Nationstar Mortg., LLC v. MacPherson

• Decision Date: 03 April 2017
• Citation: 56 Misc.3d 339,54 N.Y.S.3d 825
• Parties: NATIONSTAR MORTGAGE, LLC, Plaintiff, v. Donald MACPHERSON, 1104 North Sea Co. Inc., United One Equities, LLC, New York State Department of Taxation and Finance, "John Doe # 1" to "John Doe # 10," the last 10 names being fictitious and unknown to plaintiff, the persons or parties intended being the persons or parties, if any, having or claiming an interest in or lien upon the mortgaged premises described in the verified complaint, Defendant.
• Court: New York Supreme Court

56 Misc.3d 339

54 N.Y.S.3d 825

NATIONSTAR MORTGAGE, LLC, Plaintiff,

v.Donald MACPHERSON, 1104 North Sea Co. Inc., United One Equities, LLC, New York State Department of Taxation and Finance, "John Doe # 1" to "John Doe # 10," the last 10 names being fictitious and unknown to plaintiff, the persons or parties intended being the persons or parties, if any, having or claiming an interest in or lien upon the mortgaged premises described in the verified complaint, Defendant.

Supreme Court, Suffolk County, New York.

April 3, 2017.

Gross Polowy, LLC, Williamsville, for Plaintiff.

Irwin Popkin, Esq., Melville, for Defs. MacPherson & 1104 North Sea Co.

THOMAS F. WHELAN, J.

ORDERED that this motion (# 001) by the plaintiff for, among other things, summary judgment, caption amendment and the appointment of a referee to compute, is granted except that recovery is limited to only those unpaid installments which accrued after September 17, 2008, that is, the six-year period immediately preceding the commencement of this action, and it is further

ORDERED that the proposed Order submitted by the plaintiff, as modified, is signed simultaneously herewith; and it is further

ORDERED that plaintiff is directed to file a notice of entry within five days of receipt of this Order pursuant to 22 NYCRR 202.5–b(h)(3).

This foreclosure action was commenced by filing on September 17, 2014. The matter was reassigned to this Part pursuant to Administrative Order No. 27–17, dated February 28, 2017 and submitted for decision on March 3, 2017. In essence, on July 25, 2006, defendant, Donald MacPherson, borrowed $1,495,000.00 from the plaintiff's predecessor-in-interest and executed a promissory note and mortgage. Since July 1, 2007, the defendant has failed to pay the monthly installments due and owing. Only the defendants, Donald MacPherson and 1104 North Sea Co., a subsequent transferee of the premises, have answered this action. In their answer, defendants alleged three affirmative defenses. The Court must address a procedural matter first.

This is an e-filed case. The summons and complaint were filed September 17, 2014 as NYSCEF Doc. No. 1.¹ Pursuant to CPLR 2103(b)(7), service of papers shall be made upon a party's attorney "by transmitting the papers to the attorney by electronic means where and in the manner authorized by the chief administrator of the courts by rule and, unless such rule shall otherwise provide, such transmission shall be upon the party's written consent ..." The court system has created the New York State Courts Electronic Filing System (NYSCEF) for the email filing of papers in authorized actions.

Ever since March 31, 2014, pursuant to Administrative Order of the Chief Administrator of the Courts (see AO64/14, March 25, 2014) and every subsequent administrative order thereafter, Suffolk County has required the mandatory electronic filing of all papers in foreclosure actions. The mandatory electronic filing program in foreclosure actions in Suffolk County is governed by 22 NYCRR 202–bb. The filing and service of all documents in an action that has been commenced electronically shall be by electronic means (see 22 NYCRR 202.5–bb [a][1]; 22 NYCRR 202.5–bb [c][1] ). The parties filed a stipulation, as NYSCEF Doc. No. 25, adjourning the motion to July 13, 2016 "and the Opposition papers shall be served and filed by July 6, 2016." Here, the record reveals that the affirmation in opposition was not filed until July 10, 2016 as NYSCEF Doc. No. 26. Such a filing is untimely pursuant to the filed stipulation between the parties. Same was rejected by counsel for the plaintiff by notice of return and rejection as NYSCEF Doc. No. 28.

