TO BE ARGUED BY:

NICHOLAS M. MOCCIA, ESQ.

TIME REQUESTED: 15 MINUTES

Supreme Court of the State of New York

Appellate Division:Second Department

TRIBECA LENDING CORPORATION,

Plaintiff-Appellant, Appellate
-against-
Division
Case No.
2010-09133
ROSEMARY CORREA,
Defendant-Respondent,
-and-

AIDA CORREA, CITY OF NEW YORK PARKING VIOLATIONS

BUREAU, MARIA RUBIA and ANTONIO RUBIA,
Defendants.

BRIEF FOR DEFENDANT-RESPONDENT

LAW OFFICES OF ROBERT E. BROWN, P.C.

Attorneys for Defendant-Respondent
44 Wall Street, 12th Floor
New York, New York 10005
(212) 766-9779

On the Brief:
NICHOLAS M. MOCCIA
ROBERT E. BROWN

Supreme Court, Richmond County, Index No. 102011/07

DICK BAILEY SERVICE (212) 608-7666 (718) 522-4363 (516) 222-2470 (914) 682-0848 Fax: (718) 522-4024
1-800-531-2028
 TABLE OF CONTENTS
Page

COUNTER-STATEMENT OF THE QUESTION PRESENTED............................1

ARGUMENT .............................................................................................................3

I. JUSTICE MALTESE DID NOT ABUSE HIS DISCRETION,

UNDER THE TOTALITY OF THE CIRCUMSTANCES AND IN
THE FURTHERANCE OF JUSTICE, IN DETERMINING THAT
THE DEFENDANT-RESPONDENT HAS AN “EXCUSABLE
DEFAULT” FOR THE PURPOSE OF VACATING THE
PLAINTIFF-APPELLANT’S JUDGMENT OF FORECLOSURE ...............3

A. Plaintiff-Appellant misconstrues what constitutes an “excusable

default” within the meaning of CPLR 5015(a)(1)......................................3

i. Standard of Review.............................................................................4
ii. Justice Maltese did not abuse his discretion in finding that the
Defendant-Respondent had an “excusable default” within the
meaning of CPLR 5015(a)(1) notwithstanding his finding that
the Defendant-Respondent was personally served pursuant to
CPLR 308(1).......................................................................................5
iii. Justice Maltese did not abuse his discretion in basing his
finding of an excusable default on post-judgment events ..................7
iv. Justice Maltese did not abuse his discretion in finding that
improper or ineffective counsel in the residential foreclosure
context constitutes an excusable default within the meaning of
5015(a)(1) .........................................................................................10

B. Plaintiff-Appellant disregards the trial court’s inherent power to

grant relief from its own judgment for reasons not enumerated in
CPLR 5015(a)...........................................................................................14

II. JUSTICE MALTESE DID NOT ABUSE HIS DISCRETION IN

DETERMINING THAT THE DEFENDANT-RESPONDENT HAD
A MERITORIOUS DEFENSE FOR THE PURPOSE OF CPLR
5015(a) ...........................................................................................................16

CONCLUSION........................................................................................................18
i
 COUNTER-STATEMENT OF THE QUESTION PRESENTED

I. Did the Honorable Joseph J. Maltese, J.S.C., (“Justice Maltese”) abuse his

discretion, under the totality of the circumstances and in the furtherance of

justice, in determining that Defendant-Respondent had an “excusable

default” within the meaning of CPLR 5015(a)(1) and in light of the inherent,

non-statutory power courts have to relieve parties of judgments entered on a

default? Answer: No. Justice Maltese did not abuse his discretion, under

the totality of the circumstances and in the furtherance of justice, in

determining that the Defendant-Respondent had an “excusable default”

within the meaning of CPLR 5015(a)(1). Moreover, the trial court in any

case has the inherent, non-statutory power to relieve the Defendant-

Respondent of the judgment of foreclosure entered on default even in the

absence of any specific grounds set forth in CPLR 5015(a)(1) since the

statute merely codifies some principal grounds and is not exhaustive of the

court’s power.

II. Did Justice Maltese abuse his discretion in determining that the Defendant-

Respondent made a prima facie showing that it had meritorious defenses

warranting a vacatur of the Plaintiff-Appellant’s judgment of foreclosure?

Answer: No. Justice Maltese did not abuse his discretion in finding a

meritorious defense even in the absence of “admissible evidence”, since a

1
lesser showing, namely a prima facie showing, is sufficient to satisfy the

“meritorious defense” requirement of CPLR 5015(a)(1).

