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Hudson City Sav. Bank v. Atanasio

Supreme Court, Suffolk County
Aug 20, 2018
60 Misc. 3d 1223 (N.Y. Sup. Ct. 2018)

Opinion

64069/2013

08-20-2018

HUDSON CITY SAVINGS BANK, Plaintiff, v. Ronald ATANASIO a/k/a Ronald J. Atanasio a/k/a Ronnie Atanasio, et al., Defendant.

COHN & ROTH, LLC, 100 East Old Country Road, Suite 28, Mineola, NY 11501, Attorneys for Plaintiff. CHARLES WALLSHEIN, ESQ., 35 Pinelawn Road, Suite 106E, Melville, NY 11747, Attorney for Defendant Atanasio. PETER D. TAMSEN, P.C., 260 Montauk Highway, Suite 14, Bay Shore, NY 11706, Attorney for Defendant Bonnie Canzone.


COHN & ROTH, LLC, 100 East Old Country Road, Suite 28, Mineola, NY 11501, Attorneys for Plaintiff.

CHARLES WALLSHEIN, ESQ., 35 Pinelawn Road, Suite 106E, Melville, NY 11747, Attorney for Defendant Atanasio.

PETER D. TAMSEN, P.C., 260 Montauk Highway, Suite 14, Bay Shore, NY 11706, Attorney for Defendant Bonnie Canzone.

Robert F. Quinlan, J.

Upon the following papers read on this application for an order discontinuing the action and vacating the notice of pendency ; Notice of Motion/Order to Show Cause and supporting papers Doc No.59-61 ; Answering Affidavit and supporting papers Doc # 62-63 and Doc # 64-65; Reply Affirmation and supporting papers Doc # 66-70 ; Other; it is

ORDERED that plaintiff's motion for an order discontinuing the action and vacating the notice of pendency (seq. # 003) is granted, as set forth below.

This is an action to foreclose a mortgage upon residential real property located at 17 Peacock Path, Quogue, Suffolk County, New York ("the property") allegedly given by defendants Ronald Atanasio and Bonnie Canzona, brother and sister, ("defendants") on January 30, 2008 to Mortgage Electronics Registration Systems ("MERS") acting solely as nominee for PHH Mortgage Corporation ("PHH") for purposes of recording the mortgage, to secure a note given the same day by defendants to PHH. Through a series of transactions, plaintiff Hudson City Savings Bank ("plaintiff") allegedly came into possession of the note and mortgage, and upon defendants defaulting in their payment obligations, plaintiff commenced this action by filing a summons, complaint and notice of pendency with the Suffolk County Clerk on November 21, 2013, which contained therein a clear statement by plaintiff that the action acted to accelerate the payment of the debt pursuant to the terms of the mortgage and note.

Initially only defendant Atanasio filed an answer, as defendant Canzona was purportedly served through a guardian of her property appointed pursuant to MHL Article 81, which guardian failed to file an answer and shortly after service successfully moved to be relieved as guardian before the justice handling the "Article 81" proceeding. This outgoing guardian failed to advise the incoming guardian of the service of the summons and complaint in this action.

Plaintiff moved for an order granting summary judgment, striking defendant Atanasio's answer, setting the default of the non-answering defendants, including defendant Canzona, and for an order of reference (Seq. # 001). Defendant Atanasio opposed the motion and cross-moved to amend his answer, for summary judgment dismissing the complaint and for the posting of a bond (Seq. # 002). The action and motions were originally assigned to Justice Emily Pines, and upon her retirement to Justice William G. Ford, but were transferred to this part by Administrative Order # 29-17, dated February 28, 2017 of the District Administrative Judge. Both motions were decided on the record after oral argument on May 8, 2017, at which time the court issued an order which denied both motions for summary judgment, granted defendant Atanasio's motion to amend his answer to add seven affirmative defenses, one of which alleged plaintiff's lack of standing to bring the action, but denied the addition of three other proposed affirmative defenses and all proposed counterclaims. The order also directed a limited period of discovery.

