No Prejudice, No Abandonment: Second Department Reaffirms Discretionary Nonforfeiture Under 22 NYCRR 202.48

Introduction

In Manufacturers & Traders Trust Company v. Ahmed (2025 NY Slip Op 04898), the Appellate Division, Second Department, addressed whether technical defects in complying with New York’s notice-of-settlement rule (22 NYCRR 202.48) require vacatur of a prior order or a finding that a motion was abandoned. The case arises from a long-running residential mortgage foreclosure involving an original lender (NetBank), an assignee (Hudson City Savings Bank, FSB), and a substituted plaintiff (Manufacturers and Traders Trust Company).

The core issue on appeal was narrow but consequential: should an order granting summary judgment and an order of reference be vacated under 22 NYCRR 202.48(b) because the plaintiff’s proof of service for the notice of settlement was defective (omitting the recipients) and, as the defendant argued, failed to specify a settlement date? The Second Department held that even though the record did not show strict compliance with the rule, vacatur was not warranted because the defendant actually received the notice, suffered no prejudice, and vacatur would undermine judicial economy and the repose that the rule is meant to promote.

The decision also reiterates two important appellate practice rules: (1) there is no appeal from an order denying a motion to vacate a decision (as opposed to an order), and (2) a limited notice of appeal constrains the issues the appellate court will reach.

Summary of the Opinion

• The court dismissed the appeal “from so much of the order … as denied that branch of [defendant’s] motion which was pursuant to 22 NYCRR 202.48(b) to vacate the decision” because no appeal lies from an order denying a motion to vacate a decision (citing Coradin v New York City Tr. Auth., 3 AD3d 547).
• The court affirmed the order insofar as reviewed, upholding the Supreme Court’s denial of the defendant’s request, under 22 NYCRR 202.48(b), to vacate the May 11, 2017 order granting summary judgment and an order of reference.
• While acknowledging the plaintiff’s technical noncompliance with 22 NYCRR 202.48 (the affidavit of mailing omitted recipients), the court found no prejudice to the defendant—who did not deny receiving the notice of settlement or the opportunity to counter—and concluded that denying vacatur would better serve the rule’s goals of repose and conserving judicial resources (citing U.S. Bank Trust, N.A. v Rahman, 218 AD3d 626; Deutsche Bank Natl. Trust Co. v Quinn, 186 AD3d 561).
• The court declined to consider the defendant’s CPLR 5015(a)(5) argument to vacate the judgment of foreclosure and sale, holding that it was beyond the scope of his limited notice of appeal (citing McSparron v McSparron, 87 NY2d 275; Catlin Ins. Co., Inc. v Falco Constr. Corp., 216 AD3d 734).
• One bill of costs was awarded to the plaintiff.

Case Background and Procedural Posture

The defendant, Helal Ahmed, executed a $600,000 note in 2005 in favor of NetBank, secured by a mortgage on residential property in East Elmhurst. After an alleged payment default on December 1, 2010, the mortgage was assigned to Hudson City Savings Bank, FSB, which filed a foreclosure action in 2015. In 2016, Hudson City moved for summary judgment, to strike the answer, to substitute Manufacturers & Traders Trust Company (M&T) as plaintiff, and for an order of reference. The court issued a decision on December 6, 2016, granting the motion with a “Settle Order” directive.

The plaintiff served a notice of settlement by mail on February 2, 2017, within 60 days of the filing date of the decision (December 29, 2016), and the Supreme Court signed the proposed order on May 11, 2017. A judgment of foreclosure and sale followed in November 2018. In February 2020, the Supreme Court vacated a prior order (dated April 19, 2018) granting a default judgment of foreclosure and sale after the defendant moved under CPLR 5015(a)(1).

In 2021, the defendant moved to vacate (1) the December 2016 decision and May 11, 2017 order under 22 NYCRR 202.48(b), contending the plaintiff abandoned its motion due to defective notice-of-settlement procedures, and (2) the judgment of foreclosure and sale under CPLR 5015(a)(5). The Supreme Court denied the motion. The defendant appealed.

Key Holdings at a Glance

• Appealability: No appeal lies from an order denying a motion to vacate a decision; appeal dismissed to that extent (Coradin).
• 22 NYCRR 202.48(b): Even with defective proof of service for a notice of settlement, vacatur is not required where defendant had actual notice, suffered no prejudice, and repose/judicial economy would be served by denying vacatur (Rahman; Quinn; Atedgi; Lola Roberts; Campbell).
• Scope of Appeal: A limited notice of appeal prevents review of issues not encompassed by that notice (McSparron; Catlin).