2
 ARGUMENT

I. JUSTICE MALTESE DID NOT ABUSE HIS DISCRETION, UNDER

THE TOTALITY OF THE CIRCUMSTANCES AND IN THE
FURTHERANCE OF JUSTICE, IN DETERMINING THAT THE
DEFENDANT-RESPONDENT HAS AN “EXCUSABLE DEFAULT” FOR
THE PURPOSE OF VACATING THE PLAINTIFF-APPELLANT’S
JUDGMENT OF FORECLOSURE

A. Plaintiff-Appellant misconstrues what constitutes an “excusable

default” within the meaning of CPLR 5015(a)(1)

CPLR 5015(a)(1) states in pertinent part:

(a) On motion. The court which rendered a judgment or

order may relieve a party from it upon such terms as may
be just, on motion of any interested person with such
notice as the court may direct, upon the ground of:

1. excusable default, if such motion is made within

one year after service of a copy of the judgment or
order with written notice of its entry upon the
moving party, or, if the moving party has entered
the judgment or order, within one year after such
entry;

The Plaintiff-Appellant misconstrues the application of CPLR 5015(a) in the

following manner:
1. that the trial court can “err” with regard to matters of judicial

discretion such as a finding of an excusable default or a meritorious

defense for the purposes of vacating a default judgment pursuant to

CPLR 5015(a);

3
 2. that it is an abuse of discretion for the trial court to make a finding of

an excusable default where the Defendant-Respondent was personally

served pursuant to 308(1);

3. that it is an abuse of discretion for the trial court to base its finding of

an excusable default on post-judgment of foreclosure events;

4. that it is an abuse of discretion for the trial court to base its finding of

an excusable default on repeated instances of ineffective and improper

legal counseling in the residential foreclosure context when such

instances are reflected in the record and based on the trial court’s

findings of fact rather than the “mere allegations” of the Defendant-

Respondent.

i. Standard of Review

It is worth highlighting that the Plaintiff-Appellant misconstrues the standard

of review upon which this appeal ought to be based. The Plaintiff-Appellant

repeatedly—and inappropriately—poses the question presented as whether the trial

court “erred in its determination”. The standard of review is an “abuse of

discretion” standard, since a motion to be relieved of a default in answering is

addressed to the sound discretion of the court, and so discussion as to whether the

trial court “erred” is misplaced. Moreover, the exercise of such discretion

4
generally should not be disturbed if there is support in the record therefor. See

Mondrone v Lakeview Auto Sales & Serv., 170 A.D.2d 586 (2d Dep’t 1991); see

also Gleissner v. Singh, 264 A.D.2d 811 (2d Dep’t 1999).

ii. Justice Maltese did not abuse his discretion in finding that the
Defendant-Respondent had an “excusable default” within the
meaning of CPLR 5015(a)(1) notwithstanding his finding that the
Defendant-Respondent was personally served pursuant to CPLR
308(1)

In the first instance, the Plaintiff-Appellant seems to suggest that the because

Justice Maltese held that the Defendant-Respondent was served pursuant to CPLR

308(1), and because the Defendant-Respondent’s first attempt to appear was after

the Judgment of Foreclosure was rendered, Justice abused his discretion in finding

that the Defendant-Respondent had an “excusable default” within the meaning of

CPLR 5015(a). See Brief for Plaintiff-Appellant at pp. 17-18. The Appellant-

Plaintiff cites no authority for the proposition that it is an abuse of discretion for a

trial court to find an excusable default where there is a finding of service pursuant

to CPLR 308(1) because no such authority exists.

The Plaintiff-Appellant’s contention that service pursuant to CPLR 308(1)

precludes the possibility of an excusable default is clearly belied by the statutory

scheme set in place by the CPLR for vacating default judgments. A litigant may

seek to vacate a default judgment pursuant to CPLR 317 “upon a finding of the

5
court that he did not personally receive notice of the summons in time to defend

and has a meritorious defense.” Accordingly, a lesser showing is required for a

vacatur pursuant to CPLR 317, because of the litigant’s failure to “personally

receive notice of the summons”—i.e. failure to be personally served pursuant to

CPLR 308(1). See Larman v Russel, 240 A.D.2d 473 (2d Dep’t 1997) (Appellants

were entitled, under CPLR 317, to vacatur of their default where they proved that

they were not personally served pursuant to CPLR 308(1) and that they had a

meritorious defense). Where, in contrast, a litigant is personally served pursuant to

CPLR 308(1), a litigant cannot rely of CPLR 317 for a vacatur of a default

judgment, but instead must resort to CPLR 5015(a), which requires an additional

showing as, for instance, an “excusable default” in the case of CPLR 5015(a)(1).

