FAPA Applies to Unenforced Foreclosure Judgments; Unilateral De‑Acceleration Cannot Revive the Statute of Limitations — US Bank N.A. v. Livoti

FAPA Applies to Unenforced Foreclosure Judgments; Unilateral De‑Acceleration Cannot Revive the Statute of Limitations — US Bank N.A. v. Livoti

Introduction

This commentary analyzes the Appellate Division, Second Department’s decision in US Bank National Association v. Livoti, 2025 NY Slip Op 06212 (Nov. 12, 2025). The case sits at the confluence of New York foreclosure practice, the statute of limitations, and the Legislature’s 2022 enactment known as the Foreclosure Abuse Prevention Act (FAPA) (L 2022, ch 821).

The core dispute: whether a lender who accelerated a mortgage in 2009 could later “reset” the six-year limitations period with a unilateral de‑acceleration letter in 2015 (as permitted under then-existing case law), and whether FAPA—effective December 30, 2022—retroactively nullifies that reset in a case where a judgment of foreclosure and sale had been entered but not yet enforced. The borrower, Stella Livoti, argued the action was time‑barred; the lender, US Bank N.A., argued FAPA should not apply retroactively and, alternatively, that its application would be unconstitutional.

The decision clarifies several pivotal issues for foreclosure litigation:

  • FAPA applies retroactively to actions where a final judgment of foreclosure and sale has not been enforced; scheduling a sale does not constitute “enforcement.”
  • CPLR 203(h), enacted by FAPA, bars unilateral acts by lenders (such as de‑acceleration letters or discontinuances) from reviving or resetting the accrual of the foreclosure statute of limitations.
  • Borrowers may obtain renewal of prior adverse orders based on FAPA as a change in the law under CPLR 2221(e).
  • Constitutional challenges to FAPA (Takings, Due Process, Contract Clauses) failed on this record.

Summary of the Opinion

The Second Department reversed the Supreme Court’s order that had denied Livoti’s motion to renew. It held that:

  • FAPA constitutes a change in law warranting renewal under CPLR 2221(e).
  • FAPA applies to this case because the final judgment of foreclosure and sale, though entered before FAPA’s effective date, had not been “enforced.” A scheduled auction does not equal enforcement.
  • The mortgage debt was accelerated in August 2009 when the lender’s predecessor filed a foreclosure action seeking the full balance. The six-year limitations period thus began in 2009.
  • Under FAPA’s CPLR 203(h), the lender’s 2015 de‑acceleration letter could not unilaterally reset the statute of limitations.
  • The 2016 foreclosure action was time‑barred. The Court vacated prior orders granting summary judgment to the lender, the order confirming the referee’s report, and the order and judgment of foreclosure and sale, and granted the borrower’s cross‑motion for summary judgment dismissing the complaint as time‑barred.
  • Constitutional objections to FAPA were rejected.

Case Background and Procedural Posture

  • August 2007: Livoti executed a $1,000,000 note secured by a mortgage on property in Massapequa.
  • August 2009: CitiMortgage (plaintiff’s predecessor) commenced a foreclosure action, thereby accelerating the debt.
  • April 16, 2015: The prior action was dismissed as abandoned under CPLR 3215(c).
  • July 2015: CitiMortgage sent a de‑acceleration (rescission) letter.
  • May 2016: US Bank commenced the present foreclosure action.
  • October 8, 2019: Supreme Court granted the lender summary judgment, struck Livoti’s defenses, and issued an order of reference; denied Livoti’s limitations cross‑motion. That disposition was affirmed on appeal (US Bank N.A. v Livoti, 209 AD3d 1054, 1057).
  • December 20, 2022: Supreme Court granted confirmation of the referee’s report and entered an order and judgment of foreclosure and sale.
  • December 30, 2022: FAPA became effective.
  • February–April 2023: The lender served notice of entry of the judgment and scheduled a foreclosure sale for April 25, 2023.
  • March 2023: Livoti moved for leave to renew based on FAPA; the Supreme Court denied renewal on September 21, 2023.
  • November 12, 2025: The Second Department reversed, granted renewal, vacated the prior orders and the judgment of foreclosure and sale, and dismissed the action as time‑barred.

