HSBC Bank USA, N.A. v. Francis

• Docket Number: 2020–03967,Index No. 712696/17
• Decision Date: 22 February 2023
• Citation: 214 A.D.3d 58,185 N.Y.S.3d 173
• Parties: HSBC BANK USA, N.A., respondent, v. Beverly FRANCIS, etc., appellant, et al., defendants.
• Court: New York Supreme Court — Appellate Division

214 A.D.3d 58

185 N.Y.S.3d 173

HSBC BANK USA, N.A., respondent,

v.Beverly FRANCIS, etc., appellant, et al., defendants.

2020–03967

Index No. 712696/17

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

Argued—November 21, 2022

February 22, 2023

Charles Wallshein, PLLC, Melville, NY, for appellant.

LOGS Legal Group, LLP, Rochester, NY (Ellis M. Oster of counsel), for respondent.

MARK C. DILLON, J.P., BETSY BARROS, LARA J. GENOVESI, JANICE A. TAYLOR, JJ.

OPINION & ORDER

DILLON, J.P.

On this appeal we consider whether the Supreme Court improvidently exercised its discretion in granting a motion to consolidate two actions where, faced with an apparently meritorious motion to dismiss the complaint as time-barred in one action, the plaintiff sought to avoid dismissal by moving to consolidate that action with a timely action. We hold that, in this case, the court improvidently exercised its discretion in granting consolidation and that, in general, consolidation should be denied where one of the cases to be consolidated is confronted with a pending, apparently meritorious motion to dismiss.

I. Relevant Facts

In 2007, the defendant Beverly Francis (hereinafter the defendant), executed a note that was secured by a mortgage on certain real property located in Queens. The next year, the plaintiff's predecessor in interest commenced an action to foreclose that mortgage (hereinafter the 2008 action). The defendant did not appear in the 2008 action. The plaintiff's predecessor in interest obtained an order of reference and a judgment of foreclosure and sale. The plaintiff's predecessor in interest later moved, in effect, to vacate the judgment of foreclosure and sale, so that a corrected judgment could be entered instead, and that motion was granted. No judgment was entered thereafter. On this record, the 2008 action was never discontinued or dismissed.

In 2017, the plaintiff commenced this action to foreclose the same mortgage (hereinafter the 2017 action). The defendant interposed an answer, asserting affirmative defenses and counterclaims. The defendant moved pursuant to CPLR 3211(a)(5) to dismiss the complaint insofar as asserted against her on the ground of untimeliness and for summary judgment on her counterclaim pursuant to RPAPL 1501(4), inter alia, to cancel and discharge the subject mortgage. The plaintiff cross-moved, among other things, to consolidate the 2008 action and the 2017 action.

In an order dated January 2, 2020, the Supreme Court granted that branch of the plaintiff's cross-motion which was to consolidate the 2008 action and the 2017 action, and denied, as academic, the defendant's motion pursuant to CPLR 3211(a)(5) to dismiss the complaint insofar as asserted against her and for summary judgment on her counterclaim pursuant to RPAPL 1501(4), inter alia, to cancel and discharge the subject mortgage. The court reasoned that the cases arose from identical facts and circumstances, involved common questions of law and fact, and involved causes of action to foreclose on a residential mortgage. Consolidation, in the court's view, would avoid unnecessary duplication of trials and the possibility of inconsistent verdicts since both actions arose from the same transaction or occurrence. The court held that the defendant's dismissal motion was denied as "moot, in light of the consolidation." The defendant appeals.

II. Legal Analysis

On her appeal, the defendant challenges, among other things, the grant of that branch of the plaintiff's cross-motion which was to consolidate the 2008 action and the 2017 action, and the denial of that branch of her motion which was pursuant to CPLR 3211(a)(5) to dismiss the complaint in the 2017 action insofar as asserted against her as time-barred.

A party may move for judgment dismissing one or more causes of action asserted against it on the ground that the cause of action may not be maintained because of the statute of limitations (see CPLR 3211[a][5] ). "On a motion to dismiss a complaint pursuant to CPLR 3211(a)(5) on the ground that the statute of limitations has expired, the moving defendant must establish, prima facie, that the time in which to commence the action has expired" ( Cadlerock Joint Venture, L.P. v. Trombley, 189 A.D.3d 1157, 1158, 134 N.Y.S.3d 236 ). "If the defendant satisfies this burden, the burden shifts to the plaintiff to raise a question of fact as to whether the statute of limitations was tolled or otherwise inapplicable, or whether the plaintiff actually commenced the action within the applicable limitations period" ( Barry v. Cadman Towers, Inc., 136 A.D.3d 951, 952, 25 N.Y.S.3d 342 ).

An action to foreclose a mortgage is subject to a six-year statute of limitations (see CPLR 213[4] ). With respect to a mortgage payable in installments, separate causes of action accrue for each installment that is not paid, and the statute of limitations begins to run on the date each installment becomes due (see Nationstar Mtge., LLC v. Weisblum, 143 A.D.3d 866, 867, 39 N.Y.S.3d 491 ). However, "even if a mortgage is payable in installments, once a mortgage debt is accelerated, the entire amount is due and the [s]tatute of [l]imitations begins to run on the entire debt" ( EMC Mtge. Corp. v. Patella, 279 A.D.2d 604, 605, 720 N.Y.S.2d 161 ).

