Wells Fargo Bank, National Association v. Barasch
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Attorneys and Parties
Brief Summary
Mortgage foreclosure and civil procedure, specifically whether a lender could obtain more time to serve a defendant after prior service was found defective.
The Supreme Court, Westchester County, granted the plaintiff's motion under CPLR 306-b [authorizes a court to extend the time for service upon good cause shown or in the interest of justice] to extend the time to serve Mark Barasch with the summons and complaint.
The Appellate Division reversed the order insofar as appealed from and denied the branch of the plaintiff's motion seeking an extension of time to serve Mark Barasch.
The plaintiff did not show good cause because it failed to demonstrate reasonable diligence in attempting service, and it also failed to justify relief in the interest of justice because it waited years after being put on notice that service was challenged and more than 4 1/2 years after the trial court found service improper before seeking the extension.
Background
In July 2015, Wells Fargo commenced a mortgage foreclosure action against Mark Barasch, Ellen Barasch, and others concerning property in Pound Ridge. The defendants were purportedly served under CPLR 308(2), but in August 2015 they moved to dismiss under CPLR 3211(a)(8) [permits dismissal for lack of personal jurisdiction]. After settlement conference proceedings, they renewed that challenge in November 2015. The Supreme Court later ordered a hearing on service, and after the hearing, in April 2017, it dismissed the complaint insofar as asserted against the defendants for lack of personal jurisdiction due to improper service. The Appellate Division affirmed that ruling in 2020. In December 2021, the plaintiff moved under CPLR 306-b for more time to serve the defendants again.
Lower Court Decision
The Supreme Court held that the action remained pending because no judgment dismissing the complaint had been entered and granted the plaintiff's motion to extend the time to serve the defendants, including Mark Barasch.
Appellate Division Reversal
The Appellate Division agreed that the action was still pending and that the plaintiff was not procedurally barred from seeking relief under CPLR 306-b. However, it held that the plaintiff was not entitled to that relief. The court found no good cause because the plaintiff did not show reasonable diligence in effecting service. It also found no basis to grant relief in the interest of justice because the plaintiff had notice of the service objection as early as August 2015, waited until the eve of the February 2017 service hearing to seek a stay and extension, and then waited until December 2021—more than 4 1/2 years after the court ruled service improper—to make the motion at issue. The order granting the extension as to Mark Barasch was therefore reversed.
Legal Significance
The decision underscores that even when an action remains technically pending, a plaintiff seeking relief under CPLR 306-b must act diligently. Courts may deny an extension where the plaintiff delays substantially after learning service is disputed or after a court has already ruled that service was defective. The case reinforces that the 'interest of justice' standard is flexible but does not excuse prolonged inaction.
A foreclosure plaintiff cannot rely on CPLR 306-b to revive defective service after years of delay; once service is challenged, prompt action is critical to show either good cause or that an extension is warranted in the interest of justice.