HSBC Bank USA, Nat'l Ass'n v. Cooper

Citation Codes

Equivalent Citations

citation codes

Docket Number

2015–11122

Motions

Motion to compel : Denied Plaintiff

Attorney(S)

Pansy N. Cooper, Cambria Heights, NY, appellant pro se. Rosicki, Rosicki & Associates, P.C. (Reed Smith, LLP, New York, N.Y. [Andrew B. Messite and Joseph B. Teig ], of counsel), for respondent.

Judges

Reinaldo E. Rivera
Jeffrey A. Cohen

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Smart Summary

Factual and Procedural Background

The plaintiff, HSBC Bank USA, National Association, commenced a mortgage foreclosure action against the defendant Pansy N. Cooper and other defendants. Cooper failed to timely answer the complaint but subsequently moved pursuant to CPLR 3012(d) to compel the plaintiff to accept her late answer. The plaintiff opposed this motion. While Cooper's motion was pending and undecided, the plaintiff moved for leave to enter a default judgment against Cooper and for an order of reference. Cooper opposed, arguing the plaintiff lacked standing to maintain the action. The Supreme Court denied Cooper's motion to compel acceptance of her late answer, finding no reasonable excuse for the delay, and granted the plaintiff's motion for leave to enter a default judgment and an order of reference. Cooper appeals from that order.

Legal Issues Presented

Whether the Supreme Court erred in granting the plaintiff's motion for leave to enter a default judgment against Cooper and for an order of reference.
Whether the plaintiff demonstrated proper authority and standing to maintain the foreclosure action and to submit an affidavit of merit in support of the default judgment.

Arguments of the Parties

Appellant's Arguments

Cooper contended that the plaintiff lacked standing to maintain the foreclosure action.
Cooper sought to compel the plaintiff to accept her late answer, arguing she had a reasonable excuse for the delay.

Respondent's Arguments

The plaintiff opposed Cooper's motion to compel acceptance of a late answer.
The plaintiff submitted an affidavit of merit executed by the Vice President of Loan Documentation for the plaintiff's purported servicer to support the motion for default judgment.

Table of Precedents Cited

Precedent	Rule or Principle Cited For	Application by the Court
HSBC Bank USA, N.A. v. Betts, 67 A.D.3d 735, 888 N.Y.S.2d 203	Requirement under CPLR 3215(f) that affidavits supporting default judgments must be made by a party with authority.	The court found the affidavit submitted lacked evidence that the affiant had authority to act on behalf of the plaintiff, requiring denial of the default judgment motion.
US Bank N.A. v. Louis, 148 A.D.3d 758, 48 N.Y.S.3d 458	Supports scrutiny of standing and authority in foreclosure default judgments.	Referenced as analogous authority supporting the need for proper evidentiary foundation.
Deutsche Bank Natl. Trust Co. v. Patrick, 136 A.D.3d 970, 25 N.Y.S.3d 364	Addresses evidentiary requirements for affidavits in foreclosure proceedings.	Used to reinforce the requirement for proper authority in affidavits supporting default judgments.
Bayview Loan Servicing, LLC v. Bernard, 130 A.D.3d 850, 12 N.Y.S.3d 894	Confirms necessity of proper authority and standing in foreclosure actions.	Cited as controlling precedent mandating denial of default judgment without proper proof of authority.
US Bank N.A. v. Poku, 118 A.D.3d 980, 989 N.Y.S.2d 75	Addresses procedural safeguards in foreclosure default judgments.	Supports the court's decision to require proper papers before granting default judgment.
Matter of Miedema v. Miedema, 144 A.D.3d 803, 40 N.Y.S.3d 559	Procedural rule that an appeal must be taken from the order denying a motion to compel acceptance of a late answer to be properly before the court.	The court held that Cooper's contention regarding denial of her motion to compel acceptance of her late answer was not properly before the court on this appeal.

Court's Reasoning and Analysis

The court first determined that Cooper's challenge to the denial of her motion to compel acceptance of her late answer was not properly before it because no appeal was taken from that separate order, citing Matter of Miedema v. Miedema. The court then analyzed the plaintiff’s motion for leave to enter a default judgment. Under CPLR 3215(f), where a foreclosure complaint is unverified, an affidavit made by the party must set forth proof of the claim, default, and amount due. The plaintiff submitted an affidavit of merit executed by the Vice President of Loan Documentation for the plaintiff's purported servicer. However, the record lacked evidence that this individual had authority to act on behalf of the plaintiff. Without such evidence, the affidavit was insufficient to support the default judgment. Consequently, the court concluded that the Supreme Court erred in granting the plaintiff's motion for default judgment and order of reference. The court reversed the order insofar as appealed from, denied those branches of the plaintiff's motion, and allowed leave to renew upon submission of proper papers, citing multiple precedents to support the necessity of proper authority in affidavits submitted in foreclosure default judgment motions.

