Bank of New York Mellon Trust Company v. Kyung Lee, also known as Kyung Soon Lee, et al.
Attorneys and Parties
Brief Summary
Mortgage foreclosure statute of limitations and applicability of the Foreclosure Abuse Prevention Act (FAPA) to the savings statute in recommenced foreclosure actions.
The Supreme Court denied 170H, LLC’s CPLR 3211(a) [pre-answer motion to dismiss; (a)(1) for documentary evidence, (a)(5) for statute of limitations] motion, accepting plaintiff’s reliance on CPLR 205(a) [general six-month savings statute allowing recommencement after a prior timely action is terminated other than on the merits] to render the 2022 action timely.
The Appellate Division reversed and granted dismissal as time-barred.
The mortgage debt was accelerated by the 2013 foreclosure filing, starting the six-year limitations period under CPLR 213(4) [six-year statute of limitations for mortgage foreclosure actions]. The 2022 action was commenced more than six years later. Under FAPA [Foreclosure Abuse Prevention Act; effective Dec. 30, 2022; replaced CPLR 205(a) with 205-a for CPLR 213(4) actions], CPLR 205-a [FAPA’s savings provision for mortgage foreclosure that limits recommencement and treats certain dismissals, including CPLR 3215, as neglect barring refiling] applies and precludes reliance on the savings statute after a CPLR 3215(c) [dismissal of complaint as abandoned when plaintiff fails to take proceedings for entry of judgment within one year after default] dismissal; FAPA’s retroactivity and constitutionality challenges were rejected.
Background
In 2006, Kyung Lee executed a consolidated note and a consolidation, extension, and modification agreement secured by a mortgage on a Mount Sinai condominium. The debt and CEMA were assigned to the plaintiff. In October 2013, plaintiff filed a foreclosure action, thereby accelerating the debt. In March 2018, Lee moved to dismiss for abandonment under CPLR 3215(c); the Supreme Court denied the motion in December 2018, but the Appellate Division reversed in February 2022 and granted dismissal. In May 2022, title transferred to 170H, LLC. Plaintiff filed this new foreclosure action in August 2022. 170H moved to dismiss under CPLR 3211(a)(1) and (5), arguing the action was time-barred under CPLR 213(4); plaintiff invoked CPLR 205(a)’s savings clause.
Lower Court Decision
The Supreme Court (Suffolk County) denied 170H’s CPLR 3211(a) motion, holding the action timely based on CPLR 205(a) [general six-month savings statute allowing recommencement after a prior timely action is terminated other than on the merits].
Appellate Division Reversal
Reversed. The court held the 2013 action accelerated the debt, starting the six-year limitations clock. The 2022 filing exceeded that period. FAPA [Foreclosure Abuse Prevention Act; effective Dec. 30, 2022; replaced CPLR 205(a) with 205-a for CPLR 213(4) actions] governs and replaces CPLR 205(a) with CPLR 205-a [FAPA’s savings provision for mortgage foreclosure that limits recommencement and treats certain dismissals, including CPLR 3215, as neglect barring refiling] in mortgage foreclosure cases; a CPLR 3215(c) [dismissal of complaint as abandoned when plaintiff fails to take proceedings for entry of judgment within one year after default] dismissal constitutes neglect that bars use of the savings statute. Retroactivity and constitutional challenges to FAPA were rejected. The complaint was dismissed as against 170H as time-barred.
Legal Significance
Confirms that, in mortgage foreclosure cases, the six-year limitations period begins upon acceleration through commencement of a foreclosure action, and that FAPA applies retroactively to bar reliance on the savings statute after a CPLR 3215(c) dismissal. Lenders cannot use CPLR 205(a) to revive time-barred foreclosure claims; CPLR 205-a tightly limits recommencement.
After a CPLR 3215(c) abandonment dismissal, a lender cannot rely on the six-month savings statute to refile a mortgage foreclosure beyond six years from acceleration; FAPA’s CPLR 205-a forecloses that avenue, and such actions will be dismissed as time-barred.