Subsequently, on November 9, 2017, plaintiff's counsel and counsel for defendant Canzona entered into a stipulation to allow the filing of an answer on her behalf, which also included an affirmative defense alleging plaintiff's lack of standing. Thereafter, counsel appeared before the court on numerous occasions for conference relating to the progress of the action.

Plaintiff now moves for an order discontinuing the action and vacating the notice of pendency (Seq. # 003); the court notes that these requests for relief are the only ones stated in the notice of motion, which is without a "general relief clause." Though not referred to in plaintiff's notice of motion, paragraph 3 of plaintiff's counsel's affirmation in support states "Plaintiff is moving to revoke the acceleration of the principal sum and interest secured by the Note/Bond and Mortgage," and the proposed order submitted with the motion contains a paragraph ordering that "the acceleration ... secured by the Note/Bond and Mortgage is hereby revoked." Each defendant submits partial opposition to the motion, consenting to the discontinuance and cancellation of the notice of pendency, but opposing plaintiff's request that the order also declare that the acceleration of the debt has been revoked. Although plaintiff's counsel acknowledges in paragraph 2 of his reply affirmation that he is not seeking an order declaring the acceleration revoked, claiming he is merely notifying the court that plaintiff is revoking the acceleration and asking the court to discontinue the action because plaintiff is electing to revoke the acceleration, he does not submit a modified order to reflect that or request that the court delete or modify the first "ORDERED" paragraph in the proposed order.

DISCONTINUANCE AND CANCELLATION OF NOTICE OF PENDENCY GRANTED

The determination of a motion for leave to voluntarily discontinue an action pursuant to CPLR 3217 (b) rests with the sound discretion of the court (see Wells Fargo Bank v. Chapin , 107 AD3d 881 [2d Dept 2013] ; Emigrant Mortg. Co. v. Carrera , 126 AD3d 853 [2d Dept 2015] ; Kondaur Capital Corp. v. Reilly , 162 AD3d 998 [2d Dept 2018] ). The general rule is that a plaintiff should be permitted to discontinue an action unless a party is prejudiced thereby (see Great W. Bank v. Terio , 200 AD2d 608 [2d Dept 1994] ; Wells Fargo Bank, N.A. v. Fisch , 103 AD3d 622 [2d Dept 2013] ). As a plaintiff cannot ordinarily be compelled to litigate, absent special circumstances, an application for discontinuance should be granted (see Hurell-Harung v. State , 112 AD3d 1213 [3rd Dept 2013] ). Here, as defendants raise no object to the discontinuance, plaintiff's application, no matter it's claimed reason for making it, should be granted, and along with it the cancellation of the related notice of pendency.

REQUEST FOR ORDER REVOKING ACCELERATION DENIED

Plaintiff's counsel's assertion that plaintiff is revoking the acceleration, and because of this the application to discontinue should be granted, is immaterial to the granting of the discontinuance and vacatur of the notice of pendency which is otherwise consented to by defendants. If plaintiff's reason for seeking an order to discontinue is that it wishes to revoke the acceleration of the debt involved in this action, than it may do so as required by case law. What benefit plaintiff believes may accrue to it by this motion to discontinue as an act of revocation may be determined upon the filing of a subsequent action and upon the issues raised therein. The court makes no determination that this act of discontinuance, nor the statements made by plaintiff's counsel in his affirmation, are either affirmative acts of revocation of the acceleration by plaintiff, or on the other hand, merely bare conclusory statements. The issue of the effectiveness of a revocation of the acceleration of the debt is not properly before the court on this motion.

