Opinion
No. 2022-03826 Index No. 703499/13
09-18-2024
Wells Fargo Bank, N.A., appellant, v. Mohamed S. A. Hakim, et al., respondents, et al., defendants.
Frenkel, Lambert, Weiss, Weisman & Gordon, LLP, Bay Shore, NY (Ruth O'Connor of counsel), for appellant. Michael Kennedy Karlson, New York, NY, for respondents.
Frenkel, Lambert, Weiss, Weisman & Gordon, LLP, Bay Shore, NY (Ruth O'Connor of counsel), for appellant.
Michael Kennedy Karlson, New York, NY, for respondents.
VALERIE BRATHWAITE NELSON, J.P. ROBERT J. MILLER DEBORAH A. DOWLING LILLIAN WAN, JJ.
DECISION & ORDER
In an action to foreclose a mortgage, the plaintiff appeals from an order of the Supreme Court, Queens County (Carmen R. Velasquez, J.), dated March 31, 2022. The order, insofar as appealed from, granted those branches of the motion of the defendants Mohamed S. A. Hakim and Sylvie Hakim which were pursuant to CPLR 5015(a)(3) to vacate an order and judgment of foreclosure and sale (one paper) of the same court entered July 5, 2018, and for leave to serve a late answer, and deemed the answer of those defendants timely served.
ORDERED that the order is reversed insofar as appealed from, on the law and in the exercise of discretion, with costs, and those branches of the motion of the defendants Mohamed S. A. Hakim and Sylvie Hakim which were pursuant to CPLR 5015(a)(3) to vacate an order and judgment of foreclosure and sale and for leave to serve a late answer are denied.
In August 2013, the plaintiff commenced this action against, among others, the defendants Mohamed S. A. Hakim and Sylvie Hakim (hereinafter together the defendants) to foreclose a mortgage on certain real property located in Queens. The defendants retained counsel but failed to answer the complaint or appear at a residential foreclosure conference scheduled for January 15, 2014. In February 2014, the defendants interposed an answer with counterclaims, which was rejected by the plaintiff as untimely. In an order entered June 19, 2014, the Supreme Court, inter alia, appointed a referee to compute the amount due to the plaintiff. In November 2014, the plaintiff moved, among other things, for a judgment of foreclosure and sale. The court denied the plaintiff's motion without prejudice to renew after a foreclosure settlement conference scheduled for October 9, 2015. The defendants failed to appear at that foreclosure settlement conference, and on July 5, 2018, the court entered an order and judgment of foreclosure and sale, inter alia, directing the sale of the subject property.
Thereafter, in October 2019, a consent to change attorney was filed, substituting new counsel for the defendants. In April 2021, the defendants moved, among other things, pursuant to CPLR 5015(a)(3) to vacate the judgment of foreclosure and sale and for leave to serve a late answer. In support of their motion, the defendants contended, inter alia, that the plaintiff obtained the order and judgment of foreclosure and sale through fraudulent misrepresentations pertaining to its possession of the note and the mailing of the RPAPL 1304 notice and that law office failure provided an excuse for their default. In an order dated March 31, 2022, the Supreme Court, among other things, granted those branches of the defendants' motion and deemed the defendants' answer timely served. The plaintiff appeals.
CPLR 5015(a)(3) permits a court to relieve a party from an order or judgment on the ground of "fraud, misrepresentation, or other misconduct of an adverse party." Here, the defendants' contentions that the plaintiff obtained the order and judgment of foreclosure and sale through fraudulent misrepresentations pertaining to its possession of the note and the mailing of the RPAPL 1304 notice amount to allegations of intrinsic fraud (see U.S. Bank Trust, N.A. v McCobb, 222 A.D.3d 696; Wells Fargo Bank, N.A. v Arratia, 207 A.D.3d 598, 599; U.S. Bank, N.A. v Robinson, 168 A.D.3d 1120, 1121). "Where a defendant seeks to vacate a default pursuant to CPLR 5015(a)(3) based on intrinsic fraud, he or she must establish a reasonable excuse for the default and a potentially meritorious defense to the action" (U.S. Bank, N.A. v Gadson, 181 A.D.3d 748, 748; see HSBC Bank USA, N.A. v Scivoletti, 212 A.D.3d 600, 603). "Law office failure may be accepted as a reasonable excuse in the exercise of the court's sound discretion" (U.S. Bank Trust, N.A. v McCobb, 222 A.D.3d at 698), provided that such an excuse is "supported by a detailed and credible explanation for the law office failure alleged to have caused the default" (HSBC Bank USA, N.A. v Joseph, 209 A.D.3d 633, 634). "Mere neglect is not a reasonable excuse" (id.; see U.S. Bank Trust, N.A. v McCobb, 222 A.D.3d at 698; Wells Fargo Bank, N.A. v Eliacin, 206 A.D.3d 950, 952).
Here, the defendants failed to establish a reasonable excuse for their default, as they offered only a conclusory and unsubstantiated claim of law office failure amounting to mere neglect (see HSBC Bank USA, N.A. v Joseph, 209 A.D.3d at 634; Wilmington Sav. Fund Socy., FSB v Rodriguez, 197 A.D.3d 784, 786; Pei Qi Chen v Chen, 186 A.D.3d 723, 724). The evidence submitted by the defendants that their former counsel had been disbarred from the practice of law in 2018 does not constitute a detailed and credible explanation of the law office failure that caused the defendants' default (see HSBC Bank USA, N.A. v Joseph, 209 A.D.3d at 634), and the defendants did not contend that their former counsel's disbarment arose as a result of the counsel's failure to communicate with clients or neglect of client matters (see e.g. Matter of Pelsinger, 164 A.D.3d 189).
Since the defendants failed to establish a reasonable excuse for their default, it is unnecessary to consider whether they had a potentially meritorious defense to the action (see U.S. Bank, N.A. v Gadson, 181 A.D.3d at 749).
Accordingly, the Supreme Court should have denied those branches of the defendants' motion which were pursuant to CPLR 5015(a)(3) to vacate the order and judgment of foreclosure and sale and for leave to serve a late answer.
BRATHWAITE NELSON, J.P., MILLER, DOWLING and WAN, JJ., concur.