Deutsche Bank National Trust Company v Howell
Attorneys and Parties
Brief Summary
Mortgage foreclosure procedure—substitution of counsel, limits on sua sponte dismissal for noncompliance with a status conference order, and effect of cancelled notice of pendency (lis pendens).
The Supreme Court, Queens County, denied Deutsche Bank’s unopposed motion to substitute new counsel, vacate a 2015 sua sponte dismissal and cancellation of the notice of pendency, and restore the case to the active calendar.
The August 4, 2023 order denying substitution of counsel, vacatur of the April 15, 2015 dismissal order, and restoration of the action.
Under CPLR 321(b)(2) [permits substitution of counsel by court order when consent cannot be obtained], the plaintiff could be substituted without a consent from a dissolved predecessor firm; a sua sponte dismissal must be used sparingly and mere failure to comply with a status conference order is insufficient; and RPAPL 1331 [requires filing a notice of pendency at least 20 days before a foreclosure sale judgment] together with CPLR 6516(a) [authorizes filing a new notice of pendency after cancellation in appropriate circumstances] allow a new notice despite prior cancellation. The Administrative Order AO/208/13 [requires a foreclosure counsel affirmation/certificate of merit] did not justify dismissal.
Background
In 2007, Deutsche Bank commenced a foreclosure action against Dave Howell regarding residential property in Queens and filed a notice of pendency. Howell defaulted. The court granted an order of reference in 2008 and, in 2009, granted an unopposed motion to confirm the referee’s report and for a judgment of foreclosure and sale. On March 4, 2015, the court ordered the plaintiff to appear for a final status conference on April 15, 2015, and to file the foreclosure affirmation/certificate of merit under AO/208/13 [requires a foreclosure counsel affirmation/certificate of merit] and an application for judgment by that date. On April 15, 2015, the court sua sponte dismissed the action without prejudice and cancelled the notice of pendency. In June 2023, plaintiff moved by order to show cause to substitute Robertson, Anschutz, Schneid, Crane & Partners, PLLC as counsel, vacate the 2015 dismissal order, and restore the case; the motion was unopposed.
Lower Court Decision
The Supreme Court, Queens County, denied the unopposed motion, reasoning that substitution was improper without a consent to change attorney from the dissolved predecessor firm and that the prior cancellation of the notice of pendency precluded vacatur and restoration.
Appellate Division Reversal
Reversed. The Appellate Division granted substitution under CPLR 321(b)(2) [permits substitution of counsel by court order when consent cannot be obtained], vacated the April 15, 2015 dismissal, and restored the action to the active calendar. The court held that sua sponte dismissal is reserved for extraordinary circumstances and noncompliance with a status conference order is not enough. It further held that cancellation of a prior notice of pendency does not bar the plaintiff from filing a new notice to comply with RPAPL 1331 [requires filing a notice of pendency at least 20 days before a foreclosure sale judgment], consistent with CPLR 6516(a) [authorizes filing a new notice of pendency after cancellation in appropriate circumstances].
Legal Significance
Clarifies that in New York foreclosure actions, courts should not dismiss sua sponte for routine noncompliance with a status order; substitution of counsel may proceed by court order when a prior firm has dissolved; and a cancelled notice of pendency does not bar filing a new notice prior to final judgment under RPAPL 1331 and CPLR 6516(a).
In foreclosure cases, failure to meet a status conference directive is not an extraordinary basis for sua sponte dismissal; counsel can be substituted by court order under CPLR 321(b)(2), and a previously cancelled lis pendens can be refiled to satisfy RPAPL 1331.