The failure of plaintiff's notice of motion to include in the relief sought a request for an order revoking the acceleration of the debt, or a general relief clause "for such other, further or different relief" is fatal to plaintiff's application for such an order and fails to bring that request before the court ( CPLR 2214 [a]; see Tirado v. Miller , 75 AD3d 153 [2d Dept 2010] ). A court may grant relief that is not requested in a notice of motion in the interest of justice, where such a general relief clause is plead, where the relief is not dramatically unlike the relief sought, where proof supports it and where there is no prejudice to any party (see Matter of LiMandri , 171 AD2d 747 [2d Dept 1991] ; Frankel v. Stavsky , 40 AD3d 918 [2d Dept 2007] ; Geffner v. Mercy Medical Center , 83 AD3d 998 [2d Dept 2011] ; Evans v. Argent Mtg. Co., LLC , 120 AD3d 618 [2d Dept 2014] ; USAA Federal Savings Bank v. Calvin , 145 AD3d 704 [2d Dept 2016] ). Here, even if plaintiff had included a general relief clause, the facts would not support such an action by the court, as a determination that the acceleration of the debt had been revoked is substantially different than merely requesting to discontinue an action and cancel the notice of pendency filed in relation thereto, plaintiff provides no proof to support such a revocation (see Milone v. US Bank Natl. Assn ., ––– AD3d ––––, 2018 NY Slip Op 05760 [2d Dept 2018] ), and such an order would result in potential prejudice to defendants.

Although the court finds that the issue of revocation of the acceleration and the concomitant issue of the statute of limitations is not before it on this motion, it notes that actions to foreclose a mortgage are governed by a six-year statute of limitations ( CPLR 213[4] ; see Wells Fargo Bank, N.A. v. Eitani , 148 AD3d 193 [2d Dept 2017] ). The filing of the summons and complaint constitutes a valid act of acceleration and the statute of limitations begins to run on the entire debt from that date (see EMC Mtge. Corp. v. Smith , 18 AD3d 602 [2d Dept 2005] ; NMNT Realty Corp. v. Knoxville 2012 Trust, 151 AD3d 1068 [2d Dept 2017] ). A lender may revoke its election to accelerate the mortgage, but it must do so by an affirmative act of revocation occurring during the six-year statute of limitations period subsequent to the initiation of the foreclosure action (see EMC Mtge. Corp. v. Patella , 279 AD2d 604 [2d Dept 2001] ; NMNT Realty Corp. v. Knoxville 2012 Trust , supra). Considering the filing date of the summons and complaint here, as noted above, plaintiff has well over a year to commence a corrected action before the statute of limitations would become an issue.

Further, both defendants have raised plaintiff's standing as an affirmative defense, which standing plaintiff failed to establish upon its denied summary judgment motion (Seq. # 001), and upon which issue there remains uncompleted discovery. The issue of plaintiff's proof of standing has been recently held to be a necessary element of a valid "de-acceleration" (see Milone v. US Bank Natl. Assn ., supra). In Milone v. US Bank Natl. Assn , supra, the Second Department also held that a "de-acceleration" notice by a lender must be clear and unequivocal, and not merely a pretextual attempt to avoid the statute of limitations. Here, unlike in Milone v. US Bank Natl. Assn , supra, the "notice of de-acceleration" contained in the statements of plaintiff's counsel on this motion made no demand that defendants' meet their monthly payment obligations under the mortgage and note, raising a possible claim that this "notice" could be merely "pretextual." The court assumes all counsel will be guided by the holding in Milone v. US Bank Natl. Assn , supra, but as these issues are not before the court on this motion, the court finds no need to determine them or decide whether plaintiff's motion papers act to revoke the acceleration.

Plaintiff's proposed order as modified by the court, is signed contemporaneously herewith.

This constitutes the Order and decision of the Court.


Summaries of

Hudson City Sav. Bank v. Atanasio

Supreme Court, Suffolk County
Aug 20, 2018
60 Misc. 3d 1223 (N.Y. Sup. Ct. 2018)
Case details for

Hudson City Sav. Bank v. Atanasio

Case Details

Full title:Hudson City Savings Bank, Plaintiff, v. Ronald Atanasio A/K/A RONALD J…

Court:Supreme Court, Suffolk County

Date published: Aug 20, 2018

Citations

60 Misc. 3d 1223 (N.Y. Sup. Ct. 2018)
2018 N.Y. Slip Op. 51218
110 N.Y.S.3d 500

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