CEEFPA Hardship Declarations Are Not an “Appearance”: Second Department Clarifies No Waiver of Personal Jurisdiction in Foreclosure Actions

Introduction

In U.S. Bank Trust, N.A. v. Lane (2025 NY Slip Op 04680), the Appellate Division, Second Department addressed a recurring pandemic-era question in New York foreclosure practice: does filing a COVID-19 hardship declaration under the COVID-19 Emergency Eviction and Foreclosure Prevention Act of 2020 (CEEFPA) constitute an “appearance” that waives a homeowner’s defense of lack of personal jurisdiction? The court held that it does not. Although the defendant prevailed on that point, the court nevertheless affirmed the denial of his motion to vacate a foreclosure judgment because the lender established proper service under CPLR 308(2) and the defendant’s submissions failed to rebut the process server’s prima facie showing.

The decision both clarifies the procedural effect of CEEFPA hardship declarations and reiterates exacting standards for challenging service of process in mortgage foreclosure cases. It thus provides important guidance to borrowers, lenders, and trial courts about waiver, service, and motions to vacate default judgments under CPLR 5015(a)(4).

Summary of the Judgment

The Second Department affirmed the Supreme Court’s order denying the borrower’s motion to vacate the order and judgment of foreclosure and sale and to dismiss for lack of personal jurisdiction. The appellate court expressly rejected the trial court’s reasoning that the defendant’s filing of a CEEFPA hardship declaration amounted to an “appearance” that waived the personal jurisdiction defense. Nonetheless, it affirmed the outcome on alternative grounds: the plaintiff made a prima facie showing of proper “deliver-and-mail” service under CPLR 308(2), and the defendant’s affidavits were insufficient to warrant a traverse hearing or to overcome the presumption of proper service.

Background and Key Issues

Fannie Mae commenced the foreclosure action in 2016 against, among others, Daniel Lane, who did not appear or answer. The trial court granted a default and entered an order of reference (2018), followed by an order and judgment of foreclosure and sale (December 2020) that later substituted U.S. Bank Trust, N.A. as plaintiff. In May 2021—after judgment—the defendant filed a CEEFPA hardship declaration, which, by statute, stayed execution of the judgment for a defined period later extended through January 15, 2022. As a foreclosure sale approached in June 2022, the defendant moved to vacate the judgment and dismiss for lack of personal jurisdiction under CPLR 5015(a)(4); the trial court denied relief, reasoning that the hardship declaration was an appearance and the defendant had not timely raised jurisdiction, thus deeming it waived.

On appeal, two core issues emerged:

Whether a CEEFPA hardship declaration constitutes an “appearance” that waives a personal jurisdiction defense.
Whether the plaintiff effected proper service under CPLR 308(2), or whether the defendant’s affidavits warranted an evidentiary (traverse) hearing and vacatur under CPLR 5015(a)(4).

