Here is a guide to pursuing and defending a foreclosure action.
Bank of N.Y. Mellon v Gordon, 2019 NY Slip Op 02306, Decided on March 27, 2019, Appellate Division, Second Department:
"In the wake of the financial crisis that began in 2008, the trial
courts of this state have faced an unprecedented spike in judicial
foreclosure actions. The challenges presented by this dramatic increase
in litigation have been compounded by poor record-keeping practices, a
changing regulatory environment, inordinate delays, and inadequate legal
representation. The sheer number of foreclosure cases has also resulted
in a renewed focus on the legal principles underlying such actions and
presented circumstances under which those principles must be extended
and applied to new factual scenarios.
From an appellate perspective, the recent flood of foreclosure
appeals has revealed consistent and repeated confusion about some of the
most fundamental aspects of the procedural, substantive, and
evidentiary law that must be routinely applied in a foreclosure context.
In an effort to provide additional clarity in this important area of
the law, we deem it appropriate to collect and reiterate some of these
foundational principles in the hope that such clarity will eliminate
many of the disputes that make up an ever-increasing proportion of
trial-level dockets. For the reasons that follow, we modify the order
appealed from.
1.
Factual and Procedural Background
The plaintiff commenced this action to foreclose a mortgage. The
defendant Dushaun Gordon interposed an answer which included 55
affirmative defenses, 5 counterclaims asserted against the plaintiff,
and 2 cross claims asserted against the defendant Mortgage Electronic
[*2]Registration Systems, Inc. (hereinafter MERS).
The plaintiff thereafter moved for, among other relief, summary
judgment on the complaint insofar as asserted against Gordon and
dismissing the affirmative defenses and counterclaims asserted by that
defendant, and to appoint a referee to compute the amount due. Gordon
opposed the plaintiff's motion and cross-moved pursuant to CPLR 3211 and
3212 to dismiss the complaint insofar as asserted against him or, in
the alternative, to compel disclosure, in effect, pursuant to CPLR 3124,
and for leave to enter a default judgment on his cross claims asserted
against MERS.
In a decision dated July 23, 2015, the Supreme Court determined,
among other things, that the plaintiff was entitled to summary judgment
on the complaint. A subsequent order entered August 7, 2015, upon the
decision, inter alia, (1) granted those branches of the plaintiff's
motion which were for summary judgment on the complaint insofar as
asserted against Gordon and dismissing the affirmative defenses and
counterclaims asserted by that defendant, and to appoint a referee to
compute the amount due, and (2), in effect, denied Gordon's cross motion
pursuant to CPLR 3211 and 3212 to dismiss the complaint insofar as
asserted against him or, in the alternative, to compel disclosure, in
effect, pursuant to CPLR 3124, and for leave to enter a default judgment
on his cross claims asserted against MERS. Gordon appeals from those
portions of the order entered August 7, 2015. We modify.
2.
Legal Analysis
A.
General Principles
A motion for summary judgment "shall be granted if, upon all the
papers and proof submitted, the cause of action or defense shall be
established sufficiently to warrant the court as a matter of law in
directing judgment in favor of any party" (CPLR 3212[b];
see Alvarez v Prospect Hosp.,
68 NY2d 320, 324). Such a motion must be supported "by affidavit, by a
copy of the pleadings and by other available proof, such as depositions
and written admissions" (CPLR 3212[b]). To make a prima facie showing,
the moving party must "demonstrate its entitlement to summary judgment
by submission of proof in admissible form" (
Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d 498, 507;
see Zuckerman v City of New York,
49 NY2d 557, 562). Admissible evidence may include "affidavits by
persons having knowledge of the facts [and] reciting the material facts"
(
GTF Mktg. v Colonial Aluminum Sales, 66 NY2d 965, 967;
see CPLR 3212[b];
Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co.,
25 NY3d at 508). "Once a prima facie showing has been made, the burden
shifts to the party opposing the motion for summary judgment to produce
evidentiary proof in admissible form sufficient to establish the
existence of material issues of fact which require a trial of the
action'" (
Rosenblatt v St. George Health & Racquetball Assoc., LLC, 119 AD3d 45, 50, quoting
Alvarez v Prospect Hosp., 68 NY2d at 324).
