Flagstar Bank, FSB v. Poliseno

Opinion

Flagstar Bank, FSB v Poliseno

2026 NY Slip Op 05082

August 26, 2026

Appellate Division, Second Department

Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.

This decision is uncorrected and subject to revision before publication in the Official Reports.

Flagstar Bank, FSB, respondent,

v

Loretta Poliseno, appellant, et al., defendants.

Supreme Court of the State of New York, Appellate Division, Second Judicial Department

Decided on August 26, 2026

2024-03371, 2024-03378, (Index No. 5525/11)

Cheryl E. Chambers, J.P.

Paul Wooten

Lillian Wan

Phillip Hom, JJ.

Yolande I. Nicholson, Brooklyn, NY, for appellant.

Friedman Vartolo LLP, Garden City, NY (Ronald P. Labeck of counsel), for respondent.

[*1]

DECISION & ORDER

In an action to foreclose a mortgage, the defendant Loretta Poliseno appeals from two orders of the Supreme Court, Kings County (Larry D. Martin, J.), both dated October 18, 2023. The first order, insofar as appealed from, granted those branches of the plaintiff's motion which were for leave to amend the caption to substitute AJX Mortgage Trust I as the plaintiff, for leave to enter a default judgment against the defendant Loretta Poliseno, and for an order of reference, and denied those branches of the cross-motion of the defendant Loretta Poliseno which were, in effect, pursuant to CPLR 5015(a)(4) to vacate her default in answering the complaint and thereupon pursuant to CPLR 3211(a)(8) to dismiss the complaint insofar as asserted against her for lack of personal jurisdiction, to dismiss the complaint insofar as asserted against her for failure to comply with RPAPL 1302(1)(a) and 1303, or, in the alternative, pursuant to CPLR 3012(d) for leave to serve a late answer. The second order, insofar as appealed from, granted the same relief to the plaintiff and referred the matter to a referee to compute the amount due to the plaintiff.

ORDERED that the orders are modified, on the law, by deleting the provisions thereof granting those branches of the plaintiff's motion which were for leave to enter a default judgment against the defendant Loretta Poliseno and for an order of reference, and substituting therefor provisions denying those branches of the motion; as so modified, the orders are affirmed insofar as appealed from, without costs or disbursements.

In June 2007, the defendant Loretta Poliseno (hereinafter the defendant) executed a note in favor of Globe Mortgage America, LLC (hereinafter Globe), which was secured by a mortgage on certain real property located in Brooklyn. By assignment of mortgage dated August 1, 2008, Mortgage Electronic Registration Systems, Inc., as nominee for Globe, assigned the mortgage to the plaintiff.

In March 2011, the plaintiff commenced this action against the defendant, among others, to foreclose the mortgage. The defendant failed to timely appear or answer the complaint. Settlement conferences pursuant to CPLR 3408 were held between November 29, 2011, and March 21, 2013, after which the plaintiff was permitted to proceed with the action. On May 28, 2013, the [*2]defendant's counsel filed a notice of appearance on behalf of the defendant.

After a series of assignments, the mortgage was assigned to AJX Mortgage Trust I (hereinafter AJX Mortgage). In orders dated June 3, 2016, and September 28, 2017, the Supreme Court denied, with leave to renew, the plaintiff's separate motions, inter alia, for leave to enter a default judgment against the defendant and for an order of reference.

In February 2018, the plaintiff moved, among other things, to amend the caption to substitute AJX Mortgage as the plaintiff, for leave to enter a default judgment against the defendant, and for an order of reference. The defendant cross-moved, inter alia, in effect, pursuant to CPLR 5015(a)(4) to vacate her default in answering the complaint and thereupon pursuant to CPLR 3211(a)(8) to dismiss the complaint insofar as asserted against her for lack of personal jurisdiction, to dismiss the complaint insofar as asserted against her for failure to comply with RPAPL 1302(a)(1) and 1303, or, in the alternative, pursuant to CPLR 3012(d) for leave to serve a late answer. In an order dated October 18, 2023, the Supreme Court, among other things, granted those branches of the plaintiff's motion and denied those branches of the defendant's cross-motion. In a second order dated October 18, 2023, the court, inter alia, granted the same relief to the plaintiff and referred the matter to a referee to compute the amount due to the plaintiff. The defendant appeals.

