| Benson v Deutsche Bank Natl. Trust, Inc. |
| 2013 NY Slip Op 05606 [109 AD3d 495] |
| August 14, 2013 |
| Appellate Division, Second Department |
| Andrew N. Benson, Respondent, v Deutsche BankNational Trust, Inc., et al., Appellants, et al., Defendants. |
—[*1] Andrew N. Benson, North Salem, N.Y., respondent pro se.
In an action, inter alia, for a judgment declaring that a mortgage on certain realproperty is null and void, the defendants Deutsche Bank National Trust, Inc., as Trusteefor unknown Mortgage Securitization Loan Trusts Series 1-12, Countrywide Bank N.A.,Countrywide Home Loans, Inc., BAC Home Loans Servicing, L.P., Bank of AmericaCorp., and Mortgage Electronic Registry System appeal (1) from so much of an order ofthe Supreme Court, Westchester County (O. Bellantoni, J.), entered July 14, 2011, asdenied those branches of their motion which were, in effect, for a judgment declaringthat the first mortgage on the real property is not null and void and pursuant to CPLR3211 (a) (1) and (7) to dismiss the seventh cause of action insofar as asserted againstthem, and (2), as limited by their brief, from so much of an order of the same courtentered December 22, 2011, as, upon reargument, adhered to the original determination.
Ordered that the appeal from the order entered July 14, 2011, is dismissed, as thatorder was superseded by the order entered December 22, 2011, made upon reargument;and it is further,
Ordered that the order entered December 22, 2011, is reversed insofar as appealedfrom, on the law, and, upon reargument, the determination in the order entered July 14,2011, denying those branches of the appellants' motion which were, in effect, for ajudgment declaring that the first mortgage on the subject real property is not null andvoid and pursuant to CPLR 3211 (a) (1) and (7) to dismiss the seventh cause of actioninsofar as asserted against them is vacated, and those branches of the motion are granted,and the matter is remitted to the Supreme Court, Westchester County, for the entry of ajudgment, inter alia, declaring that the first mortgage on the subject real property is notnull and void; and it is further,
Ordered that one bill of costs is awarded to the appellants.
On March 26, 2004, the plaintiff, Andrew N. Benson, obtained a mortgage loan in[*2]the sum of $450,000 from the appellant CountrywideHome Loans, Inc. (hereinafter Countrywide), and gave a first mortgage on his propertylocated in North Salem (hereinafter the premises) to Mortgage Electronic RegistrationSystems, Inc., sued herein as Mortgage Electronic Registry System (hereinafter MERS),as nominee for Countrywide (hereinafter the first mortgage). On February 21, 2007, theplaintiff obtained an additional mortgage loan in the sum of $325,105.23 fromCountrywide, and gave a second mortgage on the premises to MERS, as nominee forCountrywide (hereinafter the second mortgage). On the same date, the plaintiff executeda Consolidation, Extension and Modification Agreement (hereinafter the CEMA),whereby the first mortgage and the second mortgage were consolidated into a single lienin the amount of $750,000, which was to be held by MERS, as nominee forCountrywide. Annexed as an exhibit to the CEMA was a consolidated note in the amountof $750,000, dated February 2, 2007. MERS, as Countrywide's nominee, subsequentlyassigned the first mortgage to the appellant Deutsche Bank National Trust, Inc.
In March 2011, the plaintiff commenced the instant action, asserting seven causes ofaction. In the first cause of action, he sought a judgment declaring that the first mortgageis null and void, alleging, in effect, that the first mortgage was satisfied because it wasassigned to a third party and that the execution of the CEMA rendered the first mortgagenonexistent. In the seventh cause of action, the plaintiff sought to quiet title to thepremises, alleging, in effect, that when the first mortgage was sold to a third party, theappellants failed to deliver a certificate stating that the instrument had been satisfied, andthat the first mortgage thus remained an "open item" clouding title. The appellantsmoved, in effect, for a judgment declaring that the first mortgage is not null and void,and, among other things, pursuant to CPLR 3211 (a) (1) and (7) to dismiss the second,third, fifth, sixth, and seventh causes of action insofar as asserted against them. TheSupreme Court, inter alia, denied those branches of the appellants' motion which were, ineffect, for a judgment declaring that the first mortgage is not null and void and to dismissseventh cause of action insofar as asserted against them. In an order entered December22, 2011, the Supreme Court granted the appellants' motion for leave to reargue thosebranches of their motion and, upon reargument, adhered to its original determination.
