Pryce v Nationstar Mortgage, LLC
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Attorneys and Parties
Brief Summary
Mortgage foreclosure limitations and title-clearing litigation, specifically whether a prior foreclosure action accelerated the debt and whether a later voluntary discontinuance could undo that acceleration so as to avoid expiration of the six-year foreclosure statute of limitations.
The Supreme Court had earlier denied summary judgment to the plaintiff on his claim under Real Property Actions and Proceedings Law (RPAPL) 1501(4) [permits a person with an interest in real property subject to a mortgage to seek cancellation and discharge of the mortgage when the foreclosure statute of limitations has expired], finding a triable issue as to whether discontinuance of the 2009 foreclosure action revoked acceleration, and later denied renewal as untimely.
The Appellate Division reversed the July 13, 2023 order insofar as appealed from, granted leave to renew, vacated so much of the June 5, 2018 order as denied summary judgment against Nationstar, and upon renewal granted summary judgment to the plaintiff.
After enactment of the Foreclosure Abuse Prevention Act (FAPA), including Civil Practice Law and Rules (CPLR) 203(h) [provides that once a mortgage foreclosure claim accrues, no party may unilaterally waive, postpone, cancel, toll, revive, reset, or otherwise extend the accrual or limitations period unless expressly authorized by statute] and CPLR 3217(e) [provides that voluntary discontinuance of an action on a mortgage instrument does not waive, toll, revive, reset, or extend the limitations period unless expressly prescribed by statute], the prior discontinuance of the 2009 foreclosure action could not revoke the acceleration or restart the clock. Because the debt was accelerated in 2009, the six-year limitations period expired in 2015, and any new foreclosure action would be time-barred.
Background
In 2017, Cassius Pryce brought an action, among other things, under RPAPL 1501(4) to cancel and discharge a mortgage encumbering property in Newburgh. He alleged that the mortgage debt had been accelerated when a 2009 foreclosure action was commenced and the complaint elected to call due the full amount of the debt. Since more than six years had passed, Pryce argued that any new foreclosure action was barred by CPLR 213(4) [six-year statute of limitations governing mortgage foreclosure actions]. Nationstar opposed, relying on the discontinuance of the 2009 foreclosure action as a basis to argue that the acceleration had been revoked.
Lower Court Decision
In the June 5, 2018 order, the Supreme Court denied Pryce's summary judgment motion against Nationstar, concluding that the discontinuance of the 2009 foreclosure action created a triable issue of fact as to whether acceleration had been revoked. After FAPA was enacted in 2022, Pryce moved for leave to renew based on the change in law. In the July 13, 2023 order, the Supreme Court denied renewal as untimely.
Appellate Division Reversal
The Appellate Division held that the renewal motion was timely because no final judgment had yet been entered or enforced and a motion to renew based on a change in law may be made before the time to appeal from the final judgment expires. On the merits, the court found that the 2009 foreclosure action accelerated the debt, starting the six-year limitations period in 2009. Under FAPA's amendments to CPLR 203(h) and CPLR 3217(e), the subsequent voluntary discontinuance of that foreclosure action could not, in form or effect, revoke acceleration or reset the statute of limitations. The court rejected Nationstar's challenges to FAPA's retroactive application and constitutionality, held that the limitations period expired in 2015, and ruled that the mortgage was subject to cancellation and discharge.
Legal Significance
This decision reinforces that FAPA applies to pending mortgage limitations disputes and prevents lenders or servicers from using unilateral acts, including voluntary discontinuances, to undo acceleration or revive expired foreclosure claims. It also confirms that a CPLR 2221(e) renewal motion based on a change in law remains timely before the appeal period from a final judgment expires.
When a foreclosure complaint accelerates a mortgage debt, the six-year clock begins to run, and after FAPA a lender cannot later reset that clock simply by discontinuing the foreclosure action. Property owners may use RPAPL 1501(4) to clear the mortgage record once the foreclosure limitations period has expired.