assignment
44. The purported assignment of the mortgage or deed of trust that is attached to the
complaint conflicts with the alleged copy of the mortgage or deed of trust that is attached to the
complaint filed in this case. In addition, there is no proof of a continuous chain of assignments
from the originator of the deed of trust to the current alleged beneficiary thereof, whoever that
may be.
45, The Note imposes waiver of the Defendant's right to demand presentment of the
Note from the Note Holder. This waiver insulates the Mortgagee from the requirement of
presentment. This results in the division of the Note Holder from the Mortgagee. When the Note
interest is divided and dispersed among numerous investors (thereafter Note Holders), and the
Mortgage (Security Instrument) is assigned to a separate party (thereafter the Mortgagee), the
Note and Mortgage lack mutuality of obligation and/or remedy. The Defendant is afforded no
compensating means of ascertaining, verifying or otherwise, with certainty, determining the
ownership of the Note.
COUNTERCLAIMS
First Counterclaim
Statute of Frauds
46. The Plaintiff, the trust, and/or other parties that were/are under the control of or
acting on behalf of the Plaintiff and/or the trust fabricated documents and/or made false
statements in documents for purposes of inducing the Defendants to pay money or surrender
their home to the Plaintiff, the trust, or another party under the control of or acting on behalf of
the Plaintiff.Second Counterclaim
Violation of Banking Law §6-1 Amended Part 41.3(b)
47. The Plaintiff and/or its agents, employees, brokers induced defendants to enter
into mortgage agreement and loan consolidation then executed a security instrument without
verifying defendant’s income and ability to pay the obligation set forth in the Note/Mortgage.
The statute sets forth that:
No lending without due regard to repayment
ability. A lender or mortgage broker may not make or
arrange a high-cost home loan unless the lender
reasonably believes at the time the loan is consummated
that the borrower or the borrowers (when considered
collectively in the case of multiple borrowers) will be
able to make the scheduled payments to repay the
obligation based upon a consideration of their current
and expected income, current obligations, employment
status, and other financial resources (other than the
borrower’s equity in the dwelling which secures
repayment of the loan) as verified by detailed
documentation of all sources of income and
corroborated by independent verification.
A lender shall benefit from a_ rebuttable
presumption that an borrower is able to make the
scheduled payments to repay the obligation, if, at the
time the high-cost home loan is consummated, or at the
time of the first rate adjustment in the case of a lower
introductory interest rate, the borrower’s scheduled
monthly payments do not exceed 50% of the borrower’s
monthly gross income as verified by the credit
application, the borrower's financial statement, a credit
report, financial information provided to the lender by
or on behalf of making such high cost home loan,
follows the residual income guidelines pursuant to Title
38 of the Code of Federal Regulations.
10Defendants’ employment information was not reviewed, falsified, altered, inflated, or otherwise
adjusted without knowledge or consent of defendant in order for plaintiff to execute a high-cost
loan mortgage/note with defendants.
Third Counterclaim
Violation of the Home Mortgage Disclosure Act
12 U.S.C. 29 §1003 and for Administrative Sanctions §305
48. Defendants will rely on the Home Mortgage Disclosure Act (HMDA) 12 U.S.C.
Chapter 29, Part 1003 (2801 et seg.) enacted to abrogate the Consumer Protection Act to provide
adequate home financing to qualified applicants on reasonable terms and conditions.
Fourth Counterclaim
Violation of the Fair Credit Reporting Act
49. | Upon information and belief, the Plaintiff and/or its attorneys, agents, servants
and/or employees, and/or Plaintiff's alleged predecessor(s) interest and/or their attorneys, agents,
servants and/or employees, repeatedly reported false, negative information on Defendants’ credit
report in violation of the federal Fair Credit Reporting Act causing the Defendants to suffer
damages. As a result of the foregoing, Defendants respectfully request that this Court award the
greater of one hundred thousand dollars ($100,000.00) or $1,000 for each violation of the Fair
Credit Reporting Act, and/or Defendants’ actual damages including damages related to
emotional distress and monetary losses, together with punitive damages, attorneys’ fees and
costs.
