Aurora Loan Services, LLC v Miller
Categories
Attorneys and Parties
Brief Summary
Mortgage foreclosure procedure, specifically whether a foreclosure complaint was abandoned when the plaintiff did not obtain a default judgment within one year after the borrower's default.
The Supreme Court, Kings County, sua sponte dismissed the foreclosure complaint as abandoned under CPLR 3215(c) [if the plaintiff fails to take proceedings for entry of judgment within one year after a default, the court shall dismiss the complaint as abandoned unless sufficient cause is shown], and denied the plaintiff's unopposed motion as academic.
The Appellate Division reversed the dismissal, granted substitution of Harold Walcott for Kurtis Miller and amendment of the caption, and remitted for a merits determination on the requests for a default judgment and an order of reference.
Because the plaintiff filed a request for judicial intervention (RJI) seeking a mandatory residential mortgage foreclosure settlement conference within one year after Miller's default, which counted as taking proceedings for entry of judgment under CPLR 3215(c).
Background
Aurora Loan Services, LLC commenced a mortgage foreclosure action in November 2010 against Kurtis Miller and others concerning Brooklyn property. Service on Miller was made under CPLR 308(2), became complete on January 9, 2011, and Miller's time to answer expired on February 8, 2011. On January 13, 2012, the plaintiff filed a request for judicial intervention seeking a residential mortgage foreclosure settlement conference under CPLR 3408 [mandates settlement conferences in residential mortgage foreclosure actions]. In January 2014, Miller sold the property to Harold Walcott. In September 2022, the plaintiff moved to substitute Walcott for Miller, amend the caption, obtain a default judgment against the nonappearing and nonanswering defendants, and secure an order of reference.
Lower Court Decision
The Supreme Court, Kings County, ruled on its own initiative that the complaint had been abandoned under CPLR 3215(c) and dismissed it. As a result, it effectively denied as academic the plaintiff's unopposed motion to substitute Walcott, amend the caption, enter a default judgment, and appoint a referee through an order of reference.
Appellate Division Reversal
The Appellate Division held that the plaintiff timely took proceedings for entry of judgment because the January 13, 2012 request for judicial intervention seeking a CPLR 3408 settlement conference was filed less than one year after Miller defaulted on February 8, 2011. The court explained that a plaintiff need not actually obtain a default judgment within the one-year period, only take steps showing an intent to pursue judgment. It further held that once the plaintiff satisfied CPLR 3215(c), it did not need to explain later delays. The court also ruled that substitution of Harold Walcott for Miller and amendment of the caption should have been granted. It therefore reversed the order insofar as appealed from and remitted for determination on the merits of the branches of the motion seeking a default judgment and an order of reference.
Legal Significance
This decision reinforces that in New York foreclosure actions, filing a request for judicial intervention to obtain the mandatory settlement conference can satisfy CPLR 3215(c)'s requirement that the plaintiff take proceedings for entry of judgment within one year of a defendant's default. It also confirms that compliance with that initial one-year requirement prevents abandonment dismissal even if substantial delay occurs later, and that a post-commencement transferee of the mortgaged property may be substituted as a defendant.
A foreclosure plaintiff avoids dismissal for abandonment under CPLR 3215(c) by timely taking any qualifying step toward judgment, including filing a request for judicial intervention for a mandatory foreclosure settlement conference; once that is done, later delay alone does not justify dismissal.