Nevertheless, CPLR 5015(a)(1) is available to any litigant who demonstrates an

excusable default and a meritorious defendant regardless of the means of service.

Oppenheimer v. Westcott, 47 N.Y.2d 595, 602, 419 N.Y.S.2d 908, 393 N.E.2d 982

(1979); Rockland Bakery, Inc. v. B.M. Baking Co., Inc. 2011 WL 1631437, 2* (2d

Dep’t 2011). West Coast Realty Services, Inc. v. Holness, 16 Misc.3d 1117(A),

847 N.Y.S.2d 899 (Table), 2007 N.Y. Slip Op. 51449(U) (Sup. Ct. Kings County

2007); see Seigel, NEW YORK PRACTICE (4th ed.) at §108.

The lesser showing required by CPLR 317 is intelligible only to the extent

that lack of personal service pursuant to CPLR 308(1) itself already constitutes a

6
reasonable excuse for a default. It does not follow, however, that the converse is

true—namely, that a finding of personal service bars the further finding that there

was excusable default pursuant to CPLR 5015(a)(1). Regardless, the Plaintiff-

Appellant makes much of the fact that the Defendant-Respondent was found to be

personally served, even though such a finding is not dispositive as to whether the

trial court abused its discretion in vacating the Plaintiff-Appellant’s default

judgment. Most notably, the Plaintiff-Appellant cites no authority to that effect.

Likewise, additional service pursuant to CPLR 3215(g) does not bar a

finding of an excusable default pursuant to CPLR 5015(a)(1), and even if it did,

there is no affidavit of service in the record that an additional summons and

complaint were served on the Defendant-Respondent pursuant to CPLR 3215(g).

Each and every time the Plaintiff-Appellant references additional service pursuant

to CPLR 3215(g), the Plaintiff-Appellant makes no reference to the record

whatsoever, because it cannot do so.

iii. Justice Maltese did not abuse his discretion in basing his finding of
an excusable default on post-judgment events

Next the Plaintiff-Appellant contends that in order to satisfy the excusable

default requirement of CPLR 5015(a)(1), the Defendant-Respondent must

demonstrate “a reasonable excuse for a default in appearance prior to entry of the

Judgment of Foreclosure” (Emphasis supplied). See Brief for Plaintiff-Appellant

7
at 18ff. In support of its position the Plaintiff-Appellant cites Perellie v. Crimson’s

Restaurant Ltd, 108 A.D.2d 903, 485 N.Y.S.2d 789 (2d Dep’t 1985). Besides the

fact that the Perellie case does not pertain to a foreclosure action, it is noteworthy

that there is no discussion whatsoever of an “excusable default” being limited to a

“reasonable excuse for a default in appearance prior to entry of judgment”. In

Perellie, this Court noted that the Defendants “failed to offer any excuse” and,

moreover, did not have a meritorious defense. Instead, this Court notes:

The determination of what constitutes a reasonable

excuse for a default “lies within the sound discretion of
the trial court” (De Vito v. Marine Midland Bank, 100
AD2d 530, 531; Vernon v. Nassau County Med. Center,
102 AD2d 852; CPLR 2005, 3012 [d]).

See Perellie, 108 A.D.2d at 904. No qualification as to the substance of a

reasonable excuse is made, nor is any procedural benchmark set as to when the

events constituting the reasonable excuse must take place. Contrary to the

Plaintiff-Appellant’s contention that the “reasonable excuse” must pertain to pre-

judgment events or activity, there is wide-spread authority that courts do indeed

consider post-judgment events or activity. For instance, in Bekker v. Fleischman,

35 A.D.3d 334, 825 N.Y.S.2d 270 (2d Dep’t 2006), this Court not only noted that

the defendant failed to submit any excuse for his failure to respond to the

plaintiff’s motion for a default judgment, which pertains to activity prior to the

entry of a judgment, but this Court also took into consideration the defendant’s

8
“lengthy delay in moving to vacate the order granting the plaintiff’s motion”,

which pertains to activity (or inactivity, as the case may be) subsequent to the

rendering of a judgment. See also the more recently decided Alterbaum v.