Fifth Counterclaim
Failing to Attach Mortgage and Note to Complaint
Or to Submit due Diligence Affirmation
Pursuant to OCA Order No. 431/11
1150. Plaintiff failed to attach the “Due Diligence Affirmation” to the Mortgage/Note as
is required under Administrative Order #431/11 of the NYS Unified Court System Office of
Court Administration.
51. The Defendants specifically reserves the right to assert additional counterclaims,
mandatory and non mandatory, upon completion of ongoing discovery.
Sixth Counterclaim
52. The Plaintiff misrepresented the facts of the loan to the Defendant and the general
public that it was in the business of issuing mortgage loans based upon the potential borrower's
ability to pay the loan, which induced the Defendant to enter into the subject mortgage to the
Defendant's detriment. See Popular Financial Svs. LLC vs. Williams, 50 AD 3d 660, 661,
855 N.Y.S. 2d $81 (2™ Dept 2008). The Defendant values the counterclaim on this matter at
One-Hundred Thousand Dollars ($100,000.00) and a prohibition against foreclosure.
Seventh Counterclaim
53. The Plaintiff failed to investigate and ascertain the economic status of the
Defendant. Plaintiff had an absolute duty to investigate the economic status of Defendants
before issuing its loan, which it failed to do so, Plaintiff seduced Defendant to obligate herself on
a loan that required monthly payments that exceeded her gross monthly income. See Mathurin
y. Lost & Found Recovery, LLC, 19 Mise 3d 756, 758-759, 854 N.Y.S.2d (Sup Ct Kings Co
2008). The Defendant values the counterclaim on this matter at One-Hundred Thousand Dollars
($100,000.00) and a prohibition against foreclosure.
WHEREFORE, Defendant requests the Court dismiss the Plaintiffs Complaint without
prejudice, and for all other relief to which these Defendants prove themselves entitled including
2an award of reasonable attorney's fees and costs, and for such other and further relief as the court
ee IRM! P.C.
2 Mole
sq.
Yuriy Mosh¢s}
Attogheys for Defendant
176 Cottey Island Avenue, Ste. 5R
Brooklyn, New York 11230
deems just and proper.
Dated: Brooklyn, New York
February 04, 2013
To: Frankel. Lambert, Weiss. Weisman & Gordon LLP
Todd Falasco, Esq.
Attorneys for Plaintiff
20 West Main Street
Bay Shore, New York 11706
13ATTORNEY VERIFICATION
I, Yuriy Moshes, Esq., an attorney at Litvin Law Firm, P.C. representing defendants in
the instant action have read the foregoing Answer to the complaint. The matters stated in the
answer are true of my own knowledge except those matters stated on information and belief, and
as to those matters, I believe them to be true.
The reason this verification is made by deponent is because the defendant does not reside
or have a place of business within the County of Kings where the attorneys Litvin Law Firm,
P.C. office is located.
Dated: Brooklyn, New York
February 04, 2013
14File No.: 001128/2013
AFFIDAVIT OF SERVICE
State of New York }
ss.
County of Kings }
YURIY MOSHES, being duly sworn, deposes and says: I am over the age of 18 and I am not a
party to this action, I am an Attorney in the office of Litvin Law Finn, P.C. representing
Defendant.
That on Feb. 4, 13 I served a true copy of the ANSWER, AFFIRMATIVE
DEFENSES AND COUNTERCLAIM via U.S. mail and by mailing the same in a first class
post paid wrapper in an official depository under the exclusive care and custody of the United
States Postal Service within the State of New York, addressed to the last known address of the
addressee(s) as listed below:
To: Christina A. Incorvaia, Esq.
FEIN, SUCH & CRANE, LLP
Attorney for Plaintiff
747 Chestnut Ridge Road, Ste. 200
Chestnut Ridge, NY 10977-6216
ube
p) MOSHES
15SUPREME COURT OF THE STATE OF NEW. YORK =»
COUNTY. OF SUFFOLK
“U.S. Bank National Associ as Trustee for J.P.
Morgan Acquisition Trust 2006» CW Eee
Charis ‘Nicholson ‘Clerk of The Su ‘olk County Dist -
a and sas bang DOE #1” through: “JOHN DOE AAC
Dated: 2: Brooklyn, New York
February 2013
To: Christina A. Incorvaia, Esq.