"In determining a motion for summary judgment, the court must view
the evidence in the light most favorable to the nonmoving party" (
Stukas v Streiter, 83 AD3d 18, 22;
see Pearson v Dix McBride, LLC, 63 AD3d 895).
"The function of the court on a motion for summary judgment is not to
resolve issues of fact or determine matters of credibility, but merely
to determine whether such issues exist" (
Kolivas v Kirchoff, 14 AD3d 493, 493;
see Sillman v Twentieth Century-Fox Film Corp., 3 NY2d 395, 404;
Stukas v Streiter,
83 AD3d at 23). Accordingly, "[t]he court may not weigh the credibility
of the affiants on a motion for summary judgment unless it clearly
appears that the issues are not genuine, but feigned" (
Glick & Dolleck v Tri-Pac Export Corp., 22 NY2d 439, 441;
see 6243 Jericho Realty Corp. v AutoZone, Inc., 27 AD3d 447, 449). "[W]here credibility determinations are required, summary judgment must be denied" (
People v Greenberg, 95 AD3d 474, 483,
affd 21 NY3d 439;
see Pryor & Mandelup, LLP v Sabbeth, 82 AD3d 731, 732;
Campbell v Campbell, 43 AD3d 1264, 1266).
In addition, " [a] motion for summary judgment will not be granted if
it depends on proof that would be inadmissible at the trial under some
exclusionary rule of evidence'" (
Rosenblatt v St. George Health & Racquetball Assoc.,
LLC,
119 AD3d at 52, quoting David D. Siegel, Practice Commentaries,
McKinney's Cons Laws of NY, Book 7B, CPLR C3212:18 at 27 [2005 ed];
see HSBC Mtge. Servs., Inc. v Royal, 142 AD3d 952, 954;
Aurora Loan Servs., LLC v Mercius, 138 AD3d 650, 652;
US Bank N.A. v Madero, 125 AD3d 757,
758). "Out-of-court statements offered for the truth of the matters
they assert are hearsay and may be received in evidence only if they
fall within one of the recognized exceptions to the hearsay rule, and
then only if the proponent demonstrates that the evidence is reliable" (
Nucci v Proper, 95 NY2d 597, 602 [internal quotation marks omitted];
see Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co., 25 NY3d at 508).
However, as a general matter, a court should not examine the
admissibility of evidence submitted in support of a motion for summary
judgment unless the nonmoving party has specifically raised that issue
in its opposition to the motion (
see Rosenblatt v St. George Health & Racquetball Assoc.,
LLC,
119 AD3d at 55), for "[w]e are not in the business of blindsiding
litigants, who expect us to decide their appeals on rationales advanced
by the parties, not arguments their adversaries never made" (
Misicki v Caradonna, 12 NY3d 511,
519). Indeed "in civil cases, inadmissible hearsay admitted without
objection may be considered and given such probative value as, under the
circumstances, it may possess'" (
Rosenblatt v St. George Health & Racquetball Assoc.,
LLC, 119 AD3d 54-55, quoting Jerome Prince, Richardson on Evidence § 8-108 [Farrell 11th ed 2008];
see Matter of Findlay, 253 NY 1, 11;
Ford v Snook, 205 App Div 194, 198,
affd 240 NY 624).
B.
Standing
In this case, Gordon contends that the Supreme Court should not have
awarded the plaintiff summary judgment on the complaint insofar as
asserted against him because, in his view, there are triable issues of
fact as to whether the plaintiff has standing to maintain this action.
This
contention is without merit.