Shubert Organization, Inc., 80 A.D.3d 635, 636, 914 N.Y.S.2d 681 (2d Dep’t

2011), which also takes into consideration the lengthy delay between the granting

of a default judgment and the defendant’s motion to vacate. In these cases, the

events contemplated include post-judgment events, not exclusively pre-judgment

events.

Accordingly, Justice Maltese did not abuse his discretion by considering

post-judgment events in order to make a finding of an excusable default pursuant

to CPLR 5015(a)(1), and the Plaintiff-Appellant can cite no authority indicating

that such would be an abuse of discretion. It is, however, an abuse of discretion

for a court to vacate pursuant to CPLR 5015(a)(1) where no excuse or meritorious

defense is offered by the litigant. In the instant matter, this is clearly not the case.

Whether there is a reasonable excuse for a default is a discretionary, sui generis

determination to be made by the court based on all relevant factors, including the

extent of the delay, whether there has been prejudice to the opposing party,

whether there has been willfulness, and the strong public policy in favor of

resolving cases on the merits. See Harcztark v. Drive Variety, Inc. 21 A.D.3d

876, 877, 2005 N.Y. Slip Op. 06584 (2d Dep’t 2005); see also Orwell Bldg. Corp.

9
v Bessaha, 5 A.D.3d 573 (2d Dep’t 2004). These are the very factors that Justice

Maltese took into consideration in rendering his decision to vacate the judgment

of foreclosure and sale here at issue.

iv. Justice Maltese did not abuse his discretion in finding that improper
or ineffective counsel in the residential foreclosure context
constitutes an excusable default within the meaning of 5015(a)(1)

The basis for the trial court’s vacatur of the Plaintiff-Appellant’s default

judgment is, in part, a finding that “Rosemary Correa was not properly counseled

to her detriment.” See R. at 13. Justice Maltese’s finding is not based on “bare

allegations”, but finds ample support in the record. Justice Maltese acknowledges

that “while bare allegations of incompetence on the part of prior counsel are

insufficient to establish an excusable default under CPLR 5015(a), the record

supports a finding that the Defendant was ineffectively served by counsel.” See

R. at 13-14.

Firstly, counsel for Plaintiff-Appellant falsely asserts that the Defendant-

Respondent intentionally defaulted in appearing in the foreclosure action for two

(2) years. See Plaintiff-Appellant’s brief at p. 21. Plaintiff-Appellant claims that

the Defendant-Respondent was personally served the summons and complaint on

June 13, 2007. The Defendant-Respondent first appeared on March 17, 2008,

when Craig A. Fine, Esq., filed an Emergency Order to Show Cause to stay the

10
Plaintiff-Appellant’s first foreclosure sale scheduled for March 18, 2008. See R.

at 180-187. Accordingly, only ten (10) months had elapsed from the date of

service of the summons and complaint to the Defendant-Respondent’s first

appearance. In what appears to be an outrageous display of gamesmanship,

counsel for the Plaintiff-Appellant apparently starts to measure the time for

appearing from the date of the Defendant-Respondent’s purported default in

payment of the mortgage, not from the date of service of the summons and

complaint on June 13, 2007.

On March 17, 2008, Craig A. Fine, Esq., filed an Emergency Order to

Show Cause to stay the Plaintiff-Appellant’s first foreclosure sale scheduled for

March 18, 2008. See R. at 180-187. The purpose of this Emergency Order to

Show Cause was to give the Defendant-Respondent an opportunity to refinance

the mortgage here at issue with a new mortgage approved by HCI Mortgage. See

R. at 186. It is noteworthy that Mr. Fine neglected—to the Defendant-

Respondent’s detriment—to pray for a vacatur of the default judgment and an

opportunity to serve an answer/counterclaim on the Plaintiff-Appellant. In this

regard, Justice Maltese opines as follows:

But [Craig A. Fine, Esq.] took no steps to file an answer or interpose

any defense on her behalf. While it is not specifically argued by the
defendant, it is clear from the record that Rosemary Correa was
not properly counseled to her detriment.

