Opinion
2014-08-27
CONFIDENTIAL LENDING, LLC, appellant, v. Viola NURSE, respondent, et al., defendants.
Aronauer, Re & Yudell, LLP, New York, N.Y. (John C. Re of counsel), for appellant. Vernita Charles, Brooklyn, N.Y., for respondent.
Aronauer, Re & Yudell, LLP, New York, N.Y. (John C. Re of counsel), for appellant. Vernita Charles, Brooklyn, N.Y., for respondent.
PETER B. SKELOS, J.P., PLUMMER E. LOTT, SHERI S. ROMAN, and JEFFREY A. COHEN, JJ.
In an action to foreclose a mortgage, the plaintiff appeals from so much of an order of the Supreme Court, Kings County (Edwards, J.), dated September 19, 2012, as granted the cross motion of the defendant Viola Nurse for leave to amend her answer to assert the defense of lack of standing and additional allegations in support of her defense and counterclaims sounding in fraud and alleging violations of General Business Law § 349 and Real Property Law § 440–a, and, upon renewal, denied those branches of its motion which were for summary judgment on the complaint and dismissing the affirmative defenses and counterclaims asserted by the defendant Viola Nurse or, alternatively, to sever her counterclaims, for leave to enter a default judgment against the defendants Caryn Nurse, the New York City Environmental Control Board, Charles Laing, and Iris Laing, and to appoint a referee to compute the amount due the plaintiff.
ORDERED that the order is modified, on the law, on the facts, and in the exercise of discretion, (1) by deleting the provisions thereof, upon renewal, denying those branches of the plaintiff's motion which were for summary judgment dismissing the defense and counterclaims asserted by the defendant Viola Nurse sounding in fraud and alleging violations of General Business Law § 349 and Real Property Law § 440–a, and for leave to enter a default judgment against the defendant the New York City Environmental Control Board, and substituting therefor a provision granting those branches of the plaintiff's motion, and (2) by deleting the provision thereof granting that branch of the cross motion of the defendant Viola Nurse which was for leave to amend her answer to assert additional allegations in support of her defense and counterclaims sounding in fraud and alleging violations of General Business Law § 349 and Real Property Law § 440–a, and substituting therefor a provision denying that branch of the cross motion; as so modified, the order is affirmed insofar as appealed from, with costs payable to the plaintiff by the defendant Viola Nurse.
Contrary to the plaintiff's contention, it failed to establish, prima facie, that it had standing to commence this foreclosure action. Accordingly, the Supreme Court, upon renewal, correctly denied that branch of its motion which was for summary judgment on the complaint insofar as asserted against the defendant Viola Nurse (hereafter Nurse) ( see HSBC Bank USA v. Hernandez, 92 A.D.3d 843, 844, 939 N.Y.S.2d 120; see generallyRPAPL 1302[1]; Deutsche Bank Natl. Trust Co. v. Spanos, 102 A.D.3d 909, 961 N.Y.S.2d 200).
However, we agree with the plaintiff's contention that, upon renewal, the Supreme Court erred in denying that branch of its motion which was for summary judgment dismissing Nurse's defense and counterclaim sounding in fraud. Upon renewal, the plaintiff demonstrated, prima facie, that Nurse ratified the subject note, mortgage, and collateral mortgage by making payments thereon to the plaintiff without protest, while she remained aware of the circumstances forming the basis of her defense and counterclaim sounding in fraud. In so doing, Nurse waived all such defenses and counterclaims ( see Moweta v. Citywide Home Improvements of Queens, 267 A.D.2d 438, 700 N.Y.S.2d 845; see also Wujin Nanxiashu Secant Factory v. Ti–Well Intl. Corp., 14 A.D.3d 352, 788 N.Y.S.2d 78; Davis & Davis v. Morson, 286 A.D.2d 584, 585, 730 N.Y.S.2d 293). In opposition, Nurse failed to raise a triable issue of fact.
We also agree with the plaintiff's contention that, upon renewal, the Supreme Court erred in denying that branch of its motion which was for summary judgment dismissing Nurse's counterclaim alleging a violation of General Business Law § 349. In opposition to the plaintiff's prima facie showing that the underlying transaction was private in nature, and that the allegedly deceptive acts were not aimed at the public at large ( see New York Univ. v. Continental Ins. Co., 87 N.Y.2d 308, 320, 639 N.Y.S.2d 283, 662 N.E.2d 763), Nurse failed to raise a triable issue of fact.
