| Deutsche Bank Trust Co. Ams. v Cox |
| 2013 NY Slip Op 06543 [110 AD3d 760] |
| October 9, 2013 |
| Appellate Division, Second Department |
| Deutsche Bank Trust Company Americas, as Trustee forSaxon Assets Securities Trust 2002-3, Respondent, v Anthony Cox,Appellant. |
—[*1] Houser & Allison, APC (Lijue T. Philip of counsel), for respondent.
In an action, inter alia, for a judgment declaring that the plaintiff has an equitablemortgage upon certain real property owned by the defendant, the defendant appeals froman order and judgment (one paper) of the Supreme Court, Queens County (McDonald,J.), entered August 1, 2011, which, upon a decision of the same court dated May 19,2011, inter alia, granted the plaintiff's motion for summary judgment on the complaint, ineffect, denied that branch of his cross motion which was pursuant to CPLR 3025 (b) forleave to amend the answer to assert certain affirmative defenses, and declared that theplaintiff has an equitable mortgage on the subject real property.
Ordered that the order and judgment is modified, on the law and in the exercise ofdiscretion, (1) by deleting the provision thereof granting the plaintiff's motion forsummary judgment on the complaint, and substituting therefor a provision denying theplaintiff's motion, with leave to renew after the completion of discovery, (2) by deletingthe provision thereof, in effect, denying that branch of the defendant's cross motionwhich was for leave to amend the answer to assert the 1st, 2nd, 3rd, 7th, 8th, 9th, 10th,and 11th proposed affirmative defenses, and substituting therefor a provision grantingthat branch of the defendant's cross motion, and (3) by deleting the provision thereofdeclaring, inter alia, that the plaintiff has an equitable mortgage on the subject realproperty; as so modified, the order and judgment is affirmed, with costs to the defendant.
The plaintiff commenced this action, inter alia, for a judgment declaring that it has anequitable mortgage on certain real property owned by the defendant. New York lawallows the imposition of an equitable lien if there is an express or implied agreement thatthere shall be a lien on specific property (see M & B Joint Venture, Inc. v Laurus Master Fund, Ltd., 12NY3d 798, 800 [2009]; Teichman v Community Hosp. of W. Suffolk, 87NY2d 514, 520 [1996]). "While [a] court will impose an equitable mortgage where thefacts surrounding a transaction evidence that the parties intended that a specific piece ofproperty is to be held or transferred to secure an obligation, it is necessary that anintention to create such a charge clearly appear from the language and the attendantcircumstances" (Tornatore vBruno, 12 AD3d 1115, 1117-1118 [2004] [internal quotation marks and citationomitted]; see Pennsylvania Oil Prods. Ref. Co. v Willrock Producing Co., 267NY 427, 434-435 [1935]; J.P.Morgan Chase Bank, N.A. v Cortes, 96 AD3d 803, 803-804 [2012]; Fremont Inv. & Loan v Delsol,65 AD3d 1013, 1014 [2009]).
Here, the defendant initially did not raise in his answer a defense based upon lack ofpersonal jurisdiction, lack of standing or a capacity to sue, or the statute of limitations.Hence, those affirmative defenses were waived at that point (see CPLR 3211[e]). However, defenses waived under CPLR 3211 (e) can nevertheless be interposed inan answer amended by leave of court [*2]pursuant toCPLR 3025 (b) so long as the amendment does not cause the other party prejudice orsurprise resulting directly from the delay and is not palpably insufficient or patentlydevoid of merit (see CPLR 3025 [b]; Aurora Loan Servs., LLC v Dimura, 104 AD3d 796, 797[2013]; U.S. Bank, N.A. vSharif, 89 AD3d 723, 724 [2011]; Complete Mgt., Inc. v Rubenstein, 74 AD3d 722, 723[2010]; Lucido v Mancuso,49 AD3d 220, 222 [2008]). " 'Mere lateness is not a barrier to the amendment. Itmust be lateness coupled with significant prejudice to the other side, the very elements ofthe laches doctrine' " (PublicAdm'r of Kings County v Hossain Constr. Corp., 27 AD3d 714, 716 [2006],quoting Edenwald Contr. Co. v City of New York, 60 NY2d 957, 959 [1983];see Aurora Loan Servs., LLC v Dimura, 104 AD3d at 797).
The Supreme Court improvidently exercised its discretion by, in effect, denying thatbranch of the defendant's cross motion which was for leave to amend the answer to assertthe 1st, 2nd, 3rd, 7th, 8th, 9th, 10th, and 11th proposed affirmative defenses based upon,inter alia, lack of personal jurisdiction, lack of standing or a capacity to sue, and thestatute of limitations. In opposition to that branch of the cross motion, the plaintiff failedto demonstrate the existence of any prejudice or surprise that would result from theamendment, or that the proposed affirmative defenses were palpably insufficient orpatently devoid of merit (see U.S. Bank, N.A. v Sharif, 89 AD3d at 724-725).
As the Supreme Court, in effect, denied the subject branch of the defendant's crossmotion, the parties have not been afforded an opportunity to conduct discovery withrespect to the amended answer. Under the circumstances of this case, therefore, theplaintiff's motion for summary judgment on the complaint must be denied, with leave torenew upon the completion of discovery. Consequently, the Supreme Court erred inissuing a judgment declaring, inter alia, that the plaintiff has an equitable mortgage onthe subject property.
The defendant's remaining contentions are without merit. Balkin, J.P., Leventhal,Austin and Roman, JJ., concur. [Prior Case History: 2011 NY Slip Op31489(U).]