11
(Emphasis supplied); see R at 13. Plaintiff-Appellant speculates, without any

basis in the record, that Mr. Fine neglected to ask for these additional items of

relief because doing so would be frivolous and sanctionable. See Plaintiff-

Appellant’s Brief at 33. It is noteworthy that Mr. Fine inexplicably withdrew the

Emergency Order to Show Cause two months later on May 14, 2008 (see R. at

188), notwithstanding the fact that Mr. Fine failed to assist the Defendant-

Respondent in refinancing her mortgage, or otherwise find a satisfactory exit

strategy for the Defendant-Respondent to the foreclosure action. Indeed, Mr. Fine

undertook the representation of the Defendant-Respondent for a mere two

months, from March 14, 2008, to May 14, 2008, and did not bother to make an

application to be relieved as counsel after he withdrew the Emergency Order to

Show Cause. He just stopped actively representing the Defendant-Respondent

after May 14, 2008.

Rather than speculate about what Justice Maltese might have found

regarding the motivations of Mr. Fine, the more appropriate question is whether

Justice Maltese, in finding that Mr. Fine inadequately counseled the Defendant-

Respondent, abused his discretion by finding an excusable default on that basis.

Again, his finding is not based on “bare allegations”, but is grounded in

documentary evidence contained in the record as well as findings of fact made by

Justice Maltese after having dealt with Mr. Fine directly and observing the course

12
of action (or lack thereof) that he took on behalf of the Defendant-Respondent.

See R. at 13-14.

Next, the Plaintiff-Appellant argues that Justice Maltese “misconstrued the

law” by finding that the Defendant-Respondent’s reliance on a non-attorney,

acting as an attorney before the Court, constituted a reasonable excuse for a

default. The Plaintiff-Appellant troublingly asserts without authority:

The law provides that defendants may act pro-se and may seek the
assistance of attorneys and non-attorneys in doing so. There is
nothing fundamentally wrong with that unless the IAS Court [sic]1
found that a non-attorney was acting before the court as an attorney. It
did not make such a determination.

See Plaintiff-Appellant’s Brief at 36-37.

To the contrary, Justice Maltese did in fact make such a determination. He

noted that a licensed realtor, Herricson Torres, assisted the Defendant-Respondent

in preparing the second Order to Show Cause, filed February 9, 2009. See R. at

164-174. In this regard Justice Maltese in the strongest of terms held that “Mr.

Torres’ actions are the very definition of the unauthorized practice of law.” See R.

at 14 (Emphasis supplied).

Again the question arises, did Justice Maltese abuse his discretion under the

totality of the circumstances and in the interest of justice in finding that the

1
The Plaintiff-Appellant repeatedly refers to the trial court as an IAS Court. The Supreme
Court, Richmond County, does not participate in the IAS system, but refers to its trial and
motion parts as “DCM Parts”.

13
Defendant-Respondent’s reliance on Torres’ “expertise” contributed, in part, to a

finding of an excusable default. The answer to that question is necessarily “no”.

Justice Maltese did not abuse his discretion, especially when one considers this

particular incident from the context of a larger, macro perspective. Specifically,

Justice Maltese cites “the rampant economic opportunism of a growing industry

that preys on those least able to support it.” See R. at 14. Early in his decision,

Justice Maltese observes:

While the public only begins to learn of the causes of the current
rampant foreclosure filings, the courts have already begun to see a
cadre of unscrupulous individuals promising foreclosure cure-alls that
prey upon those already approaching an economic rock bottom.

See R at 12.

Accordingly, based on the totality of the circumstance and in the interest of

justice, Justice Maltese did not abuse his discretion in finding that Defendant-

Respondent’s ill-advised dealing with Herricson Torres—whose actions are the

very definition of the unauthorized practice of law—contributed to an excusable

default.

B. Plaintiff-Appellant disregards the trial court’s inherent power to

grant relief from its own judgment for reasons not enumerated in
CPLR 5015(a)

It is well-settled that a trial court possesses statutory and inherent power to

grant relief from its own judgment. See Woodson v. Mendon Leasing Corp., 100

N.Y.2d 62, 68, 790 N.E.2d 1156, 1160, 760 N.Y.S.2d 727, 731 (2003); see also the

14
often cited Ladd v. Stevenson, 112 N.Y. 325, 332, 19 N.E. 842 (1889). In

Woodson, the Court of Appeal opines as follows:

Under CPLR 5015(a), a court is empowered to vacate a

default judgment for several reasons, including excusable
neglect; newly-discovered evidence; fraud,
misrepresentation or other misconduct by an adverse
party; lack of jurisdiction; or upon the reversal,
modification or vacatur of a prior order. These categories
represent a codification of the principal grounds upon
which courts have traditionally vacated default
judgments as part of their “inherent discretionary power”
(see Siegel, PRACTICE COMMENTARIES, MCKINNEY'S
CONS. LAWS OF N.Y., Book 7B, CPLR C5015:11, at 476
[1992]). It thus follows that section 5015(a) does not
provide an exhaustive list as to when a default
judgment may be vacated. Indeed, the drafters of that
provision intended that courts retain and exercise
their inherent discretionary power in situations that
warranted vacatur but which the drafters could not
easily foresee (see id.; 3d PRELIMINARY REPORT OF
ADVISORY COMM. ON PRACTICE AND PROCEDURE, 1959
N.Y. Legis Doc. No. 17, at 204);

See Woodson, 100 N.Y.2d at 68; (Emphasis supplied).