"[W]here, as here, standing is not an essential element of the cause
of action, under CPLR 3018(b) a defendant must affirmatively plead lack
of standing as an affirmative defense in the answer in order to properly
raise the issue in its responsive pleading" (
US Bank N.A. v Nelson, ___ AD3d ___, ___, 2019 NY Slip Op 00494, *2-3 [2d Dept 2019];
see Matter of Fossella v Dinkins, 66 NY2d 162, 167;
BAC Home Loans Servicing, LP v Alvarado, 168 AD3d 1029, 1030;
see also Green Bus Lines v Consolidated Mut. Ins. Co.,
74 AD2d 136, 142-143). Here, Gordon asserted standing as an affirmative
defense in his answer. Accordingly, the issue of standing is properly
before this Court (
cf. US Bank N.A. v Nelson, ___ AD3d ___, 2019 NY Slip Op 00494).
Where the issue of standing is raised by a defendant in a mortgage
foreclosure action, a plaintiff must prove its standing in order to be
entitled to relief against that defendant (
see HSBC Bank USA, N.A. v Roumiantseva, 130 AD3d 983, 983-984;
HSBC Bank USA, N.A. v Calderon, 115 AD3d 708, 709;
Bank of N.Y. v Silverberg, 86 AD3d 274,
279). "A plaintiff establishes its standing in a mortgage foreclosure
action by demonstrating that it is either the holder or assignee of the
underlying note at the time the action is commenced" (
Wells Fargo Bank, N.A. v Gallagher, 137 AD3d 898, 899;
see Aurora Loan Servs., LLC v Taylor, 25 NY3d 355,
360-362). "Either a written assignment of the underlying note or the
physical delivery of the note prior to the commencement of the
foreclosure action is sufficient to transfer the obligation, and the
mortgage passes with the debt as an inseparable incident" (
U.S. Bank, N.A. v Collymore, 68 AD3d 752, 754;
see JPMorgan Chase Bank, N.A. v Weinberger, 142 AD3d 643, 644-645).
Here, the plaintiff established, prima facie, that it had standing to
prosecute this action by demonstrating that it was in physical
possession of the note, which had been endorsed in blank, at the time
the action was commenced. In this regard, the plaintiff submitted the
affidavit of its attorneys' employee, Kyra Schwartz, who stated that
certain business records, which were maintained by her employer and
attached to her affidavit, demonstrated that the plaintiff's attorneys
were in possession of the original note endorsed in blank since August
19, 2011, a date which was prior to the commencement of this action (
see Bank of Am., N.A. v Tobing, 163 AD3d 518, 519-520;
U.S. Bank, N.A. v Cardenas, 160 AD3d 784, 785;
PennyMac Corp. v Chavez, 144 AD3d 1006, 1007;
M & T Bank v Cliffside Prop. Mgt., LLC, 137 AD3d 876, 877).
In opposition, Gordon failed to raise a triable issue of fact with
respect to the issue of standing. Inasmuch as the mortgage "passes with
the debt as an inseparable incident" (
U.S. Bank,
N.A. v Collymore, 68 AD3d at 754;
see Aurora Loan Servs., LLC v Taylor,
25 NY3d at 361), Gordon's arguments regarding the validity and timing
of the mortgage assignment failed to raise a triable issue of fact in
opposition (
see Wells Fargo Bank, N.A. v Heiney, 168 AD3d 1126, 1127;
Aurora Loan Servs., LLC v Vrionedes, 167 AD3d 829, 830;
Flagstar Bank, FSB v Mendoza, 139 AD3d 898, 900).
Gordon further contends that Schwartz's affidavit was insufficient to
lay a proper foundation for the admissibility of the business records
that she attached to it. This contention is also without merit.
