Deutsche Bank Nat'l Trust Co. v. Lamarre

211 A.D.3d 811

181 N.Y.S.3d 128

DEUTSCHE BANK NATIONAL TRUST COMPANY, etc., appellant,

v.Lucser LAMARRE, respondent, et al., defendants.

2019–04734

Index No. 926/08

Supreme Court, Appellate Division, Second Department, New York.

Argued—May 20, 2022

December 14, 2022

Robertson, Anschutz, Schneid, Crane & Partners, PLLC, Westbury, NY (Joseph F. Battista and Leah Lenz of counsel), for appellant.

Berg & David PLLC, Brooklyn, NY (Abraham David and Sholom Wohlgelernter of counsel), for respondent.

BETSY BARROS, J.P., REINALDO E. RIVERA, CHERYL E. CHAMBERS, DEBORAH A. DOWLING, JJ.

DECISION & ORDER

In an action to foreclose a mortgage, the plaintiff appeals from an order of the Supreme Court, Kings County (Lawrence Knipel, J.), dated January 16, 2019. The order denied the plaintiff's motion to vacate an order of the same court dated February 27, 2014, sua sponte, directing dismissal of the complaint, and to restore the action to the active calendar.

ORDERED that the order dated January 16, 2019, is reversed, on the law, with costs, and the plaintiff's motion to vacate the order dated February 27, 2014, and to restore the action to the active calendar is granted.

On April 15, 2005, Lucser Lamarre executed a note in the sum of $384,000 in favor of WMC Mortgage Corp. The note was secured by a mortgage on real property located in Brooklyn. In January 2008, the plaintiff commenced this action to foreclose the mortgage against, among others, Lamarre. In the complaint, the plaintiff sought a deficiency judgment against Lamarre in the event that the proceeds from a foreclosure sale were insufficient to satisfy the amount due and owing to the plaintiff. Lamarre failed to answer the complaint. In an order dated February 27, 2014 (hereinafter the dismissal order), the Supreme Court, sua sponte, directed dismissal of the complaint pursuant to CPLR 3215(c).

In 2015, Lamarre transferred his interest in the subject property to 651 Wyona, LLC. In March 2017, the plaintiff commenced an action (hereinafter the 2017 action) to foreclose the mortgage against, among others, Lamarre and 651 Wyona, LLC. In an order dated June 13, 2018, the Supreme Court, inter alia, found that the 2017 action was untimely and granted a cross motion to dismiss the complaint in that action.

In October 2018, the plaintiff moved in this action to vacate the dismissal order and to restore the action to the active calendar. In an order dated January 16, 2019, the Supreme Court denied the motion, and the plaintiff appeals.

"If the plaintiff fails to take proceedings for the entry of judgment within one year after the default, the court shall not enter judgment but shall dismiss the complaint as abandoned, without costs, upon its own initiative or on motion, unless sufficient cause is shown why the complaint should not be dismissed" ( CPLR 3215[c] ). "The term ‘take proceedings’ is unique to CPLR 3215(c), as it is not found in any other provision of the CPLR" ( Citibank, N.A. v. Kerszko, 203 A.D.3d 42, 50, 161 N.Y.S.3d 232 ). "To ‘take proceedings’ is a broader and more encompassing concept than a more tightly defined ‘filing’ or ‘service’ of a motion for leave to enter a default judgment or other type of motion" ( id. at 50, 161 N.Y.S.3d 232 ). "The relevant inquiry, therefore, is not the form that an application takes when presented to the court or its result" ( id. at 52, 161 N.Y.S.3d 232 [emphasis omitted]). "Rather, it is the intent that can be inferred from an application presented to the court seeking to have the action ‘proceed,’ inconsistent with that of an abandonment of the plaintiff's claims" ( id. [emphasis omitted]).

Here, the plaintiff correctly contends that the Supreme Court erred in, sua sponte, directing dismissal of the complaint in this action pursuant to CPLR 3215(c). The plaintiff demonstrated that it filed a motion, inter alia, for an order of reference on October 24, 2008, which was within one year of the defendants’ default in the action. Presenting this motion to the court was sufficient to demonstrate the plaintiff's intent to have the action proceed, notwithstanding that the motion papers were ultimately rejected by the court as defective (see Citibank, N.A. v. Kerszko, 203 A.D.3d at 43–44, 52, 161 N.Y.S.3d 232 ). Although our dissenting colleague notes that the plaintiff thereafter failed to explain its failure to fix the defects that resulted in the motion papers being rejected for a period of 10 years, once a plaintiff establishes "compliance with CPLR 3215(c)," it is "not required, under the plain language of that subdivision, to account for any additional periods of delay that may have occurred subsequent to the initial one-year period contemplated by CPLR 3215(c)" ( Citimortgage, Inc. v. Zaibak, 188 A.D.3d 982, 983, 132 N.Y.S.3d 678 ). Thus, because the plaintiff did not abandon the action, the court should have granted the plaintiff's motion to vacate the dismissal order and to restore the action to the active calendar (see U.S. Bank, N.A. v. Stiene, 203 A.D.3d 985, 986–987, 165 N.Y.S.3d 580 ; Bank of N.Y. Mellon v. Shterenberg, 153 A.D.3d 1310, 1311, 61 N.Y.S.3d 304 ).

