U.S. Bank National Association v. Mc Dermott

Background

U.S. Bank National Association, acting as trustee for the RMAC Trust, Series 2016-CTT, brought a mortgage-foreclosure action under Article 13 of New York’s Real Property Actions and Proceedings Law. The mortgage encumbered property at 41 Clinton Street, Middletown, New York. The defendants had signed a $147,900 promissory note and mortgage in 2007 and later entered into two loan-modification agreements.

U.S. Bank alleged that the defendants failed to make monthly payments beginning May 1, 2018. It submitted evidence that its loan servicer mailed 90-day pre-foreclosure notices on July 16, 2019, electronically filed the required information with New York’s Superintendent of Financial Services on July 17, 2019, and mailed a contractual notice of default on September 16, 2019.

Mark A. Mc Dermott filed an answer. Courtney R. Mc Dermott did not respond, and the Clerk issued a certificate of default against her. U.S. Bank moved for summary judgment against Mark and default judgment against Courtney.

Jurisdiction

The court found that it had jurisdiction based on the parties’ citizenship in different states and an amount in controversy exceeding $75,000. The opinion states that U.S. Bank’s main office was in Cincinnati, Ohio, and that the defendants were citizens of New York.

Default-judgment motion

The court denied U.S. Bank’s motion for default judgment without prejudice because the court’s Individual Rules required a party seeking default judgment to proceed by an order to show cause. U.S. Bank had not used that procedure. The court stated that U.S. Bank could file the motion again in compliance with those rules.

Summary-judgment standard

Summary judgment is a decision entered without a trial when the moving party shows that there is no genuine dispute about a fact that could affect the outcome and that the party is entitled to judgment under the law. Although Mark did not oppose the motion or respond to U.S. Bank’s statement of facts, the court still examined U.S. Bank’s submissions to determine whether they met the required burden.

Foreclosure claim and defenses

Under New York law, a mortgagee establishes an initial right to foreclose by producing the note, mortgage, and evidence of default. The court found that U.S. Bank supplied the promissory note, mortgage, loan-modification agreements, and evidence that Mark had defaulted. Mark did not provide evidence disputing the alleged default or otherwise rebutting U.S. Bank’s submissions.

The court rejected Mark’s affirmative defenses:

- Failure to state a claim: The court concluded that U.S. Bank had stated a foreclosure claim because it established the elements of a prima facie foreclosure case. - Statute of limitations: The court held that the action was filed within New York’s six-year limitations period. The alleged default began in 2018, and U.S. Bank filed the action on January 14, 2020. - Standing: The court found that U.S. Bank had standing because an affidavit stated that the note and mortgage had been physically delivered to U.S. Bank before the action began and that written mortgage assignments had been recorded. - Personal jurisdiction: The court rejected Mark’s service objection after reviewing affidavits stating that a process server served each defendant with the summons and complaint. - Required foreclosure notices: The court found that U.S. Bank established compliance with New York Real Property Actions and Proceedings Law §§ 1304 and 1306. Its evidence included affidavits and copies of the 90-day notices mailed by first-class and certified mail, as well as a state filing record showing that the required information was electronically filed.

Disposition

The court concluded that U.S. Bank had established a prima facie foreclosure case and that Mark’s defenses failed. It granted U.S. Bank’s motion for summary judgment on all claims against Mark A. Mc Dermott. The Clerk was directed to enter judgment against Mark and terminate the pending motion. The court denied U.S. Bank’s motion for default judgment against Courtney R. Mc Dermott without prejudice and permitted U.S. Bank to file a renewed motion that complies with the court’s Individual Rules.