FEIN; SUCH & CRANE, LLP.
Attorney for Plaintiff Be
747 Chestnut Ridge Road, Ste..200
Chestnut Ridge, NY: 10977-6216
16
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(FILED: SUFFOLK COUNTY CLERK 0270472013) INDEX NO. 001128/2013 NYSCEF DOC. NO. 14 RECEIVED NYSCEF: 02/04/2013 SUPREME COURT OF THE STATE OF NEW YORK COUNTY OF SUFFOLK eee anne een nne en enn nnn enenen nnn nnennnnmnmnnnnn U.S. Bank National Association, as Trustee for J.P. Index No.: 001128/2013 Morgan Acquisition Trust 2006-CW1 VERIFIED ANSWER Plaintiff, -against- Charis Nicholson, Clerk of The Suffolk County District Court, and “JOHN DOE #1” through “JOHN DOE #10”, the last ten names being fictitious and unknown to the plaintiff, the person or parties intended being the person or parties, if any, having or claiming an interest in or lien upon the mortgaged premises described in the complaint. Defendants. attorney, Litvin Law Firm, P.C., answer the allegations contained in plaintiff's complaint, as follows: 1. Defendant denies knowledge and information sufficient to form a belief as to the allegation contained in Paragraph “1” of the Complaint. 2. Defendant admits to the allegations contained in Paragraph “2” of the Complaint 3. Defendant admits that a Mortgage was delivered to America’s Wholesale Lender. However, lacks knowledge or information sufficient to form a belicf as to the allegations referring to MERS as nominee. Defendant demands Plaintiff prove and establish the role MERS played in the transfer of ownership of the subject Mortgage. 4. Defendant lacks knowledge or information sufficient to form a belief as to the validity of the allegations contained in Paragraph “4” of the Complaint. Defendant demands that Plaintiff prove that the mortgaged referenced in this Paragraph was duly recorded,5. response is required. 6. The al response is required. 7 The al response is required. 8. The all! response is required. Defendant denies the a 9. The al Defendant denies the Defendant denies the Defendant denies the al The allegation contained in paragraph “5” is a lega legation in paragraph * legation contained in paragraph “6” is a legal legation in paragrap egation contained in paragraph “7” is a legal legation in paragrap! legation in paragrap egation contained in paragraph “9” is a lega response is required. Defendant denies the allegation in paragrap! 10. The al response is required. 11. The all response is required. 12. The ali egation contained in paragraph “10” is a le “5” of t bh “6” of tl “7” of t legation contained in paragraph “8” is a legal conclusion and h “8” of tl conclusion and conclusion and conclusion and therefore no he Complaint. therefore no he Complaint. therefore no Complaint. therefore no e Complaint. conclusion and therefore no “9” of Defendant denies the allegation in paragrap! “10” of he Complaint. gal conclusion and therefore no the Complaint. legation contained in paragraph “11” is a legal conclusion and therefore no Defendant denies the allegation in paragraph “11” of the Complaint. legation contained in paragraph “12” is a legal conclusion and therefore no response is required. Defendant denies the allegation in paragraph “12” of the Complaint. 13. Defendant lacks knowledge or information sufficient to form a belief as to the truth or validity to the allegation contained in Paragraph “13” of the Complaint 14, Defendant lacks knowledge or information sufficient to form a belief as to the truth or validity to the allegation contained in Paragraph “14” of the Complaint 15. Defendant lacks knowledge or information sufficient to form a belief as to the truth or validity to the allegation contained in Paragraph “15” of the Complaint16. The allegation contained in paragraph “16” is a legal conclusion and therefore no response is required. Defendant denies the allegation in paragraph “16” of the Complaint. 17. The allegation contained in paragraph “17” is a legal conclusion and therefore no response is required. Defendant denies the allegation in paragraph “17” of the Complaint. 18. The allegation contained in paragraph “18” is a legal conclusion and therefore no response is required. Defendant denies the allegation in paragraph “18” of the Complaint. 19. The allegation contained in paragraph “19” is a legal conclusion and therefore no response is required. Defendant denies the allegation in paragraph “19” of the Complaint. 