Download - NYSupreme Court- Thornburg v Beltrami - Case dismissed. MERS assigment fails

8/6/2019 NYSupreme Court- Thornburg v Beltrami - Case dismissed. MERS assigment fails.

1/9

Thornburg Mtg. Home Loans, Inc. v Beltrami

2011 NY Slip Op 32035(U)

July 11, 2011

Supreme Court, New York County

Docket Number: 106026/09

Judge: Joan A. Madden

Republished from New York State Unified CourtSystem's E-Courts Service.

Search E-Courts (http://www.nycourts.gov/ecourts) forany additional information on this case.

This opinion is uncorrected and not selected for officialpublication.

www.S

topForec

losureF rau

d .com


2/9

Index Number . 106026/2009THORNBURG MORTGAGEVS.BELTRAMI, MICHAELSEQUENCE NUMBER : 002APPT RE F COMPU TEEXAMINE ACCOUNT

-

INDEX N O .MOTION DATEMOTION SEQ. N O .

MOTION GAL. NO.-1 this motlon to/for

PAPERS NUMBEREDNotlce of Motion/ Order to Sho w Cause - Affldavlts - Exhlblts ...Answering Affidavits - ExhibitsReplying AffldavitsCross-Motion:A s N O

d

Upon the foregoing papers, it is ordered that thla m otion 15

LF I L E DJUL 2 2 2011NEW YORKCOUNTYCLERKS OFFICE

Dated: * LCheck one: P A L ISPOSITION 0 ON-FINAL DISPOSITIONCheck if appropriate: n D O NOT POST REFERENCE

]

www .StopF

orec los

u reFraud

.com


3/9

Plaintiff,-against-

MICHAEL BELTRAMI; COR NELIS B. SPIERING; NEW YORKCITY ENVIRONMENTAL CON TROL BOARD; NEW YORKCITY PARKING VIOLATIONS BUREAU; NEW YORK CITYTRANSIT ADJUDICATION BUREAU ; NEW YORK STATEDEPARTMENT OF TAXATION AND FINANCE; UNITEDSTATES OF AMERICA - NTERNAL REVENUE SERVICE;JOHN DOES AND JANE DOES, said names beingfictitious, parties intended being po ssible tenants or occupants ofpremises, and corporations, other entities or persons who claim,or may claim, a lien against the premises.

F I L E DJUL 2 2 2011NEW YOAKCOUNTY CLERKS OFFICE

JOAN A. MADDEN, J.:In this action to foreclose a $3 million mortgage, plaintiff ThornburgMortgage Home

Loans, Inc. (LThornburg) moves for m order granting summary judgment against defendantsMichael Beltrami and Com elis B. Spiering (hereinafter defendants), granting a defaultjudgment against the remaining defendants, and appointing a Referee to compute. DefendantsBeltrami and Spiering are co-mortgagors, and are appearing in this action by separate counsel.Beltrami opposes the motion and cross-moves for summary judgment dismissing the complaint.Spiering initially opposed the motion, but has changed his position and favors grantingThornburgs motion and denying co-defendant Beltramis cross-motion.

Beltrami and Spiering served and filed a joint answer dated June 19,2009,which onlyBeltrami verified. Spiering subsequently retained separate counsel, who submits an affirmation1

]

www .StopF

orec los

u reFraud

.com


4/9

On September 21,2007, Beltrami and Spiering borrowed the sum of $3 million fromThornburg. The loan was secured by a mortgage on their townhouse located at 30 Comm erceStreet in Manhattan. They also executed an Interest-Only Promissory Adjustable Rate Note.The mortgage indicate s that the property is a single family dwelling, to be occupied by theborrowers as heir principal residence.2 The mortgage refers to Thornburg as the lender andMortgage Electronic Registration Systems, Inc. (MERS) as a separate corporation that isacting solely as a nominee fo r Lender, and states that [flor purposes of recording this mortgage,MERS is the mortgagee of record. On October 15,2007, the mortgage was recorded, listingBeltrami and Spiering as the mortgagorhorrower, and MERS as the rnortgageeAender. OnMay 8,2009, MERS, as nominee for Thornburg executed an assignment o f mortgage, assigningthe mortgage to Thornburg. The assignment was recorded on September 22,2009, and statesthat it is effective as of October 4,2008.

In June 2008, defendants defaulted on the mortgage and have not made any paymentssince that time. On April 29,2 009 , Thornburg commenced this action to foreclose on themortgage. As noted above, Beltrami and Spiering served and filed an answer, assertingaffirmative defenses of lack of personal jurisdiction, incomplete and improper notice underRPAPL 1303, and an incomplete and improper description of the property. Thornburg is now

that his client never s aw the answer and respectfully disavows the Answer in its entirety.Spierings counsel advises that his client is willing to file a late answer, if the court deems itappropriate, (the gist of which wo uld adm it almost every allegation of the Complaint, or[olthem ise Spiering will consent to a default judgm ent against him and in the Pla intiffs favor.

