HSBC Bank USA, N.A. v. St. Hillaire
Attorneys and Parties
Brief Summary
Mortgage foreclosure timing under the six-month savings statutes and what constitutes 'termination' of a prior action for recommencement under CPLR 205-a [foreclosure-specific savings statute providing a six-month window to recommence, with stricter conditions] and CPLR 205(a) [general savings statute allowing recommencement within six months after termination when the prior action was timely and not dismissed on specified grounds].
Supreme Court held the 2022 foreclosure was untimely under CPLR 205-a and granted defendants’ RPAPL 1501(4) [authorizes an action to cancel and discharge a mortgage of record when the statute of limitations has expired] counterclaim to cancel the mortgage.
Dismissal of the complaint and the grant of the RPAPL 1501(4) counterclaim.
The Second Department held that, absent an appeal, 'termination' occurs 30 days after service with notice of entry of the dismissal order (recognizing the CPLR 5513(a) [30-day deadline to take an appeal after service with notice of entry] and CPLR 2221(d) [30-day deadline to move for leave to reargue after service with notice of entry] windows and the service requirement of CPLR 2220(b) [order must be served with notice of entry to affect parties]). Measuring from that date, and applying CPLR 205-a’s requirement that service be 'completed' within six months, the recommenced action and completed service were timely.
Background
In 2005, Nina St. Hillaire executed a note and mortgage, later modified in 2008. She allegedly defaulted as of February 1, 2009. The lender accelerated the debt by commencing a foreclosure on July 12, 2013. That 2013 action was dismissed by order dated March 21, 2022 for failure to comply with RPAPL 1304’s separate-envelope requirement; the order was entered and served with notice of entry on March 29, 2022 and was not appealed. The lender recommenced on September 9, 2022 and served St. Hillaire and current owner Josue Pierre by 'nail and mail' under CPLR 308(4) [method of service requiring delivery and mailing plus filing of proof; service completes 10 days after filing], with affidavits filed October 10, 2022, making service complete October 20, 2022. Defendants moved for summary judgment, arguing the action was untimely even with CPLR 205-a because they calculated the six months from March 29, 2022. Plaintiff argued FAPA’s CPLR 205-a should not apply retroactively and, alternatively, that the six months should run from termination 30 days after service with notice of entry, and only then must service be completed within six months.
Lower Court Decision
The Supreme Court (Kings County) applied CPLR 205-a, held the recommenced action time-barred by measuring six months from the March 29, 2022 entry date of the dismissal order, dismissed the complaint, and granted defendants’ RPAPL 1501(4) counterclaim to cancel and discharge the mortgage.
Appellate Division Reversal
Reversing, the Second Department held that for CPLR 205-a (and by extension CPLR 205(a)), when no appeal is taken, 'termination' occurs 30 days after service with notice of entry of the dismissal order, accounting for the statutory periods to appeal or seek reargument, and harmonizing with CPLR 2220(b). If an appeal is perfected, termination is delayed until the appellate process is exhausted; if a notice of appeal is filed but not perfected, termination occurs upon dismissal of the appeal. Termination does not wait for entry of judgment. Applying the rule here, service with notice of entry occurred March 29, 2022; termination thus occurred April 28, 2022; the six-month period ended October 28, 2022. Because the lender completed service on October 20, 2022, the action was timely under CPLR 205-a. The court also noted that subsequent Court of Appeals and Second Department decisions have rejected constitutional challenges to FAPA. The panel disapproved prior Second Department computations that measured the six-month period from the dismissal or entry date rather than from service with notice of entry plus 30 days.
Legal Significance
Clarifies, within the Second Department, the definitive starting point of the six-month savings period for recommencing actions under CPLR 205-a and CPLR 205(a): the clock starts 30 days after service with notice of entry of the dismissal order unless the appellate process is pursued and must then be exhausted. The decision harmonizes the savings statutes with CPLR 2220(b), CPLR 5513(a), and CPLR 2221(d), eliminates inconsistent prior computations, and emphasizes that CPLR 205-a requires service to be 'completed' within the six-month window.
In foreclosure and other cases governed by CPLR 205-a (and CPLR 205(a)), the six-month savings period runs from 30 days after service with notice of entry of the dismissal order (absent an appeal), and for CPLR 205-a the plaintiff must complete—not merely effect—service within that period.