Court Opinion

ID: 4112041
Source: CourtListenerOpinion
Date Created: 2016-12-29 15:11:11.32444+00
Date Added: 2024-06-11T07:45:44.766869
License: Public Domain

State of New York
                   Supreme Court, Appellate Division
                       Third Judicial Department
Decided and Entered: December 29, 2016                   523163
________________________________

NOVASTAR MORTGAGE, INC.,
                    Appellant,
      v                                     MEMORANDUM AND ORDER

PAUL C. MELIUS et al.,
                    Respondents,
                    et al.,
                    Defendants.
________________________________

Calendar Date:   November 15, 2016

Before:   Garry, J.P., Egan Jr., Devine, Clark and Mulvey, JJ.

                             __________

      Greenberg Traurig, LLP, New York City (John C. Molluzzo Jr.
of counsel), for appellant.

      Barbaruolo Law Firm, PC, Latham (Justin Myers of counsel),
for respondents.

                             __________

Garry, J.P.

      Appeal from an order of the Supreme Court (Zwack, J.),
entered August 12, 2015 in Albany County, which denied
plaintiff's motion to, among other things, vacate a prior order.

      In 2007, plaintiffs commenced this foreclosure action
alleging that defendants Paul C. Melius and Michele Melius
(hereinafter collectively referred to as defendants) had
defaulted in their payments on a note and mortgage on property
located in the Town of Brunswick, Rensselaer County. Defendants
did not file an answer or oppose the action. In June 2009,
defendants filed a petition in bankruptcy, resulting in an
automatic stay of the foreclosure action. Plaintiff's motion for
                              -2-                523163

relief from the stay was granted in November 2009, and, in May
2010, Supreme Court (Platkin, J.) issued an order of reference
upon plaintiff's motion.

      There was no further activity until May 2012,1 when Supreme
Court removed the action from its docket as a result of
plaintiff's failure to pursue the action following issuance of
the order of reference. In April 2014, plaintiff filed a consent
to change attorney, identifying a new law firm as counsel. This
firm thereafter sent correspondence advising the court of the
substitution and of plaintiff's intent to file a motion for a
judgment of foreclosure, and asking the court to return the
matter to the calendar. In July 2014, Supreme Court (Zwack, J.)
denied the request by a letter decision and order in which the
court found that plaintiff had failed to move for the case to be
restored within 12 months after it was marked off the calendar as
required by CPLR 3404 and had not demonstrated a reasonable
excuse for its failure to do so. Thereafter, upon defendants'
request, the Rensselaer County Clerk entered a judgment of
dismissal pursuant to CPLR 3404. Plaintiff nevertheless obtained
a referee's report of computation pursuant to the May 2010 order
of reference and, in June 2015, moved for an order confirming the
referee's report, granting a judgment of foreclosure and sale,
vacating the July 2014 order and restoring the action to the
court's calendar. Defendants opposed the motion. Supreme Court
treated the application as a motion for relief pursuant to CPLR
5015 or, in the alternative, as a motion for renewal and
reargument pursuant to CPLR 2221, and denied it in its entirety.
Plaintiff appeals.

      Initially, plaintiff followed the appropriate procedure in
moving to vacate the July 2014 order. Contrary to Supreme
Court's determination, plaintiff could not have challenged the
order by taking a direct appeal. As the order was made in
response to plaintiff's letter and did not decide a motion made
upon notice, it was not appealable as of right (see CPLR 5701 [a]

    1
        In March 2012, plaintiff filed a consent to change
attorney substituting counsel, but apparently did not notify
Supreme Court of this substitution.
                              -3-                523163

[2]; Sholes v Meagher, 100 NY2d 333, 335 [2003]; Djeddah v
Williams, 134 AD3d 479, 480 [2015]; Shields v Carbone, 99 AD3d
1100, 1101 n 2 [2012]). Such an order is properly challenged by
moving on notice for vacatur, as plaintiff did here, and then by
taking an appeal as of right if the requested relief is denied
(see CPLR 5701 [a] [3]; Matter of Katherine B. v Cataldo, 5 NY3d
196, 201 n 1 [2005]; Sholes v Meagher, 100 NY2d at 335; Siegel,
NY Prac § 244 at 425 [5th ed 2011]). Thus, the court should have
addressed the merits of plaintiff's motion to vacate the July
2014 order, and the application should not have been denied based
upon the standards applicable to motions pursuant to CPLR 5015
and 2221.

      Further, as plaintiff contends, CPLR 3404, which permits
the dismissal of cases that are "struck from the calendar . . .
and not restored within one year thereafter," does not apply to
cases that have not been placed on the trial calendar because no
note of issue has been filed (see McCarthy v Jorgensen, 290 AD2d
116, 118 [2002]; Lopez v Imperial Delivery Serv., 282 AD2d 190,
199 [2001], lv dismissed 96 NY2d 937 [2001]; see also Schmidt v
Mack, 46 AD3d 1205, 1206 [2007]). Here, as a note of issue had
not been filed, dismissal for lack of prosecution was governed by
CPLR 3216. This statute sets forth strict preconditions that
must be satisfied before an action may be dismissed and "is
extremely forgiving of litigation delay" (Baczkowski v Collins
Constr. Co., 89 NY2d 499, 503 [1997]; see Travis v Cuff, 28 AD3d
749, 750 [2006]; Chauvin v Keniry, 4 AD3d 700, 702 [2004], lv
dismissed 2 NY3d 823 [2004]). An action may not be dismissed
pursuant to this provision until, among other things, the court
or the party seeking dismissal has served the opposing party with
a written demand to serve and file a note of issue within 90 days
and the opposing party has failed to do so (see CPLR 3216 [b]
[3]; Cadichon v Facelle, 18 NY3d 230, 235 [2011]; Baczkowski v
Collins Constr. Co., 89 NY2d at 503). When no note of issue has
been filed and no 90-day demand has been served, "courts do not
possess the power to dismiss an action for general delay" (Chase
v Scavuzzo, 87 NY2d 228, 233 [1995]). Here, plaintiff was never
served with the 90-day notice required by CPLR 3216; accordingly,
the action was not properly dismissed and plaintiff's motion to
vacate the July 2014 order should have been granted (see Cerrone
v North Shore—Long Is. Jewish Health Sys., Inc., 134 AD3d 874,
                              -4-                  523163

875 [2015]; Travis v Cuff, 28 AD3d at 750; McCarthy v Jorgensen,
290 AD2d at 118).

     Egan Jr., Devine, Clark and Mulvey, JJ., concur.

      ORDERED that the order is reversed, on the law, with costs,
motion granted to the extent of vacating the July 28, 2014 order
and the judgment entered thereon.

                             ENTER:

                             Robert D. Mayberger
                             Clerk of the Court