Further, upon renewal, the Supreme Court should have granted that branch of the plaintiff's motion which was for summary judgment dismissing Nurse's counterclaim alleging a violation of Real Property Law § 440–a, since the allegation that certain nonparties unlawfully held themselves out as real estate brokers without the requisite license is irrelevant to the circumstances surrounding Nurses's execution of the underlying mortgage, note, guaranty, and collateral mortgage. In any event, Nurse's conclusory allegations that certain persons allegedly violated Real Property Law § 440–a by virtue of their failure to secure the requisite real estate brokers' license were insufficient, upon renewal, to defeat that branch of the plaintiff's motion which was for summary judgment dismissing Nurse's counterclaim alleging a violation of Real Property Law § 440–a.
The Supreme Court improvidently exercised its discretion in granting Nurse leave to amend her answer to the extent that she sought to assert additional allegations in support of her defense and counterclaims sounding in fraud and alleging violations of General Business Law § 349 and Real Property Law § 440–a. Leave to amend a pleading should be freely given absent prejudice or surprise, and a court should not examine the merits or legal sufficiency of the proposed amendment unless it is palpably insufficient or patently devoid of merit on its face ( see Greco v. Christoffersen, 70 A.D.3d 769, 770, 896 N.Y.S.2d 363; Rosicki, Rosicki & Assoc., P.C. v. Cochems, 59 A.D.3d 512, 514, 873 N.Y.S.2d 184). The determination whether to grant such leave is within the Supreme Court's broad discretion, and the exercise of that discretion will not be lightly disturbed ( see Greco v. Christoffersen, 70 A.D.3d at 770, 896 N.Y.S.2d 363). Here, the proposed allegations supporting the defense and counterclaims sounding in fraud and alleging violations of General Business Law § 349 and Real Property Law § 440–a were palpably insufficient and patently devoid of merit ( see Bank of Smithtown v. 219 Sagg Main, LLC, 107 A.D.3d 654, 656, 968 N.Y.S.2d 95; Bloom v. Lugli, 102 A.D.3d 715, 718, 958 N.Y.S.2d 184).
Upon renewal, the Supreme Court properly denied that branch of the plaintiff's motion which was for leave to enter a default judgment against the defendants Caryn Nurse, Charles Laing, and Iris Laing. Although service upon the defaulting defendants of the notice of motion to renew was not required since the plaintiff moved for leave to enter a default judgment within one year of the defendants' default ( see Stoltz v. Playquest Theater Co., 257 A.D.2d 758, 759, 683 N.Y.S.2d 339; Milman & Shwergold v. Chase Manhattan Bank, 105 A.D.2d 652, 653, 481 N.Y.S.2d 368; Q.P.I. Rests. v. Slevin, 93 A.D.2d 767, 768, 461 N.Y.S.2d 334), the Supreme Court properly determined that the plaintiff failed to comply with the additional notice requirement of CPLR 3215(g)(3)(i) ( see Tsiporin v. Ziegel, 203 A.D.2d 451, 610 N.Y.S.2d 603; see also Bunch v. Dollar Budget, Inc., 12 A.D.3d 391, 783 N.Y.S.2d 829; Schilling v. Maren Enters., 302 A.D.2d 375, 376, 754 N.Y.S.2d 564; Rafa Enters. v. Pigand Mgt., Corp., 184 A.D.2d 329, 586 N.Y.S.2d 888). However, in seeking a default judgment against the defendant the New York City Environmental Control Board (hereinafter the ECB), the plaintiff was not required to comply with the additional notice requirement of CPLR 3215(g) because the ECB is neither a “natural person” (CPLR 3215[g][3][i] ), nor “a domestic or authorized foreign corporation” that had been served with process pursuant to Business Corporation Law § 306(b) (CPLR 3215[g][4][i] ). Accordingly, the Supreme Court erred in denying that branch of the plaintiff's motion which was for leave to enter a default judgment against the ECB. The plaintiff's remaining contentions either are without merit or need not be addressed in light of our determination.