205 A.D.3d 103
N.Y. App. Div.2022Background
- In 2010 Seymour Cohen executed a $2,100,000 note secured by a Brookville residence; monthly payments were $10,636.81.
- Emigrant Bank (successor-by-merger to Emigrant Savings Bank–Long Island) commenced foreclosure July 19, 2018, attaching the note, mortgage, and an assignment from the originator EMC to ESB‑LI.
- An RPAPL 1304 notice dated July 28, 2017 was mailed to Cohen (certified and regular mail) stating the loan was 57 days and $64,862.12 in default.
- Cohen opposed summary judgment, asserting (a) RPAPL 1304 noncompliance due to an allegedly inaccurate default amount and (b) lack of plaintiff standing.
- The Supreme Court granted plaintiff summary judgment finding RPAPL 1304 strict compliance and standing; the Appellate Division reversed in part, holding RPAPL 1304 compliance was proven but plaintiff failed to establish standing on the prima facie record.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether RPAPL 1304 notice was defective because the stated default amount was allegedly arithmetically inconsistent with missed monthly payments | The notice disclosed the required snapshot: days in default and a dollar amount; thus it complied with RPAPL 1304 | The stated default ($64,862.12) could not be correct given a $10,636.81 monthly payment overdue 57 days, so notice lacked strict compliance | Held: Notice met RPAPL 1304 because it stated duration and an amount; mathematical disputes over the amount go to the referee and judgment stage, not to invalidate the notice |
| Whether a non‑contemporaneous affidavit of mailing (Smalls) and supporting postal receipts suffice to prove statutory mailing | The affiant personally mailed the notices and receipts/acknowledgments corroborate mailings | Affidavit not contemporaneous and thus unreliable; business‑record proof required | Held: Direct affidavit of personal knowledge plus certified‑mail receipts sufficed; non‑contemporaneous execution did not defeat proof under circumstances cited |
| Whether plaintiff established standing to foreclose (possession/assignment/merger proof) | Plaintiff relied on mortgage assignment to ESB‑LI and a certificate of merger submitted later to show successor status | Cohen: plaintiff failed to show physical possession, indorsement, or assignment of the note to plaintiff before suit; merger proof was submitted in reply and was insufficient to trace the note | Held: Plaintiff failed to meet prima facie burden on standing—assignment/possession of the note to plaintiff before commencement was not established on the initial motion papers; merger documents submitted in reply could not be considered |
| Whether a dispute over total indebtedness precludes summary judgment on foreclosure | Plaintiff: amount dispute does not bar foreclosure relief; computation can be resolved by referee | Cohen: material dispute as to amount means plaintiff cannot obtain summary relief | Held: Dispute over the precise debt amount does not preclude summary judgment on the foreclosure claim; amount is resolved by the referee under RPAPL 1321 |
Key Cases Cited
- CIT Bank N.A. v. Schiffman, 36 N.Y.3d 550 (Court of Appeals) (non‑contemporaneous affidavit of mailing does not necessarily invalidate proof of mailing)
- Excel Capital Group Corp. v. 225 Ross St. Realty, Inc., 165 A.D.3d 1233 (dispute over total indebtedness does not preclude foreclosure summary relief; amount resolved by referee)
- Gustavia Home, LLC v. Hoyer, 362 F. Supp. 3d 71 (E.D.N.Y.) (amount dispute does not affect adequacy of RPAPL 1304 notice)
- Bank of Am., N.A. v. Kessler, 202 A.D.3d 10 (strict compliance requirement for RPAPL 1304 notices reiterated)
- Sparta GP Holding Reo Corp. v. Lynch, 186 A.D.3d 894 (discrepancies between cure/default dates can defeat RPAPL 1304 compliance)
- U.S. Bank N.A. v. Hammer, 192 A.D.3d 846 (evidence submitted for the first time in reply cannot establish plaintiff's prima facie case on summary judgment)