OneWest Bank, FSB v. Simpson

• Decision Date: 15 March 2017
• Citation: 148 A.D.3d 920,49 N.Y.S.3d 523
• Parties: ONEWEST BANK, FSB, respondent, v. Gladys SIMPSON, et al., appellants, et al., defendants.
• Court: New York Supreme Court — Appellate Division

148 A.D.3d 920

49 N.Y.S.3d 523

ONEWEST BANK, FSB, respondent,

v.Gladys SIMPSON, et al., appellants, et al., defendants.

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

March 15, 2017.

Lester & Associates, P.C., Garden City, NY (Roy J. Lester and Gabriel Korinman of counsel), for appellants.

Stein, Wiener & Roth, LLP, Carle Place, NY (Gerald Roth and Mojdeh Malekan of counsel), for respondent.

MARK C. DILLON, J.P., LEONARD B. AUSTIN, SYLVIA O. HINDS–RADIX, and JOSEPH J. MALTESE, JJ.

In an action to foreclose a mortgage, the defendants Gladys Simpson and Toni K. Bolt appeal, as limited by their brief, from (1) so much of an order of the Supreme Court, Nassau County (Marber, J.), entered October 17, 2014, as granted the branch of the plaintiff's motion which was for summary judgment on the complaint insofar as asserted against them, to strike their answer, and for an order of reference, and (2) so much of an order of the same court entered November 12, 2014, as granted that same branch of the plaintiff's motion, struck their answer, and appointed a referee to compute the amount due to the plaintiff.

ORDERED that the appeal from the order entered October 17, 2014, is dismissed, as the portion of the order appealed from was superseded by the order entered November 12, 2014; and it is further,

ORDERED that the order entered November 12, 2014, is affirmed insofar as appealed from; and it is further,

ORDERED that one bill of costs is awarded to the plaintiff.

In November 2005, United Mortgage Corp. (hereinafter United) loaned the principal sum of $469,324.50 to Gloria Johnson (hereinafter the decedent). The loan was evidenced by a note and secured by a home equity conversion mortgage, also known as a reverse mortgage, encumbering certain real property in Westbury. Upon the decedent's death in July 2011, her daughters, the defendants Toni K. Bolt and Stephanie Washington, as co-administrators of her estate, instead of satisfying the debt pursuant to the terms of the reverse mortgage, conveyed the property to their grandmother, the defendant Gladys Simpson, for no consideration.

In December 2012, United assigned the reverse mortgage to the plaintiff, OneWest Bank, FSB (hereinafter OneWest). In May 2013, OneWest commenced this action to foreclose the reverse mortgage. Gladys Simpson and Bolt (hereinafter together the defendants) filed an answer asserting various affirmative defenses. In July 2014, OneWest moved, inter alia, for summary judgment on the complaint, to strike the defendants' answer, and for an order of reference. The defendants opposed the motion, arguing, among other things, that OneWest lacked standing and failed to comply with a condition precedent contained in paragraphs 16 and 20 of the reverse mortgage, which together require that OneWest provide the borrower with a notice of default "by delivering [the notice] or by mailing [the notice] by first class mail" prior to acceleration of the reverse mortgage.

By order entered October 17, 2014, the Supreme Court granted that branch of OneWest's motion which was for summary judgment on the complaint, to strike the answer, and for an order of reference, and directed OneWest to forward a proposed order to the foreclosure clerk for execution. In an order entered November 12, 2014, the court, among other things, granted that same branch of the motion, struck the defendants' answer, and appointed a referee to compute the amount due. The defendants appeal, and we affirm insofar as appealed from.

"Generally, in moving for summary judgment in an action to foreclose a mortgage, a plaintiff establishes its prima facie case through the production of the mortgage, the unpaid note, and evidence of default" (Plaza Equities, LLC v. Lamberti, 118 A.D.3d 688, 689, 986 N.Y.S.2d 843 ). Moreover, where, as here, a plaintiff's standing to commence a foreclosure action is placed in issue by a defendant, it is incumbent upon the plaintiff to prove its standing to be entitled to relief (see Bank of N.Y. Mellon v. Visconti, 136 A.D.3d 950, 25 N.Y.S.3d 630 ; HSBC Bank USA, N.A. v. Spitzer, 131 A.D.3d 1206, 1207, 18 N.Y.S.3d 67 ). A plaintiff establishes its standing in a mortgage foreclosure action by demonstrating that it was either the holder or assignee of the underlying note at the time the action was commenced (see Aurora Loan Servs., LLC v. Taylor, 114 A.D.3d 627, 980 N.Y.S.2d 475, affd. 25 N.Y.3d 355, 12 N.Y.S.3d 612, 34 N.E.3d 363 ; Bank of N.Y. v. Silverberg, 86 A.D.3d 274, 279, 926 N.Y.S.2d 532 ; U.S. Bank, N.A. v. Collymore, 68 A.D.3d 752, 753, 890 N.Y.S.2d 578 ). "Either a written assignment of the underlying note or the physical delivery of the note prior to the commencement of the foreclosure action is sufficient to transfer the obligation, and the mortgage passes with the debt as an inseparable incident" (U.S. Bank N.A. v. Collymore, 68 A.D.3d at 754, 890 N.Y.S.2d 578 ; see Aurora Loan Servs., LLC v. Taylor, 25 N.Y.3d at 361–362, 12 N.Y.S.3d 612, 34 N.E.3d 363 ).

Here, in support of its motion for...