CIT Bank, NA v. RuizCIT Bank, NA v. Ruiz
NINA R. MORRISON, United States District Judge:
This is a foreclosure action brought pursuant to the Court’s diversity jurisdiction under
The history of this case is long and complicated. The parties’ familiarity with the factual and procedural background is assumed.
For present purposes, it is sufficient to note that Defendants Marco Ruiz and Mercedes Ruiz (the “Defеndants”) obtained a $492,000 mortgage loan from IndyMac Bank, F.S.B., on July 23, 2007. ECF No. 1-9 at 4–9.1 This loan was secured by a mortgage on real property located at 134-09 Hawtree Street in Ozone Park, New York. Id. The mortgage was recorded in the Office of the City Register of the City of New York on August 28, 2007. Id. at 10–11. Defendants subsequently executed and delivered a loan modification agreement, which modified the promissory note and mortgage, on August 18, 2009. ECF No. 150-9 at 2, 40–47.
Defendants defaulted on the mortgage loan by failing to make payments owed beginning on December 1, 2010. Id. at 2, 48–149. Thereafter, on November 12, 2013, Plaintiff mailed Defendants the ninety-day notices that are required under New York law, id. at 150–259; see also
Plaintiff commenced this action on May 22, 2014. ECF No. 1. At that time, Plaintiff possessed the original promissory note. ECF No. 150-9 at 2. First Citizens
The instant motion for default judgment and supporting papers were filed with the Court on January 31, 2022. ECF Nos. 80, 81, and 82. The instant motion for summary judgment against the Ruiz Defendants and supporting papers were served upon Defеndants by First Class Mail on August 7, 2025. ECF No. 144. The motion and supporting papers were then filed with the Court on September 15, 2025. ECF Nos. 147, 148, 149, 150 & 151.
Following its receipt of the motion for summary judgment, the Court directed Plaintiff to explain (1) its position as to whether the Court’s resolution of the summary judgment motion against the Ruiz Defendants depends upon a determination of the rights of the non-appearing Defеndants named in this proceeding; and (2) what steps Plaintiff would take to resolve this proceeding against the non-appearing Defendants, in the event the Court granted the motion for summary judgment. Dkt. Order dated Apr. 15, 2026. On April 17, 2026, Plaintiff filed a letter in response to the Court’s Order “request[ing] that the Court decide the pending motion for Summary Judgment [] as it pertains to the Ruiz defendants, as well as the pending motion for default judgment as it pertains to the non-appearing defendants.” ECF No. 152 at 1.
I. Unopposed motion for summary judgment
“The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.”
The Court must “examin[e] the moving party’s submission to determine if it has met its burden of demonstrating that no material issue of fact remains for trial. If the evidence submitted in support of the summary judgment motion does not meet the movant’s burden of production, then summary judgment must be denied even if no opposing evidentiary matter is presented.” Wells Fargo Bank, N.A. v. 840 Westchester Ave. NMA, LLC, 786 F. Supp. 3d 586, 595 (S.D.N.Y. 2025) (quoting D.H. Blair & Co. v. Gottdiener, 462 F.3d 95, 110 (2d Cir. 2006)). “In foreclosure actions where a motion for summary judgment is fully unopposed but the non-movant has previously filed an Answer, courts consider whether the affirmative defenses raised
II. Motion for default judgment
Where a movant seeks default judgment on а claim that is not for a sum certain, it must apply for such judgment with a court following the clerk’s entry of default.
DISCUSSION
I. Plaintiff is entitled to summary judgment agаinst the Ruiz Defendants, and the affirmative defenses asserted by the Ruiz Defendants in their answer do not raise genuine disputes of material fact
“In a mortgage foreclosure action under New York law, a lender must prove (1) the existence of a debt, (2) secured by a mortgage, and (3) a default on that debt.” U.S. Bank, N.A. v. Squadron VCD, LLC, 504 F. App’x 30, 32 (2d Cir. 2012) (summary order) (first citing R.B. Ventures, Ltd. v. Shane, 112 F.3d 54, 59 n.2 (2d Cir. 1997); and then citing United States v. Freidus, 769 F. Supp. 1266, 1277 (S.D.N.Y. 1991)). “Under New York law, a plaintiff in a foreclosure action еstablishes prima facie entitlement to summary judgment ‘by producing evidence of the mortgage, the unpaid note, and the defendant’s default.’” CIT Bank N.A. v. Donovan, 856 F. App’x 335, 336
Here, Plaintiff has established its prima facie entitlement to summary judgment through the аffidavit of Default Analyst Samantha Davis and its supporting documentation. ECF No. 150-9. This affidavit documents the note, id. at 8–13; the mortgage, id. at 15–39; a 2009 loan modification, id. at 41–47; and a detailed payment history, id. at 49–301, which supports Plaintiff’s assertion that the Ruiz Defendants failed to make payments due December 1, 2010 and thereafter, id. at ¶ 7. This documentation is sufficient to establish Plaintiff’s “presumptive right to foreclose.” 840 Westchester Ave. NMA, LLC, 786 F. Supp. 3d at 596 (quoting Heirs, 2020 WL 3639989, at *4).
