| HSBC Bank USA, N.A. v Grella |
| 2016 NY Slip Op 08199 [145 AD3d 669] |
| December 7, 2016 |
| Appellate Division, Second Department |
[*1]
| HSBC Bank USA, National Association,Respondent, v Lucia Grella, Appellant, et al.,Defendants. |
Peter Panaro, Massapequa, NY, for appellant.
Shapiro, DiCaro & Barak, LLC (Reed Smith, LLP, New York, NY [Andrew B.Messite and Lonnie Klein], of counsel), for respondent.
In an action to foreclose a mortgage, the defendant Lucia Grella appeals, as limitedby her brief, from so much of an order of the Supreme Court, Suffolk County (Spinner,J.), dated October 23, 2014, as denied her motion to vacate her default in answering thecomplaint and for leave to serve a late answer, and denied that branch of her separatemotion which was pursuant to CPLR 3215 (c) to dismiss the complaint insofar asasserted against her.
Ordered that the order is modified, on the law, by deleting the provision thereofdenying that branch of the defendant Lucia Grella's motion which was pursuant to CPLR3215 (c) to dismiss the complaint insofar as asserted against her and substituting therefora provision granting that branch of the motion; as so modified, the order is affirmedinsofar as appealed from, with costs to the defendant Lucia Grella.
On May 13, 2011, the plaintiff commenced the instant foreclosure action. On May19, 2011, the defendant Lucia Grella (hereinafter the defendant) was personally servedwith process. The defendant did not interpose an answer. Thereafter, from January 2012until December 19, 2012, mandatory foreclosure settlement conferences were held. OnDecember 19, 2012, the case was released from the mandatory foreclosure settlementconference part and remitted to the Individual Assignment System. Over one year later,on April 15, 2014, the defendant moved by order to show cause to vacate her default inanswering the complaint and for leave to serve a late answer. In the order to show cause,the Supreme Court granted a stay of all proceedings in the action while the motion waspending. Before that motion was decided, on May 30, 2014, the defendant made anothermotion which was, inter alia, pursuant to CPLR 3215 (c) to dismiss the complaint insofaras asserted against her as abandoned. The court denied both of the defendant's motions,and the defendant appeals.
Contrary to the plaintiff's contention, the defendant did not waive the right to seekdismissal of the complaint pursuant to CPLR 3215 (c) by moving to vacate her defaultand for leave to serve a late answer. "The mere fact that the legislative intent underlyingCPLR 3215 (c) was to prevent the plaintiffs from unreasonably delaying thedetermination of an action, does not foreclose the possibility that a defendant may waivethe right to seek a dismissal pursuant to the section by his [*2]or her conduct" (Myers v Slutsky, 139 AD2d 709,710 [1988]). A defendant may waive the right to seek a dismissal pursuant to CPLR3215 (c) by serving an answer or taking "any other steps which may be viewed as aformal or informal appearance" (id. at 711; see De Lourdes Torres v Jones, 26 NY3d 742, 772 [2016];HSBC Bank USA v Lugo,127 AD3d 502, 503 [2015];Hodson v Vinnie's Farm Mkt., 103 AD3d 549 [2013]). However, a motionpursuant to CPLR 3012 (d) for leave to serve an untimely answer does not constituteeither a formal (see CPLR 320) or informal appearance (see CPLR 3012[d]). This case is distinguishable from Myers v Slutsky (139 AD2d 709 [1988]),since the defendant in that case appeared in the action (see CPLR 320 [a]), and,therefore, waived the right to seek dismissal pursuant to CPLR 3215 (c). In contrast,here, the defendant only sought leave to appear, which relief was denied. Accordingly,the defendant did not waive her right seek dismissal of the complaint insofar as assertedagainst her pursuant to CPLR 3215 (c).
"The language of CPLR 3215 (c) is not, in the first instance, discretionary, butmandatory, inasmuch as courts 'shall' dismiss claims (CPLR 3215 [c]) for which defaultjudgments are not sought within the requisite one-year period, as those claims are thendeemed abandoned" (Giglio vNTIMP, Inc., 86 AD3d 301, 307-308 [2011]; see Pipinias v J. Sackaris &Sons, Inc., 116 AD3d 749, 751 [2014]). The failure to timely seek a default maybe excused if "sufficient cause is shown why the complaint should not be dismissed"(CPLR 3215 [c]), which requires the plaintiff to proffer a reasonable excuse for the delayin timely moving for a default judgment and to demonstrate that the cause of action ispotentially meritorious (seeAurora Loan Servs., LLC v Hiyo, 130 AD3d 763 [2015]; Pipinias v J.Sackaris & Sons, Inc., 116 AD3d at 751; Giglio v NTIMP, Inc., 86AD3d at 308).
Here, the defendant was personally served with process on May 19, 2011, and shedefaulted by failing to serve an answer within 20 days (see CPLR 3012 [a]).However, the plaintiff took no steps to initiate proceedings for the entry of a defaultjudgment at any point before the defendant moved in May 2014 to dismiss the complaintinsofar as asserted against her as abandoned. The fact that the case was in the mandatorysettlement conference part (see 22 NYCRR 202.12-a [c] [7]) from January 2012until December 19, 2012, did not constitute a reasonable excuse for the plaintiff'sprotracted delay, since the case was released from that part more than a year before thedefendant's May 2014 motion (see U.S. Bank, N.A. v Dorvelus, 140 AD3d 850, 852[2016]; see also Whiteside vManfredi, 132 AD3d 851, 852 [2015]; Kohn v Tri-State Hardwoods, Ltd., 92 AD3d 642, 643[2012]). Although the Supreme Court issued a stay of all proceedings in the action onApril 15, 2014, that stay did not constitute a reasonable excuse because it was issuednearly two years after the defendant defaulted, and more than one year after mandatorysettlement conferences had ended. The plaintiff's vague and unsubstantiated assertionsthat it withheld prosecution until such time as it could assess whether the mortgagedpremises had been damaged by Hurricane Sandy, and that it spent a year reviewing andprocessing unspecified documentation, were also insufficient to establish a reasonableexcuse for its failure to initiate proceedings for over three years after the defendant'sdefault. Since the plaintiff failed to meet its burden to show sufficient cause why thecomplaint should not be dismissed, the court should have granted the defendant's motionto dismiss the complaint insofar as asserted against her (see Aurora Loan Servs., LLC vHiyo, 130 AD3d 763 [2015]; Pipinias v J. Sackaris & Sons, Inc., 116 AD3d 749[2014]; GMAC vMinewiser, 115 AD3d 707 [2014]; Wells Fargo Bank, N.A. v Cervini, 84 AD3d 789, 790[2011]).
The defendant's remaining contention, which is raised for the first time on appeal, isnot properly before this Court (see Soldatenko v Village of Scarsdale, 138 AD3d 975[2016]; Retained Realty, Inc. vSyed, 137 AD3d 1099 [2016]), and, in any event, need not be reached in light ofour determination. Leventhal, J.P., Hall, Austin and Barros, JJ., concur.