Deutsche Bank National Trust Company v. Blasse
Attorneys and Parties
Brief Summary
Mortgage foreclosure statute of limitations after acceleration and the effect of the Foreclosure Abuse Prevention Act (FAPA) on the CPLR 205(a)/205-a savings provisions.
The Supreme Court, Kings County granted the lender summary judgment and an order of reference, finding the action timely under CPLR 205(a) [savings provision allowing recommencement within six months after certain terminations].
The grant of summary judgment and the order of reference in favor of the plaintiff were reversed and those branches of the motion were denied.
The 2007 foreclosure action accelerated the debt, starting the six-year limitations period under CPLR 213(4) [six-year statute of limitations for foreclosure]. Because the 2007 action was dismissed as abandoned under CPLR 3215(c) [dismissal for failure to seek default judgment within one year], FAPA (2022) bars reliance on CPLR 205(a) or 205-a to save the time-barred claims. The court also rejected challenges to FAPA’s retroactivity and constitutionality.
Background
In 2007, Deutsche Bank National Trust Company commenced a foreclosure action against Kelvin Blasse, electing in the complaint to accelerate the full mortgage debt. That 2007 action was dismissed on April 1, 2019, as abandoned under CPLR 3215(c) [dismissal for failure to seek default judgment within one year]. The lender filed a new foreclosure action in September 2019 and moved in March 2021 for summary judgment and an order of reference. The borrower opposed, asserting a statute of limitations defense based on the 2007 acceleration.
Lower Court Decision
By orders dated September 29, 2022, the Supreme Court, Kings County granted summary judgment on the complaint against Blasse and appointed a referee to compute, holding the collection of the complete arrears was timely under CPLR 205(a) [savings provision allowing recommencement within six months after certain terminations].
Appellate Division Reversal
The Appellate Division reversed, holding that a triable issue existed on the statute of limitations and that, under the Foreclosure Abuse Prevention Act (FAPA), the plaintiff could not invoke CPLR 205(a) or 205-a where the prior action was dismissed as abandoned under CPLR 3215(c). The court also rejected the lender’s arguments against FAPA’s retroactive application and constitutionality, and denied summary judgment and the order of reference.
Legal Significance
The decision reinforces that once a foreclosure is accelerated, CPLR 213(4) [six-year statute of limitations for foreclosure] governs the entire debt, and that FAPA prevents lenders from using CPLR 205(a)/205-a to revive foreclosure actions when an earlier case was dismissed as abandoned under CPLR 3215(c). It also confirms the retroactive application and constitutionality of FAPA in this context.
After acceleration, lenders cannot rely on CPLR 205(a) or 205-a to rescue a new foreclosure action if a prior action was dismissed as abandoned; FAPA applies retroactively and bars such savings in abandonment dismissals.