Retroactive Application and Constitutionality of New York’s Foreclosure Abuse Prevention Act (FAPA):
Commentary on Deutsche Bank Natl. Trust Co. v. Testa, 2025 NY Slip Op 06418 (4th Dept)

I. Introduction

The Appellate Division, Fourth Department’s decision in Deutsche Bank Natl. Trust Co. v. Testa, 2025 NY Slip Op 06418, is a significant contribution to New York foreclosure jurisprudence in the post–Foreclosure Abuse Prevention Act (“FAPA”) era. The opinion consolidates and extends a now-emerging consensus in the Appellate Division that:

FAPA applies retroactively to mortgage foreclosure actions governed by CPLR 213(4);
FAPA constitutionally abrogates the rule of Freedom Mtge. Corp. v Engel, 37 NY3d 1 (2021), under which lenders could unilaterally reset the statute of limitations by voluntarily discontinuing a prior foreclosure action;
Once a mortgage foreclosure claim is time-barred, not only must the action be dismissed with prejudice, but the borrower is entitled under RPAPL 1501(4) to cancellation and discharge of the mortgage of record.

The decision therefore has systemic implications for:

lenders and servicers attempting to revive or reconfigure long-defaulted loans;
borrowers defending foreclosure actions commenced after a prior acceleration; and
trial courts applying FAPA and dealing with constitutional attacks on it.

II. Background of the Case

A. Parties and Procedural Posture

Plaintiff: Deutsche Bank National Trust Company, as trustee for Ameriquest Mortgage Securities Inc., Asset-Backed Pass-Through Certificates, Series 2005-R5 (a securitized mortgage trust).
Defendant: Peter F. Testa, a mortgagor on the subject property. He was both a defending party and cross-appellant.

The case arises out of a mortgage foreclosure action commenced in 2018 concerning a mortgage that had already been the subject of an earlier foreclosure action filed in 2007. The 2007 action expressly accelerated the mortgage debt by declaring the entire principal sum immediately due and payable.

In Supreme Court (Chautauqua County), Deutsche Bank moved for summary judgment on its foreclosure complaint. Testa cross-moved, seeking:

summary judgment dismissing the complaint as time-barred under CPLR 213(4); and
relief under RPAPL article 15 (a “quiet title” mechanism) cancelling and discharging the mortgage of record.

Supreme Court:

Denied plaintiff’s motion for summary judgment;
Granted defendant’s cross-motion “to the extent” of dismissing the complaint with prejudice as time-barred;
But did not issue a judgment on the counterclaim cancelling and discharging the mortgage under RPAPL 1501(4).

Deutsche Bank appealed the dismissal of its complaint. Testa cross-appealed, arguing that having dismissed the complaint with prejudice, Supreme Court was required to grant affirmative relief on his counterclaim by cancelling and discharging the mortgage.

B. The Central Legal Issues

Statute of Limitations and Acceleration: Did the 2007 foreclosure action validly accelerate the mortgage debt so that the six-year statute of limitations under CPLR 213(4) expired before the 2018 action?
Effect of Voluntary Discontinuance: Did plaintiff’s purported voluntary discontinuance of the 2007 action in 2012 reset or revive the statute of limitations, especially in light of FAPA’s amendment to CPLR 3217(e)?
Retroactivity of FAPA: Does FAPA apply to this case, even though the conduct (the 2007 acceleration and subsequent discontinuance) predated its enactment?
Constitutional Challenges: Does retroactive application of FAPA violate:
- substantive or procedural due process,
- the Contract Clause (U.S. Const. art. I, § 10[1]), or
- the Takings Clause (U.S. Const. Amend. V)?
Remedy After Time-Bar: When a foreclosure action is dismissed as time-barred, must the court grant a judgment cancelling and discharging the mortgage under RPAPL 1501(4)?