“The burden then shifts to [Defendants] to make any affirmative showing оf a bona fide defense to the action, such as fraud, duress, oppressive or unconscionable actions, or bad faith.” Id. at 596–97 (citation modified). The Ruiz Defendants raised four affirmative defenses to this action in their 2018 answer. ECF No. 50 at 1–4 (asserting that (1) this Court is without subject matter jurisdiction, (2) Plaintiff lacks
First, the record establishes that One West Bank, N.A., the Plaintiff at the time this action was commenced, was a citizen of California, ECF No. 150-2 at 33, and the Second Circuit previously acknowledged that One West Bank was a citizen of California, OneWest Bank, N.A. v. Melina, 827 F.3d 214, 221 (2d Cir. 2016). The complaint and amended complaint alleged complete diversity between the parties, and Plaintiff has adduced sufficient evidence to establish by a preponderance of evidence that complete diversity existed at the time of this proceeding’s commencement.
Second, the record establishes that (1) IndyMac Bank assigned the mortgage to One West Bank in 2012, ECF No. 150-2 at 33–36; and (2) One West Bank was in physical possession of the note prior to the commencement of this proceeding, ECF No. 150-9 ¶ 5. “New York courts have repeatedly held that proof of physical possession [of the note]—such as the affidavits of OneWest’s сorporate representative and counsel in this case—is sufficient on its own to prove a plaintiff‘s standing to foreclose on the mortgage associated with the note.” Melina, 827 F.3d at 223.
Finally, the record establishes Plaintiff’s compliance with the requirements of
Accordingly, because there is no genuine dispute of material fact as to the Ruiz Defendants’ liability, Plaintiff has established its entitlement to summary judgment against the Ruiz Defendants.
II. Default judgment is аppropriate against some, but not all, non-mortgagor Defendants
New York law provides that “[e]very person having any lien or incumbrance upon the real property which is claimed to be subject and subordinate to the lien of the plaintiff” shall be joined as a necessary party to a foreclosure action.
“Entry of default judgment against non-mortgagor defendants is generally appropriate where the complaint alleges ‘nominal liability,’ meaning that аny judgments or liens a defendant may have against the property are subordinate to the plaintiff’s lien.” Id. (citation modified). “When a default judgment is entered against a defendant with a ‘nominal interest’ in a property, any such interest in the relevant
For municipal defendants in default, courts apply a heightened pleading standard to determine whether the plaintiff has established nominal liability, requiring the complaint to allege “detailed facts showing the particular nature of the interest in or lien on the real property and the reason for mаking the state or city agency a party-defendant.” Windward Bora, LLC v. Thompson, No. 18-CV-1811 (NGG) (RML), 2020 WL 1242828, at *5 (E.D.N.Y. Mar. 16, 2020) (quoting
Here, Plaintiff has named seven non-mortgagor Defendants, Amended Compl. ¶¶ 5–11, ECF No. 20, all of whom have failed to appear. Plaintiff alleges that “[t]he defendant(s) claim an interest or lien encumbering the property, which is either subordinate to Plaintiff’s mortgage, or paid in full, equitably subordinated, or adversе to Plaintiff’s mortgage.” Amended Compl. ¶ 12. The Court considers the appropriateness of default judgment against each of these Defendants below.
a. Mr. Artinez
Plaintiff alleges that “Mr. Artinez” is a “tenant of the property” — or at least, that he was a tenant of the property at the time the Amended Complaint was filed back in 2014. Amended Compl. ¶ 5. Default judgment is not appropriate against Mr.
b. Maria Colon and Monica Lopez
Plaintiff alleges that Maria Colon and Monica Lopez are “tenant[s] of the property.” Amended Compl. ¶¶ 6–7. Unlike “Mr. Artinez,” Plaintiff did obtain certificates of default from the Clerk against Colоn and Lopez. Clerk’s Entry of Default dated Jan. 22, 2015. Accordingly, Plaintiff’s allegations that Colon’s and Lopez’s interests in the property are subordinate to Plaintiff’s mortgage are deemed conceded. Mitchell, 2021 WL 54081, at *4. This establishes that Plaintiff is entitled to a default judgment against Colon and Lopez, terminating these tenants’ nominal interest in the property.
