| Bank of Am., N.A. v Kyle |
| 2015 NY Slip Op 04705 [129 AD3d 1168] |
| June 4, 2015 |
| Appellate Division, Third Department |
[*1]
| Bank of America, N.A., Respondent, v Edward J. Kyle,Appellant, et al., Defendants. |
Law Office of Ronald J. Kim, Saratoga Springs (Ronald J. Kim of counsel), forappellant.
Akerman, LLP, New York City (Jordan M. Smith of counsel), for respondent.
Rose, J. Appeal from an order of the Supreme Court (Ferradino, J.), enteredNovember 19, 2013 in Saratoga County, which, among other things, granted plaintiff'smotion for summary judgment.
Defendant Edward J. Kyle (hereinafter defendant) executed a note in favor ofCountrywide Home Loans, Inc. secured by a mortgage on real property located inSaratoga County. He defaulted on the payments in 2011, and plaintiff commenced thisaction for foreclosure in August 2012. Following joinder of issue, plaintiff moved forsummary judgment striking the answer and appointing a referee to compute the amountdue. Defendant then cross-moved for, among other things, an order striking plaintiff'scomplaint for failure to respond to discovery demands. Supreme Court granted plaintiff'smotion for summary judgment and defendant appeals.
Inasmuch as defendant raised the affirmative defense of standing and plaintiff failedto sustain its burden of establishing that it was a holder or assignee of the note at thecommencement of the action, summary judgment should not have been granted. Ourwell-settled rule is that "[a] plaintiff has standing in a mortgage foreclosure action whereit is both the holder or assignee of the subject mortgage and the holder or assignee of theunderlying note at the time the action is commenced" (Wells Fargo Bank, NA vOstiguy, 127 AD3d 1375, 1376 [2015] [internal quotation marks and citationsomitted]; accord Citibank, N.A.[*2]v Herman, 125 AD3d 587, 588 [2015]; Chase Home Fin., LLC vMiciotta, 101 AD3d 1307, 1307 [2012]). "Either a written assignment of theunderlying note or the physical delivery of the note prior to the commencement of theforeclosure action is sufficient to transfer the obligation" (Chase Home Fin., LLC vMiciotta, 101 AD3d at 1307 [internal quotation marks and citation omitted]; seeCitibank, N.A. v Herman, 125 AD3d at 588).
Here, plaintiff does not rely on a written assignment of the note, but instead arguesthat it had physical possession of the note at the time of the commencement of the action.The note itself does not establish this, however, because it has only an undatedindorsement in blank from the original lender (see U.S. Bank, N.A. v Collymore, 68 AD3d 752, 754[2009]). While plaintiff's possession of such a bearer instrument would make it a holder(see Wells Fargo Bank, NA vOstiguy, 127 AD3d 1375, 1376 [2015]; UCC 3-204 [a]), the affidavit submittedby plaintiff from an assistant secretary of the current assignee of the mortgage, NationstarMortgage, LLC, does not establish whether plaintiff had possession of the note at thetime the action was commenced. The affidavit states only that "[a]s of the date theforeclosure action was commenced, 08/27/2012 [sic] was and remains inpossession of the Note."[FN*] Plaintiff argues that this is merely atypographical error that should be overlooked because the affiant also affirms theallegations in the complaint as true and accurate. However, the complaint alleges in thealternative that plaintiff "is now the sole, true and lawful holder of the saidbond(s)/note(s) . . . or has been delegated the authority to institute amortgage foreclosure action by the owner and holder of the subject . . .note." This type of disjunctive, "varying, and potentially inconsistent, statement[ ] do[es]not definitively establish that plaintiff maintained physical possession of the note at therelevant time" (Wells Fargo Bank, NA v Ostiguy, 127 AD3d at 1377 [2015];see U.S. Bank, N.A. v Collymore, 68 AD3d at 754). Given the lack of anydefinitive statement in the complaint that plaintiff held the note, we cannot overlook thealleged typographical error in the affidavit.
Plaintiff's alternative argument, that it had the authority to bring the foreclosureaction based on the servicing guidelines of Freddie Mac, which defendant alleges is theholder of the note, is not supported by any evidence in the record (see US Bank N.A. v Faruque,120 AD3d 575, 577 [2014]). Moreover, although the record does include anassignment of the mortgage to plaintiff dated prior to the commencement of the action,there is no evidence that the note was assigned with the mortgage and, without the note,the assignee of only the mortgage has no standing (see Bank of Am., N.A. v Paulsen, 125 AD3d 909, 911[2015]; Citibank, N.A. v Herman, 125 AD3d at 589; US Bank N.A. vFaruque, 120 AD3d at 577). Accordingly, the issue of standing cannot be determinedas a matter of law on this record. Finally, we have considered defendant's contentionsregarding his cross motion and found them to be unpersuasive.
Lahtinen, J.P., McCarthy and Garry, JJ., concur. Ordered that the order is modified,on the law, without costs, by reversing so much thereof as granted plaintiff's motion forsummary judgment; said motion denied; and, as so modified, affirmed.
Footnote *:The date "08/27/2012,"which is the date of the commencement of the action, is typed on an underlined blankspace in the quoted sentence.