III. Summary of the Opinion

The Fourth Department modified the order and clarified the consequences of the dismissal:

Time-Bar Affirmed: The Court held that defendant Testa met his burden to show that the foreclosure action is time-barred under CPLR 213(4). The 2007 foreclosure complaint accelerated the mortgage by declaring the entire principal immediately due, starting the six-year statute of limitations. By the time the 2018 foreclosure was commenced, the limitations period had expired.
No Revival by Discontinuance; Engel Abrogated by FAPA: Plaintiff’s purported voluntary discontinuance in 2012 did not reset the statute of limitations. The Court acknowledged Freedom Mtge. Corp. v Engel but emphasized that FAPA—specifically CPLR 3217(e)—abrogated Engel’s rule. Voluntary discontinuance now cannot “waive, postpone, cancel, toll, extend, revive or reset” the limitations period unless a statute expressly allows it.
Retroactive Application of FAPA: The Court held that FAPA applies retroactively to this action, relying on its express language (L 2022, ch 821, § 10) and its remedial purpose. The Court followed the reasoning of other departments (e.g., Genovese v Nationstar Mtge. LLC, Deutsche Bank Natl. Trust Co. v Dagrin).
Constitutional Challenges Rejected: Applying FAPA retroactively does not violate due process, the Contract Clause, or the Takings Clause. The Court held:
- FAPA is rationally related to a legitimate legislative purpose (stopping abuse and ensuring finality);
- the lender had no contractual or vested right to unilaterally revoke acceleration and reset the statute of limitations by voluntary discontinuance; and
- therefore, there is no unconstitutional impairment or taking of property rights.
Mandatory Mortgage Cancellation under RPAPL 1501(4): On Testa’s cross-appeal, the Court agreed that once the complaint was properly dismissed as time-barred, Supreme Court should have entered a judgment on the RPAPL article 15 counterclaim cancelling and discharging the mortgage. The case was remitted to Supreme Court solely to issue that appropriate judgment.
All Other Arguments Rejected: The Court briefly noted that it had reviewed plaintiff’s remaining contentions and found none merited reversal or any further modification.

IV. Detailed Analysis

A. Statute of Limitations and Acceleration in Mortgage Foreclosures

1. The Legal Framework

Under CPLR 213(4), an action to foreclose a mortgage is governed by a six-year statute of limitations. The key question is: when does that six-year clock start running?

The Court, echoing a long line of cases, restates the rule:

The statute of limitations begins to run when the mortgage debt is accelerated.
Acceleration can occur in multiple ways, but the most common include:
- a clear, unequivocal notice from the lender demanding immediate repayment of the entire loan; or
- commencement of a foreclosure action that expressly elects to call due the entire debt.

The Court cites:

Federal Natl. Mtge. Assn. v Tortora, 188 AD3d 70 (4th Dept 2020) – holding that the statute of limitations begins when the debt is accelerated;
Business Loan Ctr., Inc. v Wagner, 31 AD3d 1122 (4th Dept 2006) – similar principle;
U.S. Bank N.A. v Balderston, 163 AD3d 1482 (4th Dept 2018) – reaffirming that filing a foreclosure action can effectuate acceleration;
Wilmington Sav. Fund Socy., FSB v Gustafson, 160 AD3d 1409 (4th Dept 2018) – once accelerated, the statute runs on the entire debt.

2. Application to the Facts in Testa

In support of his cross-motion, Testa submitted the complaint from the 2007 foreclosure action concerning the same mortgage. That complaint:

was filed on April 11, 2007; and
explicitly declared “that the whole of the principal sum secured hereby become immediately due and payable.”

This language constituted a clear and unequivocal acceleration of the mortgage debt. As a result:

Acceleration date: April 11, 2007;
End of six-year limitations period: April 11, 2013 (absent tolling or valid de-acceleration under then-applicable law);
Date of the instant foreclosure action: November 16, 2018.

Because more than six years elapsed between acceleration and the commencement of the 2018 action, Testa met his initial burden of showing that the action was untimely, citing:

U.S. Bank Trust N.A. v Holmes, 233 AD3d 1480 (4th Dept 2024); and
Deutsche Bank Natl. Trust Co. v Adrian, 157 AD3d 934 (2d Dept 2018).