Even if defendant seeks to argue that 22 NYCRR 202.5–b(f)(2)(ii) may be applicable, which it is not since that involves the consent program that does not exist in Suffolk County (see 22 NYCRR 202.5–b [b] ), and that other CPLR service methods are available, that provision still requires "that proof of that service shall be filed electronically." Moreover, pursuant to 22 NYCRR 202.5–b(d)(4), "[w]here a document has been filed electronically pursuant to this section, the official record shall be the electronic recording of the document stored by the County Clerk." Here, the affirmation in opposition was not timely filed and an affidavit of service has never been filed. These defects render the opposing papers by the answering defendants jurisdictionally defective since "the failure to provide proper service of a motion deprives the court of jurisdiction to entertain the motion" (Lee v. I–Sheng Li, 129 A.D.3d 923, 10 N.Y.S.3d 451 [2d Dept.2015] ; see Crown Waterproofing, Inc. v. Tadco Constr. Corp., 99 A.D.3d 964, 965, 953 N.Y.S.2d 254 [2d Dept.2012] ; Daulat v. Helms Bros., Inc., 32 A.D.3d 410, 411, 819 N.Y.S.2d 557 [2d Dept.2006] ). Since the affirmation in opposition violated the filed stipulation and the mandatory e-filing rules established by the Chief Administrator of the Courts, as authorized by the State Legislature in CPLR 2103(b)(7), the document is deemed untimely and a nullity.

As noted above, defendants' answer alleged three affirmative defenses. The Second Affirmative Defense challenges plaintiff's standing to commence this action. In the moving papers, plaintiff addresses its burden of proof on this summary judgment motion and refutes the affirmative defenses of the answer. With regard to compliance with RPAPL 1304, plaintiff has established its prima facie burden with the submission of the affidavit of April Simmons, a Document Execution Specialist employed by the plaintiff, the servicer of the mortgage loan in question. She explained Nationstar's practices and procedures and its possession of the note on November 25, 2013.

The Court rejects the Second Affirmative Defense (standing). One of the various methods that standing may be established is by due proof that the plaintiff or its custodial agent was in possession of the note prior to the commencement of the action. The production of such proof is sufficient to establish, prima facie, the plaintiff's possession of the requisite standing to prosecute its claims for foreclosure and sale (see Aurora Loan Servs., LLC v. Taylor, 25 N.Y.3d 355, 12 N.Y.S.3d 612, 34 N.E.3d 363 [2015] ; U.S. Bank v. Ehrenfeld, 144 A.D.3d 893, 41 N.Y.S.3d 269 [2d Dept.2016] ; JPMorgan Chase Bank, Natl. Assn. v. Weinberger, 142 A.D.3d 643, 37 N.Y.S.3d 286 [2d Dept.2016] ; Citimortgage, Inc. v. Klein, 140 A.D.3d 913, 33 N.Y.S.3d 432 [2d Dept.2016] ; U.S. Bank Natl. Ass'n v. Godwin, 137 A.D.3d 1260, 28 N.Y.S.3d 450 [2d Dept.2016] ; Wells Fargo Bank, N.A. v. Joseph, 137 A.D.3d 896, 26 N.Y.S.3d 583 [2d Dept.2016] ; Emigrant Bank v. Larizza, 129 A.D.3d 904, 13 N.Y.S.3d 129 [2d Dept.2015] ; Deutsche Bank Natl. Trust Co. v. Whalen, 107 A.D.3d 931, 969 N.Y.S.2d 82 [2d Dept.2013] ).

