HSBC Bank USA, N.A. v Bornstein
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Attorneys and Parties
Brief Summary
Mortgage foreclosure procedure and abandonment of claims against a defaulting defendant.
The Supreme Court, Kings County, denied the defendants' cross-motion to dismiss the complaint against Yehuda Bornstein, as trustee of "NEB 3-06 Trust," as abandoned, while granting the plaintiff leave to discontinue the action against the answering defendants.
The Appellate Division reversed the portion of the order denying dismissal under CPLR 3215(c) [if the plaintiff fails to take proceedings for the entry of judgment within one year after the default, the court shall not enter judgment but shall dismiss the complaint as abandoned unless sufficient cause is shown].
The plaintiff did not take sufficient proceedings to obtain a default judgment against the non-answering defendant within one year of that defendant's default. Its 2017 motion was withdrawn, and it then took no further action until December 2019, showing inadequate prosecution under the statute.
Background
HSBC Bank USA, N.A. commenced a mortgage foreclosure action in May 2015 concerning Brooklyn real property. Nathan Bornstein and Esther Bornstein answered the complaint, but Yehuda Bornstein, as trustee of "NEB 3-06 Trust," did not. Service of the summons and complaint was not completed within the time required by CPLR 306-b [requires service within 120 days], so the plaintiff moved in January 2016 to validate late service nunc pro tunc, and that motion was granted on September 28, 2016. The non-answering defendant still did not appear. Although the plaintiff filed a motion on October 9, 2017 seeking, among other relief, a default judgment against the non-answering defendant, it withdrew that motion on October 16, 2017. The plaintiff then took no further action until December 2019, when it again moved for a default judgment and to discontinue the action against the answering defendants.
Lower Court Decision
The Supreme Court granted the plaintiff leave to discontinue the action against Nathan Bornstein and Esther Bornstein and denied the defendants' cross-motion seeking dismissal of the complaint against Yehuda Bornstein, as trustee of "NEB 3-06 Trust," as abandoned under CPLR 3215(c).
Appellate Division Reversal
The Appellate Division reversed insofar as appealed from and granted the branch of the defendants' cross-motion seeking dismissal of the complaint against Yehuda Bornstein, as trustee of "NEB 3-06 Trust," as abandoned. The court held that the plaintiff failed to take sufficient proceedings for entry of judgment within one year after the default. The withdrawn 2017 motion did not save the claim, especially because no further action was taken until December 2019 despite the Supreme Court twice directing the plaintiff to resume prosecution.
Legal Significance
The decision reinforces that in foreclosure actions, a plaintiff must actively pursue a default judgment against a non-answering defendant within the period required by CPLR 3215(c). A plaintiff need not actually obtain the judgment within one year, but it must take meaningful proceedings showing an intent to seek judgment and not abandon the claim. A withdrawn motion followed by prolonged inactivity can support mandatory dismissal.
If a foreclosure plaintiff lets a defaulting defendant sit without timely and meaningful steps toward a default judgment, the claim can be dismissed as abandoned under CPLR 3215(c), even if the action continues against other defendants.