On a motion to dismiss a complaint pursuant to CPLR 3211 (a) (1), dismissal iswarranted where "the documentary evidence utterly refutes [the] plaintiff's factualallegations, conclusively establishing a defense as a matter of law" (Goshen v MutualLife Ins. Co. of N.Y., 98 NY2d 314, 326 [2002]; see R.I. Is. House, LLC v North Town Phase II Houses, Inc., 51AD3d 890, 893 [2008]). In considering a motion to dismiss for failure to state acause of action pursuant CPLR 3211 (a) (7), the court is required to "accept the facts asalleged in the complaint as true, accord [the] plaintiff[ ] the benefit of every possiblefavorable inference, and determine only whether the facts as alleged fit within anycognizable legal theory" (Leon v Martinez, 84 NY2d 83, 87-88 [1994]).
In the instant matter, the plaintiff increased the outstanding balance of the firstmortgage by borrowing the second mortgage loan and executing the CEMA. Althoughthe CEMA created a single mortgage lien, "[a] consolidation of outstanding loans is adevice intended for the convenience of only the contracting parties" and "cannot impairliens in favor of parties that are not the contracting parties, which retain theirindependent force and effect" (Federal Deposit Ins. Corp. v Five Star Mgt., 258AD2d 15, 22 [1999]). Where, as here, balances of first mortgage loans are increased withsecond mortgage loans and CEMAs are executed to consolidate the mortgages into singleliens, the first notes and mortgages still exist and may be assigned to other lenders (see Aurora Loan Servs., LLC vWeisblum, 85 AD3d 95, 109 [2011]). Further, an assignment of a loanobligation means that the obligation has been transferred, not paid in full and, thus,contrary to the plaintiff's allegation, does not render the obligation satisfied anddischarged.
Here, the documentary evidence conclusively established the continued validity ofthe first mortgage, dated March 26, 2004, and the allegations in the complaint failed toset forth the existence of a bona fide justiciable controversy as to whether title to thesubject premises is wrongfully encumbered by the first mortgage (see CPLR3211 [a] [1], [7]; Aurora Loan Servs., LLC v Weisblum, 85 AD3d at 109).Accordingly, upon reargument, the Supreme Court should have granted those branchesof the appellants' motion which were pursuant to CPLR 3211 (a) (1) and (7) [*3]to dismiss the seventh cause of action insofar as assertedagainst them.
Moreover, since the record before the Supreme Court was sufficient to resolve allissues of fact such that the rights of the parties can be determined as a matter of law(see Hoffman v City of Syracuse, 2 NY2d 484, 487 [1957]; Village of Woodbury v Brach,99 AD3d 697, 700 [2012]; Matter of Tilcon N.Y., Inc. v Town of Poughkeepsie, 87 AD3d1148, 1150 [2011]), upon reargument, the Supreme Court should have granted thatbranch of the appellants' motion which was, in effect, for a judgment declaring that thefirst mortgage is not null and void.
Since this is, in part, a declaratory judgment action, we remit the matter to theSupreme Court, Westchester County, for the entry of a judgment, inter alia, declaring thatthe first mortgage is not null and void (see Lanza v Wagner, 11 NY2d 317, 334[1962], appeal dismissed 371 US 74 [1962], cert denied 371 US 901[1962]). Skelos, J.P., Dickerson, Austin and Cohen, JJ., concur.