RPAPL 1304 Compliance Requires Proof of Subservicer Authority; Board Resolution Alone Is Insufficient (LNV Corp. v Almberg)

1. Introduction

LNV Corp. v Almberg (2026 NY Slip Op 00886 [App Div, 2d Dept Feb. 18, 2026]) is a mortgage foreclosure appeal arising from a foreclosure action on residential property in Mount Sinai, New York. The plaintiff, LNV Corporation, sought summary judgment, an order of reference, and ultimately a judgment of foreclosure and sale against defendants Winston Almberg and Tara Almberg.

The central issues on this appeal were evidentiary and procedural: (i) whether LNV established standing to commence the action, (ii) whether it proved strict compliance with RPAPL 1304 (the 90-day pre-foreclosure notice requirement), and (iii) whether the record properly supported the amounts due as reflected in the referee’s report and related affidavits.

2. Summary of the Opinion

The Second Department:

  • Dismissed the appeal from the intermediate order dated November 6, 2023 under Matter of Aho because it was subsumed by the later foreclosure judgment.
  • Reversed the order and judgment of foreclosure and sale because, although LNV established standing, it failed to establish RPAPL 1304 compliance: the record did not prove that the entity that mailed the notices (an alleged subservicer) had authority to send them “by the lender, assignee or mortgage loan servicer” as the statute requires.
  • Also faulted the evidentiary support for the referee’s report: an affidavit submitted first in reply should not have been considered, and, in any event, the affidavit failed to lay a proper business-records foundation for documents created by other entities.

3. Analysis

3.1 Precedents Cited

Appellate procedure: when an intermediate order is no longer directly appealable

Matter of Aho, 39 NY2d 241, 248, supplies the standard rule that the right to directly appeal an intermediate order terminates upon entry of the final judgment; issues are reviewed on the appeal from the judgment. The court applied that doctrine to dismiss the appeal from the November 6, 2023 order, while still reaching the issues via the appeal from the foreclosure judgment.

Successive summary judgment motions and “law of the case” limits

The panel held that LNV’s second summary judgment motion did not violate the rule against successive motions, emphasizing the Supreme Court’s direction that LNV file a renewed motion within 45 days. For that conclusion, it relied on: U.S. Bank N.A. v Bravo, 238 AD3d 935, 937; Wilmington Sav. Fund Socy., FSB v Novis, 200 AD3d 739, 741; and Greene v Sager, 78 AD3d 777, 778.

The court also addressed whether its earlier reversal in LNV Corp. v Almberg, 194 AD3d 703, precluded reconsideration. It cited Central Mtge. Co. v Resheff, 200 AD3d 640, 645, for the proposition that “law of the case” binds later proceedings only as to issues actually resolved on the prior appeal, absent new evidence or a change in law. Here, the court concluded its earlier decision did not finally resolve standing or RPAPL 1304 issues in a way that foreclosed renewed litigation of them on a subsequent record.

Standing in foreclosure and proof of possession/endorsement

To describe what a plaintiff must show on summary judgment, the court relied on: Deutsche Bank Natl. Trust Co. v Kingsbury, 171 AD3d 871 (mortgage, unpaid note, and default); Wells Fargo Bank, N.A. v Mitselmakher, 216 AD3d 1056; and on the standing-specific requirement that, once standing is put in issue by the answer, it is part of the plaintiff’s prima facie case (Deutsche Bank Natl. Trust Co. v Kingsbury, 171 AD3d at 872).

On the method of proving standing through possession of a note endorsed in blank (or note plus a firmly affixed allonge endorsed in blank), the court relied on US Bank Trust, N.A. v Loring, 193 AD3d 1101, 1103 and again Wells Fargo Bank, N.A. v Mitselmakher. For the requirement that endorsements be on the instrument or on a paper “so firmly affixed” as to become part of it, the court cited HSBC Bank USA, N.A. v Roumiantseva, 130 AD3d 983, 985, quoting UCC 3-202.

The court also accepted the practice of demonstrating standing by attaching the note and endorsed allonges to the complaint and supporting the record with an affidavit, citing U.S. Bank N.A. v Hunte, 215 AD3d 887, 889 and M & T Bank v Bonilla, 215 AD3d 813, 814. Applying those principles, it held LNV met its prima facie burden on standing through a custodian affidavit asserting possession of the original endorsed note with firmly affixed allonges at commencement.

Waiver of mortgage “notice of default” condition precedent when not pleaded

The court held defendants waived a defense based on failure to comply with a mortgage contractual notice-of-default provision because they did not plead it, relying on CPLR 3015(a) and Deutsche Bank Natl. Trust Co. v Wentworth, 211 AD3d 684, 687. It also noted LNV’s complaint did not allege compliance with that mortgage notice, only compliance with statutory regimes including RPAPL 1304 and RPAPL 1306. Under Deutsche Bank Natl. Trust Co. v Wentworth, a general denial therefore did not place that mortgage condition precedent at issue.

RPAPL 1304: proof that the sender was statutorily authorized

The dispositive defect concerned RPAPL 1304. The court held LNV failed to prove that the RPAPL 1304 notices were sent by the “lender, assignee or mortgage loan servicer” (RPAPL 1304[1]) because the notices were mailed by an alleged subservicer (Dovenmuehle Mortgage, Inc.) and the record did not adequately establish that the subservicer had authority to act for LNV or its servicer.