Analysis

Precedents Cited and Their Influence

  • CPLR 2221(e) — Motion to Renew: The Court relied on the proposition that a motion to renew is appropriate when there has been a change in the law that would change the prior determination (JPMorgan Chase Bank, N.A. v Eze, 232 AD3d 865, 866). This opened the path to revisit the 2019 orders and the 2022 judgment in light of FAPA.
  • Acceleration and Limitations:
    • CPLR 213(4) sets a six-year limitations period for mortgage foreclosure claims.
    • Acceleration occurs when the lender sues for the full balance due; limitations run on the entire debt from that date (e.g., Collins v Bank of N.Y. Mellon, 227 AD3d 948, 950; Sarkar v Deutsche Bank Trust Co. Ams., 225 AD3d 641, 643).
    • The Court applied that black-letter rule here: acceleration in 2009 started the six-year clock, expiring in 2015; the 2016 action was presumptively time‑barred (see Bank of N.Y. Mellon v Norton, 219 AD3d 680, 682; U.S. Bank N.A. v Jarrett, 233 AD3d 731, 732).
  • Freedom Mortgage v. Engel and FAPA’s Response:
    • Pre‑FAPA, the Court of Appeals allowed lenders to revoke acceleration through unilateral actions (like clear de‑acceleration letters or discontinuance), thereby restarting the six-year clock (Freedom Mtge. Corp. v Engel, 37 NY3d 1, 32).
    • FAPA legislatively abrogated that aspect of Engel by adding CPLR 203(h), which now provides that once the foreclosure cause of action accrues, no party may unilaterally revive or reset accrual or extend the limitations period (FV‑1, Inc. v Palaguachi, 234 AD3d 818, 820–821; FV‑1 Inc. v Samuels, 240 AD3d 757, 759).
    • Applying CPLR 203(h), the Court held the 2015 rescission letter had no effect on limitations.
  • FAPA’s Retroactivity and “Enforcement” Threshold:
    • By its terms, FAPA “took effect immediately” and applies “to all actions commenced on an instrument described under [CPLR 213(4)] in which a final judgment of foreclosure and sale has not been enforced” (Wells Fargo Bank, N.A. v Edwards, 231 AD3d 1189, 1193, quoting L 2022, ch 821, § 10; Genovese v Nationstar Mtge. LLC, 223 AD3d 37, 44; 97 Lyman Ave., LLC v MTGLQ Invs., L.P., 233 AD3d 1038, 1042).
    • The Court agreed that the Legislature clearly indicated retroactive application and further held that merely scheduling a sale is not “enforcement” (see also FV‑1 Inc. v Samuels, 240 AD3d at 760; Wilmington Sav. Fund Socy., FSB v Thomas, 226 AD3d 1064, 1067).
  • Constitutional Challenges:
    • The lender’s Takings, Due Process, and Contract Clause challenges failed (see FV‑1, Inc. v Palaguachi, 234 AD3d at 822; Deutsche Bank Natl. Trust Co. v Dagrin, 233 AD3d 1065, 1069–1071; 97 Lyman Ave., LLC v MTGLQ Invs., L.P., 233 AD3d at 1043).
    • Those authorities collectively uphold FAPA’s retroactive reach in pending, unenforced foreclosure matters.

Legal Reasoning

  1. Renewal Based on Change in Law: Under CPLR 2221(e)(2), a change in law that would alter the prior determination is a valid basis for renewal. FAPA’s enactment after the 2019 and 2022 orders satisfied that requirement. The Court exercised its discretion to revisit—and ultimately vacate—earlier rulings.
  2. FAPA’s Retroactivity Expressly Reaches This Posture: The Legislature specified that FAPA applies “immediately” to all CPLR 213(4) actions where a final judgment “has not been enforced.” Because the scheduled auction had not occurred, the judgment remained unenforced. The Court emphasized that a sale date on the calendar does not constitute enforcement.
  3. Acceleration Occurred in 2009; De‑Acceleration Letter Ineffective:
    • The 2009 foreclosure filing elected to call the full balance due, accelerating the debt and starting the six‑year limitations clock.
    • Even though the prior action was dismissed as abandoned in 2015 and the lender issued a de‑acceleration letter, FAPA’s CPLR 203(h) prohibits unilateral acts that purport to revive or reset accrual. Thus, neither the dismissal nor the letter halted or reset the limitations clock.
    • With accrual fixed in 2009, the 2016 action fell outside the six‑year window.
  4. Burden and Proof on Summary Judgment:
    • The borrower made a prima facie showing that the action was time‑barred because the 2016 filing post‑dated the 2009 accrual by more than six years (see Bank of N.Y. Mellon v Norton, 219 AD3d at 682; U.S. Bank N.A. v Jarrett, 233 AD3d at 732).
    • The lender failed to raise a triable issue in opposition (Wells Fargo Bank, N.A. v Brandt, 230 AD3d 623, 625).
  5. Constitutional Arguments Rejected: Consistent with recent appellate authority, the Court rejected the lender’s claims that FAPA’s retroactive application violates the Takings, Due Process, or Contract Clauses.