20. Defendant lacks knowledge or information sufficient to form a_ belief as to the truth or validity to the allegation contained in Paragraph “20” of the Complaint 21. Defendant lacks knowledge or information sufficient to form a belief as to the truth or validity to the allegation contained in Paragraph “21” of the Complaint 22. Defendant lacks knowledge or information sufficient to form a belief as to the truth or validity to the allegation contained in Paragraph “22” of the Complaint 23. Defendant lacks knowledge or information sufficient to form a belief as to the truth or validity to the allegation contained in Paragraph “23” of the Complaint 24. Defendant lacks knowledge or information sufficient to form a belief as to the trath or validity to the allegation contained in Paragraph “24” of the Complaint AFFIRMATIVE DEFENSES First Affirmative Defenses Plaintiff Fails to State a Cause of Action 25. Upon information and belief and subject to further discovery, Defendant alleges that Plaintiffs Complaint fails to annex an affirmation of due diligence.26. These answering defendant alleges that to the extent plaintiff seeks equitable relief, plaintiff's inequitable conduct constitutes unclean hands and therefore bars the granting of relief to defendants herein. Second Affirmative Defense Anticipatory Repudiation 27. These answering defendant is informed and believe and on such information and belief allege that plaintiff breached its contract with defendants and that by reason of said breach of contract, plaintiff has been excused of its duties to perform all obligations set forth in said contract. Third Affirmative Defense Failure to Mitigate Damages 28. Upon information and belief, and subject to further discovery, Plaintiff has failed to mitigate damages. Plaintiff has had ample opportunity to reduce any damages by either modifying or refinancing its loan or to sell its collateral on the open market. However, Plaintiff refuses to do so despite reasonable opportunities, and chooses to have the damages accumulate and increase, and the end result will be less net return on Plaintiff's loan than what Plaintiff has been offered since the alleged default, thereby increasing its own damages at the expense of the Defendant. 29. It has been reported that the Plaintiff has received TARP (Troubled Asset Relief Plan) funds under the Economic Stabilization Act of 2008 totaling over 6.5 billion dollars, according to the United States Department of the Treasury §105(a) Troubled Asset Relief Program (TARP) Report to Congress for the period April 1st, 2009 — April 30th 2009. 30. The purpose of the TARP funds as stated in Public Law 110-343 known as the Economic Stabilization Act of 2008 is as stated below:“SEC. 2. PURPOSES. The purposes of this Act are-—- (1) to immediately provide authority and facilities that the Secretary of the Treasury can use to restore liquidity and stability to the financial system of the United States; and (2) to ensure that such authority and such facilities are used in a manner that— (A) protects home values, college funds, retirement accounts, and life savings; (B) preserves homeownership and promotes jobs and economic growth; (C) maximizes overall returns to the taxpayers of the United States; and (D) provides public accountability for the exercise of such authority. 31. In implementing the Act, the United States Treasury has instituted a number of programs, including the ‘Making Homes Affordable’ Act, Capital Purchase Program and Capital Assistance Program among others. See http://www. financialstability.gov/roadtostability/programs.htm 32 Pursuant to the plans and the authority provided by H.R. 1424 Title 1 §109-110, the United States Treasury has ordered as follows: “Mortgage Foreclosure Mitigation: All recipients of capital investments under the Financial Stability Plan will be required to commit to participate in mortgage foreclosure mitigation programs consistent with guidelines Treasury released as part of its Making Home Affordable Mortgage Modification Program. http://www.financialstability.gov/about/transparenc yaccountability.html (April 16th, 2009) 33. Plaintiff as a recipient of TARP funds, is subject to the U.S. Treasury” loan modification program guidelines for the Making Home Affordable Program which clearly require “Any foreclosure action...be temporarily suspended during the trial period, or while borrowers are considered for alternative foreclosure prevention options. In the event that theHome Affordable Modification or alternative foreclosure options fail, the foreclosure action may be resumed.” 