Wells Fargo Bank, National Association v Wercberger
Attorneys and Parties
Brief Summary
Residential mortgage foreclosure—timeliness of seeking default judgment under CPLR 3215(c) [If the plaintiff fails to take proceedings for the entry of judgment within one year after the default, the court shall not enter judgment but shall dismiss the complaint as abandoned; excusable upon sufficient cause].
The Supreme Court denied Kaplan’s CPLR 3215(c) cross‑motion to dismiss as abandoned, denied his subsequent motion to dismiss under CPLR 3211(a)(5) and 3217(c), granted the bank leave to enter a default judgment and an order of reference, denied Kaplan’s CPLR 3211(a)(8) jurisdictional cross‑motion, and appointed a referee.
The Appellate Division reversed the denial of Kaplan’s CPLR 3215(c) cross‑motion, granted dismissal of the complaint as against Kaplan as abandoned, and reversed the orders granting a default judgment and order of reference; related appeals were dismissed as academic.
Wells Fargo missed the one‑year CPLR 3215(c) deadline by about five months and offered only a conclusory, unsubstantiated excuse not supported by someone with personal knowledge, failing to show sufficient cause. The statute is mandatory and strictly construed.
Background
Wells Fargo commenced a foreclosure action in July 2012 against multiple defendants, including David Kaplan. Kaplan was served in October 2012; even crediting the bank’s later date of October 31, 2012, the one‑year CPLR 3215(c) period to take proceedings for entry of a default judgment expired on November 30, 2013. The bank did not move for default judgment and an order of reference until May 7, 2014. Kaplan cross‑moved to dismiss as abandoned under CPLR 3215(c). The bank argued its delay should be excused, but its showing was conclusory and not in admissible form by a person with personal knowledge. The Supreme Court denied Kaplan’s cross‑motion, later granted the bank’s motion for default and an order of reference, and appointed a referee. On appeal, the bank’s waiver argument regarding CPLR 3215(c) was not considered because it was raised for the first time and did not present a pure question of law.
Lower Court Decision
By order dated March 6, 2017, the Supreme Court, Kings County, denied Kaplan’s CPLR 3215(c) cross‑motion to dismiss as abandoned. By order dated September 5, 2017, it denied Kaplan’s motion to dismiss under CPLR 3211(a)(5) and 3217(c) [defense‑based pre‑answer dismissal grounds and voluntary discontinuance provisions]. In June 2019, the bank moved for leave to enter a default judgment and an order of reference; by two orders dated February 18, 2020, the court granted that relief, denied Kaplan’s cross‑motion including under CPLR 3211(a)(8) [lack of personal jurisdiction], and appointed a referee to compute.
Appellate Division Reversal
The Appellate Division reversed the March 6, 2017 order insofar as appealed from and granted Kaplan’s CPLR 3215(c) cross‑motion, dismissing the complaint against him as abandoned. It dismissed as academic the appeals from the September 5, 2017 order and from the portion of the first February 18, 2020 order denying Kaplan’s cross‑motion. It also reversed both February 18, 2020 orders insofar as they granted the bank leave to enter a default judgment and an order of reference, and denied those branches of the bank’s motion. One bill of costs was awarded to Kaplan.
Legal Significance
Reaffirms strict, mandatory enforcement of CPLR 3215(c) in foreclosure cases: if a plaintiff does not take proceedings for entry of default judgment within one year of default, dismissal is required absent a showing of sufficient cause consisting of both a reasonable excuse and a potentially meritorious claim, supported by admissible evidence from a person with personal knowledge. Conclusory, unsupported excuses will not suffice, and late efforts to obtain default and an order of reference will be denied.
In New York foreclosure actions, missing the one‑year CPLR 3215(c) deadline without a substantiated, admissible excuse compels dismissal as abandoned and defeats later attempts to enter a default judgment or obtain an order of reference.