While the mortgage is for a single family home, the record suggests that the property is aon e or two-family residence. Even if the townhouse is a two-family home, that fact would notalter the outcome of this action.2

]

www .StopF

oreclosu re

F raud .co

m


5/9

moving for summary judgm ent an d related relief. Beltrami is cross-mov ing for summaryjudgm ent dismissing the complaint o n the following grounds: 1) Thornburg did not comply withthe Foreclosure Prevention and Responsibility Lending Act of 2008, as incorporated in WAPL1303 and 1304, and CPLR 3408; 2) Thornburg lacks standing to m aintain this action, since itchanged its name in the bankruptcy proceeding and (no longer exists; 3) Thornburg did notown the mortgage when it comm enced this action in April 2009; 4) Beltrami did not receive anotice of default; 5 ) the notice of default is defective on its face; an d 6) the mortgage documentshe and Spiering signed were not with Thornburg but with MERS.

Thornburg is not entitled to summary judgment, and complaint must be dismissed basedon its failure to comply with the statutory notice requirement of RPAPL 1304, which is amandatory condition precedent to the commencement of this mortgage foreclosure action.Aurora Loan Sew in LLC v. Weisblum, AD3d -, 923 NYS2d 609,611 (2d Dept 201 1).As the plaintiff in a mortgage foreclosure action, Thornburg has the burden of demonstratingcompliance with the notice requirement of RPAPL 1304, and noncom pliance results in dismissalof the complaint. See id.

Although RPAPL 1304 was amended in 2009 (effective January 1,20 10) so as o beapplicable to any home loan, w hen that section was originally enacted in 2008, its applicabilitywas limited to high-cost, sub-prime, and non-traditional hom e loans. RPAPL 1304(1);Aurora Loan Services. Section 1304(5)(e) defined a non-traditional home loan as a payment option adjustable rate mortgage o r an nterest only loanconsummated between January irst, two thousand three and Septem ber first, two thousandeight. W A P L 1304 as originally enacted became effective with foreclosure actions

C v . Weisblum, supra at 615.

3

]

www .StopF

orec los

u reFraud

.com


6/9

commenced on or after September 1,2008. &g id.RPAPL 1304(1) requires that at least ninety days before a lender or mortgage loan

servicer commences legal action against the borrower, including mortgage foreclosure, the lenderor mortgage loan servicer shall give notice to the borrower in at least fourteen-point type whichshall include certain specified la n g ~ a g e . ~ PAPL 1304(2) provides that the notice shall besent by the lender or mortgage loan servicer to the borrower, by registered or certified mail andalso by first class mail to the last known address of the borrower, and if different, to th e residence

3RpAPL 1304(1) mandates the following content of the notice:YOU COULD LOSE YOUR HOME. PLEASE

READ TH E FOLLOWINGNOTICE CAREFULLYAs of * . ,your home loan is . . . days in default. Under New York StateLaw, we are required to se nd you this notice to inform you that you are at risk oflosing your home. You can cure this default by making the payment of . . . dollarsb y . . . .If you are experienc ing financial difficulty, you should know that there areseveral options available to you that may help you keep your home. Attached tothis notice is a list of governm ent approved housing counseling agencies in yourarea which provide free or very low-cost counseling. You sh ould considercontacting one of these agencies imm ediately. These agencies specialize inhelping homeowners who are facing financial difficulty. Housing counselors canhelp you assess your financial condition and work with us to explore thepossibility of modifying your loan, establishing an easier payment plan for you, oreven working out a period of loan forbearance. If you wish, you may also contactus directly at . . . . . . . and ask to discuss possible options.we encourage you to take imm ediate steps to try to achieve a resolution. Thelonger you wait, the few er options you may have.mailed, we may com men ce legal action against you (or sooner if you cease to livein the dwelling as your primary residence).If you need further information, please call the Ne w York State BankingDepartments toll-free help line a t 1 877-BANK-NYS (1-877-226-5697) or visitthe Departments website at http://www.banking,state.ny.us.

While we cannot assure that a mutually agreeable resolution is possible,

If this matter is not resolved within 90 days from the date this notice was

4

]

www .StopF

oreclosu re

F raud .co

m
http://www.banking%2Cstate.ny.us/http://www.banking%2Cstate.ny.us/


7/9

which is the subject of the mortgage. RPAPL 1304(2) also provides that the no tice isconsidered given as of the da te it is m ailed, and that the notice shall contain a list of at leastfive United States department of housing and urban development approved housing counselingagencies, or other housing counseling agencies, as designated by the division of housing andcommunity renewal, that serve the region where the borrower resides.

