| Hudson City Sav. Bank v Cohen |
| 2014 NY Slip Op 06177 [120 AD3d 1304] |
| September 17, 2014 |
| Appellate Division, Second Department |
[*1]
| Hudson City Savings Bank, Appellant, v JeanCohen et al., Respondents, et al., Defendants. |
McCullough, Goldberger & Staudt, LLP, White Plains, N.Y. (Ruth F-L. Post ofcounsel), for appellant.
Rubin & Licatesi, P.C., Garden City, N.Y. (Alexander Paykin of counsel), forrespondents.
In an action to foreclose a mortgage, the plaintiff appeals from an order of theSupreme Court, Westchester County (Colabella, J.), entered December 4, 2012, whichgranted those branches of the motion of the defendants Jean Cohen and Julius Cohenwhich were, in effect, pursuant to CPLR 5015 (a) to vacate a judgment of foreclosureand sale dated June 1, 2011, upon their failure to appear or answer the complaint, and toset aside the sale of the subject property.
Ordered that the order is affirmed, with costs.
In December 2010, the plaintiff commenced this action to foreclose a mortgage. OnJune 1, 2011, the Supreme Court issued a judgment of foreclosure and sale upon thefailure of the defendants Jean Cohen and Julius Cohen (hereinafter together the Cohendefendants) to appear or answer the complaint. At the foreclosure sale held in July 2011,the plaintiff was the highest bidder and acquired title to the subject property. In May2012, the Cohen defendants moved, inter alia, in effect, pursuant to CPLR 5015 (a) tovacate the judgment of foreclosure and sale and to set aside the sale. The Supreme Court,inter alia, granted those branches of their motion, invoking the court's inherent power tovacate a judgment in the interest of substantial justice.
" 'A foreclosure action is equitable in nature and triggers the equitablepowers of the court' " (Deutsche Bank Natl. Trust Co. v Luden, 91 AD3d 701, 701[2012], quoting Mortgage Elec.Registration Sys., Inc. v Horkan, 68 AD3d 948, 948 [2009]). "Under CPLR5015 (a), a court is empowered to vacate a default judgment for several reasons,including excusable neglect; newly-discovered evidence; fraud, misrepresentation orother misconduct by an adverse party; lack of jurisdiction; or upon the reversal,modification or vacatur of a prior order" (Woodson v Mendon Leasing Corp.,100 NY2d 62, 68 [2003]).
"In addition to the grounds set forth in section 5015 (a), a court may vacate its ownjudgment for sufficient reason and in the interests of substantial justice" (id.; see Nationscredit Fin. Servs. Corp.v Atherley, 91 AD3d 922, 922 [2012]; Galasso, Langione & Botter, LLP v Liotti, 81 AD3d884, 885 [2011]; Katz vMarra, 74 AD3d 888, 891 [2010]). Indeed, the drafters of CPLR 5015 (a)"intended that courts retain and exercise their inherent discretionary power in situationsthat warranted vacatur but [*2]which the drafters couldnot easily foresee" (Woodson v Mendon Leasing Corp., 100 NY2d at 68).
"The decision as to the setting aside of a default in answering is generally left to thesound discretion of the Supreme Court, the exercise of which will generally not bedisturbed if there is support in the record therefor" (Manigat v Louis, 262 AD2d289, 289 [1999]; see Tobin v Perlmutter, 288 AD2d 210, 210 [2001]).
Under the unique circumstances of this case, the Supreme Court providentlyexercised its discretion in vacating the judgment of foreclosure and sale entered on thedefault of the Cohen defendants "in the interests of substantial justice" (NationscreditFin. Servs. Corp. v Atherley, 91 AD3d at 922 [internal quotation marks omitted]).The documentary evidence submitted in support of the motion raises issues including,among others, whether the plaintiff had "knowledge of facts that would lead areasonable, prudent lender to make inquiries of the circumstances of the transaction atissue" (LaSalle Bank Natl.Assn. v Ally, 39 AD3d 597, 600 [2007]; see Fischer v Sadov Realty Corp., 34 AD3d 630, 631[2006]).
The plaintiff's remaining contention, that vacatur should have been denied on theground that the Cohen defendants were seeking the same relief as plaintiffs in a separateplenary action, is without merit (see James v Shave, 62 NY2d 712, 714 [1984];Egloff v Town ofLewisboro, 89 AD3d 792, 793 [2011]; Matter of Calabrese Bakeries, Inc. v Rockland Bakery, Inc., 83AD3d 1060, 1061 [2011]). Rivera, J.P., Sgroi, Cohen and Barros, JJ., concur.