It is clear that the enumerated grounds in CPLR 5015(a) are not intended to

be comprehensive or exclusive since a trial court possesses inherent, discretionary

power to vacate its own judgment for sufficient reason and in the interests of

substantial justice. The provisions of the CPLR were not intended in any way to

limit this inherent power. Delagi v. Delagi, 34 A.D.2d 1005, 313 N.Y.S.2d 265

(2d Dept’ 1970).

In Delagi, this Court holds with reference to CPLR 5015(a) as follows:

15
 The inherent power of the court to relieve a party from
the operation of a judgment in the interests of substantial
justice has been continually recognized in this State over
the past hundred years and the provisions of the CPLR
were not intended in any way to limit this power. ‘In all
these cases, rules and precedents are of little value as
guides to the exercise of judicial discretion. * * *
exceptional cases continually arise in which the
development of truth and the promotion of
substantial justice will furnish sufficient ground for
granting new trials, although they do not come within
any former precedent, and consequently not within the
operation of any principle or rule established for the
guidance of the court, in the exercise of its discretion’.

Delagi v. Delagi, 34 A.D.2d at 1007; (Citations omitted)(Emphasis supplied).

Not surprisingly, the Plaintiff-Appellant conveniently ignores the trial

court’s inherent power to vacate its own judgments. Nevertheless, the trial court is

justified in exercising its inherent power in the instant matter in light of the

rampant economic opportunism that the trial court has directly observed in the

residential foreclosure context. Indeed, Justice Maltese makes reference to this at

length in his Decision and Order.

II. JUSTICE MALTESE DID NOT ABUSE HIS DISCRETION IN

DETERMINING THAT THE DEFENDANT-RESPONDENT HAD A
MERITORIOUS DEFENSE FOR THE PURPOSE OF CPLR 5015(a)

Again, the Plaintiff-Appellant ignores the appropriate standard of review by

arguing that Justice Maltese “erred” in his determination that the Defendant-

Respondent proffered a meritorious defense sufficient to satisfy the requirements

16
of CPLR 5015(a). The standard or review, as noted above, for the purposes of this

appeal is “abuse of discretion”, not error in determination. While the Plaintiff-

Appellant correctly observes that a determination of what constitutes a reasonable

excuse and meritorious defense is within the sound discretion of the court (Anamdi

v. Anugo, 229 A.D. 408, 644 N.Y.2d 804 (2d Dep’t 1996)), the Plaintiff-Appellant

inappositely argues that the meritorious defense proffered by the Defendant-

Respondent was “inadmissible hearsay”, and therefore insufficient to meet the

threshold to establish that the Defendant-Respondent had a meritorious defense.

Accordingly, the Plaintiff-Appellant contends, without authority, that Justice

Maltese “erred” in his determination by basing his finding of a meritorious defense

on “inadmissible hearsay”.

In order to satisfy the meritorious defense requirement of CPLR 5015(a), a

litigant need not satisfy the rules of evidence concerning admissibility used at trial,

or satisfy any burden of proof. See Anamdi v. Anugo, 229 A.D.2d 408, 409 (2d

Dep’t 1996). Indeed, the litigant need not prove anything; rather, it is sufficient for

a litigant to set forth facts sufficient to establish that such a claim is meritorious—

i.e. to make a prima facie showing. See id. at 409. Accordingly, any discussion of

“inadmissible hearsay” is misplaced and irrelevant.

In the instant matter, Justice Maltese cites but one of many meritorious

defenses asserted by Defendant-Respondent. See R. at 15. In addition to

17
violations of the New York State Banking Law §6, the Defendant-Respondent also

alleges facts sufficient to establish the following meritorious defenses: (a) lack of

standing and capacity (see Affirmation of Robert Brown at R. 233-234, ¶14-17);

(b) defective notice of sale (see Affirmation of Robert Brown at R. 235, ¶18); and

(c) Plaintiff waived its acceleration of the mortgage debt by accepting payment

from the Defendant-Respondent after the foreclosure action was commenced (see

Affirmation of Robert Brown at R. 237, ¶22-23; see also Affidavit of Rosemary

Correa at R. 241, ¶8).