"Records made in the regular course of business are hearsay when
offered for the truth of their contents" (Jerome Prince, Richardson on
Evidence § 8-301 [Farrell 11th ed 1995]). "The statutory business
records rule, now CPLR 4518(a), was originally enacted in 1928 to
overcome the
[*3]deficiencies of common law rules which severely hampered proof of many valid claims" (
id.;
see People v Kennedy, 68 NY2d 569, 578;
Johnson v Lutz, 253 NY 124, 127-128).
The current version of the business records rule provides that
"[a]ny writing or record, whether in the form of an entry in a book
or otherwise, made as a memorandum or record of any act, transaction,
occurrence or event, shall be admissible in evidence in proof of that
act, transaction, occurrence or event, if the judge finds that it was
made in the regular course of any business and that it was the regular
course of such business to make it, at the time of the act, transaction,
occurrence or event, or within a reasonable time thereafter" (CPLR
4518[a]).
An "electronic record . . . shall be admissible in a tangible exhibit
that is a true and accurate representation of such electronic record" (
id.).
A court "may consider the method or manner by which the electronic
record was stored, maintained or retrieved in determining whether the
exhibit is a true and accurate representation of such electronic record"
(
id.). However, "[a]ll other circumstances of the making of the
memorandum or record, including lack of personal knowledge by the maker,
may be proved to affect its weight, but they shall not affect its
admissibility" (
id.;
see People v Kangas, 28 NY3d 984, 985-986;
cf. Fed Rules Evid rule 803[6]).
Accordingly, to establish a foundation for the admission of a
business record, the proponent of the record must satisfy the
requirements identified in the statute (
see CPLR 4518[a]). First,
the proponent must establish "that the record be made in the regular
course of business—essentially, that it reflect a routine, regularly
conducted business activity, and that it be needed and relied on in the
performance of functions of the business" (
People v Kennedy, 68
NY2d at 579). Second, the proponent must also demonstrate "that it be
the regular course of such business to make the record . . .
essentially, that the record be made pursuant to established procedures
for the routine, habitual, systematic making of such a record" (
id. at
579-580). Third, the proponent must establish "that the record be made
at or about the time of the event being recorded—essentially, that
recollection be fairly accurate and the habit or routine of making the
entries assured" (
id. at 580).
In addition to these statutory requirements, the Court of Appeals has
held that "[u]nless some other hearsay exception is available,
admission may only be granted where it is demonstrated that the
informant has personal knowledge of the act, event or condition and he
[or she] is under a business duty to report it to the entrant" (
Matter of Leon RR, 48 NY2d 117, 123 [citation omitted];
see People v Patterson, 28 NY3d 544, 550;
Johnson v Lutz, 253 NY at 127-128;
Murray v Donlan,
77 AD2d 337, 346). That said, "[i]t would clearly defeat the utility of
CPLR 4518 to require the testimony of all persons involved in creating
the record" (Jerome Prince, Richardson on Evidence § 8-306 [Farrell 11th
ed 1995]).
Finally, under the circumstances here, it bears noting that the
business record exception to the hearsay rule applies to a "writing or
record" (CPLR 4518[a]). Although "[t]he foundation for admission of a
business record usually is provided by the testimony of the custodian,
the author or some other witness familiar with the practices and
procedures of the particular business" (Jerome Prince, Richardson on
Evidence § 8-306 [Farrell 11th ed 1995]), it is the business record
itself, not the foundational affidavit, that serves as proof of the
matter asserted (
see generally Great Am. Ins. Co. v Auto Mkt. of Jamaica, N.Y., 133 AD3d 631, 632-633; 35 Carmody-Wait 2d § 194:94 [2019];
cf.
