Wells Fargo Bank, N.A. v. Gonzalez

• Decision Date: 03 July 2019
• Docket Number: Index No. 4051/14,2016–04516
• Citation: 104 N.Y.S.3d 167,174 A.D.3d 555
• Parties: WELLS FARGO BANK, N.A., etc., Respondent, v. Israel GONZALEZ, et al., Appellants, et al., Defendants.
• Court: New York Supreme Court — Appellate Division

174 A.D.3d 555

104 N.Y.S.3d 167

WELLS FARGO BANK, N.A., etc., Respondent,

v.Israel GONZALEZ, et al., Appellants, et al., Defendants.

2016–04516

Index No. 4051/14

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

Argued—February 19, 2019

July 3, 2019

R. David Marquez, Mineola, N.Y., for appellants.

Frenkel, Lambert, Weiss, Weisman & Gordon, LLP, Bay Shore, N.Y. (Christopher P. Kohn of counsel), for respondent.

RUTH C. BALKIN, J.P., LEONARD B. AUSTIN, HECTOR D. LASALLE, ANGELA G. IANNACCI, JJ.

DECISION & ORDER

In an action to foreclose a mortgage, the defendants Israel Gonzalez and Edith Y. Gonzalez appeal from an order of the Supreme Court, Nassau County (Thomas A. Adams, J.), dated February 2, 2016. The order granted the plaintiff's motion, inter alia, for summary judgment on the complaint, to strike those defendants' answer, and to appoint a referee to compute the amount due to the plaintiff.

ORDERED that the order is affirmed, with costs.

The plaintiff commenced this action to foreclose a mortgage given by the defendants Israel Gonzalez and Edith Y. Gonzalez (hereinafter together the defendants) to secure a note. In their answer, the defendants asserted the affirmative defenses of, inter alia, lack of standing and failure to comply with RPAPL 1304. The plaintiff subsequently moved, inter alia, for summary judgment on the complaint, to strike the defendants' answer, and to appoint a referee to compute the amount due to the plaintiff. The defendants opposed the motion. By order dated February 2, 2016, the Supreme Court granted the plaintiff's motion, and the defendants appeal.

To establish prima facie entitlement to judgment as a matter of law in an action to foreclose a mortgage, a plaintiff must produce the mortgage, the unpaid note, and evidence of default (see Nationstar Mtge., LLC v. Medley, 168 A.D.3d 959, 960, 93 N.Y.S.3d 69 ; Deutsche Bank Trust Co. Ams. v. Garrison, 147 A.D.3d 725, 726, 46 N.Y.S.3d 185 ; Deutsche Bank Natl. Trust Co. v. Abdan, 131 A.D.3d 1001, 1002, 16 N.Y.S.3d 459 ; Plaza Equities, LLC v. Lamberti, 118 A.D.3d 688, 689, 986 N.Y.S.2d 843 ). Where, as here, the issue of standing is raised by a defendant, a plaintiff must also establish its standing as part of its prima facie case for summary judgment (see Federal Natl. Mtge. Assn. v. Marlin, 168 A.D.3d 679, 680–681, 91 N.Y.S.3d 262 ; Deutsche Bank Trust Co. Ams. v. Garrison, 147 A.D.3d at 726, 46 N.Y.S.3d 185 ; Security Lending, Ltd. v. New Realty Corp., 142 A.D.3d 986, 987, 37 N.Y.S.3d 327 ; LGF Holdings, LLC v. Skydel, 139 A.D.3d 814, 32 N.Y.S.3d 243 ; MLCFC 2007–9 Mixed Astoria, LLC v. 36–02 35th Ave. Dev., LLC, 116 A.D.3d 745, 746, 983 N.Y.S.2d 604 ). A plaintiff establishes its standing in a mortgage foreclosure action by demonstrating that, when the action was commenced, it was either the holder of, or the assignee of, the underlying note (see Aurora Loan Servs., LLC v. Taylor, 25 N.Y.3d 355, 361–362, 12 N.Y.S.3d 612, 34 N.E.3d 363 ; Security Lending, Ltd. v. New Realty Corp., 142 A.D.3d at 987, 37 N.Y.S.3d 327 ; LGF Holdings, LLC v. Skydel, 139 A.D.3d at 814, 32 N.Y.S.3d 243 ; Wells Fargo Bank, N.A. v. Rooney, 132 A.D.3d 980, 981, 19 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, and the mortgage passes with the debt as an inseparable incident" ( U.S. Bank, N.A. v. Collymore, 68 A.D.3d 752, 754, 890 N.Y.S.2d 578 ; see Security Lending, Ltd. v. New Realty Corp., 142 A.D.3d at 987, 37 N.Y.S.3d 327 ; LGF Holdings, LLC v. Skydel, 139 A.D.3d at 814, 32 N.Y.S.3d 243 ).

