U.S. Bank Nat'l Ass'n v. Bhimsen

206 A.D.3d 846

171 N.Y.S.3d 110

U.S. BANK NATIONAL ASSOCIATION, etc., appellant,

v.Lilowtie BHIMSEN, respondent, et al., defendants.

2019–08093

Index No. 505163/17

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

Argued—February 28, 2022

June 15, 2022

McCalla Raymer Leibert Pierce, LLC, New York, NY (Charles H. Jeanfreau of counsel), for appellant.

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

FRANCESCA E. CONNOLLY, J.P., SHERI S. ROMAN, JOSEPH J. MALTESE, LINDA CHRISTOPHER, JJ.

DECISION & ORDER

In an action to foreclose a mortgage, the plaintiff appeals from an order and judgment (one paper) of the Supreme Court, Kings County (Noach Dear, J.), dated May 15, 2019. The order and judgment, upon an order of the same court dated April 2, 2019, inter alia, granting those branches of the cross motion of the defendant Lilowtie Bhimsen which were for summary judgment dismissing the complaint insofar as asserted against that defendant and for leave to enter a default judgment on that defendant's counterclaim pursuant to RPAPL 1501(4) to cancel and discharge of record the subject mortgage, granted that branch of that defendant's cross motion which was for summary judgment dismissing the complaint insofar as asserted against that defendant and canceled and discharged of record the subject mortgage.

ORDERED that the order and judgment is reversed, on the law, on the facts, and in the exercise of discretion, with costs, those branches of the cross motion of the defendant Lilowtie Bhimsen which were for summary judgment dismissing the complaint insofar as asserted against that defendant and for leave to enter a default judgment on that defendant's counterclaim pursuant to RPAPL 1501(4) to cancel and discharge of record the subject mortgage are denied, and the order dated April 2, 2019, is modified accordingly.

In January 2006, the defendant Lilowtie Bhimsen (hereinafter the defendant) borrowed the sum of $518,500 from WMC Mortgage Corp. The loan was secured by a mortgage on certain real property located in Brooklyn. On September 4, 2007, LaSalle Bank, N.A. (hereinafter LaSalle Bank), commenced an action to foreclose the mortgage (hereinafter the 2007 action), but shortly thereafter it voluntarily discontinued the 2007 action.

On January 2, 2008, LaSalle Bank commenced a second action to foreclose the mortgage (hereinafter the 2008 action). In an order dated September 17, 2013, the Supreme Court directed dismissal of the complaint in the 2008 action as abandoned. In the interim, the mortgage was assigned to the plaintiff.

On March 15, 2017, the plaintiff commenced this action to foreclose the mortgage, alleging that the defendant defaulted on the loan by failing to make the payments due on May 1, 2011, and thereafter. The defendant interposed an answer asserting various affirmative defenses and a counterclaim pursuant to RPAPL 1501(4) to cancel and discharge of record the mortgage. After the matter was released from the mandatory foreclosure settlement part, the plaintiff moved, inter alia, for summary judgment on the complaint insofar as asserted against the defendant, to strike the defendant's answer and counterclaim, and for an order of reference. The defendant opposed the motion and cross-moved, inter alia, for summary judgment dismissing the complaint insofar as asserted against the defendant and for leave to enter a default judgment on the defendant's counterclaim pursuant to RPAPL 1501(4).

In an order dated April 2, 2019, the Supreme Court, inter alia, denied the plaintiff's motion and granted those branches of the defendant's cross motion which were for summary judgment dismissing the complaint insofar as asserted against the defendant and for leave to enter a default judgment on the defendant's counterclaim. In an order and judgment dated May 15, 2019, the court, upon the order dated April 2, 2019, granted that branch of the defendant's cross motion which was for summary judgment dismissing the complaint insofar as asserted against the defendant and canceled and discharged of record the mortgage. The plaintiff appeals.

An action to foreclose a mortgage is subject to a six-year statute of limitations (see CPLR 213[4] ). In the case of an installment loan, a separate cause of action accrues as to each missed payment, but once the debt is accelerated, the limitations period begins to run on the entire debt (see Nationstar Mtge., LLC v. Weisblum, 143 A.D.3d 866, 867, 39 N.Y.S.3d 491 ). "A lender may revoke its election to accelerate the mortgage, but it must do so by an affirmative act of revocation occurring during the six-year statute of limitations period subsequent to the initiation of the prior foreclosure action" ( NMNT Realty Corp. v. Knoxville 2012 Trust, 151 A.D.3d 1068, 1069–1070, 58 N.Y.S.3d 118 ).

Pursuant to RPAPL 1501(4), a person having an estate or an interest in real property subject to a mortgage can seek to cancel and discharge of record that encumbrance where the period allowed by the applicable statute of limitations for the commencement of an action to foreclose the mortgage has expired, provided that the mortgagee or its successor was not in possession of the subject real property at...