JP Morgan Chase Bank Nat'l Ass'n v. Miodownik

• Decision Date: 24 January 2012
• Citation: 91 A.D.3d 546,937 N.Y.S.2d 192,2012 N.Y. Slip Op. 00416
• Parties: JP MORGAN CHASE BANK NATIONAL ASSOCIATION, Plaintiff–Respondent, v. Hela MIODOWNIK, Defendant–Appellant,Washington Mutual Bank, etc., et al., Defendants.
• Court: New York Supreme Court — Appellate Division

2012 N.Y. Slip Op. 00416

91 A.D.3d 546

937 N.Y.S.2d 192

JP MORGAN CHASE BANK NATIONAL ASSOCIATION, Plaintiff–Respondent,

v.Hela MIODOWNIK, Defendant–Appellant,Washington Mutual Bank, etc., et al., Defendants.

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

Jan. 24, 2012.

Adam R. Allan, New York, for appellant.

Parker Ibrahim & Berg LLC, New York (Scott W. Parker of counsel), for respondent.

TOM, J.P., FRIEDMAN, DeGRASSE, RICHTER, JJ.

Order, Supreme Court, New York County (O. Peter Sherwood, J.), entered August 12, 2010, which denied defendant Miodownik's motion to dismiss the complaint as against her, unanimously affirmed, without costs.

In this action to foreclose a consolidated mortgage, defendant argues that plaintiff JP Morgan Chase Bank, N.A. (JPMC) does not own the note it is attempting to foreclose. On September 25, 2008, the Office of Thrift Supervision closed Washington Mutual Bank (WAMU) and appointed the FDIC as Receiver ( see Dipaola v. JPMorgan Chase Bank, 2011 WL 3501756, *3, 2011 U.S. Dist LEXIS 88753, *7 [N.D.Cal.2011] ). On that same date, the bulk of WAMU's assets were transferred to JPMC pursuant to a Purchase and Assumption Agreement (the P & A Agreement) entered into between FDIC as Receiver, the FDIC in its corporate capacity, and JPMC ( see id.). Courts have found that the P & A Agreement evinced that JPMC purchased all of WAMU's loans and loan commitments, and therefore had the right to foreclose on a defaulting borrower ( see e.g. Haynes v. JPMorgan Chase Bank, N.A., 2011 WL 2581956, 2011 U.S. Dist LEXIS 69703 [M.D.Ga.2011] ).

Defendant's contention that pursuant to sections 2.5 and 3.5 of the P & A Agreement, a borrower's loan is exempt from the P & A Agreement if the borrower is pressing a counterclaim against WAMU, is unavailing. Consistent with section 2.1 of the P & A Agreement, JPMC, as the assuming bank, agreed to continue to service all loans, and agreed to assume the liabilities associated with its ongoing servicing obligations ( see Allen v. United Fin. Mtge. Corp., 2010 WL 1135787, *3–4, 2010 U.S. Dist LEXIS 26503, *9–10 [N.D.Cal.2010] ). However, section 2.5 of the P & A Agreement expressly provides that JPMC did not assume the potential liabilities of WAMU associated with claims of defaulting borrowers such as defendant, where the claims directly relate to WAMU's lending practices ( see e.g. Yeomalakis v. Federal Deposit Ins. Co., 562 F.3d 56, 60 [1st Cir.2009]; Hanaway v. JPMorgan Chase Bank, 2011 WL 672559, *2, 2011 U.S. Dist LEXIS 21374, *8 [C.D.Cal.2011]; Cassese v. Washington Mut., Inc., 2008 WL 7022845, *3, 2008 U.S. Dist LEXIS 111709, *7 [E.D.N.Y.2008] ).

Moreover, defendant's reliance on section 3.5 of the P & A Agreement, is misplaced since this provision deals with “assets” of WAMU, and makes clear that the FDIC, as Receiver, was retaining any interest, right, action, claim, or judgment that WAMU had for itself so that the FDIC as Receiver would retain the benefit of those recoveries, rather than JPMC. Section 3.5 expressly...