Holding and Implications

The court's final decision is to REVERSE the order of the Supreme Court insofar as it granted the plaintiff's motion for leave to enter a default judgment against Cooper and for an order of reference. Those branches of the plaintiff's motion are DENIED, with leave to renew upon submission of proper papers demonstrating authority.

This decision directly affects the parties by preventing the entry of a default judgment against Cooper based on insufficient evidentiary support. It does not establish new precedent but reaffirms existing requirements for proper authority and standing in foreclosure proceedings.

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HSBC BANK USA, NATIONAL ASSOCIATION, etc., respondent, v. Pansy N. COOPER, appellant, et al., defendants.

Pansy N. Cooper, Cambria Heights, NY, appellant pro se.

Rosicki, Rosicki & Associates, P.C. (Reed Smith, LLP, New York, N.Y. [Andrew B. Messite and Joseph B. Teig ], of counsel), for respondent.

REINALDO E. RIVERA, J.P., JEFFREY A. COHEN, SYLVIA O. HINDS–RADIX, VALERIE BRATHWAITE NELSON, JJ.

DECISION & ORDER

In an action to foreclose a mortgage, the defendant Pansy N. Cooper appeals, as limited by her brief, from so much of an order of the Supreme Court, Queens County (Siegal, J.), dated July 8, 2015, as granted those branches of the plaintiff's motion which were for leave to enter a default judgment against her and for an order of reference.

ORDERED that the order is reversed insofar as appealed from, on the law, with costs, and those branches of the plaintiff's motion which were for leave to enter a default judgment against the appellant and for an order of reference are denied, with leave to renew upon proper papers.

The plaintiff commenced this action to foreclose a mortgage against the defendant Pansy N. Cooper and other defendants. Cooper failed to timely answer the complaint, but subsequently moved pursuant to CPLR 3012(d) to compel the plaintiff to accept her late answer. The plaintiff opposed Cooper's motion.

While Cooper's motion to compel the plaintiff to accept her late answer was pending and undecided, the plaintiff moved, inter alia, for leave to enter a default judgment against Cooper and for an order of reference. Cooper opposed the motion, arguing that the plaintiff lacked standing to maintain this action.

Subsequently, the Supreme Court denied Cooper's motion to compel the plaintiff to accept her late answer, finding that she failed to show a reasonable excuse for the delay. Thereafter, in the order appealed from, the Supreme Court, inter alia, granted those branches of the plaintiff's motion which were for leave to enter a default judgment against Cooper and for an order of reference. Cooper appeals.

As a threshold matter, Cooper's contention that the Supreme Court erred in denying her motion to compel the plaintiff to accept her late answer is not properly before the Court on this appeal, as the denial of that motion was the subject of a separate order from which no appeal was taken (see Matter of Miedema v. Miedema, 144 A.D.3d 803, 804, 40 N.Y.S.3d 559 ).

"Where, as here, a foreclosure complaint is not verified, CPLR 3215(f) states, among other things, that upon any application for a judgment by default, proof of the facts constituting the claim, the default, and the amount due are to be set forth in an affidavit made by the party " ( HSBC Bank USA, N.A. v. Betts, 67 A.D.3d 735, 736, 888 N.Y.S.2d 203 [internal quotation marks omitted; emphasis added] ). Here, the plaintiff submitted an affidavit of merit executed by the Vice President of Loan Documentation for the plaintiff's purported "servicer." However, there is no evidence in the record demonstrating that the Vice President of Loan Documentation had the authority to act on behalf of the plaintiff. Under such circumstances, the Supreme Court should have denied those branches of the plaintiff's motion which were for leave to enter a default judgment against Cooper and for an order of reference, with leave to renew upon proper papers (see HSBC Bank USA, N.A. v. Betts, 67 A.D.3d at 736, 888 N.Y.S.2d 203 ; cf. US Bank N.A. v. Louis, 148 A.D.3d 758, 758–759, 48 N.Y.S.3d 458 ; Deutsche Bank Natl. Trust Co. v Patrick, 136 A.D.3d 970, 971, 25 N.Y.S.3d 364 ; Bayview Loan Servicing, LLC v. Bernard, 130 A.D.3d 850, 850, 12 N.Y.S.3d 894 ; US Bank N.A. v. Poku, 118 A.D.3d 980, 981, 989 N.Y.S.2d 75 ).

RIVERA, J.P., COHEN, HINDS–RADIX and BRATHWAITE NELSON, JJ., concur.