Here, the plaintiff established, prima facie, its standing by submitting an affidavit of an employee of counsel for the plaintiff, who stated that the plaintiff's counsel had been in possession of the original note endorsed in blank since September 9, 2011, a date which was prior to the commencement of the action (see Bank of N.Y. Mellon v. Gordon , 171 A.D.3d 197, 97 N.Y.S.3d 286 ; Bank of Am., N.A. v. Tobing , 163 A.D.3d 518, 76 N.Y.S.3d 832 ; U.S. Bank, Natl. Assn. v. Cardenas , 160 A.D.3d 784, 785, 71 N.Y.S.3d 368 ; PennyMac Corp. v. Chavez , 144 A.D.3d 1006, 42 N.Y.S.3d 239 ; M & T Bank v. Cliffside Prop. Mgt., LLC , 137 A.D.3d 876, 26 N.Y.S.3d 601 ). Moreover, the employee attached to her affidavit a copy of the original note, and averred that plaintiff's counsel still had custody of the original note and that she had compared the copy to the original and the copy was true and accurate.

In opposition, the defendants failed to raise a triable issue of fact (see Bank of Am., N.A. v. Tobing, 163 A.D.3d at 520, 76 N.Y.S.3d 832 ; U.S. Bank, Natl. Assn. v. Cardenas, 160 A.D.3d at 785, 71 N.Y.S.3d 368 ; M & T Bank v. Cliffside Prop. Mgt., LLC, 137 A.D.3d at 877, 26 N.Y.S.3d 601 ). The defendants contend that the plaintiff's submissions failed to show "a complete chain of title leading from the loan originator." However, "[t]here is simply no requirement that an entity in possession of a negotiable instrument that has been endorsed in blank must establish how it came into possession of the instrument in order to be able to enforce it" ( JPMorgan Chase Bank, N.A. v. Weinberger, 142 A.D.3d 643, 645, 37 N.Y.S.3d 286 ; see UCC 3–204[2] ; PennyMac Corp. v. Chavez, 144 A.D.3d at 1007, 42 N.Y.S.3d 239 ). Contrary to the defendants' further contention, "it is unnecessary to give factual details of the delivery in order to establish that possession was obtained prior to a particular date" ( JPMorgan Chase Bank, N.A. v. Weinberger, 142 A.D.3d at 645, 37 N.Y.S.3d 286 ; see Aurora Loan Servs., LLC v. Taylor, 25 N.Y.3d at 362, 12 N.Y.S.3d 612, 34 N.E.3d 363 ; PennyMac Corp. v. Chavez, 144 A.D.3d at 1007, 42 N.Y.S.3d 239 ).

In addition, the plaintiff established its prima facie entitlement to judgment as a matter of law by submitting the note, the mortgage, and evidence of the defendants' default in making their monthly mortgage payments. Contrary to the defendants' contention, an affidavit of an officer of the servicer of the subject loan, submitted by the plaintiff in support of its motion, did not constitute hearsay, as the affidavit established that the records upon which the officer relied were admissible as business records and submitted in evidence (see CPLR 4518[a] ; People v. Cratsley, 86 N.Y.2d 81, 629 N.Y.S.2d 992, 653 N.E.2d 1162 ; Nationstar Mtge., LLC v. Medley, 168 A.D.3d at 961, 93 N.Y.S.3d 69 ; Lodato v. Greyhawk N. Am., LLC, 39 A.D.3d 494, 834 N.Y.S.2d 239 ; Plymouth Rock Fuel Corp. v. Leucadia, Inc., 117 A.D.2d 727, 498 N.Y.S.2d 453 ).

Contrary to the defendants' contention, "[a] grant of summary judgment is not premature merely because discovery has not been completed" ( HSBC Bank USA, N.A. v. Armijos, 151 A.D.3d 943, 944, 57 N.Y.S.3d 205 [internal quotation marks omitted]; see Chemical Bank v. PIC Motors Corp., 58 N.Y.2d...