9 Weinstein-Korn-Miller, NY Civ Prac CPLR ¶ 4518.20). Accordingly,
"[e]vidence of the contents of business records is admissible only where
the records themselves are introduced" (35 Carmody-Wait 2d § 194:94
[2019];
see People v Barnes, 177 AD2d 989;
see also People v Olivero, 27 Misc 3d 1218[A], 2010 NY Slip Op 50794[U] [Civ Ct, Kings County];
People v Ross, 12 Misc 3d 755,
764 [Crim Ct, Kings County 2006]). "Without their introduction, a
witness's testimony as to the contents of the records is inadmissible
hearsay" (35 Carmody-Wait 2d § 194:94 [2019];
see U.S. Bank Natl. Assn. v 22 S. Madison, LLC, ___ AD3d ___, ___, 2019 NY Slip Op 01635, *2 [2d Dept 2019];
People v Barnes,
177 AD2d 989). Of course, generally speaking, a witness may always
testify as to matters which are within his or her personal knowledge
through personal observation (
see Jerome Prince, Richardson on Evidence §§ 4-301, 6-210 [Farrell 11th ed 1995];
see also People v Daddona, 81 NY2d 990, 992;
Pease v Smith, 61 NY 477, 484-485;
People v Duffy, 124 AD2d 258, 260;
Levy v Huwer, 80 App Div 499, 501-502,
affd 176 NY 612).
Here, Schwartz stated in her affidavit that she was employed by the
law firm that represented the plaintiff in this action. Schwartz stated
that she was "employed as the manager of a group of employees . . . that
is responsible for receiving original loan documents from the firm's
clients [and] documenting the receipt of [those] original loan
documents." She stated that, when a client forwards a file containing
original loan documents, "[her] staff makes a computer entry . . .
confirming [their] receipt." These entries were made "at or about the
time of the receipt of the original loan documents," and the records of
such events were "created and maintained in the ordinary course of [the]
business" of the plaintiff's attorneys. Finally, Schwartz stated that
"[i]t was the normal course of [the firm's] business to store these
records as computer entries."
Schwartz further stated that she reviewed the firm's business records
relative to this case, which records showed that the original note was
received on August 19, 2011. Attached to Schwartz's affidavit was "a
true and accurate printout [she] made of the computer entry confirming
the receipt . . . of the original note." Schwartz also attached a copy
of the original note to her affidavit, and affirmed that she had
compared this copy "to the original note which remains in storage under
the custody of [her] team" and that the copy was "a true and accurate
copy of the original note."
Contrary to Gordon's contention, Schwartz did not need to demonstrate
her familiarity with the record-keeping practices and procedures of the
plaintiff, the original lender, Countrywide Home Loans, Inc.
(hereinafter Countrywide), or MERS, in order to lay a proper foundation
for the admission of the business record attached to her affidavit.
Schwartz sought to lay a foundation for the admission of a business
record maintained by her employer, the plaintiff's attorneys. She did
not seek to lay a foundation for business records produced or maintained
by any of the other entities identified by Gordon. As this Court has
previously observed, "[t]here is no requirement that a plaintiff in a
foreclosure action rely on any particular set of business records to
establish a prima facie case, so long as the plaintiff satisfies the
admissibility requirements of CPLR 4518(a), and the records themselves
actually evince the facts for which they are relied upon" (
Citigroup v Kopelowitz, 147 AD3d 1014, 1015;
see HSBC Bank USA, N.A. v Ozcan, 154 AD3d 822,
826). Accordingly, under the circumstances, since Schwartz only sought
to lay a foundation for a business record produced and maintained by her
own employer, she was only required to set forth her familiarity with
her employer's record-keeping practices and procedures (
see generally CPLR 4518[a];
People v Kennedy, 68 NY2d at 579-580;
cf. Aurora Loan Servs., LLC v Baritz, 144 AD3d 618;
US Bank N.A. v Handler, 140 AD3d 948;
Aurora Loan Servs., LLC v Mercius, 138 AD3d 650).
Gordon's remaining arguments relating to the issue of standing are
either improperly raised for the first time on appeal or without merit.