In reaching that conclusion, the court relied on: Citibank, N.A. v Herman, 215 AD3d 626, 628 and U.S. Bank N.A. v Tesoriero, 204 AD3d 1066, 1068, which require competent proof of an agent’s/servicer’s authority when a plaintiff attempts to establish RPAPL 1304 compliance through mailings by an entity other than the lender itself.

The key evidentiary point: a board “Resolution” referencing a subservicing agreement not in the record was insufficient. Without the underlying agreement (or equivalent proof), LNV could not show the alleged subservicer was acting as a statutorily qualified sender on LNV’s behalf.

Referee’s report, reply papers, and business-records foundations

The court held that an affidavit supporting the amounts due, submitted for the first time in reply, should not have been considered, citing HSBC Bank USA, N.A. v Rahmanan, 194 AD3d 792, 795.

It further held that even if considered, the affidavit failed to provide a proper foundation for business records where at least some records were created by entities other than LNV. For that principle, it relied on Bank of N.Y. Mellon v Gordon, 171 AD3d 197, 210, which requires an affiant either to have knowledge of the other entity’s record-keeping practices or to show the third-party records were integrated into the plaintiff’s own records and routinely relied upon in the plaintiff’s business.

3.2 Legal Reasoning

The decision follows a structured foreclosure-summary-judgment framework:

  1. Procedural posture: the intermediate order appeal was dismissed under Matter of Aho, but reviewed on the judgment appeal.
  2. Standing: because standing was placed in issue by the answer, LNV had to prove it as part of its prima facie case (Deutsche Bank Natl. Trust Co. v Kingsbury). LNV satisfied that burden through a custodian affidavit attesting to possession of the original note endorsed in blank with firmly affixed allonges at commencement (consistent with US Bank Trust, N.A. v Loring and HSBC Bank USA, N.A. v Roumiantseva).
  3. Contractual notice-of-default defense: the defense was deemed waived under CPLR 3015(a) and Deutsche Bank Natl. Trust Co. v Wentworth because it was not pleaded and LNV did not plead compliance with that contractual notice.
  4. RPAPL 1304 as a strict condition precedent: despite standing, LNV still had to prove compliance with RPAPL 1304 as part of its prima facie showing. The court treated the statutory requirement that the notice be sent by the “lender, assignee or mortgage loan servicer” as an evidentiary gatekeeping problem: when the mailing is performed by a claimed subservicer, authority must be shown with competent evidence (not mere conclusory assertions or incomplete delegations). A board resolution referencing an absent subservicing agreement did not suffice.
  5. Downstream consequences: because RPAPL 1304 was not established, summary judgment and the order of reference could not stand; and the foreclosure judgment (dependent on those rulings) and confirmation of the referee’s report were reversed. Independently, the court also identified defects in the proof supporting the computation of the amount due (reply affidavit and business-records foundation).

3.3 Impact

The opinion reinforces several practical rules likely to shape foreclosure motion practice in the Second Department:

  • RPAPL 1304 “sender” identity must be proven, not assumed: when a notice is mailed by a subservicer or other agent, plaintiffs should expect to produce the operative servicing/subservicing agreement (or other admissible proof of delegation) tying the mailing entity to the lender, assignee, or mortgage loan servicer contemplated by RPAPL 1304(1).
  • Corporate resolutions may be insufficient standing alone: a resolution that recites authority “pursuant to” an agreement not in the record is vulnerable; courts may demand the agreement itself.
  • Affidavit practice matters: plaintiffs risk reversal when critical proof (such as amounts due) is introduced for the first time in reply, or when an affiant does not establish a proper foundation for third-party records under Bank of N.Y. Mellon v Gordon.
  • Standing can be won and the case still lost: even a complete standing showing will not cure a deficient RPAPL 1304 record; statutory conditions precedent remain separate and strictly policed.

4. Complex Concepts Simplified

  • Standing (foreclosure): the plaintiff must show it had the right to enforce the note when the case began—commonly by showing possession of the original note endorsed in blank at commencement.
  • Endorsement in blank: a signature/endorsement that does not name a specific payee; it generally makes the note payable to the bearer, so possession can establish the right to enforce.
  • Allonge: a sheet of paper attached to a negotiable instrument for additional endorsements. Under the UCC, it must be “so firmly affixed” that it becomes part of the instrument.
  • RPAPL 1304 notice: a 90-day pre-foreclosure notice requirement designed to provide borrowers an opportunity to avoid foreclosure. The statute specifies who must send it (the “lender, assignee or mortgage loan servicer”) and how it must be sent.
  • Order of reference / referee’s report: after summary judgment in foreclosure, a referee is often appointed to compute the amount due. The computation must be supported by admissible evidence.
  • Business-records foundation: an affidavit must explain how records were made and kept; when relying on records created by another entity, the affiant must show knowledge of that entity’s practices or that the records were integrated and routinely relied upon.
  • Reply papers rule: parties generally cannot hold back essential proof until reply; courts may disregard new evidence first submitted in reply because the opposing party had no chance to respond.

5. Conclusion

LNV Corp. v Almberg draws a sharp line between proving standing and proving statutory conditions precedent. Although LNV established standing through possession of an endorsed note, it failed to meet its summary judgment burden on RPAPL 1304 because it did not competently prove that the entity mailing the notices had authority to do so as the lender/assignee/servicer’s agent—particularly where the claimed authority depended on a subservicing agreement absent from the record. The decision also serves as a cautionary reminder that foreclosure judgments can be undone by defective evidentiary foundations for both RPAPL 1304 compliance and the amounts due.