34. Plaintiff has already been remunerated for its troubled assets, has sought and been given taxpayer money and agreed to undertake meaningful loan modification with their clients who are facing foreclosure in return for billions of taxpayer dollars. Plaintiff taken the money and now seeks to recover again from the homeowner through foreclosure even though it has not complied with the loss mitigation requirements as required by the TARP. Fourth Affirmative Defense Unlawful Collection of Fees 35. Upon information and belief and subject to further discovery, the Defendant believes the Plaintiff has charged and/or collected payments from Defendant for attomey fees, legal fees, foreclosure costs, other fees and charges including inspection fees and late fees and has wrongfully added and continues to unilaterally add these charges to the balance Plaintiff claims is due and owing under the subject note and mortgage. Fifth Affirmative Defense Equitable Estoppel 36. Plaintiff is estopped or has waived its right to foreclose and is otherwise before this Court with unclean hands. Plaintiff is barred by reason of acts, omissions, representations and courses of action as to the value and affordability of the property sued upon, which Defendants were led to rely on to their detriment, thereby barring, under the doctrine of equitable estoppel, any causes of action asserted by the Plaintiff against the Defendant. Sixth Affirmative Defense Failing to File the RJI pursuant to 22 NYCRR §202.12-a)b) 37. Plaintiff failed to file with the proof of service the specialized RJI required by theUniform Rules for the New York State Trial Courts §202.12-a(b), which deprives defendant of their right to the statutorily mandated settlement conference under CPLR §3408 38. Civil Practice Law and Rules §3408 is a case management remedy against unfair or unconscionable debt collection practices and permits the borrower to exercise his right to avail himself of the statutorily mandated settlement conference. 39. Plaintiff's unlawful conduct prevents borrowers from working with their lenders, their loan servicing companies, and/or the foreclosing plaintiff directly to resolve alleged delinquencies on their mortgage loans because lenders, loan servicing companies, and/or foreclosing plaintiff generally will not modify mortgage loans once the homeowner is in foreclosure unless required to do so by law. 40. Plaintiffs unlawful conduct causes borrowers to incur increased loan balances because every day between the filing of proof of service and the filing of the specialized RJ! is an additional day of unnecessary delinquency, causing the accrual of unnecessary fees and expenses to accrue and be assessed against the borrowers’ loan account, which would not occur absent plaintiff's unjustified and improper delay in filing the specialized RJI. 41. Plaintiff's violation of the Uniform Rules §202.12-a(b) is a deceptive act and/or practice because, inter alia, it prevents homeowners from resolving the alleged delinquency on their mortgage loans expeditiously by availing themselves of their statutory right to an in-person settlement conference pursuant to CPLR §3408. Plaintiff's conduct delays the foreclosure action simultaneously the homeowner’s loan balance increases because of unnecessary fees, delinquent interest, and foreclosure-related costs and fees are assessed against homeowner’s accounts. Such increased loan balances render it more difficult for homeowners to obtain loan workouts.Seventh Affirmative Defense Failure to Serve Notice Pursuant to RPAPL 1308 and 1309 42. Plaintiff failed to serve Notice pursuant to RPAPL §1308 (I)allowing the foreclosing party in a residential action relief in state court;(2) postpone a judgment of foreclosure for 90 days under this act and allow a nine month abeyance of any foreclosure action if the homeowner receives counseling and participates in a mandatory settlement conference pursuant to this act. The abeyance is solely for the purpose to come to a settlement with the foreclosing party to keep the homeowner in their home; (3) waive all fees associated with the filing of a foreclosure action pursuant to this act; (4) establish the minimum requirements to be met in filing a foreclosure action; (5) and (6) allow the court officer presiding over the settlement conference to continue fo pay the mortgage actionable in the foreclosure so as to preserve the financial interest of the homeowner in the property until a settlement can be reached. This payment schedule shall last for no more than one year without a re-examination of the circumstances, and failure to adhere to such a payment schedule may result in foreclosure or termination of the abeyance; (7) allow for any party to apply to the court officer or mediator for a revision of such payment schedule based on the fact that the terms of the payment plan are no