HSBC Bank United States, Nat'l Ass'n v. Masters

176 A.D.3d 926

108 N.Y.S.3d 359 (Mem)

HSBC BANK USA, NATIONAL ASSOCIATION, etc., Respondent,

v.James MASTERS, etc., Appellant, et al., Defendants.

2016–12763

Index No. 15606/09

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

Submitted—February 26, 2019

October 16, 2019

Harvey Sorid, Uniondale, NY, for appellant.

Duane Morris LLP, New York, N.Y. (Brett L. Messinger of counsel), for respondent.

LEONARD B. AUSTIN, J.P., JEFFREY A. COHEN, VALERIE BRATHWAITE NELSON, ANGELA G. IANNACCI, JJ.

DECISION & ORDER

ORDERED that the order is affirmed insofar as appealed from, with costs.

On September 30, 2005, the defendant James Masters executed a note in the sum of $430,000 in favor of Fremont Investment & Loan. The note was secured by a mortgage on certain real property located in Seaford. The mortgage was subsequently assigned to the plaintiff. In August 2009, the plaintiff commenced this action to foreclose the mortgage. Masters defaulted in answering the complaint. On June 1, 2012, the case was marked "disposed" due to inactivity.

Thereafter, on January 12, 2016, the plaintiff moved, inter alia, to restore the action to the calendar and for an order of reference pursuant to RPAPL 1321. In support of its motion, the plaintiff submitted, among other things, the mortgage, the unpaid note, which was endorsed in blank, the assignment of the mortgage to the plaintiff, the complaint, the affidavit of a representative of its servicing agent attesting to Masters's default, and evidence that Masters failed to answer the complaint within the time allowed. Masters opposed the plaintiff's motion and cross-moved for summary judgment dismissing the complaint insofar as asserted against him. In an order entered August 30, 2016, the Supreme Court granted the plaintiff's motion and, in effect, denied Masters's cross motion. Masters appeals from so much of the order as granted that branch of the plaintiff's motion which was for an order of reference and, in effect, denied his cross motion for summary judgment dismissing the complaint insofar as asserted against him.

In opposition to the plaintiff's motion and in support of his cross motion, Masters argued that the plaintiff failed to establish standing and its compliance with RPAPL 1304 and the condition precedent contained in paragraph 22 of the mortgage, which required service of a specified notice of default. However, "[t]o successfully oppose a facially adequate motion for an order of reference based on the failure to appear or timely serve an answer, a defendant must demonstrate a reasonable excuse for the delay and a potentially meritorious defense to the action" ( US Bank N.A. v. Ashraf, 171 A.D.3d 983, 983, 97 N.Y.S.3d 706, citing Aurora Loan Servs., LLC v. Movtady, 165 A.D.3d 1025, 1026–1027, 87 N.Y.S.3d 114 ; see 21st Mtge. Corp. v. Palazzotto, 164 A.D.3d 1293, 1293, 81...