Court Opinion

ID: 4081064
Source: CourtListenerOpinion
Date Created: 2016-10-07 23:22:40.433242+00
Date Added: 2024-06-11T14:33:12.635164
License: Public Domain

SUPREME COURT OF THE STATE OF NEW YORK
           Appellate Division, Fourth Judicial Department

430
CA 15-01263
PRESENT: WHALEN, P.J., PERADOTTO, LINDLEY, DEJOSEPH, AND NEMOYER, JJ.

JPMORGAN CHASE BANK, NATIONAL ASSOCIATION,
PLAINTIFF-APPELLANT,

                    V                             MEMORANDUM AND ORDER

SANDRA A. KOBEE, ALSO KNOWN AS SANDRA KOBEE,
DEFENDANT-RESPONDENT,
ET AL., DEFENDANTS.
(APPEAL NO. 1.)

MORGAN, LEWIS & BOCKIUS LLP, NEW YORK CITY (SIMON CHANG OF COUNSEL),
FOR PLAINTIFF-APPELLANT.

     Appeal from an order of the Supreme Court, Erie County (James H.
Dillon, J.), entered December 10, 2014. The order denied the motion
of plaintiff for summary judgment and dismissed the complaint.

     It is hereby ORDERED that the order so appealed from is
unanimously reversed on the law without costs, the complaint is
reinstated, and the motion is granted.

     Memorandum: Plaintiff commenced this action seeking to foreclose
on a mortgage secured by residential property owned by Sandra A. Kobee
(defendant). According to plaintiff, defendant borrowed $87,782.00
from Real Estate Mortgage Network, Inc. (REMN) in November 2007 to
purchase a home in Cheektowaga, and signed a promissory note in that
amount in favor of REMN. The note was secured by a mortgage, which
identified defendant as the mortgagor and stated that the security
interest “is given to Mortgage Electronic Registration Systems, Inc.
(MERS) (solely as nominee for Lender),” i.e., REMN. Defendant later
defaulted on the note, and the mortgage was thereafter assigned to
plaintiff by MERS, as nominee for REMN. Following joinder of issue,
plaintiff moved for summary judgment. Although defendant did not
raise standing as an affirmative defense in her answer and did not
submit any papers in opposition to the motion, Supreme Court denied
the motion and sua sponte dismissed the complaint, concluding that
plaintiff lacks “standing to bring a foreclosure action” because MERS
never held the note. The court further concluded that the mortgage
was not valid. Plaintiff moved for leave to reargue and renew the
motion, but the court denied that motion as well. In appeal No. 1,
plaintiff appeals from the order denying its motion and dismissing the
complaint, and, in appeal No. 2, plaintiff appeals from the denial of
the motion for leave to reargue and renew. We now reverse the order
in appeal No. 1, reinstate the complaint, and grant plaintiff’s
                                 -2-                           430
                                                         CA 15-01263

motion.

     By failing to raise standing as an affirmative defense in her
answer, defendant waived that defense (see HSBC Bank USA, NA v Halls,
136 AD3d 752, 753; HSBC Bank USA, N.A. v Ashley, 104 AD3d 975, 975-
976, lv dismissed 21 NY3d 956; see generally Wells Fargo Bank Minn.,
N.A. v Mastropaolo, 42 AD3d 239, 242-244), and the court therefore
erred in sua sponte dismissing the complaint on that ground (see
Onewest Bank, FSB v Prince, 130 AD3d 700, 701; U.S. Bank, N.A. v
Emmanuel, 83 AD3d 1047, 1048-1049). In any event, we conclude that
plaintiff does not in fact lack standing to commence this action. “In
an action to foreclose a mortgage, the plaintiff has standing where,
at the time the action is commenced, it is the holder or assignee of
both the subject mortgage and the underlying note” (Citimortgage, Inc.
v Chow Ming Tung, 126 AD3d 841, 842; see Aurora Loan Servs., LLC v
Taylor, 25 NY3d 355, 361). Here, plaintiff not only specifically
averred in its verified pleading that it owned the mortgage and note
at the time the foreclosure action was commenced, it also submitted an
affidavit from one of its vice-presidents, who averred that plaintiff
had physical possession of the note at the time the action was
commenced, which is sufficient to confer standing upon plaintiff (see
Aurora, 25 NY3d at 361-362; Deutsche Bank Natl. Trust Co. v Monica,
131 AD3d 737, 738-740).

     We further conclude that the court erred in determining that the
mortgage is invalid (see Ruiz v Mortgage Elec. Registration Sys.,
Inc., 130 AD3d 1000, 1001-1002; see also First Franklin Fin. Corp. v
Norton, 132 AD3d 1423, 1424). Inasmuch as plaintiff met its initial
burden of establishing entitlement to judgment as a matter of law, and
defendant did not raise an issue of fact, plaintiff is entitled to
summary judgment.

     Insofar as the order in appeal No. 2 denied that part of
plaintiff’s motion seeking leave to reargue, no appeal lies from the
order (see Empire Ins. Co. v Food City, 167 AD2d 983, 984) and,
insofar as the order in appeal No. 2 denied that part of the motion
seeking leave to renew, the appeal is moot in view of our
determination in appeal No. 1 (see McCabe v CSX Transp., Inc., 27 AD3d
1150, 1151).

Entered:   June 10, 2016                        Frances E. Cafarell
                                                Clerk of the Court