Once that prima facie showing was made, the burden shifted to the plaintiff to raise a triable issue, for example by demonstrating:

tolling of the statute of limitations, or
that the action was actually commenced within the applicable period.

The Court held that plaintiff failed to do so. The only plausible argument plaintiff advanced was that its voluntary discontinuance of the 2007 action in 2012 reset the statute of limitations. That argument is where FAPA—and this decision’s core significance—comes sharply into focus.

B. FAPA and the End of the Engel Rule

1. The Pre-FAPA World: Freedom Mtge. Corp. v Engel

In Freedom Mtge. Corp. v Engel, 37 NY3d 1 (2021), the Court of Appeals held that:

a lender could unilaterally revoke its earlier acceleration of a mortgage debt, and
such revocation could be accomplished simply by voluntarily discontinuing the foreclosure action in which acceleration had been elected,

thereby resetting the six-year statute of limitations.

In practice, Engel allowed lenders to:

accelerate by filing a foreclosure action;
later voluntarily discontinue that action; and
then treat the debt as no longer accelerated, thereby avoiding or mitigating time-bar problems and often re-accelerating later in a new action.

This framework was heavily criticized as enabling “serial” or manipulative foreclosures and undermining the finality and repose that statutes of limitation are meant to provide.

2. The Legislature Responds: Foreclosure Abuse Prevention Act

The New York Legislature responded by enacting the Foreclosure Abuse Prevention Act (L 2022, ch 821), which among other things:

amended CPLR 213(4),
added CPLR 3217(e), and
included an explicit provision governing its temporal reach (L 2022, ch 821, § 10).

Of particular importance in Testa is CPLR 3217(e), which provides:

“[i]n any action on an instrument described under [CPLR 213(4)], the voluntary discontinuance of such action, whether on motion, order, stipulation or by notice, shall not, in form or effect, waive, postpone, cancel, toll, extend, revive or reset the limitations period to commence an action and to interpose a claim, unless expressly prescribed by statute.”

In other words:

Voluntary discontinuance no longer constitutes a de-acceleration that can reset the statute of limitations.
This is a direct legislative overruling of Engel’s core holding as applied to mortgage foreclosure actions.

3. FAPA’s Retroactivity Clause

Section 10 of the Act provides:

FAPA 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.”

This language was central to the Court’s conclusion that FAPA must be applied retroactively. It does not limit itself to future actions or to conduct occurring after enactment, but to all qualifying actions presently pending in which a final judgment has not been enforced.

4. The Court’s Retroactivity Analysis

The Fourth Department aligns itself with the First and Second Departments, citing:

Genovese v Nationstar Mtge. LLC, 223 AD3d 37 (1st Dept 2023);
Deutsche Bank Natl. Trust Co. v Dagrin, 233 AD3d 1065 (2d Dept 2024).

The Court reasons as follows:

Statutory Text: The plain language of FAPA, particularly § 10, “requires FAPA to be retroactively applied.”
Remedial Nature: The Court describes FAPA as “remedial in nature,” adopted to correct a perceived injustice in the prior regime (notably the effects of Engel).
Legislative Intent and Urgency: The “take-effect-immediately” clause and legislative memoranda evince urgency and a desire to curb ongoing abusive practices.
Presumption in Favor of Retroactivity for Remedial Statutes: Citing authority such as Matter of Mia S. [Michelle C.], 212 AD3d 17 (2d Dept 2022), and the general rule from Jacobus v Colgate, 217 NY 235 (1916), the Court notes that remedial legislation is an exception to the usual presumption against retroactivity and should be applied retroactively to effectuate its beneficial purpose.

Accordingly, even though:

the acceleration (2007) and purported discontinuance (2012) both predated FAPA; and
Engel was the controlling Court of Appeals authority at the time of those events,

the Court holds that FAPA governs the parties’ rights and obligations now, in 2025, as the foreclosure case is still pending and no final judgment of foreclosure and sale has been enforced.