Furthermore, the Supreme Court erred in denying the plaintiff's motion on the ground that the plaintiff had fully litigated the 2017 action, in which the plaintiff suffered an adverse ruling and stated that it did not intend to pursue this action. In the 2017 action, the court determined only that the 2017 action was time-barred. That determination had no bearing on this action, which predated the 2017 action and was timely when it was commenced (see Bank of Am., N.A. v. Ali, 202 A.D.3d 726, 733, 163 N.Y.S.3d 156 ). In addition, although the complaint in the 2017 action stated that if any other actions to recover the debt were "pending, a final judgment was not rendered in favor of Plaintiff and such action is intended to be discontinued," this Court determined in ( Bank of Am., N.A. v. Ali , 202 A.D.3d 726, 163 N.Y.S.3d 156 )—a case factually similar to the instant matter—that such a statement does not preclude a plaintiff from later assuming a contrary position in a previously commenced action where, as here, the plaintiff did not obtain a favorable judgment in the action that had been litigated. Thus, contrary to the conclusion of our dissenting colleague, the plaintiff's statement to this effect in the 2017 action does not preclude it from assuming a contrary position in this action. Furthermore, contrary to Lamarre's contention, the plaintiff did not abandon this action as a matter of law.

Finally, Lamarre's contention that this action is academic because he sold the subject property is without merit. Assuming, arguendo, that 651 Wyona, LLC, is a necessary party and that 651 Wyona, LLC, can no longer be joined as a defendant, any resulting judgment of foreclosure and sale would simply not affect the rights of 651 Wyona, LLC (see Liberty Dabar Assoc. v. Mohammed, 183 A.D.3d 880, 882, 124 N.Y.S.3d 708 ). As the parties did not address before the Supreme Court or on appeal whether 651 Wyona, LLC, is an indispensable party, there is no basis on the current record to dismiss the complaint in this action on the ground that 651 Wyona, LLC, has not been joined as a defendant (see Wells Fargo Bank, NA v. Barrella, 166 A.D.3d 711, 714–715, 88 N.Y.S.3d 36 ).

The parties’ remaining contentions, raised for the first time on appeal, are not properly before this Court (see U.S. Bank N.A. v. Salvodon, 189 A.D.3d 925, 926, 137 N.Y.S.3d 427 ; U.S. Bank N.A. v. Carlin, 186 A.D.3d 1563, 1565, 132 N.Y.S.3d 23 ).

RIVERA, CHAMBERS and DOWLING, JJ., concur.

BARROS, J.P., dissents, and votes to affirm the order dated January 16, 2019, with the following memorandum:

I.

The Supreme Court properly determined that the plaintiff abandoned this action by a commencing a second foreclosure action in which it alleged in the complaint that this first action was "intended to be discontinued" (see U.S. Bank N.A. v. Chait, 178 A.D.3d 448, 111 N.Y.S.3d 180 ; U.S. Bank Trust, N.A. v. Humphrey, 173 A.D.3d 811, 103 N.Y.S.3d 98 ; Old Republic Natl. Tit. Ins. Co. v. Conlin, 129 A.D.3d 804, 13 N.Y.S.3d 99 ). The second action was thereafter fully litigated and resulted in an order directing dismissal of the complaint as time-barred. Given the plaintiff's abandonment of this action, the court properly denied the plaintiff's motion to vacate the order dated February 27, 2014, sua sponte, directing dismissal of the complaint as abandoned pursuant to CPLR 3215(c), and to restore the action to the active calendar.

Assuming, arguendo, that this action was not abandoned via a de facto discontinuance, and that it remained pending while the parties were litigating the second foreclosure action, the plaintiff's exhibits submitted in support of its motion were inadequate to support a vacatur of the order dated February 27, 2014, sua sponte, directing dismissal of the complaint as abandoned under CPLR 3215(c).

II.

RPAPL 1301(3) provides, inter alia, that while an action is pending, no other action shall be commenced or maintained to recover any part of the mortgage debt without leave of court in which the former action was brought. The purpose of RPAPL 1301(3) is to protect the mortgagor defendant from having to defend against two independent actions to recover the same mortgage debt, and to "avoid inappropriate duplicative and vexatious litigation" ( Central Trust Co. v. Dann, 85 N.Y.2d 767, 772, 628 N.Y.S.2d 259, 651 N.E.2d 1278 ). Proceeding with a second foreclosure action even though this action was technically still pending (see JPMorgan Chase Bank, N.A. v. Gluck, 195 A.D.3d 904, 906, 151 N.Y.S.3d 102 ; State of New York Mtge. Agency v. Braun, 182 A.D.3d 63, 69, 119 N.Y.S.3d 522 ) constitutes a violation of RPAPL 1301(3), which would require dismissal of the second foreclosure action. In not seeking dismissal of the second foreclosure action under RPAPL 1301(3), the defendant Lucser Lamarre necessarily relied on the...