The instant action was commenced in April 2009, when the original provisions of RPAPL1304 were applicable. Thornburgs complaint contains an allegation that plaintiff. . . is incompliance with sending the ninety (90) day notices as required by RPAPL 1304 , if theunderlying mortgage qualifies. The parties do not dispute that the loan at issue is an interestonly home loan, which falls within the WAPL 1304(5)(e) pre-amendment definition of a non-traditional home loan . As indicated above, defendants executed an Interest-Only PromissoryAdjustable Rate Note (emphasis added). The Appellate Division Second Department recentlyissued a decision holding that Lplroper service of RPAPL 1304 notice on the borrower orborrowers is a cond ition precedent to the commencement of a foreclosure action, and the plaintiffhas the burden of establishing satisfaction of this condition. &NO ra Loan Semices. LLC v,Weisblum. supra at 616.

Here, Thornburg fails to meet its burden, as it concedes that a WAPL 1304 notice wasnot served on either Beltrami or Spiering. Rather, Thornburg argues that the W A P L 1304 noticerequirement is inapplicable because Spiering resides in Europe, and RPAPL 130 4 requires bothBeltrami and S piering to reside a t the property together, since they are the borrower under theterms of the mortgage. Alternatively, Thornburg argues that even if RPAPL 1304 applies,Beltrami has not been prejudiced, as he has participated in this action, includ ing settlement

5

]

www .StopF

orec los

u reFraud

.com


8/9

*

discussions, since its inception mo re than three years ago, and equity dictates that Beltramishould not be permitted to ho ld u p these proceedings based on illusory no tice violations.Thornburg asserts that Beltramis strategy throughout this action has been to delay the resolutionas long as possible while he continues to reside at the property, at the expense of both Thornburgand co-owner Spiering, who i s in poo r health and simply seeks to have the property, which hasbeen app raised at $5 million, sold on the open market as soon as possible.

Notwithstanding S pierings unfortunate circumstances, in light o f the Appellate DivisionSecond Departments holding in Aurora& ewices. LLC v . Weisblum, Thornburgsarguments are without merit. Notab ly, the Second Department explicitly rejected the lenderscontention that the borrowers had received proper RPAPL 1303 notice and appeared at themandatory settlement conference after commencement of the action, explaining that suchcontention does not address the statutory purpose of the pre-foreclosure notice afforded byRPAPL 1304. Id at 617. Since FWAPL 1304 notice must be sent at least 90 days prior to thecornmencement of an anticipated foreclosure action, its manifest purpose is to aid thehomeowner in m attempt to avoid litigation. The legislative history noted a typical lack ofcomm unication between d istressed homeow ners and their lenders prior to the commencement oflitigation, leading to needless foreclosu re proceedings. The bill sponsor sought to bridge thatcomm unication gap in order to facilitate a resolution that avoids foreclosure by providing a pre-foreclosure notice advising the borrow er of housing counseling services available in theBorrowers area and an additional period of time . . . to work o n a resolution.Senate Introducer Me m. In Support,Bill Jacket, L. 2008, ch . 472, at lo). The SecondDepartment also rejected the lenders suggestion that the failure to give RPAPL 1304 notice is a

(quoting

6

]

www .StopF

orec los

u reFraud

.com


9/9

c

mistake, omission or irregularity that c an be disregarded if a party is not prejudiced, holding that[wlhere as here, the condition sou ght to be disregarded is a mandatory condition precedent, thepla intif fs failure to comply cannot be disregarded. Id.

Based on the foregoing, th e com plaint must be dismissed on the ground that Thornburgfailed to comply with RPAPL 1304. Id. In view of this conclusion, the court need not determinethe additional grounds for dismissal r aised by Beltrami. T h e court notes, however, thatThornburg complied with the RPAPL 1303 notice requirement, which is a separate conditionprecedent to the commencement of this action. See First - Bank o Chicago v. Sil va , 73AD3d 162 (2dDept 2010). Also, in the event Thornburg commences a new mortgageforeclosure action, the issues raised herein as o the assignment of the mortgage by MERS, wouldpresumably be rendered academ ic, since the assignment would necessarily pre-date thecommencement of any subsequent action.

Accordingly, it isORDERED that plaintif fs motion is denied in its entirety; and it is furtherORDERED that defen dant Beltramis cross-motion for summary judgment dism issing the

complaint is granted and the com plaint is dismissed in its entirety without prejudice, and theClerk is directed to enter judgm ent accordingly.

DATED: July / / , 2 0 1 1

7

]

www .StopF

orec los

u reFraud

.com

Download - NYSupreme Court- Thornburg v Beltrami - Case dismissed. MERS assigment fails

Top Related