5. Effect on Plaintiff’s Statute of Limitations Argument

Once FAPA’s retroactivity is accepted, CPLR 3217(e) makes clear that:

Deutsche Bank’s “purported voluntary discontinuance” of the 2007 action in 2012 cannot reset or extend the statute of limitations.
It is immaterial whether, under Engel, such discontinuance might once have been construed as de-acceleration.

Accordingly, the statute of limitations expired in 2013, and the 2018 foreclosure action was time-barred. Plaintiff failed to show any other basis for tolling or extending the limitations period.

C. Constitutional Challenges to FAPA Rejected

The plaintiff challenged the retroactive application of FAPA on several constitutional grounds. The Court systematically rejects each.

1. Due Process (Substantive and Procedural)

The core due process inquiry for retroactive economic legislation is whether the retroactive application is:

“justified by a rational legislative purpose.” (American Economy Ins. Co. v State of New York, 30 NY3d 136, 158 [2017], quoting Pension Benefit Guaranty Corp. v R.A. Gray & Co., 467 US 717, 730 [1984]).

The Court emphasizes:

FAPA was enacted to overrule case law that allowed noteholders to manipulate the statute of limitations, thereby “abusing the foreclosure process” and frustrating legislative intent.
This purpose is widely recognized in the Appellate Division, including:
- U.S. Bank N.A. v Lynch, 233 AD3d 113 (3d Dept 2024), appeal dismissed 43 NY3d 985 (2025);
- Deutsche Bank Natl. Trust Co. v Goldwasser, 237 AD3d 1291 (3d Dept 2025).

The Court concludes that FAPA is:

“rationally related to the legitimate legislative purpose of providing a mechanism for parties to resolve their disputes with finality,” and therefore
its retroactive application does not violate plaintiff’s due process rights.

This analysis tracks the general deferential “rational basis” standard applied to retroactive economic regulation.

2. Contract Clause

The Contract Clause of the U.S. Constitution (art. I, § 10[1]) prohibits states from passing laws “impairing the Obligation of Contracts.” But modern Contract Clause analysis focuses on:

whether the legislation substantially impairs a contractual relationship; and, if so,
whether the impairment is reasonable and necessary to serve an important public purpose.

Here, the Court’s reasoning is more straightforward: there is no impairment of any contractual right because the lender never had, in the first place, a contractually conferred power to reset the statute of limitations through voluntary discontinuance.

The Court notes:

“plaintiff has identified no contractual provision that entitled it to [unilaterally] revoke a prior acceleration of the mortgage loan debt and reset the statute of limitations by the mere voluntary discontinuance of an action.”
Absent a contractual right to engage in the maneuver later rejected by FAPA, there is no impairment of a “contractual obligation” protected by the Contract Clause.

Accordingly, there is no Contract Clause violation. The Court cites:

FV-1, Inc. v Palaguachi, 234 AD3d 818 (2d Dept 2025);
Goldwasser, 237 AD3d 1291; and
Dagrin, 233 AD3d at 1069–1071.

3. Takings Clause

The Takings Clause of the Fifth Amendment (applied to the states via the Fourteenth Amendment) prohibits the government from taking private property for public use without just compensation. Here, the argument would be that lender’s “right” to reset the statute of limitations via voluntary discontinuance was a vested property right that FAPA destroyed.

The Court rejects this by connecting it back to the Contract Clause analysis:

Because the lender never had a vested right to reset the statute of limitations through voluntary discontinuance (no such right is found in the contract or in pre-FAPA statutory law),
FAPA did not “take” or impair that right.

The Court cites:

Dagrin, 233 AD3d at 1071; and
US Bank N.A. v Williams, 80 Misc 3d 258 (Sup Ct, Putnam County 2023).

Thus, there is no Takings Clause violation.