Accordingly, since Gordon failed to raise a triable issue of fact with
respect to the issue of standing in opposition to the plaintiff's prima
facie showing, we agree with the Supreme Court's determination to grant
those branches of the plaintiff's motion which were for summary judgment
dismissing the affirmative defenses that raised the issue of standing,
to wit, the 1st, 2nd, 3rd, 4th, 5th, 14th, 15th, 26th, 27th, and 36th
affirmative defenses (
see Aurora Loan Servs., LLC v Vrionedes, 167 AD3d at 830;
cf. US Bank N.A. v Weinman, 123 AD3d 1108, 1109-1110).
C.
Default
Although vague and inartfully drafted, Gordon's brief, liberally
construed, in effect, contends that the Supreme Court should not have
awarded the plaintiff summary judgment on the complaint insofar as
asserted against him and dismissing the 20th affirmative defense
because, in his view, the plaintiff failed to sustain its initial burden
of demonstrating that he defaulted in the repayment of the subject
note. This contention has merit.
To establish a prima facie case in an action to foreclose a mortgage,
a plaintiff must produce the mortgage, the unpaid note, and evidence of
default (
see Aurora Loan Servs., LLC v Vrionedes, 167 AD3d at 830;
Giller v Weiss, 140 AD3d 1117, 1118;
HSBC Bank USA, N.A. v Spitzer, 131 AD3d 1206, 1206-1207). A plaintiff may establish a payment default by an admission made in response to a notice to admit (
see
CPLR 3212[b]; 3123), by an affidavit from "a person having [personal]
knowledge of the facts" (CPLR 3212[b]), or by other evidence "in
admissible form" (
Viviane Etienne Med. Care, P.C. v Country-Wide Ins. Co.,
25 NY3d at 507). Here, as Gordon correctly contends, the plaintiff's
submissions failed to lay a proper foundation for the admission of the
business records relied upon by the plaintiff to establish Gordon's
default in the repayment of the subject loan.
The plaintiff relied upon the affidavit of Rosalind Carroll to lay a foundation for the
[*4]admission
of business records purporting to show that Gordon had defaulted under
the terms of the subject note by failing to make required monthly
payments. Carroll stated that she was a "document coordinator" for an
entity named "Bayview Loan Servicing, LLC" (hereinafter Bayview), which
was identified by Carroll as a "servicer for the plaintiff." Carroll
went on to state: "According to the business records I have reviewed,
[Gordon] defaulted on the loan by failing to make monthly payments due
on May 1, 2008 and continuing to the present."
Although Carroll adequately described the record-keeping practices
and procedures utilized by Bayview, and adequately stated her
familiarity with those practices, she did not actually attach or
otherwise incorporate any of Bayview's business records to her
affidavit. Accordingly, to the extent that Carroll's purported knowledge
of Gordon's default was based upon her review of unidentified business
records created and maintained by Bayview, her affidavit constituted
inadmissible hearsay and lacked probative value (
see Flick Lbr. Co. v Breton Indus., 223 AD2d 779, 780;
People v Barnes, 177 AD2d 989;
Dempsey v Intercontinental Hotel Corp., 126 AD2d 477, 479;
see also 35 Carmody-Wait 2d § 194:94 [2019]).
The only purported business record specifically identified by Carroll
as demonstrating Gordon's default is a document dated June 16, 2008.
The record indicates that this document was annexed to Carroll's
affidavit. However, Carroll does not specifically allege that Bayview
created the document. Furthermore, the document, on its face, indicates
that it was created by Countrywide, the original lender, and Carroll
does not allege that she is personally familiar with that entity's
record-keeping practices and procedures. As previously noted, "[a]
proper foundation for the admission of a business record must be
provided by someone with personal knowledge of
the maker's business practices and procedures" (
Citibank, N.A. v Cabrera, 130 AD3d 861, 861 [emphasis added]).
