Plaintiff appeals from an order of the Supreme Court, New York County (Francis A. Kahn III, J.), entered on or about April 2, 2024, which denied plaintiff's motion for summary judgment against defendant Nicola Nicholas as administrator of the Estate of Cecilia V. McDowell also known as Cecilia McDowell, and granted defendant Nicola Nicholas's cross-motion to dismiss the complaint pursuant to CPLR 3211(a)(5).

Houser LLP, New York, (Kathleen M. Massimo and Reed T. Cohn of counsel), for appellant.

Binakis Law P.C., Astoria (Patrick Binakis of counsel), for respondent.

Plaintiff commenced this foreclosure action more than six years after it voluntarily discontinued a prior foreclosure action against defendant. Ordinarily, a voluntary discontinuance does not reset the limitations period, pursuant to the Foreclosure Abuse Prevention Act (L 2022, ch 821) (FAPA). Without more, this action would be untimely based upon our determination that FAPA applies retroactively to this case and does not, contrary to plaintiff's arguments, violate plaintiff's constitutional rights. However, we further find that FAPA's retroactive application does not invalidate the parties' stipulation executed in the prior foreclosure action, which expressly tolled the limitations period. Accordingly, plaintiff's action is timely.

I.

Plaintiff's prior mortgage foreclosure action against defendant was commenced on July 25, 2008, which indisputably accelerated the entire loan. On May 4, 2011, the parties agreed to discontinue the foreclosure action without prejudice via written stipulation. They also agreed that "the statute of limitations for any claims of plaintiff or defendant against the other is hereby tolled from July 22, 2008 . . . until June 1, 2013." The stipulation was executed by the parties' respective counsel and filed with the court. Plaintiff subsequently commenced this foreclosure action on February 16, 2018 and moved for summary judgment. Defendant cross-moved to dismiss the complaint, arguing that plaintiff's action was time-barred under FAPA.

The court denied plaintiff's motion and granted defendant's cross-motion to dismiss the complaint. Applying FAPA, the court found that the voluntary discontinuance of the prior foreclosure action did not deaccelerate the loan and reset the statute of limitations. The court further found that the parties' 2011 stipulation, which was not personally signed by defendant, violated General Obligations Law § 17-105 and therefore did not toll the statute of limitations. Plaintiff's action was accordingly deemed untimely.

II.

The question before us is whether the 2011 stipulation executed by the parties' attorneys tolled the statute of limitations. We find that it did, notwithstanding the enactment of FAPA.

Preliminarily, we agree with the motion court that FAPA applies retroactively (see Genovese v Nationstar Mtge. LLC, 223 AD3d 37 [1st Dept 2023]). Our finding in Genovese that "the Legislature's goal . . . was to see FAPA applied retroactively" (id. at 45), was recently confirmed by the Court of Appeals (see Van Dyke v US Bank, N.A., - NY3d — , 2025 NY Slip Op 06537, *4 [2025] ["FAPA's text and legislative history plainly manifest the legislature's intent that these provisions have retroactive effect"] [internal quotation marks and brackets omitted]; Article 13 LLC v Ponce De Leon Fed. Bank, - NY3d — , 2025 NY Slip Op 06536, *4-5 [2025]).

Nevertheless, the court erred in finding that the parties' stipulation to toll the statute of limitations from July 22, 2008 to June 1, 2013 was unenforceable. The stipulation complied with CPLR 2104 as it related to "any matter in an action," and was in "a writing subscribed by [a party] or his attorney" [emphasis added] (see Bonnette v Long Is. Coll. Hosp., 3 NY3d 281, 286 [2004] ["The plain language of [CPLR 2104] directs that the agreement itself must be in writing, signed by the party (or attorney) to be bound"]). Contrary to the motion court's finding, the stipulation did not need to be executed by the parties themselves pursuant to General Obligations Law § 17-105(1) to be enforceable. General Obligations Law § 17-105(5)(b), as amended by FAPA, expressly provides that "[t]his section does not change the requirements or the effect with respect to the accrual of a cause of action, nor the time limited for commencement of an action based upon . . . a stipulation made in an action or proceeding." The 2011 stipulation was clearly a "stipulation made in an action or proceeding" and is therefore excluded from the requirements of General Obligations Law § 17-105(1).

