1 18-2805-cv Wilmington Sav. Fund Soc’y, FSB v. Belchou

UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT



## SUMMARY ORDER

Rulings by summary order do not have precedential effect. Cita tion to a summary order filed on or after January 1, 2007, is permitted a nd is governed by Federal Rule of Appellate Procedure 32.1 and this Court’s Local Rule 32.1.1. When citing a summary order in a document filed with this Court, a party mu st cite either the Federal Appendix or an electronic database (with the notation “summa ry order”). A party citing a summary order must serve a copy of it on any party not represented by counsel.

At a stated term of the United States Court of Appeals for the Second Circuit, held at the Thurgood Marshall United States Courthouse , 40 Foley Square, in the City of New York, on the 9 th day of April, two thousand nineteen.

PRESENT: J OHN M. W ALKER , J R ., J OSÉ A. C ABRANES , R OBERT D. S ACK , Circuit Judges.

W ILMINGTON S AVINGS F UND S OCIETY , FSB, DBA C HRISTIANA T RUST , NOT I NDIVIDUALLY
BUT AS T RUSTEE FOR C ARLSBAD F UNDING M ORTGAGE T RUST ,
Plaintiff-Appellant
, 18-2805-cv

v.

A NASTASIA B ELCHOU , L OUIS C. B ELCHOU ,
Defendants-Appellees
,

P ETER B ELCHOU , J OHN D OE #1 T HROUGH J OHN D OE #10, I NCLUSIVE THE N AMES OF THE T EN L AST2 N AMES D EFENDANTS B EING F ICTITIOUS , R EAL N AMES U NKNOWN TO THE P LAINTIFF , THE P ARTIES I NTENDED B EING P ERSONS OR C ORPORATIONS H AVING AN I NTEREST IN , OR T ENANTS OR P ERSONS

IN P OSSESSION OF , P ORTIONS OF THE M ORTGAGED P REMISES ,
Defendants

.

FOR PLAINTIFF-APPELLANT: J OHN E. B RIGANDI , Knuckles, Komosinski & Manfro, LLP, Woodcliff Lake, NJ.

FOR DEFENDANT-APPELLEE ANASTASIA BELCHOU: Martin L. Posner, Brewster, NY.

FOR DEFENDANT-APPELLEE LOUIS C. BELCHOU: J ONATHAN N ELSON , Dorf & Nelson LLP, Rye, NY.

Appeal from an order of the United States Di strict Court for the Southern District of New York (Kenneth M. Karas, Judge ).

UPON DUE CONSIDERATION WHEREO F, IT IS HEREBY ORDERED, ADJUDGED, AND DECREED that the August 22, 2018 order of the District Court be and hereby is AFFIRMED

. Plaintiff-Appellant Wilmington Savings Fund Society, FSB, DBA Christiana Trust, not Individually but as Trustee for Carlsbad Funding Mo rtgage Trust (“Plaintiff”), appeals from an order of the District Court dismissing its action seeking to foreclose on certain mortgages held by Defendants-Appellees Anastasia Belchou and Louis C. Belchou (“Defendants”). 1 To successfully

1 The District Court granted Plaintiff one week in which to submit a letter describing any putative amendments to the complaint, and appears to have extended that deadline, but Plaintiff ultimately disclaimed any intent to amend. See Wilmington Sav. Fund Soc’y, FSB v. Belchou , No. 7:17-cv2012, Dkt. No. 65 (S.D.N.Y. Oct. 15, 2018). And while the District Court did not enter a final judgment, it directed the Clerk to close the case. See id. , Dkt. No. 66. In light of Plaintiff’s disclaimer,3 foreclose on the mortgages, Plaintiff was first required to expunge an allegedly erroneous “satisfaction” purporting to discharge Defendants ’ debt. The problem, as the District Court aptly recognized, is that Plaintiff did not seek to ex punge the satisfaction unt il long after the six-year statute of limitations had run. See Defs.’ App. 19–28 (discussing app lication of N.Y. C.P.L.R. 216(6)). The District Court therefore dism issed the action as untimely. Id. at 23, 28. We assume the parties’ familiarity with the underlying facts, the procedural history of the case, and the issues on appeal.
On appeal, Plaintiff largely abandons the pos ition it took before the District Court. And rather than contesting the District Court’s concl usion directly, Plaintiff seeks to circumvent it altogether by, in effect, modifying the allegations and claims in its own complaint. Specifically, Plaintiff now argues that it seeks to foreclose not on the original mortgages subject to the satisfaction but a new obligation created pursua nt to an Extension and Modification Agreement (“EMA”) executed shortly before, but not mentioned in, the satisfaction.
In advancing this position, Plaintiff faces three obstacles. First , it is well-established that “an appellate court [ordinarily] will not consider an issue raised for the first time on appeal.” Spinelli v. Nat’l Football League , 903 F.3d 185, 198 (2d Cir. 2018) (internal quotation mark omitted). Though we can exercise our discretion to do so in certain limited circumstances, see id. , Plaintiff has not so much as attempted to show that such circumstances are present here.

