138 A.D.3d 709
N.Y. App. Div.2016Background
- In 1998 Paavo Raudkivi executed a mortgage and note in favor of Greenpoint Bank securing a loan; he later defaulted.
- Greenpoint accelerated the debt and commenced a foreclosure action in October 2001.
- Raudkivi filed Chapter 13 bankruptcy in October 2002 and submitted a confirmed plan (April 2003) that acknowledged the mortgage debt, provided for $22,201 in pre-petition arrears, and required post-petition payments outside the plan; the Bankruptcy Court confirmed the plan.
- Raudkivi made payments through July 2005, stopped, and received a bankruptcy discharge in October 2006.
- The note and mortgage were assigned to PSP-NC, LLC in July 2011; PSP-NC sued to foreclose in July 2012.
- Supreme Court granted plaintiff’s summary judgment motion and an order of reference; Raudkivi’s cross-motion to dismiss as time-barred was denied. He appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether foreclosure is time-barred under CPLR 213(4) | Limitations was renewed by debtor’s Chapter 13 plan and tolled by the automatic stay until discharge; suit filed within six years of tolling end | Statute began in Oct 2001 (acceleration); stayed Oct 2002–2006; one-year credit before stay means suit expired Oct 2011 | Court held the Chapter 13 plan revived the limitation period; the tolling effect of the automatic stay delayed accrual until discharge in Oct 2006, so the July 2012 suit was timely |
| Whether plaintiff established entitlement to foreclosure on summary judgment | Submitted mortgage, note, proof of default and assignment | Argued statute of limitations barred the claim | Court found plaintiff made prima facie showing and Raudkivi failed to raise a triable issue; summary judgment for plaintiff granted |
| Effect of bankruptcy plan on limitations | Plan acknowledged debt and promised repayment, therefore revived claim under GOL § 17-105(1) | Plan’s confirmation and the stay do not save an otherwise expired claim | Court treated the plan as renewing the limitation period; tolling applied during automatic stay until discharge |
| Whether cross-motion to dismiss succeeded | N/A | Argued prima facie dismissal based on statute of limitations | Denied — Raudkivi did not establish entitlement to dismissal on limitations grounds |
Key Cases Cited
- EMC Mtge. Corp. v. Smith, 18 AD3d 602 (establishing accrual on acceleration)
- National Loan Invs., L.P. v. Piscitello, 21 AD3d 537 (bankruptcy plan can renew/acknowledge debt for limitations purposes)
- Lew Morris Demolition Co. v. Board of Educ. of City of N.Y., 40 NY2d 516 (general principles on renewal and acknowledgment of debts)
- Zuckerman v. 234-6 W. 22 St. Corp., 267 AD2d 130 (tolling under CPLR 204(a) during applicable stays)
- Winegrad v. New York Univ. Med. Ctr., 64 NY2d 851 (summary judgment standard)