CPLR 3217, also amended by FAPA, now provides, in relevant part, that "the voluntary discontinuance" of a mortgage foreclosure action "on . . . stipulation . . . shall not, in form or effect, waive, postpone, cancel, toll, extend, revive or reset the limitations period to commence an action . . . unless expressly prescribed by statute" (CPLR 3217[e]). However, the Senate Sponsor's Memorandum in Support clarifies that FAPA does not prevent parties from agreeing to extend the limitations period for a foreclosure action; rather, it identifies General Obligations Law § 17-105 as "the exclusive means" to do so (see Senate Sponsor's Mem in Support of 2022 NY Senate Bill S5473D). The Sponsor's Memo repeatedly warned of lenders' "unilateral" acts, including lenders' "unilateral ability to toll or extend the time prescribed by law to commence an action"; their ability to "unilaterally manipulate" the limitation period; and their ability to effect a "unilateral 'de-acceleration'" (id.). And it explained that a "barestipulation of discontinuance or a lender's unilateraldecision to revoke its demand for full payment is not a method prescribed by the Legislature for waiving, extending, or modifying the statute of limitations" (id.). This language suggests that the Legislature did not intend to abrogate the ability of parties to extend the statute of limitations by explicit agreement, even if the stipulation also voluntarily discontinued the action.

We reject plaintiff's arguments that retroactive application of CPLR 3217(e) unconstitutionally infringes on its right to due process, effects an unconstitutional regulatory taking in violation of the Takings Clause, and substantially impairs its contractual rights in violation of the Contract Clause.

In Van Dyke, the Court of Appeals found that FAPA's provisions were sensibly tailored to "narrowly bar successive, collateral challenges to certain prior loan accelerations and curtail noteholders' ability to unilaterally reset the limitations period to foreclose"; advanced the strong public policy favoring finality and predictability; and operated in the highly regulated landscape of mortgage foreclosure litigation (Van Dyke, 2025 NY Slip Op 06537, *6). As a result, the Court determined that any substantial impairment of defendant's contractual right "reasonably and appropriately furthers the significant and legitimate public purposes that motivated FAPA's enactment" (id.). FAPA's retroactive application was therefore not violative of the Contract Clause (id.). For these reasons, we hold that retroactive application of CPLR 3217(e) in the instant action does not violate plaintiff's rights under the Contract Clause.

Similarly, substantive due process requires a statute's retroactive application to be supported by a "legitimate legislative purpose furthered by rational means" (American Economy Ins. Co. v State of New York, 30 NY3d 136, 157-158 [2017], cert denied 584 US 1013 [2018], quoting General Motors Corp. v Romein, 503 US 181, 191 [1992]). Given that FAPA's express purpose is to curtail certain abusive litigation practices by mortgage lenders and noteholders, "it is rational for FAPA to apply retroactively to shield as many borrowers as possible from those practices" (Van Dyke, 2025 NY Slip Op 0653, *6).

As for procedural due process, where the limitations period is shortened or created where none existed, "[d]ue [p]rocess requires that potential litigants be afforded a reasonable time for the commencement of an action before the bar takes effect" (Brothers v Florence, 95 NY2d 290, 300 [2000] [internal quotation marks omitted]). Here however, FAPA "did not alter the six-year statute of limitations whatsoever," thus procedural due process does not mandate a reasonable grace period before FAPA becomes effective (Article 13 LLC, 2025 NY Slip Op 06536, *5; see Van Dyke, 2025 NY Slip Op 0653, *6). Consequently, plaintiff's due process rights were not violated by retroactive application of CPLR 3217(e).

Finally, as this Department has repeatedly held, "applying FAPA retroactively . . . does not constitute an unconstitutional regulatory taking when applied before any judgment is entered" (US Bank N.A. v Calhoun, 236 AD3d 557, 558 [1st Dept 2025], lv denied 43 NY3d 907 [2025]; see Bank of N.Y. Mellon v Del Rio, 233 AD3d 529, 531-532 [1st Dept 2024]). Here, the motion court denied summary judgment to plaintiff and dismissed the complaint. As no judgment has been entered, no unconstitutional regulatory taking has occurred.

III.

Simply put, despite FAPA's retroactive application, the parties' 2011 stipulation in which they expressly agreed to toll the limitations period to June 1, 2013 effectively tolled the limitations period to that date. Plaintiff's commencement of this action on February 16, 2018, less than six years later, was thus timely.

Accordingly, the order of the Supreme Court, New York County (Francis A. Kahn III, J.), entered on or about April 2, 2024, which denied plaintiff's motion for summary judgment against defendant Nicola Nicholas as administrator of the Estate of Cecilia V. McDowell also known as Cecilia McDowell, and granted defendant Nicola Nicholas's cross-motion to dismiss the complaint pursuant to CPLR 3211(a)(5), should be reversed, on the law, without costs, the cross-motion denied, the complaint reinstated, and the matter remanded to Supreme Court for a determination as to whether plaintiff is entitled to summary judgment.

Order, Supreme Court, New York County (Francis A. Kahn III, J.), entered on or about April 2, 2024, reversed, on the law, without costs, the cross-motion denied, the complaint reinstated, and the matter remanded to Supreme Court for a determination as to whether plaintiff is entitled to summary judgment.

Opinion by Michael, J. All Concur.

Moulton, J.P., Kennedy, Mendez, Michael, Chan, JJ.

THIS CONSTITUTES THE DECISION AND ORDER OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: March 17, 2026