Detailed Analysis

1) Precedents Cited and How They Framed the Decision

HSBC Bank USA, N.A. v Eliyahu, 170 AD3d 1130: Reaffirmed that failure to serve process deprives the court of personal jurisdiction and renders subsequent proceedings void. This underscores the high stakes of service challenges under CPLR 5015(a)(4).
Nationstar Mtge., LLC v Stroman, 202 AD3d 804 and Cadlerock Joint Venture, L.P. v Kierstedt, 119 AD3d 627: A defendant can waive a lack-of-jurisdiction defense by appearing without timely raising it—framing the waiver analysis under CPLR 320(b).
Eastern Sav. Bank, FSB v Campbell, 167 AD3d 712 and Taveras v City of New York, 108 AD3d 614: Distinguished formal appearances (answer, notice of appearance, time-extending motion) from informal appearances (active merits litigation), anchoring the “appearance” inquiry.
Jaramillo v Asconcio, 151 AD3d 947: Informal participation on the merits confers in personam jurisdiction—key to why a mere hardship filing is not enough.
Wilmington Sav. Fund Socy., FSB v Thomas, 226 AD3d 1064: Explained CEEFPA’s operative stay periods and extensions, situating the defendant’s hardship declaration within the pandemic-era statutory scheme.
PennyMac Corp. v Barbosa, 189 AD3d 863 and U.S. Bank N.A. v Smith, 210 AD3d 725: Directly held that filing a hardship declaration does not constitute active litigation and therefore is not an informal appearance; this authority compelled rejection of the trial court’s contrary view.
HSBC Bank USA, N.A. v Whitter, 159 AD3d 942; Nationstar Mtge., LLC v Cohen, 185 AD3d 1039; Federal Natl. Mtge. Assn. v Britt, 205 AD3d 683: Process server affidavits establish prima facie service; a defendant must overcome this presumption to obtain vacatur under CPLR 5015(a)(4).
Citmortgage, Inc. v Barton, 212 AD3d 706; Rattner v Fessler, 202 AD3d 1011: A sworn denial combined with documentary or other corroborating evidence may warrant a traverse hearing, distinguishing robust challenges from conclusory assertions.
Citimortgage, Inc. v Cardali, 230 AD3d 467; Newlands Asset Holding Trust v Vasquez, 218 AD3d 786: Minor discrepancies between the person served and the process server’s description usually do not justify a hearing.
Tuttnauer USA Co., Ltd. v Russo, 216 AD3d 846; U.S. Bank N.A. v Bienenstock, 184 AD3d 593; PNC Bank, N.A. v Bannister, 161 AD3d 1114; Deutsche Bank Natl. Trust Co. v Kenol, 205 AD3d 1004: Conclusory claims like “I was not home” or unsubstantiated challenges will not overcome the presumption; specific, corroborated facts are necessary.
Bank of N.Y. Mellon v Giammona, 219 AD3d 436: New arguments raised for the first time in a reply brief are not considered—applied to dispose of certain defense contentions procedurally.

2) The Court’s Legal Reasoning

A. Filing a CEEFPA Hardship Declaration Is Not an Appearance and Does Not Waive Personal Jurisdiction

The trial court had ruled that the hardship declaration “must be deemed an appearance,” thereby deeming the lack-of-jurisdiction defense waived for failure to timely move. The Second Department rejected this. Citing PennyMac and Smith, it held that filing a hardship declaration—especially via electronic filing—does not amount to “actively litigating the action on the merits,” and therefore is not an informal appearance under CPLR 320. Nor is it a formal appearance (no answer, no notice of appearance, no time-extending motion). Accordingly, the defense of lack of personal jurisdiction was not waived on that basis.

This clarification matters: CEEFPA afforded a procedural stay mechanism to homeowners; invoking it does not signal acceptance of the court’s jurisdiction or participation in merits litigation. The court emphasized doctrinal consistency by aligning the appearance analysis with prior foreclosure decisions holding that the hardship declaration is not an appearance.

B. Proper “Deliver-and-Mail” Service Under CPLR 308(2) and the Insufficiency of the Defendant’s Rebuttal

The court affirmed the denial of the vacatur motion because the plaintiff proved proper service. The process server attested to CPLR 308(2) service by:

Delivering the summons and complaint to a person of suitable age and discretion (the defendant’s fiancée, a co-resident) at the defendant’s dwelling; and
Mailing the summons to the defendant at the same address.

This affidavit created a presumption of proper service. To obtain vacatur under CPLR 5015(a)(4), the defendant needed to overcome that presumption. He did not. The affidavits offered only minor, weakly substantiated discrepancies between the fiancée’s appearance and the process server’s description—insufficient to trigger a traverse hearing. Assertions that the fiancée would not have been home at the time of service were deemed conclusory and unsubstantiated. Consistent with long-standing Second Department authority, such thin challenges do not warrant evidentiary hearings and cannot defeat a facially valid process server affidavit.

Because service was proper, the judgment was not jurisdictionally defective and vacatur under CPLR 5015(a)(4) was correctly denied. This explains the court’s “right result, wrong reason” approach—affirming even though the trial court misconceived the waiver issue.

