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Kearney v. Kearney

Supreme Court, Monroe County

November 7, 2013

Sue A. Kearney, Plaintiff,
v.
Domenic M. Kearney, Defendant CITIMORTGAGE, INC., Plaintiff, DOMENIC M. KEARNEY, "JOHN DOES" and "JANE DOES", said names being fictitious, parties intended being possible tenants or occupants of premises, and corporations, other entities or persons who claim, or may claim, a lien the premises, Defendants.

Richard A. Dollinger, A.S.C.J.

This unusual matrimonial-related action requires the court to venture outside the Domestic Relations Law and into uncharted depths of New York law involving the relatively new obligations of a creditor when foreclosing a marital property. The facts are undisputed. In 2008, after a year's marriage, the husband secured a mortgage on the marital residence. He is the sole obligor on the note and mortgage, and is also the sole name on the title to the property. In 2010, the wife commenced an action for divorce and sought sole and exclusive use and possession of the marital residence. The husband agreed that the wife could live at the residence during the pendency of the divorce action provided she agreed to pay the mortgage. The wife failed to make the required payments, failed to inform her husband of her default, and she never forwarded any mail from the creditor regarding the mortgage.

The creditor subsequently commenced a foreclosure action. Due to the lack of payment on the mortgage, the lender sent a Notice of Foreclosure to the property, dated October 4, 2011. After the action was commenced, the husband answered the foreclosure complaint, denying the material allegations and asserting an affirmative defense that the lender had failed to comply with Real Property Actions and Proceedings Law ("RPAPL") § 1304. The husband then moved to consolidate the matrimonial action and the foreclosure under CPLR § 601, arguing that both actions involved the conduct of the wife in failing to make payments on the debt. The court denied the motion in a short written opinion. Thereafter, the husband, who had failed in his efforts to negotiate a resolution with the bank, moved to compel disclosure and preclude proof at trial or, in the alternative, dismiss the action.

The husband, as the borrower, seeks to dismiss the foreclosure action because of the creditor's non-compliance with § 1304 of the Real Property Actions and Proceedings Law. The new section provides a preliminary step for any borrower seeking to recover unpaid funds in a mortgage transaction. The statute provides that the creditor must send a notice to the borrower indicating the loan is in default, offering the borrower guidance on how to avert foreclosure and seek the assistance of professional counsel. The statute states:

Such notice shall be sent by such lender, assignee or mortgage loan servicer to the borrower, by registered or certified mail and also by first-class mail to the last known address of the borrower, and if different, to the residence that is the subject of the mortgage. Such notice shall be sent by the lender, assignee or mortgage loan servicer in a separate envelope from any other mailing or notice. Notice is considered given as of the date it is mailed.

RPAPL §1304 (2). [1]

During discovery, the borrower demanded that the mortgage holder produce evidence that the creditor had mailed the notices required by Section 1304. The mortgage holder produced four documents:

(1)a copy of the initial notice required by statute;
(2)a copy of a "proof of filing statement" issued by the New York State Department of Banking, but without any certification of the statement or any affidavit from any officials of the Banking Department;
(3)a copy of a second notice, dated November 1, 2011, addressed to the husband at the marital residence address;
(4)a copy of a tracking report from the United States Post Office regarding a letter allegedly sent to the borrower.

After reviewing the discovery responses, the borrower's counsel demanded further disclosure, seeking proof that the notice of mailing had been received, whether the notice was returned as "undeliverable, "and whether the notice was sent by registered or certified mail. The mortgage holder declined to respond further, arguing that it did not possess these requested items and had no legal obligation to prepare documents that it did not possess. The borrower then filed the instant motion.

Initially, the lender argues that the borrower has not requested summary judgment or judgment dismissing the claims and hence, the only relief that the court can grant is to compel further disclosure. The court notes that the borrower's notice of motion addresses several subjects. The first requested relief is an order compelling further disclosure. The second relief sought is to "determine the issues.. to be deemed resolved in accordance with the claims of the defendant." The notice also sought to "strike the complaint of the plaintiff." Finally, the notice of motion includes a "general relief" clause, seeking such "other and further relief as is just and proper." While these claims are somewhat general in the notice of motion, the borrower's counsel, in the opening paragraph of his affidavit, leaves no doubt about crux of the requested relief. He states that, "this affirmation is in support of a motion to dismiss this foreclosure action on the grounds that plaintiff cannot prove that it complied with the sending of ninety (90) day notices as required by RPAPL § 1304 and in compliance with RPAPL § 1306."

In short, the bank counsel asks this court to narrowly read the notice of motion, draw an adverse inference from the lack of a citations to the motion sections of the CPLR and deny the requested relief on a procedural basis. The court declines to take that step. The court acknowledges that it may not have the power to convert a simple disclosure motion into a motion for a judgment. Deutsche Bank Trust Co. of Ams. v. Tri-Links Inv. Trust, 43 A.D.3d 56 (1st Dept. 2007) (CPLR § 3212 does not authorize a court to grant summary judgment on its own motion, and CPLR § 3124 does not provide for converting a discovery motion to one for summary judgment). But, the moving party in Deutsche Bank Trust Co. of Ams. v. Tri-Links Inv. Trusto only sought disclosure relief. The moving party here seeks much more and has said so in the notice of motion and accompanying affidavits. To draw a contrary conclusion — and preclude hearing the merits of this motion - would require the court to ignore the legislative command that pleadings are to be liberally construed absent prejudice to an opposing party. CPLR § 3026. See CPLR § 3026, Advisory Committee Notes (CPLR 3026 was intended to discourage useless pleading attacks by placing the burden on the attacker to show prejudice as well as failure of compliance). Notices of motion are pleadings that benefit from the "liberal reading" required under CPLR § 3126. Cabrera v Rivera, 2012 NY Slip Op 31356 (U) (Sup. Ct. Nassau Cty. 2012)(Notice of motion is a pleading); Oppenheim v Mojo-Stumer Assoc. Architects, P.C., 25 Misc.3d 1222 (A) Sup. Ct. New York Cty. 2009). The New York courts are continually cautioned not to narrowly read notices of motion. Landmark Colony at Oyster Bay Homeowners Assn., Inc., 2010 NY Slip Op 32713 (U) (Sup. Ct. Nassau Cty. 2010) (because a rigid reading of the reference to "causes of action" in the notice of motion would cause the court to address incorrectly the issues raised in plaintiff's motion and defendants' response thereto, the court liberally interpreted the notice of motion).

Consistent with the liberal reading rule, courts have frowned on rigid interpretations of notices of motion:

A notice of motion must list the relief demanded and the grounds therefor. CPLR ยง 2214 (a). Although in specifying the grounds of the motion, it does no harm to cite chapter and verse, and that may be the better practice as it clearly puts the party on notice of the grounds alleged, there is no requirement that the notice of motion list the statute or ...

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