Citimortgage, Inc. v Fimbel
Attorneys and Parties
Brief Summary
Residential mortgage foreclosure—whether the death of a mortgagor automatically stays the action pending substitution when the property was held as tenants by the entirety and the lender waives any deficiency judgment.
The action was stayed due to the death of defendant James Fimbel; the court denied plaintiff’s unopposed motion for an order of reference, default judgment against Janice Fimbel, and to amend the caption to delete the decedent.
The denial of plaintiff’s unopposed motion on stay grounds.
The decedent’s death did not affect the merits because the surviving spouse, as tenant by the entirety, remained seized of the entire ownership interest, and the lender elected not to seek a deficiency judgment against the decedent’s estate; therefore, strict adherence to a stay pending substitution was unnecessary.
Background
Citimortgage, Inc. commenced a foreclosure action in July 2019 against, among others, James Fimbel and his spouse, Janice Fimbel, concerning property in Smithtown, New York. Janice served an untimely answer in February 2020, which plaintiff rejected. James Fimbel died in May 2020. In October 2022, plaintiff moved for an order of reference, leave to enter a default judgment against Janice, to amend the caption to delete James, and, in effect, to discontinue the action as to James. The motion was unopposed.
Lower Court Decision
By order dated January 30, 2023, the Supreme Court, Suffolk County, denied the motion on the ground that the action was automatically stayed due to the death of James Fimbel pending substitution of a personal representative.
Appellate Division Reversal
Reversed and remitted. The Appellate Division held that a stay was not required because, upon James’s death, Janice—holding title as a tenant by the entirety—remained seized of the entire ownership interest, and plaintiff’s motion to delete James from the caption and discontinue as to him constituted an election not to seek a deficiency judgment. The court remitted for a determination on the merits of plaintiff’s unopposed motion for an order of reference, default judgment against Janice, and to amend the caption.
Legal Significance
Confirms that in foreclosure actions involving property held by the entirety, the death of one spouse does not necessitate a stay or substitution where the surviving spouse retains full title and the lender waives any deficiency judgment against the decedent’s estate. Decedents who no longer hold an interest in the mortgaged premises are not necessary parties to foreclosure absent a deficiency claim, allowing courts to proceed to adjudicate merits without delay.
No automatic stay is required after a mortgagor’s death in a foreclosure when the surviving spouse holds full title by the entirety and the lender waives any deficiency; the action may proceed to the merits without substitution.