Of course, Carroll's status as an employee of Bayview does not
necessarily mean that she is incompetent to lay a foundation for the
admission of business records that were created by another entity (
see People v Cratsley,
86 NY2d 81, 90). It is true that as a general rule, "the mere filing of
papers received from other entities, even if they are retained in the
regular course of business, is insufficient to qualify the documents as
business records" (
Standard Textile Co. v National Equip. Rental, 80 AD2d 911, 911;
see People v Cratsley,
86 NY2d at 90). However, such records may be admitted into evidence if
the recipient can establish personal knowledge of the maker's business
practices and procedures, or establish that the records provided by the
maker were incorporated into the recipient's own records and routinely
relied upon by the recipient in its own business (
see People v Cratsley, 86 NY2d at 90-91;
Bank of Am., N.A. v Brannon, 156 AD3d 1, 8;
State of New York v 158th St. & Riverside Dr. Hous. Co., Inc., 100 AD3d 1293, 1296;
People v DiSalvo, 284 AD2d 547, 548-549;
Plymouth Rock Fuel Corp. v Leucadia, Inc., 117 AD2d 727, 728;
cf. United States v Jakobetz, 955 F2d 786, 800 [2d Cir];
Matter of Ollag Constr. Equip. Corp.,
665 F2d 43, 46 [2d Cir]). Indeed, "[t]he reports of an independent
contractor regularly relied on by the business may qualify as the
business' record" (Jerome Prince, Richardson on Evidence § 8-307
[Farrell 11th ed 1995];
cf. General Ins. Co. of Am. v United States Fire Ins. Co., 886 F3d 346, 358 [4th Cir];
Cocroft v HSBC Bank USA, N.A., 796 F3d 680 [7th Cir]).
Here, however, Carroll failed to attest to her personal knowledge of
Countrywide's record-keeping practices, and failed to allege that the
document that she attached to her affidavit was incorporated into
Bayview's records and routinely relied upon by Bayview in its business.
Accordingly, under the circumstances, Carroll's affidavit was
insufficient to lay a proper foundation for the admission of the
document dated June 16, 2008 (
see e.g. Aurora Loan Servs., LLC v Baritz, 144 AD3d at 619-620;
HSBC Mtge. Servs., Inc. v Royal, 142 AD3d at 954;
Aurora Loan Servs., LLC v Mercius, 138 AD3d at 652;
Citibank, N.A. v Cabrera, 130 AD3d at 861-862).
Moreover, as Gordon correctly contends, certain factual assertions
made by Carroll in her affidavit which are relevant to the issue of
Gordon's default are directly contradicted by the documents that she
attached to her affidavit. Other factual assertions made by Carroll in
her affidavit are contradicted by other portions of her own affidavit.
These contradictions raise issues of credibility (
see e.g. Taieb v Hilton Hotels Corp.,
131 AD2d 257, 261), and, as such, Carroll's affidavit failed to
eliminate all triable issues of fact with respect to the issue of
Gordon's default (
see Cristescu v Gasparis, 148 AD3d 669;
see generally Pryor & Mandelup, LLP v Sabbeth, 82 AD3d at 732).
We note that the plaintiff did actually submit payment records
relating to Gordon's mortgage in support of its motion. However, these
payment records were not attached to, or
[*5]otherwise
incorporated into, Carroll's affidavit, and she did not identify these
records or make specific reference to them. Rather, the plaintiff
inexplicably attached these payment records as an exhibit to its
attorney's
affirmation. The plaintiff's attorney does not allege personal
knowledge of the record-keeping practices and procedures of the entity
that created these payment records (
see generally Zuckerman v City of New York,
49 NY2d at 563). Since the plaintiff failed to lay the proper
foundation for the admission of the payment records into evidence, those
records do not constitute admissible evidence and cannot serve to
establish, prima facie, Gordon's default in the repayment of the subject
loan (
see generally Mallen v Farmingdale Lanes, LLC, 89 AD3d 996, 997;
Roldan v New York Univ., 81 AD3d 625, 627;
Toussaint v Ferrara Bros. Cement Mixer, 33 AD3d 991, 992;
Daliendo v Johnson, 147 AD2d 312, 321).