Impact

US Bank N.A. v. Livoti crystallizes and operationalizes FAPA’s core directives within the Second Department, with several practical consequences:

  • Unilateral De‑Acceleration Is Ineffective: After FAPA, lenders cannot rely on de‑acceleration letters, voluntary discontinuances, or similar unilateral steps to reset or extend the limitations period. Those tactics, once sanctioned by Engel, no longer work under CPLR 203(h).
  • “Enforcement” Means More Than Entry of Judgment: A judgment of foreclosure and sale is not “enforced” merely because it is entered or a sale is scheduled. Until enforcement occurs, FAPA applies retroactively to pending cases, potentially undoing judgments and sales that have not yet occurred.
  • Renewal Is a Viable Path for Borrowers: Borrowers who previously lost statute-of-limitations arguments before FAPA may obtain relief by moving to renew under CPLR 2221(e), even where adverse orders were affirmed on appeal, provided the foreclosure judgment has not been enforced.
  • Risk Assessment for Lenders:
    • Lenders must rigorously track the dates of acceleration and ensure any new action is commenced within six years of that acceleration.
    • Where a prior acceleration occurred more than six years earlier, the claim is likely time‑barred unless there is a non‑unilateral basis to toll or reset accrual (not at issue here).
    • Scheduling a sale does not insulate a judgment from FAPA. Lenders may face vacatur of judgments and denial of confirmation motions if the action is time‑barred under FAPA.
  • Systemic Effects: The ruling aligns with a growing body of Second Department decisions implementing FAPA, promoting uniformity and signaling to trial courts that FAPA can retroactively invalidate reliance on Engel-era de‑acceleration practices in unenforced cases.

Complex Concepts Simplified

  • Acceleration: When a lender declares the entire mortgage debt immediately due, typically by filing a foreclosure complaint seeking the full balance. This starts the six-year statute of limitations for foreclosure.
  • De‑Acceleration: A lender’s attempt to undo acceleration and return the loan to installment status. Pre‑FAPA, unilateral de‑acceleration (e.g., a rescission letter) could restart the limitations clock under Engel. FAPA now forbids unilateral resetting (CPLR 203(h)).
  • Statute of Limitations (CPLR 213[4]): The time limit—six years—within which a foreclosure action must be commenced. If the lender sues after six years from acceleration, the action is time‑barred.
  • FAPA (L 2022, ch 821): A 2022 law designed to prevent “abuse” of procedural devices to evade limitations in mortgage cases. The decision applies FAPA’s CPLR 203(h), and its retroactivity clause (§ 10), to bar unilateral acts from resetting accrual and to reach cases with unenforced foreclosure judgments.
  • “Enforcement” of a Judgment: For FAPA’s retroactivity, a judgment of foreclosure and sale must have been “enforced” to be beyond the statute’s reach. This decision holds that a scheduled sale is not enforcement; until a sale occurs, the judgment remains unenforced.
  • Motion to Renew (CPLR 2221[e]): A procedural device allowing a party to seek reconsideration of a prior order based on new facts or a change in law that would alter the outcome. FAPA qualifies as such a change.
  • CPLR 3215(c) Dismissal as Abandoned: If a plaintiff fails to take proceedings for the entry of judgment within one year after a defendant’s default, the action may be dismissed as “abandoned.” Under FAPA, such dismissals do not, by themselves, reset or revive the limitations period via unilateral acts.

Practical Takeaways and Guidance

  • For Lenders:
    • Identify the earliest acceleration date (often the filing of the first foreclosure seeking the full balance). Count six years from that date. If you are beyond six years, the claim is presumptively time‑barred.
    • Do not rely on de‑acceleration letters, discontinuances, or other unilateral measures to reset the clock. They are ineffective under CPLR 203(h).
    • Recognize that even with a judgment of foreclosure and sale in hand, FAPA can still apply if the judgment has not been “enforced.” A scheduled sale is not enough.
    • Expect constitutional challenges to FAPA to be unavailing given the trend of appellate decisions.
  • For Borrowers:
    • Examine the litigation history for prior accelerations. If more than six years elapsed before the current action, consider a limitations defense.
    • If you previously lost a limitations argument before FAPA, consider a motion to renew under CPLR 2221(e) if the judgment has not been enforced.
  • For Courts and Practitioners:
    • Apply FAPA retroactively in unenforced cases, consistent with L 2022, ch 821, § 10.
    • Distinguish between “entry” and “enforcement” of judgments; do not equate scheduling a sale with enforcement.
    • Be mindful that law-of-the-case does not bar renewal on a statutory change; CPLR 2221(e) permits revisiting prior orders and judgments.

Conclusion

US Bank N.A. v. Livoti reinforces the Legislature’s intent in FAPA to eliminate unilateral devices for extending foreclosure statutes of limitation and to apply that reform retroactively to cases with unenforced judgments. The decision squarely holds that:

  • Acceleration by filing a foreclosure action starts the six-year clock.
  • Unilateral de‑acceleration does not reset accrual after FAPA (CPLR 203[h]).
  • FAPA applies retroactively in actions where a final judgment has not been “enforced”; a scheduled sale is not enforcement.
  • Borrowers may obtain renewal and vacatur of prior orders and judgments predicated on pre‑FAPA law.

In the broader legal context, Livoti aligns the Second Department with a consistent, text-driven application of FAPA, signalling that Engel’s de‑acceleration workaround is no longer viable in pending, unenforced foreclosure matters. The ruling compels exacting limitations analysis and resets strategic expectations for both lenders and borrowers in New York mortgage litigation.

Case Details

Year: 2025
Court: Appellate Division of the Supreme Court, New York

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