Analysis

1) Precedents Cited and Their Role

The court anchored its reasoning in a well-developed line of Second Department authority addressing both procedural appealability and the operation of 22 NYCRR 202.48:

• Coradin v New York City Tr. Auth., 3 AD3d 547: Establishes that appeals do not lie from orders denying motions to vacate a decision. This principle compelled dismissal of the appeal as to the branch seeking to vacate the December 6, 2016 decision.
• U.S. Bank Trust, N.A. v Rahman, 218 AD3d 626: Articulates the dual commands of 22 NYCRR 202.48—timely submission within 60 days and service of a proposed order on notice—and emphasizes that abandonment should not be declared where it would not bring “repose to court proceedings” and would “waste judicial resources.” The Ahmed court quoted and applied this repose rationale in declining to vacate.
• Aurora Loan Servs., LLC v Yogev, 194 AD3d 994: Illustrates that where the record fails to demonstrate compliance with 22 NYCRR 202.48, the court may recognize technical noncompliance. Ahmed acknowledges such a failure here—the affidavit of mailing omitted recipients—before turning to prejudice and repose.
• JP Morgan Chase Bank, N.A. v Atedgi, 162 AD3d 756: Supports the discretionary nature of the remedy; even where a defect exists, denial of relief under 22 NYCRR 202.48(b) can be a provident exercise of discretion.
• Lola Roberts Beauty Salon, Inc. v Able Motor Cars Corp., 213 AD3d 751: Emphasizes the significance of prejudice; defects may be excused absent prejudice where the opponent had actual notice and the opportunity to be heard.
• Deutsche Bank Natl. Trust Co. v Quinn, 186 AD3d 561 and Campbell v Campbell, 107 AD3d 929: Reinforce the policy ground—keeping proceedings on track where vacatur would undermine repose and expend needless judicial resources.
• McSparron v McSparron, 87 NY2d 275 and Catlin Ins. Co., Inc. v Falco Constr. Corp., 216 AD3d 734: Illuminate the “limited notice of appeal” doctrine, confining appellate review to issues encompassed by the notice and thus precluding review of the defendant’s CPLR 5015(a)(5) contention.

2) The Court’s Legal Reasoning

The Second Department followed a clear, layered approach:

1. Appealability Threshold: The court first disposed of the portion of the appeal aimed at vacating the 2016 decision, reiterating that a “decision” is not an appealable paper and a party cannot appeal from an order denying a motion to vacate a decision (Coradin).
2. Rule 202.48 Compliance: Turning to the May 11, 2017 order, the court parsed 22 NYCRR 202.48:
   • Timing: Proposed orders must be submitted within 60 days after the signing and filing of the decision (22 NYCRR 202.48[a]). The court treated the filing date—December 29, 2016—as the anchor, and found the February 2, 2017 mailing timely.
   • Service on Notice: A copy of the proposed order must be served with notice of settlement (22 NYCRR 202.48[c]) by personal service at least five days or by mail at least ten days before the settlement date. Here, the notice of settlement was mailed, but the affidavit of mailing omitted the recipients. The court therefore concluded that the record did not establish strict compliance with the rule’s service proof requirements (citing Aurora).
   • Abandonment and Good Cause: The rule states that failure to timely submit “shall be deemed an abandonment … unless for good cause shown” (22 NYCRR 202.48[b]). The Second Department underscores that “abandonment” is not automatic where the defect does not impede repose and would waste judicial resources (Rahman).
3. Prejudice and Repose: Despite the defect, the court affirmed the denial of vacatur because:
   • The defendant did not deny receiving the notice of settlement or having an opportunity to submit a counter-proposal before the order was signed. This eliminated any cognizable prejudice (Lola Roberts).
   • Denying the motion “brought repose to the proceedings and preserved judicial resources” (Quinn; Campbell), aligning with the underlying purpose of the rule (Rahman).
   The court characterized this as a provident exercise of discretion (Atedgi).
4. Scope of Appeal: Finally, the court declined to consider the CPLR 5015(a)(5) attack on the judgment of foreclosure and sale because the defendant’s notice of appeal was limited and did not encompass that issue (McSparron; Catlin).

3) Practical Impact and Forward-Looking Significance

Ahmed solidifies a pragmatic, prejudice-focused approach to 22 NYCRR 202.48 in the Second Department:

• For plaintiffs and prevailing movants: Technical defects in the proof of service accompanying a notice of settlement—such as an affidavit that omits the recipients—will not necessarily vitiate an order or result in “abandonment” of the motion when the adversary actually received notice and had the opportunity to respond. Still, the opinion is not a license for laxity; careful compliance remains the best practice to avoid motion practice on technical points.
• For defendants and opponents: To obtain vacatur under 22 NYCRR 202.48(b), it is not enough to point to a defect. You must persuasively show prejudice (lack of notice or opportunity to be heard) and demonstrate that vacatur advances, rather than frustrates, repose and judicial economy. “Gotcha” procedural arguments untethered to prejudice will carry less weight.
• For trial courts: The opinion endorses a discretion-guided, purpose-driven application of the rule—favoring finality, conserving judicial resources, and looking beyond technical noncompliance where actual notice and fairness are intact.
• Appellate practice: Ahmed underscores precision in notices of appeal. A “limited” notice constrains review; issues not encompassed may be deemed beyond scope even if they were argued below. It also reinforces the longstanding distinction between decisions and orders for appealability.