Accordingly, the Plaintiff-Appellant cannot reasonably argue that Justice

Maltese abused his discretion in making a finding that the Defendant-Respondent

had a meritorious defense. The meritorious defense grounded in the Plaintiff-

Appellant’s violation of New York Bank Law §6 cited by Justice Maltese is but

one of many meritorious defenses asserted by the Defendant-Respondent. Thus, he

did not abuse his discretion in making a finding of a meritorious defense,

notwithstanding the Plaintiff-Appellant’s insistence that Defendant-Respondent

meet a burden of proof appropriate for trial, rather than a motion to vacate a default

judgment.

CONCLUSION

The Plaintiff-Appellant repeatedly and incorrectly asserts that Justice

Maltese “erred in determining” that the Defendant-Respondent had an excusable

18
default and a meritorious defense for the purpose of CPLR 5015(a)(1). The

standard of review is “abuse of discretion”, and based on the foregoing it is clear

that Justice Maltese did not abuse his discretion in finding an excusable default and

a meritorious defense when considered under the totality of the circumstances and

in the interest of justice. Moreover, the trial court in any case has the inherent

power to vacate its own judgments in appropriate circumstances.

The Plaintiff-Appellant, Tribeca Lending Corporation, repeatedly bewails

how it has been “incredibly prejudiced” by the trial court’s “improvident exercise

of discretion” and the “dilatory” tactics of the Defendant-Respondent; however, the

Plaintiff-Appellant cannot truly show any prejudice beyond being delayed in

recovering the amount it claims to be owed. In the meantime, interest, at a rate of

12.99% (see Affidavit of Debt, R. at 86; see also Affidavit of Rosemary Correa, R.

at 240), is still accruing on the principal, additional interest is being charged on

arrearages, outlays for property tax and insurance and other costs are being

recapitalized into the principal balance—all, ultimately, at the expense of the

Defendant-Respondent, not the Plaintiff-Appellant.

It is also worth noting that the Defendant-Respondent has owned the

premises, from which the foreclosure action arises, for almost 20 years. She is not

a real estate speculator, who was unable to “flip” her latest investment property

because the real estate bubble burst; rather, she met with economic hardship due to

19
the economic downturn. See Hardship Letter of Rosemary Correa, R. at 172. The

Defendant-Respondent shares her home, with her mother, a 72 year old woman, a

47 year old mentally challenged adult, her husband and three daughters. R. at 172.

It is evident that the Defendant-Respondent has made numerous attempts to save

her home by way of refinance and loan modification, but has been misled by ill-

intentioned individuals. R. at 172. Again, the Defendant-Respondent will

ultimately be responsible for the debt claimed by the Plaintiff-Appellant—a debt

with interest that is still accruing at an exorbitant rate of 12.99%. Accordingly, the

prejudice that will be suffered by the Defendant-Respondent is substantial in the

event she loses her home without ever having an opportunity to defend the

foreclosure—especially, in light of the public policy which favors the resolution of

cases on the merits. See Harris v. City of New York, 30 A.D.3d 461, 817 N.Y.S.2d

99 (2d Dep’t 2006).

While the Plaintiff-Appellant is to a certain extent correct that “obligations

must not be undermined by judicial sympathy” (see the oft-cited Graf v. Hope

Building, 254 N.Y. 1, 4, 171 N.E. 884, (1930)), there is also a strong public policy

to keep homeowners in their homes to the extent that this is possible. Indeed, it is

ironic that the Plaintiff-Appellant should cite Graf v. Hope Building in support of

its position, since this case is most famous not so much for the majority’s opinion

20
(which is admittedly still good law), but for the dissent of Justice Cardozo wherein

he opines in relevant part:

