Pryce v. Nationstar Mortg. LLC

70 Misc.3d 372

131 N.Y.S.3d 832

Cassius PRYCE, Plaintiff,

v.NATIONSTAR MORTGAGE LLC et al., Defendants.

The Bank of New York Mellon f/k/a The Bank of New York as Successor in Interest to JP Morgan Chase Bank, N.A. as Trustee for Structured Adjustable Mortgage Loan Trust Mortgage Pass-Through Certificates, Series 2005-10, Plaintiff,

v.Cassius Pryce, et al., Defendant.

EF004283-2017

Supreme Court, Orange County, New York.

Decided on September 23, 2020

For Mr. Pryce: Christopher Anthony Villanti, Esq., Villanti Smith LLP, Brooklyn, NY

For Nationstar and BNY Mellon: Brian Peter Scibetta, McCalla Raymer Leibert Pierce, LLC, New York, NY

Catherine M. Bartlett, J.

I. PROCEDURAL HISTORY

Cassius Pryce v. Nationstar Mortgage LLC, Index No. EF004283-2017 is an action pursuant to Real Property Actions and Proceedings Law ("RPAPL") § 1501(4) for a judgment cancelling and discharging a mortgage (the "Mortgage"), enforcement of which he claims is barred by the Statute of Limitations. The Bank of New York Mellon v. Cassius Pryce , Index No. EF005923-2017, is an action to foreclose the same Mortgage. By prior Decision and Order dated June 5, 2018, this Court denied Mr. Pryce's motion for summary judgment on his Section 1501(4) action, and joined that action and BNY Mellon's foreclosure action for purposes of discovery and trial. By prior Decision and Order dated January 7, 2019, the Court granted Plaintiff's motion for reargument and renewal, and adhered to its original determination with a supplemental memorandum. By prior Decision dated October 9, 2019, the Court granted BNY Mellon partial summary judgment in the foreclosure action, reserving for trial the issue whether enforcement of the Mortgage is barred by the Statute of Limitations.

The matter came on for trial on March 11, 2020. Mr. Pryce appeared by his attorney, Christopher Villanti, Esq. BNY Mellon appeared by its attorney, Brian P. Scibetta, Esq.

Mr. Pryce did not testify. Plaintiff's case-in-chief consisted of eight (8) stipulated joint exhibits.

BNY Mellon proffered in addition the testimony of Nationstar Mortgage employee Kristin Trompisz, whose testimony the Court finds credible in all respects. Through Ms. Trompisz, both sides introduced a number of additional documents in evidence.

II. THE PARTIES' CONTENTIONS

Mr. Pryce contends that (1) the Mortgage debt was validly accelerated upon the commencement of a prior foreclosure action — Aurora Loan Services v. Cassius Pryce, Index No. 14451-2009 — on December 31, 2009; (2) accordingly, the six-year Statute of Limitations commenced to run on the entire Mortgage debt on December 31, 2009; (3) neither by the voluntary discontinuance of Aurora Loan Services v. Cassius Pryce on June 11, 2015 nor by any other means was a valid revocation of the election to accelerate the Mortgage debt ever effected, hence the Statute of Limitations continued to run; (4) the present foreclosure action was commenced on July 28, 2017, more than six years after acceleration of the Mortgage debt; consequently, (5) BNY Mellon's foreclosure action is barred by the Statute of Limitations, and Mr. Pryce is entitled to judgment on his RPAPL § 1501(4) quiet title action.

BNY Mellon contends that (1) the purported acceleration of the Mortgage debt was invalid because Aurora Loan Servicing lacked standing to prosecute the 2009 foreclosure action; (2) even if the Mortgage debt was validly accelerated, the evidence demonstrates that a de-acceleration was validly effected in 2015, within the six-year limitations period; consequently, (3) BNY Mellon's present foreclosure action is not barred by the Statute of Limitations, and Mr. Pryce's affirmative Statute of Limitations defense as well as his RPAPL § 1501(4) quiet title action must be dismissed.

III. THE EVIDENCE AT TRIAL

A. Joint Exhibits

Joint Exhibit 1: Summons and Complaint in Aurora Loan Services v. Cassius Pryce The prior foreclosure action was commenced on December 31, 2009 by Aurora Loan Services, LLC. The complaint alleges in pertinent part:

FIRST: Plaintiff is a limited liability company duly organized and existing under and by virtue of the laws of the State of Delaware, and the owner and holder of a note and mortgage being foreclosed .

SECOND: On or about the 18th day of January, 2005 Cassius Pryce duly executed and delivered an adjustable rate note whereby Cassius Pryce promised to pay the sum of $327,952.00 with interest on the unpaid balance of the debt.

THIRD: That as security for the payment of said note Cassius Pryce duly executed and delivered a mortgage in the amount of $327,952.00....The mortgage was subsequently assigned to Aurora Loan Services, LLC by assignment ...

FIFTH: That the Defendant Cassius Pryce so named, has/have failed to comply with the conditions of the mortgage and note by failing to pay principal and interest...and/or other charges that came due and payable on the 1st day of June, 2009 as more fully set forth below. Accordingly, Plaintiff elects to call due the entire amount secured by the loan.

No copy of the Note was annexed to the complaint.