Complex Concepts Simplified

• “Settle Order”: When a court issues a decision with the directive “Settle Order,” it instructs the prevailing party to draft a formal order that tracks the decision and to serve it “on notice” to the adversary, who may submit counter language. The judge then reviews and signs the finalized order. The process is governed by 22 NYCRR 202.48.
• 22 NYCRR 202.48(a)-(c): This court rule requires (a) submission of the proposed order for signature within 60 days after the decision is signed and filed; (b) abandonment if not timely submitted “unless for good cause shown”; and (c) service of the proposed order with a “notice of settlement” giving the adversary a minimum of five days’ (personal) or ten days’ (mail) notice before the settlement date, along with proof of such service. In Ahmed, the affidavit of mailing omitted the recipients, creating a technical deficiency.
• “Abandonment” under 22 NYCRR 202.48(b): The rule provides a default consequence for failing to timely submit an order, but courts retain discretion to avoid abandonment where adherence to the literal rule would not promote finality (repose) and would waste resources. Actual notice and lack of prejudice can constitute “good cause.”
• “Prejudice”: In this context, prejudice generally means a meaningful impairment of the opponent’s ability to be heard or protect their interests (e.g., lack of notice of the proposed order or inability to submit counter-proposals). The defendant here did not deny receipt or opportunity, so prejudice was absent.
• Order of Reference / Referee to Compute: In foreclosure practice, once liability and default are established, a court may appoint a referee to “ascertain and compute” the amount due—interest, fees, and other sums—before entry of a judgment of foreclosure and sale.
• Decision vs. Order (Appealability): A “decision” explains the court’s reasoning; an “order” is the formal, appealable directive. One cannot appeal an order that merely denies a motion to vacate a “decision.” Appeals must be taken from orders or judgments.
• CPLR 5015(a)(1) vs. (a)(5): Subsection (a)(1) allows relief from a default due to excusable neglect; (a)(5) permits relief when the judgment is based on a prior order or judgment that has been vacated or reversed, among other grounds. In Ahmed, the court previously vacated an April 2018 order on (a)(1) grounds, but the (a)(5) challenge to the judgment of foreclosure and sale was not reached on appeal because of the limited notice of appeal.

Procedural Timeline

• 2005-09-19: Defendant executes $600,000 note and mortgage (NetBank).
• 2010-12-01: Alleged payment default.
• 2015-05-20: Hudson City Savings Bank files foreclosure action.
• 2016-12-06: Supreme Court decision granting summary judgment and order of reference; directive to “Settle Order.”
• 2016-12-29: Decision filed (triggers 60-day clock under 22 NYCRR 202.48[a]).
• 2017-02-02: Notice of settlement mailed (within 60 days), but affidavit omits recipients.
• 2017-05-11: Court signs plaintiff’s proposed order (summary judgment/order of reference).
• 2018-11-26: Judgment of foreclosure and sale issued (following April 2018 order later vacated).
• 2020-02-03: Court vacates April 19, 2018 order (CPLR 5015[a][1]).
• 2021-07: Defendant moves to vacate under 22 NYCRR 202.48(b) and CPLR 5015(a)(5).
• 2023-10-23: Supreme Court denies defendant’s motion.
• 2025-09-10: Second Department dismisses in part and affirms in part.

Practice Pointers

• For movants:
  • Track the filing date of the decision to calculate the 60-day submission window.
  • Include a clear settlement date in the notice of settlement, and serve it with adequate lead time (5 days personal / 10 days mail).
  • Ensure the affidavit of service identifies recipients and method; file it with the proposed order.
  • Retain proof of actual notice in case of technical challenges.
• For opponents:
  • Timely object to proposed orders and consider submitting a counter-proposed order before the judge signs.
  • When seeking vacatur under 22 NYCRR 202.48(b), demonstrate concrete prejudice and explain why vacatur would further repose and efficiency, not undermine them.
  • Draft broad enough notices of appeal to encompass all issues you wish to raise, including any CPLR 5015 grounds.

Conclusion

Manufacturers & Traders Trust Co. v. Ahmed reinforces a measured, purpose-driven application of 22 NYCRR 202.48: technical missteps in notice-of-settlement practice will not automatically undo orders where the opponent had actual notice, suffered no prejudice, and where vacatur would thwart finality and waste judicial resources. The opinion fits squarely within Second Department jurisprudence emphasizing discretion, prejudice, and repose (Rahman, Atedgi, Quinn, Campbell), and it underscores vital appellate principles concerning the non-appealability of decisions and the constraining effect of limited notices of appeal (Coradin; McSparron; Catlin).

The ruling’s practical message is clear. Compliance with 22 NYCRR 202.48 remains important, but the remedy for noncompliance is not mechanistic forfeiture. Courts will look to whether the opponent truly lacked notice or suffered prejudice and whether vacatur serves, rather than disserves, the orderly and efficient resolution of cases. In foreclosure practice and beyond, Ahmed will likely curb purely technical challenges to settled orders while reminding practitioners to perfect the record and protect appellate rights with carefully framed notices of appeal.