Second , even if we were to consider Plaintiff’s n ew argument, it appears unlikely to succeed on the merits. As a general matter, a consolidation ag reement “is not deemed a mortgage” if “it does not add to the charge already imposed upon the real ty by the existing mortgages.” 1 D. Kirk Drussel et al., Mortgages and Mortgage Foreclosure in New York § 17:13 (2018). Such an agreement might establish an independent obligation if it “creates a lien upon property not originally covered by the prior instrument,” id. , but even then “the first notes and mortgages still exist,” Benson v. Deutsche Bank Nat’l Tr., Inc. , 970 N.Y.S.2d 794, 797 (2d Dep’t 2013). Though it appears that parties can contract around this general rule, they must do so clearly. Bechard v. Monty’s Bay Recreation, Inc. , 11 N.Y.S.3d 695, 696 (3d Dep’t 2015) (“[A] subsequent note does not discharge the original indebtedness secured unless there is an express agreement between the pa rties.” (internal quotation marks omitted)). The agreement at issue here—a largely unmo dified “Fannie Mae/Freddie Mac UNIFORM INSTRUMENT,” J.A. 76—is far from clear on this sc ore. Indeed, it appears much more likely that

the District Court’s order, and the fact that any deadline to amend has surely passed, this Court retains jurisdiction. See Connecticut Nat’l Bank v. Fluor Corp. , 808 F.2d 957, 960 (2d Cir. 1987) (“[D]isclaimer of intent to amend effectively cure s the nonfinal character of the judgment from which the appeal has been taken.”); Festa v. Local 3 Int’l Bhd. of Elec. Workers , 905 F.2d 35, 37 (2d Cir. 1990) (holding that where “the deadline imposed by the district court for amendment has passed, we will treat the present appeal as having been time ly filed after the dismissal by the district court became final”).4 its purpose is merely to ensure that the various c onsolidated mortgages have identical terms, not to extinguish them and create a new, separate debt obligation.

Finally , even assuming Plaintiff is right on the law, the complaint’s allegations simply do not support its position. Plaintiff does not allege that the EMA discharged the prior mortgages, nor that it created a distinct new obligation. See J.A. 9–20. And the complaint’s terms suggest that Plaintiff seeks to foreclose on multiple mortgages, not simply the one it now claims the EMA created. See,
e.g. , J.A. 15 (alleging that “pursuant to the acceleration provisions of [the] notes and mortgages as consolidated and modified, the Plaintiff has elected and does elect that the whole of the principal sum secured hereby become immediately due and paya ble” (emphasis added)). It is also difficult to reconcile Plaintiff’s new theory with its attempt to expunge the allegedly erroneous satisfaction. If, as Plaintiff now claims, the EMA created a new mortgage not subject to the satisfaction, then Plaintiff’s attempt to expunge the same would be wholly superfluous.
In sum, we reject Plaintiff’s attempt on appeal to transfigure its claims into something that barely resembles the action it initially filed. And because Plaintiff has failed to challenge any of the other bases for the District Court’s decision, we see no basis on which to disturb its conclusion.

CONCLUSION
We have reviewed all of the arguments raised by Plaintiff on appeal and find them to be without merit. For the foregoing reasons, we AFFIRM the August 22, 2018 order of the District Court.

FOR THE COURT: Catherine O’Hagan Wolfe, Clerk