Additionally, the plaintiff's attachment of a duly indorsed mortgage note to its complaint or to the certificate of merit required by CPLR 3012–b, coupled with an affidavit in which it alleges that it had possession of the note prior to commencement of the action, has been held to constitute due proof of the plaintiff's possession of the note prior to the commencement of the action and thus its standing to prosecute its claim for foreclosure and sale (see JPMorgan Chase Bank, N.A. v. Venture, 148 A.D.3d 1269, 48 N.Y.S.3d 824 [3d Dept.2017] ; Deutsche Bank Trust Co. v. Garrison, 147 A.D.3d 725, 46 N.Y.S.3d 185 [2d Dept.2017] ; U.S. Bank Nat. v. Saravanan, 146 A.D.3d 1010, 45 N.Y.S.3d 547 [2d Dept.2017] ; Deutsche Bank Natl. Trust Co. v. Logan, 146 A.D.3d 861, 45 N.Y.S.3d 189 [2d Dept.2017] ; Deutsche Bank Natl. Trust Co. v. Umeh, 145 A.D.3d 497, 41 N.Y.S.3d 882 [1st Dept.2016] ; Nationstar Mtge., LLC v. Weisblum, 143 A.D.3d 866, 39 N.Y.S.3d 491, 494 [2d Dept.2016] ; Deutsche Bank Natl. Trust Co. v. Webster, 142 A.D.3d 636, 37 N.Y.S.3d 283 [2d Dept.2016] ; JPMorgan Chase Bank, Natl. Ass'n v. Weinberger,

142 A.D.3d 643, supra, 37 N.Y.S.3d 286 ; Federal Natl. Mtge. Assn. v. Yakaputz II, Inc., 141 A.D.3d 506, 507, 35 N.Y.S.3d 236, 237 [2d Dept.2016] ; JPMorgan Chase Bank, Natl. Assn. v. Kobee, 140 A.D.3d 1622, 32 N.Y.3d 767 [2d Dept.2016] ; JPMorgan Chase Bank, N.A. v. Roseman, 137 A.D.3d 1222, 29 N.Y.S.3d 380 [2d Dept.2016] ; Deutsche Bank Natl. Trust Co. v. Leigh, 137 A.D.3d 841, 28 N.Y.S.3d 86 [2d Dept.2016] ; Nationstar Mtge., LLC v. Catizone, 127 A.D.3d 1151, 9 N.Y.S.3d 315 [2d Dept.2015] ).

Appellate case authorities have repeatedly held that in determining the standing of a foreclosing plaintiff, it is the mortgage note that is the dispositive instrument, not the mortgage indenture (see Aurora Loan Servs., LLC v. Mandel, 148 A.D.3d 965, 50 N.Y.S.3d 154 [2d Dept.2017] ; Everhome Mtge. Co. v. Pettit, 135 A.D.3d 1054, 23 N.Y.S.3d 408 [2d Dept.2016] ). This result is mandated by the long standing principal incident rule which provides that because a mortgage is merely the security for the debt, the obligations of the mortgage pass as an incident to the passage of the note (see Aurora Loan Servs., LLC v. Taylor, 25 N.Y.3d 355, supra , 12 N.Y.S.3d 612, 34 N.E.3d 363 ; Wells Fargo Bank, N.A. v. Charlaff, 134 A.D.3d 1099, 24 N.Y.S.3d 317 [2d Dept.2015] ; Emigrant Bank v. Larizza, 129 A.D.3d 904, supra , 13 N.Y.S.3d 129 ). A foreclosing plaintiff has standing if it is either the holder or the assignee of the underlying note at the time that the action is commenced (see Aurora Loan Servs., LLC v. Taylor, 25 N.Y.3d 355, supra, 12 N.Y.S.3d 612, 34 N.E.3d 363 ; Loancare v. Firshing, 130 A.D.3d 787, 14 N.Y.S.3d 410 [2d Dept.2015] ; Emigrant Bank v. Larizza, 129 A.D.3d 904, supra , 13 N.Y.S.3d 129 ). "Either a written assignment of the underlying note or the physical delivery of it to the plaintiff prior to the commencement of the action is sufficient to transfer the obligation" (see id. , Wells Fargo Bank, NA v. Parker, 125 A.D.3d 848, 5 N.Y.S.3d 130 [2d Dept.2015] ; U.S. Bank NA v. Guy, 125 A.D.3d 845, 5...