Here, on her motion, the defendant demonstrated that the 2008 action called due the entire debt and that the 2017 action was therefore untimely under the applicable six-year statute of limitations (see CPLR 213[4] ; Wilmington Sav. Fund Socy., FSB v. 117 Pulaski, LLC, 197 A.D.3d 686, 687, 153 N.Y.S.3d 126 ). Thus, with the defendant having satisfied her initial burden of proof as to the untimeliness of the 2017 action, the burden shifted to the plaintiff to raise a question of fact as to whether the statute of limitations was tolled or otherwise inapplicable, or whether the plaintiff actually commenced the action within the applicable limitations period (see Wilmington Sav. Fund Socy., FSB v. 117 Pulaski, LLC, 197 A.D.3d at 687, 153 N.Y.S.3d 126 ; Barry v. Cadman Towers, Inc., 136 A.D.3d at 952, 25 N.Y.S.3d 342 ).

On its cross-motion, inter alia, to consolidate, the plaintiff made an argument to the effect that the statute of limitations defense failed once the 2017 action was consolidated with the timely 2008 action. The Supreme Court found this argument persuasive, as it granted that branch of the plaintiff's cross-motion which was to consolidate and denied the defendant's motion as "moot, in light of the consolidation."

CPLR 602(a) provides that "[w]hen actions involving a common question of law or fact are pending before a court, the court, upon motion, may order a joint trial of any or all the matters in issue, may order the actions consolidated, and may make such other orders concerning proceedings therein as may tend to avoid unnecessary costs or delay."

Consolidation has been described as the "merging" ( Matter of Associated Blind Hous. Dev. Corp. v. State of N.Y. Dept. of Pub. Serv., 142 A.D.2d 825, 827, 530 N.Y.S.2d 703 ) or "fusing" ( Kelley v. Galina–Bouquet, Inc., 155 A.D.2d 96, 101, 552 N.Y.S.2d 305 [internal quotation marks omitted]) of two or more actions into one action (see id. at 101–102, 552 N.Y.S.2d 305 ; Matter of Associated Blind Hous. Dev. Corp. v. State of N.Y. Dept. of Pub. Serv., 142 A.D.2d at 827, 530 N.Y.S.2d 703 ). The consolidated action has one caption, with one group of plaintiffs against one group of defendants, and results in one verdict or decision and one judgment with one bill of costs (see Matter of Consolidated Edison Co. of N.Y., Inc. v. New York State Bd. of Real Prop. Servs., 176 A.D.3d 1433, 1436, 112 N.Y.S.3d 313 ; Mars Assoc. v. New York City Educ. Constr. Fund, 126 A.D.2d 178, 185, 513 N.Y.S.2d 125 ; Padilla v. Greyhound Lines, Inc., 29 A.D.2d 495, 497, 288 N.Y.S.2d 641 ; Rosado v. Valvo, 58 Misc.2d 944, 946, 297 N.Y.S.2d 230 [Sup. Ct., Kings County] ). The former defendants in the actions all become codefendants together, with the possibility of amended pleadings asserting additional claims (see Vidal v. Sheffield Farms Co., 208 Misc. 438, 440, 141 N.Y.S.2d 82 [Sup. Ct., Bronx County] ). By contrast, the joinder of two or more actions under the same enabling statute, CPLR 602(a), continues the separateness of each of the actions presenting common questions of law or fact, allowing for joint proceedings but separate verdicts and judgments (see Calle v. 2118 Flatbush Ave. Realty, LLC, 209 A.D.3d 961, 963, 177 N.Y.S.3d 297 ; Longo v. Fogg, 150 A.D.3d 724, 725, 55 N.Y.S.3d 61 ; Sample v. Temkin, 87 A.D.3d 686, 687, 928 N.Y.S.2d 757 ). "Consolidation or joint trials are ‘favored by the courts in serving the interests of justice and judicial economy’ " ( Bruno v. Capetola, 101 A.D.3d 785, 786, 957 N.Y.S.2d 156, quoting Flaherty v. RCP Assoc., 208 A.D.2d 496, 498, 616 N.Y.S.2d 801 ).

Where common questions of fact or law exist, a motion pursuant to CPLR 602(a) for consolidation or joinder should be granted, absent a showing of prejudice to a substantial right by the party opposing the motion (see Disa Realty, Inc. v. Rao, 198 A.D.3d 869, 871, 156 N.Y.S.3d 300 ; Bruno v. Capetola, 101 A.D.3d at 786, 957 N.Y.S.2d 156 ). "Consolidation is appropriate where it will avoid unnecessary duplication of trials, save unnecessary costs and expense, and prevent an injustice which would result from divergent decisions based on the same facts" ( Viafax Corp. v. Citicorp Leasing, Inc., 54 A.D.3d 846, 850, 864 N.Y.S.2d 479 ). Denial of a motion to consolidate or for a joint trial "may be warranted where common questions of law or fact are lacking, where the actions involve dissimilar issues or disparate legal theories, or where a joint trial would substantially prejudice an opposing party or pose a risk of confusing the jury or rendering the litigation unwieldy" ( Cromwell v. CRP 482 Riverdale Ave., LLC, 163 A.D.3d 626, 627–628, 80 N.Y.S.3d 423 [citations omitted]; see Weiss & Biheller, MDSE, Corp. v....