| Equicredit Corp. of Am. v Campbell |
| 2010 NY Slip Op 04541 [73 AD3d 1119] |
| May 25, 2010 |
| Appellate Division, Second Department |
| Equicredit Corporation of America, Appellant, v KeithCampbell et al., Defendants, and RJ Carbone Building, Inc.,Respondent. |
—[*1] Anthony LoPresti, Garden City, N.Y., for respondent.
In an action to foreclose a mortgage, the plaintiff Equicredit Corporation of Americaappeals, as limited by its brief, from so much of an order of the Supreme Court, Queens County(Markey, J.), dated April 10, 2009, as granted that branch of the cross motion of the defendantRJ Carbone Building, Inc., which was for leave to serve and file a late answer, and deemed theproposed answer served.
Ordered that the order is affirmed insofar as appealed from, with costs.
This foreclosure action was commenced on or about March 9, 2007, by Nations CreditFinancial Services Corp., the assignor of a mortgage and note currently held by the plaintiff,Equicredit Corporation of America, by the filing of a summons and complaint and notice ofpendency on property located in Rockaway, Queens. The foreclosure action was commencedagainst, among others, the mortgagor, Keith Campbell, as well as other parties who may havehad an interest in the property, including, inter alia, RJ Carbone Building, Inc. (hereinafter thedefendant). Service was thereafter allegedly made upon the defendant on April 6, 2007, by thepersonal delivery of copies of the summons, complaint, and notice of pendency to the Secretaryof State, pursuant to Business Corporation Law § 306. The defendant did not answer. OnJune 28, 2007, the defendant sold the property to nonparties Joseph Barbagallo and BrandyWatson.
The plaintiff moved for leave to enter a judgment of foreclosure and sale against thedefendant, among others, based on the defendant's default in answering. The defendant opposedthe motion and cross-moved, inter alia, for leave to serve and file a late answer. The plaintiffopposed the cross motion and contended that the defendant lacked standing to oppose the entryof a judgment of foreclosure and sale based on its transfer of title of the subject property toBarbagallo and Watson in June 2007.
The Supreme Court granted that branch of the defendant's cross motion which was for leaveto serve and file an answer, and deemed the answer submitted with the cross motion to have[*2]been served. We affirm the order insofar as appealed from.
Under CPLR 1018, "[u]pon any transfer of interest, the action may be continued by oragainst the original parties unless the court directs the person to whom the interest is transferredto be substituted or joined in the action" (see Buywise Holding, LLC v Harris, 31 AD3d681, 683 [2006]; see also Loretto v Teleprompter Manhattan CATV Corp., 53 NY2d124, 136 [1981], revd on other grounds 458 US 419 [1982]; Udell v Haas, 20NY2d 862 [1967]). Here, since the Supreme Court did not direct that Barbagallo and Watson besubstituted or joined in the action, the defendant was properly permitted to defend the action.
In order to excuse a default, "[a] defendant who has failed to appear or answer the complaintmust provide a reasonable excuse for the default and demonstrate a meritorious defense to theaction to avoid the entering of a default judgment or to extend the time to answer" (Ennis vLema, 305 AD2d 632, 633 [2003]; see Nasca v Town of Brookhaven, 4 AD3d 462[2004]; Khanna v Premium Food & Sports Enter., 279 AD2d 508 [2001]). The defendantestablished that the alleged service upon it was defective and that the defective serviceconstituted a reasonable excuse for its default, and demonstrated the existence of a meritoriousdefense pursuant to CPLR 213 (4). Based upon the foregoing, the Supreme Court providentlyexercised its discretion in granting that branch of the defendant's cross motion which soughtleave to serve and file a late answer.
The plaintiff's remaining contentions are without merit. Dillon, J.P., Miller, Dickerson andChambers, JJ., concur.