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U.S. Bank N a. v Nyarkoha w

U.S. Bank N a. v Nyarkoha w

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U.S. Bank N A. v Nyarkoha
2012 NY Slip Op 50353(U)Decided on February 29, 2012Supreme Court, Queens CountyMarkey, J.Published byNew York State Law Reporting Bureaupursuant to Judiciary Law §431.This opinion is uncorrected and will not be published in the printed Official Reports.
Decided on February 29, 2012
Supreme Court, Queens CountyU.S. Bank National Association, as Trustee, for CSFB ARMT2006-2, 3476 Stateview Boulevard, Ft. Mill, SC 29715, Plaintiff,againstDorcas Nyarkoha, et al., Defendants.
13409/2009Appearances of Counsel:For the Plaintiff:Hogan Lovells U.S. LLP, by Allison J. Schoenthal, Danielle Mastriano, &Nicole Schiavo, Esqs., 875 Third Avenue, New York, NY 10022For Defendant Dorcas Nyarkoha: Sumani Lanka, Esq., The Legal Aid Society - - Civil Practice,120-46 Queens Boulevard, Kew Gardens, New York 11415-1204Charles J. Markey, J.
.S. Bank N A. v Nyarkoha (2012 NY Slip Op 50353(U))http://www.courts.state.ny.us/reporter/3dseries/2012/2012_50353.htm1 of 63/7/2012 7:16 PM
The following papers numbered 1 to 13 read on this motion by defendant DorcasNyarkoha, pursuant to CPLR 3012(d), for leave to serve and file a late answer, as proposed.
Papers Numbered 
Notice of Motion - Affidavits - Exhibits .........................................................................1-4Answering Affidavits - Exhibits ....................................................................................5-10Reply Affidavits ...........................................................................................................11-13This mortgage foreclosure action raises two controversial issues that will persist in the caselaw, with incongruent and inconsistent results, until a definitive ruling is eventually made by theNew York Court of Appeals. The first issue, especially in the area of mortgage foreclosures,where the statutory framework provides for a conference to all answering defendants in anattempted foreclosure of a residential mortgage (
CPLR 3408, L 2008, ch 472, § 3), iswhether or not a non-answering defendant's failure to answer timely be excused because he orshe relied on ongoing settlement talks, discussions, and negotiations. The second thorny issue iswhether or not a plaintiff bank's alleged lack of standing is a meritorious defense that may beasserted by a defendant seeking permission to file a late answer.Defendant Nyarkoha, in effect, moves to vacate her default in answering the complaint andfor leave to serve a late verified answer as proposed. She claims that her default is excusable,insofar as she believed her engagement in settlement negotiations with plaintiff's[*2]servicingagent, Wells Fargo Home Mortgage Inc. d/b/a America's Servicing Company ("ASC"), excusedher from taking further action with respect to the suit. Defendant Nyarkoha also claims she hasmeritorious defenses and counterclaims. The plaintiff opposes the motion.A defendant who has failed to timely answer the complaint must provide a reasonableexcuse for the default and demonstrate a potentially meritorious defense to the action, whenmoving to compel the acceptance of an untimely answer (
see, Palmer Ave. Corp. v. Malick,
91AD3d 853[2nd Dept. 2012];
 Lipp v Port Auth. of NY & N.J.
, 34 AD3d 649[2nd Dept. 2006];
 Juseinoski v Board of Educ. of City of NY 
, 15 AD3d 353, 356 [2nd Dept. 2005];
see also, Rodriguez v Triani
, 28 Misc 3d 130(A), 2010 WL 2802747, 2010 NY Slip Op 51256(U) [AppT. 2nd Dept. 2010]). The determination of what constitutes a reasonable excuse for a default in
.S. Bank N A. v Nyarkoha (2012 NY Slip Op 50353(U))http://www.courts.state.ny.us/reporter/3dseries/2012/2012_50353.htm2 of 63/7/2012 7:16 PM
answering lies within the sound discretion of the court (
see, Adolph H. Schreiber Hebrew Academy of Rockland, Inc. v Needleman
, 90 AD3d 791[2nd Dept. 2011];
 Maspeth Fed. Sav. & Loan Assn. v McGown
, 77 AD3d 889[2nd Dept. 2010];
Grutman v Southgate At Bar Harbor  Home Owners' Assn.
, 207 AD2d 526, 527 [2nd Dept. 1994]).Defendant Nyarkoha states that she was out of the country at the time of the service of thecopy of the summons and complaint, but after her return on June 28, 2009, contacted ASC,seeking to obtain a modification of the subject mortgage. ASC, which participated in the federalHome Affordable Modification Program ("HAMP"), accepted her application for loanmodification under HAMP. Defendant Nyarkoha entered into a three-month Trial Period Planwith ASC through HAMP, commencing October 1, 2009, and attended seven conferences heldin the Residential Foreclosure Part, wherein she was represented by the Legal Aid Society forthe purpose of the conferences.While the case was assigned to that Part, defendant Nyarkoha twice moved, in effect, tostop the running of interest on the mortgage debt. Both motions were denied. In addition,defendant Nyarkoha filed, on July 1, 2010, a
 pro se
motion for leave to serve an answer to thecomplaint, which motion was repeatedly adjourned. The case was released from the ResidentialForeclosure Part on December 1, 2010.On December 28, 2010, the Legal Aid Society served and filed a notice of appearance onbehalf of defendant Nyarkoha in this action. On January 27, 2011, defendant Nyarkoha servedand filed a notice, indicating her withdrawal of the pro se motion for leave to serve a late answer,without prejudice to her right to refile it. The instant motion was filed six months later.Regarding defendant Nyarkoha's argument that she relied on ongoing settlement discussionsand negotiations, the cases are mixed. A number of cases show a great reluctance, if not loathing,for such a defense as an excuse for not taking concrete action in a litigation, such as filing ananswer (
see, e.g., Community Preservation Corp. v Bridgewater Condominiums, LLC,
89AD3d 784[2nd Dept. 2011] [reliance on settlement discussions does not constitute reasonableexcuse];
 Mellon v Izmirligil
, 88 AD3d 930[2nd Dept. 2011] [motion to vacate was properlydenied];
 Maspeth Fed. Sav. & Loan Assn. v McGown
, 77 AD3d 889,
[purported reliance[*3]on settlement discussions was unsubstantiated];
 Jamieson v Roman,
36 AD3d 861[2ndDept. 2007] [upholding denial of motion to vacate default despite party's claim of ongoingsettlement discussions, since party delayed in appearing after being served with a copy of the judgment];
Flora Co. v Ingilis
, 233 AD2d 418 [2nd Dept. 1996] [reliance on settlement
.S. Bank N A. v Nyarkoha (2012 NY Slip Op 50353(U))http://www.courts.state.ny.us/reporter/3dseries/2012/2012_50353.htm3 of 63/7/2012 7:16 PM

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