Freedom Mortgage Corporation v Hansen-Velazquez
Attorneys and Parties
Brief Summary
Real estate finance—whether a lender is entitled to default judgment to cancel an erroneously recorded satisfaction of mortgage, and whether mortgage consolidation renders such relief academic.
Denied the lender’s unopposed motion for default judgment and to cancel and vacate the satisfaction of mortgage, deeming the relief academic due to later consolidation of the subject mortgage with another mortgage.
The Appellate Division reversed the June 22, 2023 order and granted the unopposed CPLR 3215 motion; it dismissed the appeal from the January 5, 2024 order as no appeal lies from denial of reargument.
The motion satisfied New York Civil Practice Law and Rules (CPLR) 3215 [rule governing default judgments; requires proof of service, facts constituting the claim, and the default]. Defendants’ default admits the complaint’s factual allegations, and consolidation did not render the relief academic because the subject mortgage retained independent force and effect.
Background
Freedom Mortgage Corporation alleged a mortgage was mistakenly recorded as satisfied on February 28, 2022 and sued to cancel and vacate that satisfaction. Defendants failed to appear or answer. Plaintiff moved for a default judgment and for cancellation/vacatur of the satisfaction. The Supreme Court denied the unopposed motion, reasoning the issue was academic because the mortgage had later been consolidated with another into a single lien. Plaintiff moved, in effect, to reargue; the court denied that motion as well. Plaintiff appealed both orders.
Lower Court Decision
By order entered June 22, 2023, the Supreme Court, Queens County, denied the unopposed motion for default judgment and to cancel/vacate the satisfaction of mortgage, viewing the requested relief as academic after the mortgage’s consolidation. By order entered January 5, 2024, it denied the plaintiff’s unopposed motion to reargue.
Appellate Division Reversal
The Appellate Division dismissed the appeal from the January 5, 2024 order because no appeal lies from an order denying reargument. It reversed the June 22, 2023 order, holding the unopposed motion was facially adequate under CPLR 3215 and that consolidation did not extinguish the underlying mortgage’s independent effect. The court granted the plaintiff’s motion for default judgment and ordered the cancellation and vacatur of the February 28, 2022 satisfaction of mortgage.
Legal Significance
Clarifies that a plaintiff seeking default judgment under CPLR 3215 must show proof of service, facts constituting the claim, and the default, and that defaults admit all well-pleaded facts. Also confirms that the consolidation of a mortgage with another does not render moot a claim to cancel an erroneously recorded satisfaction because the original mortgage continues to exist with independent force and effect.
An unopposed CPLR 3215 motion to cancel an erroneously recorded satisfaction should be granted when the statutory proofs are provided; mortgage consolidation does not make such relief academic because the original lien remains independently effective.