U.S. Bank Nat'l Ass'n v. 22 S. Madison, LLC

• Court: New York Supreme Court — Appellate Division
• Citation: U.S. Bank Nat'l Ass'n v. 22 S. Madison, LLC, 170 A.D.3d 772, 95 N.Y.S.3d 264 (N.Y. App. Div. 2019)
• Decision Date: 06 March 2019
• Docket Number: 2016–08169,Index No. 34091/14
• Parties: U.S. BANK NATIONAL ASSOCIATION, etc., Respondent, v. 22 SOUTH MADISON, LLC, Appellant, et al., Defendants.

170 A.D.3d 772

95 N.Y.S.3d 264

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

v.22 SOUTH MADISON, LLC, Appellant, et al., Defendants.

2016–08169

Index No. 34091/14

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

Argued—May 15, 2018

March 6, 2019

Menashe & Associates, LLP, Montebello, N.Y. (Shoshana Schneider of counsel), for appellant.

Dorf & Nelson, LLP, Rye, N.Y. (Jonathan B. Nelson of counsel), for respondent.

ALAN D. SCHEINKMAN, P.J., MARK C. DILLON, JEFFREY A. COHEN, LINDA CHRISTOPHER, JJ.

DECISION & ORDER

In an action to foreclose a mortgage, the defendant 22 South Madison, LLC, appeals from an order of the Supreme Court, Rockland County (Robert M. Berliner, J.), dated June 20, 2016. The order, insofar as appealed from, granted those branches of the plaintiff's motion which were for summary judgment on the complaint insofar as asserted against the defendant 22 South Madison, LLC, to strike that defendant's answer and affirmative defenses, and for an order of reference, and appointed a referee to ascertain and compute the amount due to the plaintiff.

ORDERED that the order is reversed insofar as appealed from, on the law, with costs, and those branches of the plaintiff's motion which were for summary judgment on the complaint insofar as asserted against the defendant 22 South Madison, LLC, to strike that defendant's answer and affirmative defenses, and for an order of reference are denied.

In December 2006, 22 South Madison, LLC (hereinafter the defendant), executed a note and a mortgage in favor of Greenpoint Mortgage Funding, Inc. (hereinafter Greenpoint). In February 2007, Greenpoint assigned the mortgage, together with the note, to Aurora Bank FSB (hereinafter Aurora). In June 2010, Aurora assigned the note and mortgage to U.S. Bank National Association (hereinafter the plaintiff).

In August 2014, the plaintiff commenced this mortgage foreclosure action against the defendant, among others. The defendant interposed an answer asserting various affirmative defenses, including lack of standing. Thereafter, the plaintiff moved, inter alia, for summary judgment on the complaint insofar as asserted against the defendant, to strike the defendant's answer and affirmative defenses, and for an order of reference. The defendant opposed the motion, arguing that triable issues of fact existed as to whether the plaintiff had standing to commence the action. The Supreme Court granted those branches of the plaintiff's motion, and the defendant appeals.

The plaintiff's standing was placed in issue by the defendant's answer. Consequently, the plaintiff was required to prove its standing as part of its prima facie showing on its motion for summary judgment (see U.S. Bank, N.A. v. Ballin, 158 A.D.3d 786, 72 N.Y.S.3d 110 ; HSBC Bank USA, N.A. v. Ehrenthal, 158 A.D.3d 668, 670, 71 N.Y.S.3d 542 ; Bank of N.Y. Mellon v. Lopes, 158 A.D.3d 662, 663, 71 N.Y.S.3d 147 ; U.S. Bank N.A. v. Henry, 157 A.D.3d 839, 840, 69 N.Y.S.3d 656 ). "A plaintiff establishes its standing in a mortgage foreclosure action by demonstrating that it is the holder or assignee of the underlying note at the time the action is commenced" ( LNV Corp. v. Francois, 134 A.D.3d 1071, 1072, 22 N.Y.S.3d 543 ). "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" ( U.S. Bank, N.A. v. Collymore, 68 A.D.3d 752, 754, 890 N.Y.S.2d 578 ).

Here, the plaintiff attempted to establish its standing by submitting an affidavit of Jillian Thrasher, a contract management coordinator at Ocwen Loan Servicing, LLC (hereinafter Ocwen), the plaintiff's loan servicer. Thrasher averred, in relevant part, that her affidavit was based upon her review of Ocwen's business records, and that upon review of such records, the mortgage and note were assigned to the plaintiff on June 22, 2010. Thus, Thrasher averred that the plaintiff had been the holder of the note and mortgage prior to the filing of the complaint on August 25, 2014. However, "[a] proper foundation for the admission of a business record must be provided by someone with personal knowledge of the maker's business practices and procedures" ( Citibank, N.A. v. Cabrera, 130 A.D.3d 861, 861, 14 N.Y.S.3d 420 ; see Aurora Loan Servs., LLC v. Mercius, 138 A.D.3d 650, 652, 29 N.Y.S.3d 462 ). Here, since...