U.S. Bank National Association, as Trustee v Ralph Thibault
Categories
Attorneys and Parties
Brief Summary
Mortgage foreclosure procedure and whether a lender moving for default judgment under CPLR 3215 [default judgment rule requiring proof of service, the facts constituting the claim, and the default] must also prove compliance with Real Property Actions and Proceedings Law (RPAPL) 1304 [pre-foreclosure notice requirement for certain home loans], and whether a borrower may file a late answer without showing an excuse for the delay.
Supreme Court denied the lender's motion for a default judgment and order of reference and granted the borrower's request to serve a late answer.
The Appellate Division reversed the portions of the order denying plaintiff's motion for default judgment and order of reference and granting defendant leave to file a late answer.
Plaintiff established service, the foreclosure claim, and defendant's failure to answer. Defendant, in turn, offered no claim that he had not defaulted and no reasonable excuse for the delay. The court also held that noncompliance with RPAPL 1304 is not a jurisdictional defect and was not a basis to deny default judgment where defendant never answered and therefore never raised that defense.
Background
In 2001, Ralph Thibault and his wife executed a note to Beneficial Homeowner Service Corporation secured by a mortgage on two St. Lawrence County properties. After later assignments, the mortgage was assigned to U.S. Bank National Association, as Trustee, in August 2022. The borrowers failed to make the November 2021 payment, creating a default. The wife died before this foreclosure action was commenced in December 2022. Defendant participated in settlement conferences from May through September 2023, and his counsel filed a notice of appearance in June 2023, but no answer was served. In November 2023, plaintiff moved for default judgment and an order of reference. In December 2023, defendant cross-moved for permission to file a late answer and to dismiss the complaint.
Lower Court Decision
Supreme Court denied plaintiff's motion for default judgment and an order of reference and granted the portion of defendant's cross-motion seeking leave to file a late answer.
Appellate Division Reversal
The Appellate Division held that plaintiff made a facially sufficient showing for default judgment by submitting the summons, verified complaint, affidavits of personal service, and an attorney affirmation establishing that defendant had not answered. The court further held that plaintiff did not need to prove compliance with RPAPL 1304 at this stage because that issue is not jurisdictional and was never raised in an answer. Defendant's cross-motion failed because he did not assert that there was no default and did not provide any excuse for the delay in answering. The order was therefore modified to grant plaintiff's motion for default judgment and order of reference and deny defendant's request to file a late answer.
Legal Significance
This decision reinforces that in a mortgage foreclosure action, a plaintiff seeking default judgment under CPLR 3215 need only establish service, the claim, and the default. It also confirms that RPAPL 1304 compliance is a waivable defense rather than a jurisdictional prerequisite to a default judgment. In addition, a defendant seeking leave to serve a late answer under CPLR 2004 [rule permitting extension of time] must provide a reasonable excuse for the delay; merely proposing defenses is insufficient. The court also noted that denial of leave to file a late answer does not bar a later motion to vacate a default judgment under CPLR 5015 (a) (1) [rule permitting relief from judgment on grounds such as excusable default].
A borrower who fails to answer a foreclosure complaint cannot block a properly supported default judgment by raising unpleaded RPAPL 1304 issues or by asking to file a late answer without explaining the delay.