c. PNC Bank, National Association
Plaintiff alleges that PNC Bank, National Association (“PNC”) is “a corporation or other business entity” and “the holder of a lien encumbering the property, which is subject and subordinate to Plaintiff’s mortgage.” Amended Compl. ¶ 8. In an
d. New York City Parking Violations Bureau, New York City Environmental Control Board, and New York City Transit Adjudication Bureau
Plaintiff alleges that the New York City Parking Violations Bureau (“PVB”), the New York City Environmental Control Board (“ECB”), and the New York City Transit Adjudication Bureau (“TAB”) are “city agenc[ies] existing under the laws of New York” and “the holder[s] of [] lien[s] encumbering the property, which [are] subject and subordinate to Plaintiff’s mortgage.” Amended Compl. ¶¶ 9–11. In an
As to ECB and TAB, Plaintiff has not complied with the provisions of New York law setting a higher pleading standard for default judgment against municipal defendants in a foreclosure proceeding. See
However, Plaintiff has sufficiently pled PVB’s nominal liability through the documents attached to the amended complaint. These documents, which indicate that Marco Ruiz is a judgment debtor owing money to PVB because of traffic or parking citations, ECF No. 20 at 10–11, outline the nature of PVB’s interest and otherwise comport with the higher pleading standard for government creditors, see Cunningham, 754 F. Supp. 3d at 286–87 (holding a plaintiff sufficiently alleged a
Accordingly, the Court grants Plaintiff’s motion for default judgment against PVB but denies, without prejudice to renew, Plaintiff’s motion for default judgment against ECB and TAB. Plaintiff must establish its reason for making ECB and TAB Defendants to this action, which it may do by setting forth in greater detail the nature of any judgments actually held by these agencies against the mortgaged property and documenting these allegations by, for example, attaching a title report indicating the interests these agеncies have. See Cunningham, 754 F. Supp. 3d at 286 (“[P]laintiff must substantiate their allegations with documentation, such as a title report.” (citation omitted)); Mitchell, 2021 WL 54081, at *4 (holding “a copy of a title search reflecting any and all judgments that TAB holds against [the mortgagor]” sufficient to establish a city agency’s nominal liability). If a title search reveals that these city agencies do not presently have an interest in the mоrtgaged property, Plaintiff should voluntarily dismiss them from this proceeding.
Plaintiff has requested the Court enter a judgment of foreclosure and sale and appoint a referee to effectuate such a sale; Plaintiff has filed a proposed judgment, which names a proposed referee, to the docket. ECF No. 150-13. However, because the Court denies Plaintiff’s motion for default judgment as to certain non-appearing Defendants — whom Plaintiff alleges have, or may have, interests in the mortgaged premises — entry of judgment of foreclosure and sale is not appropriate at this time. See Toiny LLC v. Gill, No. 18-CV-40 (NGG) (VMS), 2022 WL 4118520, at *4 (E.D.N.Y. Sep. 9, 2022) (“[T]he rights, interests and equities of all of thе parties claiming an interest in the mortgaged premises should be settled and determined before any judgment of foreclosure and sale is entered.” (citation omitted)); Freedom Mortg. Corp. v. Elmore-Hernandez, No. 18-CV-1840 (DRH) (SIL), 2019 WL 2779320, at *7 (E.D.N.Y. May 8, 2019) (denying without prejudice a judgment of foreclosure and sale until plaintiff fully demonstrated their rights to foreclosure against all defendants), report and recommendation adopted, 2019 WL 2775620 (July 2, 2019).
CONCLUSION
Plaintiff has established the Ruiz Defendants’ liability and that it is entitled to summary judgment against them. However, Plaintiff has not established that it is entitled to a default judgment against all of the presently-named non-mortgagor Defendants. Accordingly, entry of a judgment of foreclosure and sale is premature at this juncture.
Plaintiff’s motion for default judgment is GRANTED as to Defendants Colon, Lopez, PNC, and PVB and DENIED without prejudice as to Defendants Mr. Artinez, ECB, and TAB. Should Plaintiff subsequently (1) establish that it is entitled to default judgment against Mr. Artinez, ECB, and TAB, or (2) decide to dismiss those defendants from this proceeding, the Court would at that point entertain a renewed motion by Plaintiff to enter a judgment of foreclosure and sale and appoint a referee, to be proposed by Plaintiff, to calculate damages and conduct a sale of the mortgaged property.
Plaintiff is respectfully directed to file a letter to the docket, within fourteen days of this Memorandum & Order, informing the Court of how it intends to proceed with the unresolved issues outlined above.
SO ORDERED.
/s/ Nina R. Morrison
NINA R. MORRISON
United States District Judge
Dated: July 21, 2026
Brooklyn, New York