3) Impact and Implications

Clarifies waiver doctrine in the pandemic context: A CEEFPA hardship declaration is not an appearance. Borrowers who filed hardship declarations did not thereby forfeit a personal jurisdiction defense. Trial courts should not treat hardship filings as waivers.
Reemphasizes the rigor of service challenges: A process server’s affidavit remains powerful. Defendants must present detailed, corroborated evidence (e.g., contemporaneous records, employment logs, geo-location data, surveillance footage, sworn third-party statements) to obtain a traverse hearing.
Affirmance on alternative grounds encourages precision below: Even when a trial court misstates the waiver rule, an appellate court may affirm if the record shows service was proper. Litigants should brief both waiver and service comprehensively at the trial level.
Practical effect for pending foreclosure matters: Pandemic-era cases where defendants filed hardship declarations but did not otherwise appear should not be deemed to have waived personal jurisdiction. However, absent defects in service, jurisdictional vacatur will still fail.
CEEFPA’s limited function preserved: The decision underscores that the hardship declaration functions as a stay of execution for a time-limited window; it does not change party status, confer appearances, or alter jurisdictional defaults.

Complex Concepts Simplified

Personal jurisdiction: A court’s authority over a person. It depends on proper service of process. If service is defective, the court lacks power to bind the defendant, and any judgment is void.
Appearance (formal vs. informal): A party formally appears by serving an answer, a notice of appearance, or filing a motion that extends time to answer. Informal appearance occurs by actively litigating the merits (e.g., making substantive motions). Either can waive a personal jurisdiction defense if not timely raised. Filing a hardship declaration is neither.
CEEFPA hardship declaration: A pandemic-era statutory form that, when filed, stayed the execution of foreclosure judgments for defined periods. It was a protective pause—not a merits filing or consent to jurisdiction.
CPLR 308(2) service (“deliver-and-mail”): Service on a natural person by delivering the summons to a person of suitable age and discretion at the defendant’s home or business and mailing a copy to the defendant. A process server’s affidavit reciting these steps is prima facie proof.
Traverse hearing: An evidentiary hearing to determine whether service was properly made. To get one, a defendant needs a detailed, sworn denial backed by evidence—not conclusory statements or minor inconsistencies.
CPLR 5015(a)(4): A vehicle to vacate a default judgment for lack of jurisdiction. It is not subject to the typical “reasonable excuse” and “meritorious defense” requirements; the only question is whether jurisdiction existed (i.e., whether service was proper or was waived).
Order of reference and referee’s report: In foreclosure, the court may appoint a referee to compute the amount due; the referee’s report is often confirmed before entering a judgment of foreclosure and sale.

Practice Pointers

For defendants: If challenging service, provide specifics—dates, times, who was present, supporting documents (time-stamped records, digital evidence, employer certifications), and third-party affidavits. Generic statements usually fail.
For plaintiffs: Ensure process server affidavits are detailed and accurate; confirm that the “person of suitable age and discretion” truly resides at the premises; retain proof of timely mailing under CPLR 308(2).
For trial courts: Do not equate a CEEFPA hardship filing with an appearance. Address service on its merits; if the defendant’s rebuttal is specific and corroborated, hold a traverse hearing; otherwise, deny without one.
For all parties: Remember that appellate courts may affirm on any ground supported by the record. Preserve multiple, alternative bases for relief or affirmance.

Conclusion

U.S. Bank Trust, N.A. v. Lane cements a critical procedural principle: the filing of a CEEFPA hardship declaration does not constitute an appearance and does not waive a personal jurisdiction defense. At the same time, it reinforces the formidable presumption created by a process server’s affidavit under CPLR 308(2) and the demanding standard defendants must meet to obtain a traverse hearing and vacatur under CPLR 5015(a)(4). The ruling harmonizes pandemic-era foreclosure practice with longstanding New York jurisdictional doctrine, ensuring that protective statutory stays are not misread as implied consent to jurisdiction, while preserving the integrity of service rules that anchor due process.