Joint Exhibit 2: Affidavit of Merit and Amount Due

The Affidavit of Merit and Amount Due, executed in connection with Aurora Loan Services v. Cassius Pryce , was sworn to on March 12, 2010 by Cheryl Marchant, who averred:

1. That deponent is the V.P. of Aurora Loan Services, LLC.

2. Your deponent has reviewed the books and records of the Plaintiff, as well as the Complaint herein. Based upon personal knowledge, I hereby attest to and verify the truth of the matters asserted in the Complaint.

5. Deponent has reviewed the original note, mortgage, and if applicable, assignments of mortgage, kept in the regular course of business by this institution. Deponent finds the same to be in proper form, duly executed and notarized where applicable, and mortgage tax due paid thereon.

10. Deponent makes this affidavit knowing that the Referee in this matter and the Court appointing the same will rely on the truth and veracity of the statements contained herein.

Annexed to the Affidavit of Merit and Amount Due is a copy of Mr. Pryce's January 18, 2005 Adjustable Rate Note. The Lender identified in the Note is NBA Mortgage Group, A Division of National Bank of Arkansas in North Little Rock. The signature page of the Note bears one undated endorsement, as follows:

Pay to the Order of Lehman Brothers Bank, FSB Without Recourse

NBA Mortgage Group, A Division of National Bank of Arkansas in North Little Rock By: Vicki Holcomb Investment Relations Coordinator

Joint Exhibit 3: Affidavit On Motion to Discontinue

In a May 18, 2005 "Affirmation in Support of Order to Cancel Lis Pendens and to Vacate Order of Reference and Discontinue Action Without Prejudice," attorney Mehmet Basoglu, Esq. averred: "Due to an issue with the Affidavit of Merit, on 04/15/15 we were directed to discontinue the foreclosure action and cancel the Notice of Pendency. Plaintiff respectfully requests that this action be discontinued and the Notice of Pendency cancelled ."

Joint Exhibit 4: Order Discontinuing Action

By Order dated June 11, 2015, the Hon. Debra J. Kiedaisch, A.J.S.C. granted the Plaintiff's application, directed the Orange County Clerk to cancel the Notice of Pendency and Successive Notice of Pendency, and directed that the action be discontinued without costs.

Joint Exhibit 5: Adjustable Rate Note

This copy of Mr. Pryce's January 18, 2005 Adjustable Rate Note bears three undated endorsements. After the endorsement which appears on the Note annexed to Joint Exhibit 2, there are two additional endorsements, as follows:

Pay to the Order of

Lehman Brothers Holdings Inc.

Without Recourse

Lehman Brothers Bank, FSB

By: Rick W. Scogg

Vice President

Pay to the Order of

_______________

Without Recourse

Lehman Brothers Holdings Inc.

By: Denise E. Elwell

Senior Vice President

Joint Exhibit 6: Mortgage

This is the Mortgage together with the Orange County Clerk's Office Recording Page, which states "Cassius Pryce to MERS as Nominee for NBA Mortgage Group...", and reflects the recording / filing of the Mortgage on February 18, 2005.

Joint Exhibit 7: Summons and Complaint in Cassius Pryce v. Nationstar Mortgage LLC

On June 8,2017, Mr. Pryce commenced his action pursuant to RPAPL § 1501(4) to cancel and discharge the Mortgage.

Joint Exhibit 8: Summons and Complaint in The Bank of New York Mellon v. Cassius Pryce

BNY Mellon's foreclosure action was filed on July 28, 2017. Annexed to the complaint in this action is a copy of Mr. Pryce's January 18, 2005 Adjustable Rate Note bearing all three endorsements referenced above. Also annexed is a copy of the December 23, 2009 Assignment whereby MERS as Nominee for the mortgage lender, NBA Mortgage Group, purported to assign the Mortgage and the Note to Aurora Loan Services, LLC.

B. Mr. Pryce's Case

Mr. Pryce did not testify. For his case-in-chief he relied entirely on the Joint Exhibits

C. BNY Mellon's Case

In addition to the Joint Exhibits, BNY Mellon adduced evidence as follows.

1. Ownership of the Note

Defendant's Exhibit "B" is a signed "Trust Agreement" dated May 1, 2005 by and between Structured Asset Securities Corporation, as Depositor, Aurora Loan Services LLC, as Master Servicer, and JPMorgan Chase Bank, N.A., as Trustee.

The "Preliminary Statement" states in pertinent part:

The Depositor has acquired the Mortgage Loans¹ from the Seller² , and at the Closing Date³ is the owner of the Mortgage Loans and the other property being conveyed by it to the Trustee hereunder for inclusion in the Trust Fund.

Defendant's Exhibit "C" is a signed "Servicing Agreement" dated May 1, 2005 by and between Aurora Loan Services LLC, as Servicer, Lehman Brothers Holdings Inc., as Seller, and Aurora Loan Services LLC, as Master Servicer, and acknowledged by JPMorgan Chase Bank, N.A., as Trustee.

The pertinent Recitals in this Agreement state:

Whereas, the Servicer and Lehman Brothers Bank, FSB, a federal savings bank (the "Bank") are parties to a Flow Servicing Agreement, dated as of

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