Wells Fargo Bank, National Association v 16th Street Regency, LLC
Attorneys and Parties
Brief Summary
Mortgage foreclosure; effect of e-filing service failures on jurisdiction over motions and cross-motions; cancellation of notices of pendency.
Dismissed the complaint as to the responding defendants and canceled all notices of pendency; denied plaintiff’s motion to vacate its default and for more time to oppose.
The denial of plaintiff’s CPLR 5015(a)(4) motion to vacate its default and request for additional time was reversed; the grant of the defendants’ cross-motion is vacated for lack of jurisdiction and remitted for proper service and a new determination.
The defendants’ cross-motion was never effectively served under 22 NYCRR 202.5-b(f)(2)(ii) [e-filing rule: service of an interlocutory document is made by e-filing and is ineffective if notification does not reach the recipient]; because the plaintiff did not receive NYSCEF notice, the Supreme Court lacked jurisdiction to entertain the cross-motion. CPLR 5015(a)(4) [authorizes vacatur of a judgment or order for lack of jurisdiction] therefore required vacatur of the default.
Background
In April 2010, Wells Fargo commenced a Brooklyn mortgage foreclosure against 16th Street Regency, LLC, Nathan Hirsch, and Benjamin Mutzen. In 2013, the court granted summary judgment/default relief and an order of reference. In April 2023, Wells Fargo moved to confirm the referee’s report and for a judgment of foreclosure and sale (JFS). On May 9, 2023, the parties stipulated to use the New York State Courts Electronic Filing System (NYSCEF). In June 2023, defendants cross-moved to dismiss for failure to comply with Kings County Supreme Court Uniform Civil Term Rules, Part F, rule 8 [requires a plaintiff in foreclosure to move for a JFS within one year of the order of reference], and to cancel the notices of pendency under CPLR 6514(a) [authorizes court to cancel a notice of pendency in specified circumstances]. Wells Fargo did not oppose. In August 2023, Wells Fargo moved under CPLR 5015(a)(4) to vacate its default and for an extension, asserting it was never served with the cross-motion via NYSCEF.
Lower Court Decision
By order dated October 12, 2023 (Supreme Court, Kings County), the court granted defendants’ cross-motion to dismiss the complaint as to them and cancel all notices of pendency, and denied Wells Fargo’s motion to vacate its default and for more time to oppose.
Appellate Division Reversal
The Appellate Division reversed. Citing 22 NYCRR 202.5-b(f)(2)(ii) [e-filing rule: service of an interlocutory document is made by e-filing and is ineffective if notification does not reach the recipient], it held that because Wells Fargo indisputably did not receive NYSCEF notification of the cross-motion, service was ineffective and the Supreme Court lacked jurisdiction to entertain it. The court granted Wells Fargo’s CPLR 5015(a)(4) motion to vacate its default and for an extension of time, and remitted for the defendants to properly serve the cross-motion and for a new briefing schedule and determination on the cross-motion (including the CPLR 6514[a] request to cancel notices of pendency).
Legal Significance
Reaffirms that in NYSCEF cases, effective service of motions occurs only upon transmission of electronic notification to the adversary; absent such notice, the court lacks jurisdiction and any resulting order is void. It underscores strict compliance with 22 NYCRR 202.5-b(f)(2)(ii) and that CPLR 5015(a)(4) is an appropriate vehicle to vacate defaults entered without jurisdiction.
In e-filed foreclosure actions, if the opposing party does not receive NYSCEF email notification of your motion or cross-motion, service has not occurred; the court cannot rule on the motion, and any order will be vacated, with the matter remitted for proper service and renewed determination.