In sum, since the plaintiff failed to establish, prima facie,
Gordon's default in the repayment of the subject loan through the
submission of evidence in admissible form, the Supreme Court should have
denied those branches of the plaintiff's motion which were for summary
judgment on the complaint insofar as asserted against Gordon and
dismissing the 20th affirmative defense asserted by that defendant, and
to appoint a referee to compute the amount due (
see Fulton Holding Group, LLC v Lindoff, 165 AD3d 1045, 1047-1048;
HSBC Mtge. Servs., Inc. v Royal, 142 AD3d at 954).
D.
Gordon's Remaining Contentions
Addressing the remaining affirmative defenses asserted in his answer,
Gordon contends that they should not have been dismissed by the Supreme
Court, sua sponte. Contrary to Gordon's contention, the court did not
"sua sponte" strike Gordon's answer and counterclaims. Rather, this
relief was specifically requested in the plaintiff's motion papers.
Further, we agree with the Supreme Court's determination to deny
those branches of Gordon's cross motion which were pursuant to CPLR 3211
and 3212 to dismiss the complaint insofar as asserted against him, as
he failed to demonstrate his entitlement to such relief. Gordon argues
that the plaintiff's general denials of the allegations underlying his
counterclaims constituted judicial admissions that prove fatal to the
plaintiff's complaint. Formal judicial admissions include facts that are
"admitted" by a party's pleadings (
Zegarowicz v Ripatti, 77 AD3d 650, 653). To constitute a judicial admission, a statement must be "deliberate, clear, and unequivocal" (
Rahman v Smith, 40 AD3d 613, 615). The plaintiff's general denials do not meet these criteria.
Gordon also contends that the Supreme Court should not have, in
effect, denied that branch of his cross motion which was for leave to
enter a default judgment on his cross claims asserted against MERS. To
be entitled to such relief, Gordon was required to demonstrate, inter
alia, "proof of service" of the cross claims on MERS (CPLR 3215[f]).
Although Gordon's counsel affirmed that proof of service of the answer
with cross claims upon MERS had been submitted in connection with
Gordon's cross motion, the record on appeal does not support this
assertion. Since Gordon failed to submit proof of service of process on
MERS, he failed to satisfy the requirements for demonstrating his
entitlement to leave to enter a default judgment on his cross claims
asserted against that defendant (
see generally Stevens v Law Off. of Blank & Star, PLLC, 155 AD3d 917, 918).
3.
Conclusion
In light of the foregoing, we modify the order appealed from, insofar
as described below. Inasmuch as the Supreme Court's denial of that
branch of Gordon's cross motion which was to compel disclosure, in
effect, pursuant to CPLR 3124 appears to have been premised on its
granting of that branch of the plaintiff's motion which was for summary
judgment on the complaint insofar as asserted against Gordon, we remit
the matter to that court for a new determination of the branch of the
defendant's cross motion which was to compel discovery (
see Bank of N.Y. Mellon v Cutler, 154 AD3d 910, 912).
Accordingly, the order is modified, on the law, (1) by deleting the
provisions thereof granting those branches of the plaintiff's motion
which were for summary judgment on the complaint insofar as asserted
against the defendant Dushaun Gordon and dismissing the 20th affirmative
defense asserted by that defendant, and to appoint a referee to compute
the amount due, and substituting therefor a provision denying those
branches of the plaintiff's motion, and (2) by deleting the provision
thereof, in effect, denying that branch of the cross motion of the
defendant Dushaun Gordon which was to compel disclosure, in effect,
pursuant to CPLR 3124; as so modified, the order is affirmed insofar as
appealed from, and the matter is remitted to the Supreme Court, Nassau
County, for a new determination of that branch of the cross motion of
the defendant Dushaun
[*6]Gordon which was to compel disclosure, in effect, pursuant to CPLR 3124."
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