| Evans v Argent Mtge. Co., LLC |
| 2014 NY Slip Op 05835 [120 AD3d 618] |
| August 20, 2014 |
| Appellate Division, Second Department |
[*1]
| Henry M. Evans, Respondent, v ArgentMortgage Company, LLC, et al., Defendants, and Citifinancial Mortgage Company, Inc.,Appellant. (Action No. 1.) Citifinancial Mortgage Company, Inc., Appellant, v NigelWilliams et al., Respondents, et al., Defendants. (Action No.2.) |
Rosicki, Rosicki & Associates, P.C., Plainview, N.Y. (Andrew Morganstern ofcounsel), for appellant.
Auciello Law Group, P.C., Brooklyn, N.Y. (Anthony J. Auciello of counsel), forrespondents.
In related actions to foreclose a mortgage and, inter alia, for declaratory relief,Citifinancial Mortgage Company, Inc., a defendant in action No. 1 and the plaintiff inaction No. 2, appeals from (1) an order of the Supreme Court, Kings County (Schack, J.),dated July 8, 2011, which granted the motion of Henry M. Evans, the plaintiff in actionNo. 1 and a defendant in action No. 2, to discharge the mortgage and cancel the notice ofpendency, and (2) a judgment of the same court dated July 8, 2013, which, upon an orderof the same court dated July 6, 2011, and the order dated July 8, 2011, discharged themortgage, cancelled the notice of pendency, and, in effect, declared, among other things,that any claims of the plaintiff in action No. 2 against the subject property areinvalid.
Ordered that the appeal from the order dated July 8, 2011, is dismissed; and it isfurther,
Ordered that the judgment is reversed, on the law, the motion of the plaintiff inaction No. 1 is denied, the order dated July 8, 2011, is modified accordingly, action No. 2is reinstated, and the matter is remitted to the Supreme Court, Kings County, for furtherproceedings before a different Justice; and it is further,
Ordered that one bill of costs is awarded to the appellant.
[*2] The appeal from the intermediate order dated July 8,2011, must be dismissed because the right of direct appeal therefrom terminated with theentry of judgment in the actions (see Matter of Aho, 39 NY2d 241, 248 [1976]).The issues raised on appeal from the intermediate order are brought up for review andhave been considered on appeal from the judgment (see CPLR 5501 [a] [1]).
The plaintiff in action No. 1, Henry M. Evans, is the owner of the subject property.He attained title by deed in 2002 from Nigel Williams and Eugena Nunes, defendants inaction No. 2. Before the conveyance, Williams and Nunes had mortgaged the subjectproperty and the last assignee of this mortgage was the plaintiff in action No. 2,Citifinancial Mortgage Company, Inc. (hereinafter Citifinancial). Evans contends that, inMarch 2006, he refinanced the subject property with Argent Mortgage Company, LLC(hereinafter Argent). However, according to Evans, Argent failed to subsequently pay offCitifinancial's prior mortgage on the subject property from the loan proceeds.
In January 2009, Citifinancial commenced an action to foreclose the mortgageagainst, among others, Evans, Williams, and Nunes (action No. 2). Subsequently, in July2009, Evans commenced an action in the same court against, among others, Argent andCitifinancial, alleging that he refinanced the subject property with Argent, whosesubsequent actions invalidated the resulting loan (action No. 1).
On February 5, 2010, the Supreme Court issued an order wherein action No. 1 wasdiscontinued, on the consent of Evans, as to Citifinancial and certain others, but notArgent. Action No. 1 and action No. 2 were thereafter joined for trial by order datedApril 23, 2010.
In May 2011, Citifinancial made an application in action No. 2 to vacate a prior orderof reference, therein informing the court that it planned to move to discontinue theaction. By order dated July 6, 2011, the court granted Citifinancial's application to theextent that it vacated the prior order, but, on the grounds that it was conserving judicialresources, also, sua sponte, in effect, directed the dismissal of action No. 2 withprejudice.
In 2013, Evans moved to discharge the mortgage and to cancel a notice ofpendency.
In the order appealed from, the court granted Evans's motion to dischargeCitifinancial's mortgage and to cancel the notice of pendency. The court determined, suasponte, that Citifinancial did not own the mortgage on the subject property on thegrounds that an earlier assignment of the mortgage to a predecessor of Citifinancial wasdefective. In the judgment appealed from, the court discharged the mortgage, cancelledthe notice of pendency, and, in effect, declared, inter alia, that Citifinancial's claimsagainst the subject property are invalid. We reverse.
Civil Practice Law and Rules § 2214 (a) provides that "[a] notice ofmotion shall specify . . . the relief demanded and the grounds therefor."However, the court "may grant relief that is warranted by the facts plainly appearing onthe papers on both sides, if the relief granted is not too dramatically unlike the reliefsought, the proof offered supports it, and there is no prejudice to any party" (Frankel v Stavsky, 40 AD3d918, 918-919 [2007]; see HCE Assoc. v 3000 Watermill Lane Realty Corp.,173 AD2d 774 [1991]).
Here, the causes of action in Evans's complaint in action No. 1 arise out of hiscontention, inter alia, that he refinanced the subject property with Argent, which thenfailed to use the proceeds thereof to pay off the Citifinancial mortgage. Evans's motionsought discharge of the Citifinancial mortgage and cancellation of the notice of pendencyon the grounds, inter alia, that his obligation to pay such mortgage was discharged whenArgent received the proceeds for the purpose of paying off Citifinancial.
On grounds not raised or argued by the parties nor contained in the pleadings, theSupreme Court granted Evans's motion, determining that Citifinancial never actuallyowned the mortgage. The Supreme Court determined that a prior assignment of themortgage to Citifinancial's predecessor had been defective on the grounds that the powerof attorney needed to execute such [*3]assignment wasnot recorded and, as a result, the mortgage could not thereafter properly be assigned toCitifinancial. The Supreme Court erred in discharging the mortgage and cancelling thenotice of pendency on such grounds since Evans failed to dispute or contest the validityof Citifinancial's mortgage and actually affirmatively acknowledged the validity of themortgage in his complaint and motion to the court (see Emigrant Mtge. Co., Inc. v Fisher, 90 AD3d 823,824-825 [2011]).
The Supreme Court's determination that the mortgage was invalid prejudicedCitifinancial in that it was never afforded the opportunity to present evidence refuting thecourt's sua sponte determination that a prior power of attorney was not recorded, or thatif such defect existed, it did not affect Citifinancial's rights (see Rosenblatt v St. George Health& Racquetball Assoc., LLC, 119 AD3d 45, 54 [2014]; HSBC Bank USA, N.A. vTaher, 104 AD3d 815, 818 [2013]; Frankel v Stavsky, 40 AD3d at918-919). We note that the Supreme Court's determination, in effect, vitiated substantiverights of Citifinancial, which was no longer able to litigate its rights in the dismissedaction No. 2, without giving it the opportunity to be heard on the issue decided (seeid.; NYC Med. &Neurodiagnostic, P.C. v Republic W. Ins. Co., 8 Misc 3d 33, 38 [App Term, 2dDept, 2d & 11th Jud Dists 2004]).
In light of our determination, Citifinancial's remaining contentions need not beaddressed.
Accordingly, under the circumstances of this case, we deem it appropriate to remitthe matter to the Supreme Court, Kings County, for further proceedings before adifferent Justice (see HSBC Bank USA, N.A. v Taher, 104 AD3d at 818; Aurora Loan Servs., LLC vShahmela Shah Sookoo, 92 AD3d 705, 707 [2012]). Skelos, J.P., Chambers,Lott and Duffy, JJ., concur.