longer just and equitable. Plaintiff also failed to include RPAPL §1309 which states that all actions to foreclose a mortgage contain an affirmative allegation or affidavit that the mortgage banker or broker complied with all sections of the amended Banking Law 6-1. Eighth Affirmative Defense Ongoing Discovery 43. Discovery is ongoing at this time and Defendant reserves the right to add additional affirmative defenses as they become known in discovery.Ninth Affirmative Defense Defective Assignment 44. The purported assignment of the mortgage or deed of trust that is attached to the complaint conflicts with the alleged copy of the mortgage or deed of trust that is attached to the complaint filed in this case. In addition, there is no proof of a continuous chain of assignments from the originator of the deed of trust to the current alleged beneficiary thereof, whoever that may be. 45, The Note imposes waiver of the Defendant's right to demand presentment of the Note from the Note Holder. This waiver insulates the Mortgagee from the requirement of presentment. This results in the division of the Note Holder from the Mortgagee. When the Note interest is divided and dispersed among numerous investors (thereafter Note Holders), and the Mortgage (Security Instrument) is assigned to a separate party (thereafter the Mortgagee), the Note and Mortgage lack mutuality of obligation and/or remedy. The Defendant is afforded no compensating means of ascertaining, verifying or otherwise, with certainty, determining the ownership of the Note. COUNTERCLAIMS First Counterclaim Statute of Frauds 46. The Plaintiff, the trust, and/or other parties that were/are under the control of or acting on behalf of the Plaintiff and/or the trust fabricated documents and/or made false statements in documents for purposes of inducing the Defendants to pay money or surrender their home to the Plaintiff, the trust, or another party under the control of or acting on behalf of the Plaintiff.Second Counterclaim Violation of Banking Law §6-1 Amended Part 41.3(b) 47. The Plaintiff and/or its agents, employees, brokers induced defendants to enter into mortgage agreement and loan consolidation then executed a security instrument without verifying defendant’s income and ability to pay the obligation set forth in the Note/Mortgage. The statute sets forth that: No lending without due regard to repayment ability. A lender or mortgage broker may not make or arrange a high-cost home loan unless the lender reasonably believes at the time the loan is consummated that the borrower or the borrowers (when considered collectively in the case of multiple borrowers) will be able to make the scheduled payments to repay the obligation based upon a consideration of their current and expected income, current obligations, employment status, and other financial resources (other than the borrower’s equity in the dwelling which secures repayment of the loan) as verified by detailed documentation of all sources of income and corroborated by independent verification. A lender shall benefit from a_ rebuttable presumption that an borrower is able to make the scheduled payments to repay the obligation, if, at the time the high-cost home loan is consummated, or at the time of the first rate adjustment in the case of a lower introductory interest rate, the borrower’s scheduled monthly payments do not exceed 50% of the borrower’s monthly gross income as verified by the credit application, the borrower's financial statement, a credit report, financial information provided to the lender by or on behalf of making such high cost home loan, follows the residual income guidelines pursuant to Title 38 of the Code of Federal Regulations. 10Defendants’ employment information was not reviewed, falsified, altered, inflated, or otherwise adjusted without knowledge or consent of defendant in order for plaintiff to execute a high-cost loan mortgage/note with defendants. Third Counterclaim Violation of the Home Mortgage Disclosure Act 12 U.S.C. 29 §1003 and for Administrative Sanctions §305 48. Defendants will rely on the Home Mortgage Disclosure Act (HMDA) 12 U.S.C. Chapter 29, Part 1003 (2801 et seg.) enacted to abrogate the Consumer Protection Act to provide adequate home financing to qualified applicants on reasonable terms and conditions. Fourth Counterclaim Violation of the Fair Credit Reporting Act 49. | Upon information and belief, the Plaintiff and/or its attorneys, agents, servants and/or employees, and/or Plaintiff's alleged predecessor(s) interest and/or their attorneys, agents, servants and/or employees, repeatedly reported