233 A.D.3d 1065
N.Y. App. Div.2024Background:
- Frantz Dagrin executed a note and mortgage on property in 2006, which was assigned to Deutsche Bank in 2008.
- Deutsche Bank commenced a foreclosure action in 2008, accelerating the entire mortgage debt.
- The 2008 action was voluntarily discontinued by Deutsche Bank in 2013.
- In 2018, Deutsche Bank initiated a new foreclosure action against Frantz and Daniella Dagrin, more than six years after the initial acceleration.
- Defendants moved to dismiss the 2018 action as time-barred, citing the Foreclosure Abuse Prevention Act (FAPA), which precludes certain resets of the statute of limitations.
- The Supreme Court denied Deutsche Bank's motions and granted defendants’ CPLR 3211(a)(5) motion to dismiss the complaint as untimely.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the 2018 foreclosure action is time-barred | FAPA should not apply retroactively; discontinuance reset the clock | FAPA applies retroactively and bars the action as untimely | Action is time-barred; FAPA applies retroactively |
| Retroactive application of FAPA—Due Process | Retroactivity violates due process | Retroactivity is rationally related to legislative purpose | No due process violation; rational legislative basis exists |
| FAPA as a Contract Clause violation | FAPA impairs contractual right to de-accelerate debt | No substantial contractual impairment shown | No Contract Clause violation; no substantial impairment |
| FAPA as a Bill of Attainder/Takings Clause violation | Retroactive FAPA punishes lenders/unconstitutional taking | FAPA is not punitive; no vested property interest at issue | No bill of attainder or taking; statute pursues nonpunitive goals |
Key Cases Cited
- Lubonty v. U.S. Bank N.A., 34 NY3d 250 (NY Ct. App. 2019) (clarifies six-year statute of limitations on foreclosure actions)
- Freedom Mtge. Corp. v. Engel, 37 NY3d 1 (NY Ct. App. 2021) (voluntary discontinuance as revocation of acceleration; later nullified by FAPA)
- Jacobus v. Colgate, 217 NY 235 (NY Ct. App. 1916) (statutory retroactivity requires clear legislative intent)
- Majewski v. Broadalbin-Perth Cent. School Dist., 91 NY2d 577 (NY Ct. App. 1998) (analyzes presumption against retroactive legislation)
- Matter of Gleason [Michael Vee, Ltd.], 96 NY2d 117 (NY Ct. App. 2001) (factors for retroactivity of remedial statutes)