D. RPAPL 1501(4): Cancellation and Discharge of Time-Barred Mortgages

1. The Statutory Mechanism

RPAPL 1501(4) provides a cause of action allowing a property owner to obtain a judgment:

declaring that a mortgage is unenforceable because the time within which an action could have been commenced to foreclose it has expired; and
directing the cancellation and discharge of that mortgage of record.

This is a key remedial provision protecting owners from lenders holding stale security interests long after their enforceability has lapsed.

2. The Supreme Court’s Error and the Appellate Division’s Correction

Supreme Court correctly:

held that the foreclosure action was time-barred; and
dismissed Deutsche Bank’s complaint with prejudice.

However, it did not go the further required step of granting judgment on Testa’s RPAPL article 15 counterclaim to cancel and discharge the mortgage.

The Fourth Department held this was error, citing:

RPAPL 1501(4) itself;
Batavia Townhouses, Ltd. v Council of Churches Hous. Dev. Fund Co., 189 AD3d 20 (4th Dept 2020), affd 38 NY3d 467 (2022); and
Deutsche Bank Natl. Trust Co. v Sylvestre, 238 AD3d 980 (2d Dept 2025).

The principle is that once a foreclosure claim is time-barred:

not only is the lender’s claim to foreclose extinguished, but
the mortgagor is entitled to “clear title” through a judgment canceling the mortgage lien of record.

Accordingly, the Appellate Division:

Affirmed the dismissal of the complaint; but
Modified by remitting the matter to Supreme Court to enter an appropriate judgment on the RPAPL article 15 counterclaim cancelling and discharging the mortgage.

E. Key Precedents and Their Influence

1. Statute of Limitations and Acceleration Cases

U.S. Bank Trust N.A. v Holmes (4th Dept 2024)
Cited for the proposition that a defendant moving for summary judgment on statute of limitations grounds bears the initial burden of establishing untimeliness. Once that burden is met, the burden shifts to plaintiff to show tolling or applicability of an exception.
Deutsche Bank Natl. Trust Co. v Adrian (2d Dept 2018)
Emphasizes the same burden-shifting framework for statute-of-limitations defenses in foreclosure cases and recognizes that commencement of a prior foreclosure can evidence acceleration.
Federal Natl. Mtge. Assn. v Tortora (4th Dept 2020)
Articulates that the limitations period begins when the debt is accelerated and clarifies that once acceleration occurs, the statute runs on the entire debt.
Business Loan Ctr., Inc. v Wagner (4th Dept 2006)
An earlier foundation case reinforcing the acceleration and statute-of-limitations framework in commercial lending contexts.
U.S. Bank N.A. v Balderston (4th Dept 2018); Wilmington Sav. Fund Socy., FSB v Gustafson (4th Dept 2018)
Clarify the mechanics of acceleration by foreclosure complaint and confirm that once accelerated, the entire mortgage debt is subject to the six-year limitations period.

2. FAPA Retroactivity and Policy Cases

Genovese v Nationstar Mtge. LLC (1st Dept 2023)
Held that although the Legislature did not use the exact words “retroactive,” its intent was clear from FAPA’s text and context. Described FAPA as remedial legislation and emphasized urgency and a strong remedial purpose.
Deutsche Bank Natl. Trust Co. v Dagrin (2d Dept 2024)
Applied FAPA retroactively, underscored that its express language and purpose necessitate retroactive application, and rejected constitutional challenges similar to those presented in Testa.
U.S. Bank N.A. v Lynch (3d Dept 2024), appeal dismissed 43 NY3d 985 (2025); Deutsche Bank Natl. Trust Co. v Goldwasser (3d Dept 2025)
Recognized that FAPA was enacted to overrule case law (notably Engel) that had allowed lenders to abuse the foreclosure process, manipulate the statute of limitations, and undermine legislative intent.

