U.S. Bank Trust National Association v Jimenez
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Attorneys and Parties
Brief Summary
Mortgage foreclosure standing and whether the foreclosing plaintiff proved it possessed the note before commencing the action.
The Supreme Court, Nassau County, denied the plaintiff's request for summary judgment, to strike the defendants' answer, dismiss their affirmative defenses and counterclaims, and for an order of reference, and granted the defendants a trial limited to standing.
The Appellate Division reversed the denial of the plaintiff's foreclosure motion relief and reversed the grant of a limited standing trial to the defendants.
The plaintiff established standing as a matter of law by attaching to the summons and complaint a copy of the note endorsed in blank, which showed physical possession of the note at commencement. The defendants failed to raise a triable issue of fact.
Background
The plaintiff commenced an action to foreclose a mortgage on residential property in East Rockaway. David Jimenez and Denise Jimenez answered and asserted affirmative defenses, including lack of standing, and two counterclaims. The plaintiff then moved for summary judgment on the complaint against those defendants, to strike their answer, dismiss their affirmative defenses and counterclaims, and for an order of reference. The defendants opposed and cross-moved for summary judgment dismissing the complaint for lack of standing or, alternatively, for a trial limited to standing.
Lower Court Decision
The Supreme Court denied the plaintiff's requested foreclosure relief against David Jimenez and Denise Jimenez and granted the branch of their cross-motion seeking, in effect, a trial limited to the issue of standing.
Appellate Division Reversal
The Appellate Division held that in a mortgage foreclosure action a plaintiff makes a prima facie showing through the mortgage, the unpaid note, and evidence of default, and when standing is placed in issue, the plaintiff must show it was the holder or assignee of the note when the action was commenced. Here, the plaintiff satisfied that burden by attaching to the summons and complaint a copy of the note endorsed in blank, which demonstrated physical possession at commencement. Because attachment of the endorsed note to the complaint was sufficient, the plaintiff did not need additional factual detail about delivery. The defendants failed to raise a triable issue of fact. The appellate court therefore granted summary judgment to the plaintiff, struck the defendants' answer, dismissed their affirmative defenses and counterclaims, granted an order of reference, and denied the defendants' request for a standing trial.
Legal Significance
This decision reinforces New York foreclosure law that a plaintiff can establish standing through physical possession of the note before commencement, and that attaching a note endorsed in blank to the summons and complaint is sufficient proof of such possession. It also confirms that where this showing is made, a defendant must produce evidence creating a genuine factual dispute; otherwise, no separate trial on standing is warranted.
In a New York mortgage foreclosure action, attaching a note endorsed in blank to the complaint can conclusively establish standing at the summary judgment stage unless the borrower presents evidence raising a real factual dispute.