| HSBC Bank USA, N.A. v Autry |
| 2016 NY Slip Op 50940(U) [52 Misc 3d 1201(A)] |
| Decided on June 17, 2016 |
| Supreme Court, Westchester County |
| Giacomo, J. |
| Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. |
| This opinion is uncorrected and will not be published in the printed Official Reports. |
HSBC Bank
USA, National Association as Trustee for Wells Fargo Asset Securities Corporation,
Mortgage Asset-Backed Pass-Through Certificates Series 2007-PA3, Plaintiff,
against Frances Autry, Wendy Johnson, et. al., Defendant. |
The following papers numbered 1 to 5 were read on plaintiff's motion to extend time to serve the summons and complaint. PAPERS NUMBERED
Plaintiff commenced this residential non owner occupied mortgage foreclosure action on February 19, 2015. The affidavit of service for defendant Frances Autry states that she was personally served on March 5, 2015. The affidavit of service for defendant Wendy Johnson indicates that she was personally served on March 5, 2015.
Defendants served their answer on May 12, 2015. On May 15, 2015, plaintiff rejected [*2]defendants' answer as untimely.
A foreclosure settlement conference was held on May 26, 2015 and the case did not settle and the matter was released from the foreclosure conference part.
By decision and order dated December 14, 2015, this Court granted defendant's motion to dismiss the complaint for lack of personal jurisdiction solely to the extent of directing a traverse hearing be held.
A hearing was held on March 24, 2016 and on April 14, 2016 the Court (Walker, J.) found that plaintiff failed to establish that defendants were properly served and determined that the Court lacked personal jurisdiction over them.
On February 16, 2016, prior to the holding of the traverse hearing, plaintiff moved herein for leave to extend time to serve defendants. In support of its motion, plaintiff argues that in the event the traverse hearing results in a finding that the defendants were not properly served, leave should be granted extending the time to serve defendants in the interests of justice since the statute of limitations has expired and because it had timely commenced this action and believed that the original service was proper. Thus, it has shown good cause in its delay in seeking leave to extend time to serve defendants.
In opposition, defendants argue that leave should be denied because plaintiff has not shown good cause for its delay in making this motion. Further, defendants argue that they would be prejudiced by the late service of the summons and complaint since the statute of limitations expired on March 16, 2016.
CPLR § 306-b. Service of the summons and complaint, summons with notice, third-party summons and complaint, or petition with a notice of petition or order to show cause, provides:
Service of the summons and complaint, summons with notice, third-party summons and complaint, or petition with a notice of petition or order to show cause shall be made within one hundred twenty days after the commencement of the action or proceeding, provided that in an action or proceeding, except a proceeding commenced under the election law, where the applicable statute of limitations is four months or less, service shall be made not later than fifteen days after the date on which the applicable statute of limitations expires. If service is not made upon a defendant within the time provided in this section, the court, upon motion, shall dismiss the action without prejudice as to that defendant, or upon good cause shown or in the interest of justice, extend the time for service.(emphasis added)
In Bumpus v. NY City Transit Authority, (66 AD3d 26, 32 [2nd Dept 2009]), the Second Department held:
The 120-day service provision of CPLR 306-b can be extended by a court, upon motion, "upon good cause shown or in the interest of justice" (CPLR 306-b). "Good cause" and "interest of justice" are two separate and independent statutory standards (see Leader v Maroney, Ponzini & Spencer, 97 NY2d at 104). To establish good cause, a plaintiff must demonstrate reasonable diligence in attempting service (see Leader v Maroney, Ponzini & Spencer, 97 NY2d at 105-106). Good cause will not exist where a plaintiff fails to make any effort at service (see Valentin v Zaltsman, 39 AD3d 852 [2007]; [*3]Lipschitz v McCann, 13 AD3d 417 [2004]), or fails to make at least a reasonably diligent effort at service (see e.g. Kazimierski v New York Univ., 18 AD3d 820 [2005]; Baione v Central Suffolk Hosp., 14 AD3d 635, 636-637 [2005]; Busler v Corbett, 259 AD2d 13, 15 [1999]). By contrast, good cause may be found to exist where the plaintiff's failure to timely serve process is a result of circumstances beyond the plaintiff's control (see U.S. 1 Brookville Real Estate Corp. v Spallone, 13 Misc 3d 1236[A], 2006 NY Slip Op 52141[U], [2006], citing Eastern Refractories Co., Inc. v Forty Eight Insulations, Inc., 187 FRD 503, 505 [1999]; see also Greco v Renegades, Inc., 307 AD2d 711, 712 [2003] [difficulties of service associated with locating defendant enlisted in military]; Kulpa v Jackson, 3 Misc 3d 227, 235 [2004] [difficulties associated with service abroad through the Hague Convention]).
If good cause for an extension is not established, courts must consider the "interest of justice" standard of CPLR 306-b (see e.g. Busler v Corbett, 259 AD2d at 17). The interest of justice standard does not require reasonably diligent efforts at service, but courts, in making their determinations, may consider the presence or absence of diligence, along with other factors (see Leader v Maroney, Ponzini & Spencer, 97 NY2d at 105). The interest of justice standard is broader than the good cause standard (see Mead v Singleman, 24 AD3d 1142, 1144 [2005]), as its factors also include the expiration of the statute of limitations, the meritorious nature of the action, the length of delay in service, the promptness of a request by the plaintiff for an extension, and prejudice to the defendant (see Leader v Maroney, Ponzini & Spencer, 97 NY2d at 105-106; Matter of Jordan v City of New York, 38 AD3d 336, 339 [2007]; Estey-Dorsa v Chavez, 27 AD3d 277 [2006]; Mead v Singleman, 24 AD3d at 1144; de Vries v Metropolitan Tr. Auth., 11 AD3d 312, 313 [2004]; Hafkin v North Shore Univ. Hosp., 279 AD2d 86, 90-91 [2000], affd 97 NY2d 95 [2001]; see also Slate v Schiavone Constr. Co., 4 NY3d 816 [2005]).
Here, plaintiff has established good cause for its delay in seeking an extension of time to answer. Notably, defendants were served on March 5, 2015 and did not attempt to file an answer until May 15, 2015 when plaintiff rejected the answer as late. Defendants then moved to dismiss the complaint for lack of personal jurisdiction on August 18, 2015. From that date until this motion to extend time to serve the summons and complaint was filed plaintiff believed it had properly served defendants. Thus, it established good cause for making this motion. Nevertheless, even if plaintiff did not have good cause for an extension of time for service, it established it is entitled to an extension of time to serve defendants in the interest of justice (see Leader v Maroney, Ponzini & Spencer, 97 NY2d 95 [2001]).
In weighing the interest of justice "the court may consider diligence, or lack thereof, along with any other relevant factor in making its determination, including expiration of the Statute of Limitations, the meritorious nature of the cause of action, the length of delay in service, the promptness of a plaintiff's request for the extension of time, and prejudice to defendant" (id at 105-106).
Here, plaintiff diligently attempted to served defendants, defendants have not paid their mortgage since August of 2009 - almost seven years, plaintiff made this motion before the expiration of the statute of limitations and before the holding of the traverse hearing. Notably, defendants have not raised a meritorious defense to this foreclosure action and they will not be [*4]prejudiced by the delay as they have known about this action since at least May 2015 and remain in the premises rent free. Furthermore, defendants will have the ability to appear and answer the complaint.
Based on the foregoing, plaintiff's motion to extend time to serve defendants is GRANTED on the condition that defendants are served within 30 days of the date of this order.