false, negative information on Defendants’ credit report in violation of the federal Fair Credit Reporting Act causing the Defendants to suffer damages. As a result of the foregoing, Defendants respectfully request that this Court award the greater of one hundred thousand dollars ($100,000.00) or $1,000 for each violation of the Fair Credit Reporting Act, and/or Defendants’ actual damages including damages related to emotional distress and monetary losses, together with punitive damages, attorneys’ fees and costs. Fifth Counterclaim Failing to Attach Mortgage and Note to Complaint Or to Submit due Diligence Affirmation Pursuant to OCA Order No. 431/11 1150. Plaintiff failed to attach the “Due Diligence Affirmation” to the Mortgage/Note as is required under Administrative Order #431/11 of the NYS Unified Court System Office of Court Administration. 51. The Defendants specifically reserves the right to assert additional counterclaims, mandatory and non mandatory, upon completion of ongoing discovery. Sixth Counterclaim 52. The Plaintiff misrepresented the facts of the loan to the Defendant and the general public that it was in the business of issuing mortgage loans based upon the potential borrower's ability to pay the loan, which induced the Defendant to enter into the subject mortgage to the Defendant's detriment. See Popular Financial Svs. LLC vs. Williams, 50 AD 3d 660, 661, 855 N.Y.S. 2d $81 (2™ Dept 2008). The Defendant values the counterclaim on this matter at One-Hundred Thousand Dollars ($100,000.00) and a prohibition against foreclosure. Seventh Counterclaim 53. The Plaintiff failed to investigate and ascertain the economic status of the Defendant. Plaintiff had an absolute duty to investigate the economic status of Defendants before issuing its loan, which it failed to do so, Plaintiff seduced Defendant to obligate herself on a loan that required monthly payments that exceeded her gross monthly income. See Mathurin y. Lost & Found Recovery, LLC, 19 Mise 3d 756, 758-759, 854 N.Y.S.2d (Sup Ct Kings Co 2008). The Defendant values the counterclaim on this matter at One-Hundred Thousand Dollars ($100,000.00) and a prohibition against foreclosure. WHEREFORE, Defendant requests the Court dismiss the Plaintiffs Complaint without prejudice, and for all other relief to which these Defendants prove themselves entitled including 2an award of reasonable attorney's fees and costs, and for such other and further relief as the court ee IRM! P.C. 2 Mole sq. Yuriy Mosh¢s} Attogheys for Defendant 176 Cottey Island Avenue, Ste. 5R Brooklyn, New York 11230 deems just and proper. Dated: Brooklyn, New York February 04, 2013 To: Frankel. Lambert, Weiss. Weisman & Gordon LLP Todd Falasco, Esq. Attorneys for Plaintiff 20 West Main Street Bay Shore, New York 11706 13ATTORNEY VERIFICATION I, Yuriy Moshes, Esq., an attorney at Litvin Law Firm, P.C. representing defendants in the instant action have read the foregoing Answer to the complaint. The matters stated in the answer are true of my own knowledge except those matters stated on information and belief, and as to those matters, I believe them to be true. The reason this verification is made by deponent is because the defendant does not reside or have a place of business within the County of Kings where the attorneys Litvin Law Firm, P.C. office is located. Dated: Brooklyn, New York February 04, 2013 14File No.: 001128/2013 AFFIDAVIT OF SERVICE State of New York } ss. County of Kings } YURIY MOSHES, being duly sworn, deposes and says: I am over the age of 18 and I am not a party to this action, I am an Attorney in the office of Litvin Law Finn, P.C. representing Defendant. That on Feb. 4, 13 I served a true copy of the ANSWER, AFFIRMATIVE DEFENSES AND COUNTERCLAIM via U.S. mail and by mailing the same in a first class post paid wrapper in an official depository under the exclusive care and custody of the United States Postal Service within the State of New York, addressed to the last known address of the addressee(s) as listed below: To: Christina A. Incorvaia, Esq. FEIN, SUCH & CRANE, LLP Attorney for Plaintiff 747 Chestnut Ridge Road, Ste. 200 Chestnut Ridge, NY 10977-6216 ube p) MOSHES 15SUPREME COURT OF THE STATE OF NEW. YORK =» COUNTY. OF SUFFOLK “U.S. Bank National Associ as Trustee for J.P. Morgan Acquisition Trust 2006» CW Eee Charis ‘Nicholson ‘Clerk of The Su ‘olk County Dist - a and sas bang DOE #1” through: “JOHN DOE AAC Dated: 2: Brooklyn, New York February 2013 To: Christina A. Incorvaia, Esq. FEIN; SUCH & CRANE, LLP. Attorney for Plaintiff Be 747 Chestnut Ridge Road, Ste..200 Chestnut Ridge, NY: 10977-6216 16