3. Constitutional Doctrine Cases

American Economy Ins. Co. v State of New York (2017)
Addressed retroactive economic legislation and held that due process is satisfied when retroactivity is justified by a rational legislative purpose.
Pension Benefit Guaranty Corp. v R.A. Gray & Co., 467 US 717 (1984)
U.S. Supreme Court authority cited for the same “rational basis” view of retroactive regulation under due process.
Jacobus v Colgate, 217 NY 235 (1916)
A century-old New York Court of Appeals decision cited for the general rules on statutory retroactivity and the distinction between substantive and remedial legislation.
Matter of Mia S. [Michelle C.] (2d Dept 2022)
Articulates the principle that remedial legislation should generally be given retroactive effect to accomplish its purpose.
FV-1, Inc. v Palaguachi (2d Dept 2025)
Supports the conclusion that lenders had no contractual right to reset statutes of limitation via voluntary discontinuance, undermining Contract Clause claims against FAPA.

4. Quiet Title and Mortgage Cancellation Cases

Batavia Townhouses, Ltd. v Council of Churches Hous. Dev. Fund Co., 189 AD3d 20 (4th Dept 2020), affd 38 NY3d 467 (2022)
Recognized that where a mortgage foreclosure is time-barred, RPAPL 1501(4) authorizes a judgment cancelling and discharging the mortgage. Testa applies this logic directly.
Deutsche Bank Natl. Trust Co. v Sylvestre, 238 AD3d 980 (2d Dept 2025)
Another recent case confirming that the proper remedy following the determination that a mortgage is time-barred is a judgment cancelling and discharging the mortgage under RPAPL 1501(4).

V. Complex Concepts Simplified

Below are brief explanations of several technical concepts central to Testa:

1. Acceleration

Most mortgages are paid off over time in installments (e.g., monthly). Acceleration occurs when the lender declares that, due to default, the borrower must immediately pay the ENTIRE remaining balance, not just past-due installments.

Before acceleration, each installment has its own “mini” limitations period.
After acceleration, the six-year statute of limitations runs on the whole debt as a single, accelerated obligation.

2. Voluntary Discontinuance

A voluntary discontinuance is when a plaintiff (here, the lender) decides to withdraw its own lawsuit. Under CPLR 3217, this can be done:

by notice,
by stipulation, or
by court order on motion.

Under the old Engel rule, such a discontinuance could be treated as “de-accelerating” the mortgage, thereby stopping or resetting the statute of limitations. FAPA explicitly abolishes that consequence.

3. Statute of Limitations (CPLR 213(4))

A statute of limitations sets the maximum time after an event (here, acceleration) within which a legal action can be brought. CPLR 213(4) gives lenders six years to sue to foreclose a mortgage after acceleration.

If the lender misses that window and cannot demonstrate tolling or an applicable exception, the foreclosure claim is time-barred.

4. Retroactive Legislation

A statute is retroactive when it changes the legal effect of events that happened before the law was passed. Courts generally presume laws apply prospectively, but:

the Legislature can make a law retroactive; and
remedial laws (those that correct defects in existing law or procedure) are more readily applied retroactively.

5. Remedial Legislation

Remedial legislation is intended to correct or improve existing law, often to:

close loopholes,
prevent abuse, or
clarify procedures and rights.

Because such laws aim to restore fairness or effectuate preexisting policy, courts are more willing to apply them to pending cases—even where conduct occurred before enactment.

6. Contract Clause and Takings Clause in this Context

Contract Clause: Prohibits states from substantially impairing existing contracts without justification. But if a “right” (like resetting the limitations period by discontinuance) is not actually part of the contract, then restricting or abolishing it does not violate the clause.
Takings Clause: Protects against government seizure or destruction of property rights without compensation. Here, the Court held that lenders did not possess a “property right” to the Engel-type reset mechanism, so FAPA’s elimination of that mechanism is not a taking.

7. RPAPL 1501(4) Quiet Title Actions

RPAPL article 15 actions are essentially quiet title actions. Under RPAPL 1501(4), if the mortgagee can no longer lawfully foreclose because the statute of limitations has expired, the owner may seek a judgment:

declaring the mortgage unenforceable, and
directing the county clerk or registrar to cancel and discharge it of record.