There is no undeviating principle that equity shall enforce the

covenants of a mortgage, unmoved by an appeal ad misericordiam,
however urgent or affecting. The development of the jurisdiction of
the chancery is lined with historic monuments that point another
course. Equity declines to treat a mortgage upon realty as a
conveyance subject to a condition, but views it as a lien irrespective of
its form. Trimm v. Marsh, 54 N. Y. 599, 13 Am. Rep. 623. Equity
declines to give effect to a covenant, however formal, whereby in the
making of a mortgage, the mortgagor abjures and surrenders the
privilege of redemption. Mooney v. Byrne, 163 N. Y. 86, 93, 57 N. E.
163. Equity declines in the same spirit, to give effect to a covenant,
improvident in its terms, for the sale of an inheritance, but compels
the buyer to exhibit an involuntary charity if he is found to have taken
advantage of the necessities of the seller. Pomeroy, Eq. Jur. vol. 2, §
953. Equity declines to give effect to a covenant for liquidated
damages if it is so unconscionable in amount as to be equivalent in its
substance to a provision for a penalty. Kothe v. R. C. Taylor Trust,
280 U. S. 224, 50 S. Ct. 142, 74 L. Ed. 382. One could give many
illustrations of the traditional and unchallenged exercise of a like
dispensing power. It runs through the whole rubric of accident and
mistake. Equity follows the law, but not slavishly nor always. Hedges
v. Dixon County, 150 U. S. 182, 192, 14 S. Ct. 71, 37 L. Ed. 1044. If it
did, there could never be occasion for the enforcement of equitable
doctrine. 13 Halsbury, Laws of England, p. 68.

See Graf v. Hope Bldg. Corp. 254 N.Y. at 8 (1930). The spirit of Justice

Cardozo’s Depression Era dissent is strongly reflected in contemporary policy, and

is concretely manifested in the tremendous resources that the State of New York

has invested in the mandatory foreclosure settlement conferences and in providing

21
free legal services for those facing foreclosure who cannot afford attorneys.2

Justice Arthur M. Schack of Kings County has offered a succinct, contemporary

iteration of this policy concern as follows:

If you are going to take away someone’s house, everything should be

legal and correct … I don’t want to put a family on the street unless
it’s legitimate.

See Michael Powell, “A ‘Little Judge’ Who Rejects Foreclosures, Brooklyn Style,”

New York Times (August 30, 2009). Clearly, this policy concern is grounded not

merely on some warm and fuzzy sentimentality for “unsophisticated” homeowners,

but has immense practical import, both for the individual homeowner and for the

community. Moreover, judicial cognizance of such policy concerns is a proper

object of consideration in the exercise of judicial discretion—all the more so when,

as here, the trial court is sitting in equity.

In addition to the rightful concern of the equities of the individual case and

the judicial preference for resolving a case on the merits, it is common knowledge

that home vacancies due to foreclosures are having a destabilizing effect on

communities. Spill-over effects include increased inventories of abandoned or

vacant properties, demolitions, building code violations, prolonged situations of

“legal limbo” (untidy property deeds, liens, etc.), diminished property tax rolls or

2
See R. at 14, n. 8, in Justice Maltese’s Decision and Order wherein he references hearings held
by Chief Judge Lippman regarding the availability of aid to provide civil legal services for those
facing foreclosure.

22
unpaid property taxes, blighting effects (graffiti, property crimes, overgrown

lawns, accumulated debris) and additional policing in neighborhoods with vacant

homes.

Accordingly, Justice Maltese’s decision is not the idiosyncratic product of

judicial activism, but is reminiscent of the policy concern that finds one of its

earliest and most famous articulations in the Cardozo dissent in Graf. The trial

courts are vested with the discretion to, inter alia, vacate their own judgments so

that the trial courts have the flexibility to consider such policy concerns in a

manner that would not otherwise be possible if they were, in every instance,

limited by the mechanical severity of a checklist of bright line rules.

Accordingly, the Defendant-Respondent respectfully requests, in the interest

of justice, that this Court affirm the Decision and Order of the trial court signed by

the Honorable Joseph J. Maltese, J.S.C., on August 3, 2010, as a proper exercise of

judicial discretion.

Dated: New York, New York

June 3, 2011.

Law Offices of Robert E. Brown, P.C.

By:
Nicholas M. Moccia
44 Wall Street, 12th Floor
New York, New York 10005
(212) 766-9779

23
 CERTIFICATE OF COMPLIANCE

PURSUANT TO 22 NYCRR § 670.10.3(F)

The foregoing brief was prepared on a computer. A proportionally spaced

typeface was used, as follows:

Name of typeface: Times New Roman

Point size: 14

Line spacing: Double

The total number of words in the brief, inclusive of point headings and
footnotes and exclusive of pages containing the table of contents, table of citations,
proof of service, certificate of compliance, or any authorized addendum containing
statutes, rules, regulations, etc., is 5,221.

DB