This clears title and removes the cloud created by an otherwise unenforceable lien.

VI. Impact and Practical Implications

A. For Lenders and Servicers

No More “Reset by Discontinuance” Strategy:
The Engel-based practice of discontinuing and refiling foreclosures to evade the statute of limitations is definitively foreclosed in the Fourth Department, aligning it with other Departments.
Heightened Need for Timeline Management:
Lenders must now carefully track:
- the date of initial acceleration (often the first foreclosure filing); and
- any tolling events or statutory extensions that may apply.
Failing to commence a new action within six years of acceleration can permanently bar foreclosure and lead to cancellation of the mortgage.
Risk of Complete Loss of Security:
As illustrated by the Court’s directive to cancel and discharge the mortgage under RPAPL 1501(4), an untimely foreclosure action does not merely delay remedies; it can result in the complete extinguishment of the mortgage lien.
Reduced Efficacy of Constitutional Challenges:
The growing body of Appellate Division authority (First, Second, Third, and now Fourth Departments) rejecting due process, Contract Clause, and Takings challenges to FAPA makes such arguments increasingly unlikely to succeed.

B. For Borrowers and Homeowners

Statute of Limitations as a Robust Defense:
Borrowers facing foreclosure must scrutinize their prior foreclosure history and any earlier acceleration events. If six years have passed since the initial acceleration, FAPA sharply limits a lender’s ability to revive the claim.
Affirmative Remedy: Title Clearing:
When a foreclosure is time-barred, borrowers can go beyond merely defending; they can seek:
- a declaration of unenforceability, and
- cancellation and discharge of the mortgage under RPAPL 1501(4).
The Testa decision underscores that this is not discretionary; it is a logical consequence of a time-bar finding.

C. For Courts and Practitioners

Convergence Across Departments:
Testa confirms that:
- FAPA is retroactive;
- voluntary discontinuance does not reset limitations; and
- constitutional challenges to FAPA are unavailing.
This promotes uniformity and predictability statewide.
Mandatory Consideration of RPAPL 1501(4) Relief:
When a foreclosure is dismissed as time-barred and an RPAPL article 15 claim is pleaded, courts should ensure that the judgment includes appropriate cancellation and discharge language. Merely dismissing the foreclosure complaint is incomplete relief.
Careful Pleading and Proof of Acceleration:
Both sides must pay close attention to the contents of the first foreclosure complaint and any subsequent communications:
- Clear acceleration language, as in the 2007 complaint here, will usually fix the acceleration date.
- Ambiguities may become the battleground in close cases.

VII. Conclusion

Deutsche Bank Natl. Trust Co. v. Testa is a pivotal Fourth Department decision that:

confirms the retroactive application of the Foreclosure Abuse Prevention Act to all mortgage foreclosure actions where final judgments have not been enforced;
unequivocally holds that voluntary discontinuance of a prior foreclosure action no longer resets the statute of limitations on the underlying mortgage debt;
rejects constitutional challenges to FAPA under due process, the Contract Clause, and the Takings Clause, reinforcing that lenders never possessed a vested or contractual right to the Engel-style reset of limitations; and
clarifies that once a foreclosure claim is time-barred, the homeowner is entitled not merely to dismissal of the action but also to a judgment cancelling and discharging the mortgage of record under RPAPL 1501(4).

Collectively, these holdings significantly strengthen the finality of statutes of limitations in foreclosure cases, curtail lender strategies that once extended or manipulated those limitations, and provide borrowers with powerful tools to both defend and clear their titles. Testa thus stands as a cornerstone in the post-FAPA legal landscape, harmonizing the Fourth Department’s stance with other departments and providing a clear roadmap for litigants and courts in New York foreclosure litigation.

Retroactive Application and Constitutionality of New York’s Foreclosure Abuse Prevention Act (FAPA): Commentary on Deutsche Bank Natl. Trust Co. v. Testa, 2025 NY Slip Op 06418 (4th Dept)