"'Where, as here, a foreclosure complaint is not verified, CPLR 3215(f) states, among other things, that upon any application for a judgment by default, proof of the facts constituting the claim, the default, and the amount due are to be set forth in an affidavit made by the party'" (Aurora Loan Servs., LLC v Jemal, 205 AD3d 661, 664, quoting HSBC Bank USA, N.A. v Betts, 67 AD3d 735, 736). Here, the plaintiff submitted an affidavit from Julia Rust, a litigation specialist for Gregory Funding, LLC (hereinafter Gregory Funding), the purported attorney-in-fact for AJX Mortgage, along with a limited power of attorney purportedly authorizing Gregory Funding to act on behalf of AJX Mortgage. However, the plaintiff failed to demonstrate that Gregory Funding was authorized to act on behalf of AJX Mortgage, since the limited power of attorney was conditioned on "related servicing agreements," which were not submitted. Thus, the plaintiff failed to demonstrate that the affidavit it submitted was "made by the party" (CPLR 3215[f]; see HSBC Bank USA, N.A. v Cooper, 157 AD3d 775, 776; HSBC Bank USA, N.A. v Betts, 67 AD3d at 736). Moreover, Rust failed to lay a proper foundation for the business records upon which she relied (see Bank of N.Y. Mellon v Gordon, 171 AD3d 197, 209-210). Accordingly, the Supreme Court should have denied those branches of the plaintiff's motion which were for leave to enter a default judgment against the defendant and for an order of reference.

However, the Supreme Court properly denied that branch of the defendant's cross-motion which was, in effect, pursuant to CPLR 5015(a)(4) to vacate her default in answering the complaint and thereupon pursuant to CPLR 3211(a)(8) to dismiss the complaint insofar as asserted against her for lack of personal jurisdiction. "An appearance by a defendant in an action is deemed to be the equivalent of personal service of a summons upon that defendant, and, in the absence of an objection to jurisdiction by way of a motion or answer, the appearance confers personal jurisdiction over that defendant" (U.S. Bank N.A. v Jong Shin, 224 AD3d 933, 935; see CPLR 320[b]; Globe Trade Capital, LLC v Hoey, 199 AD3d 769, 770). "In addition to the formal appearances listed in CPLR 320(a), 'a defendant may appear informally by actively litigating the action before the court'" (U.S. Bank N.A. v Jong Shin, 224 AD3d at 935, quoting Taveras v City of New York, 108 AD3d 614, 617; see Travelon, Inc. v Maekitan, 215 AD3d 710, 712). Here, the defendant waived the defense of lack of personal jurisdiction by filing a notice of appearance on May 28, 2013, and by opposing the plaintiff's prior motions, among other things, for leave to enter a default judgment against her and for an order of reference, without asserting an objection to jurisdiction (see U.S. Bank N.A. v Jong Shin, 224 AD3d at 935; HSBC Bank USA, N.A. v Whitelock, 214 AD3d 855, 856).

Moreover, since the defendant failed to vacate her default in answering the complaint, she was precluded from asserting statutory defenses based on failure to comply with RPAPL 1302(1)(a) and 1303 (see Deutsche Bank Natl. Trust Co. v O'Connor, 223 AD3d 872, 877).

Furthermore, the Supreme Court properly denied that branch of the defendant's cross-motion which was pursuant to CPLR 3012(d) for leave to serve a late answer. A motion pursuant to CPLR 3012(d) to extend the time to answer a complaint requires the movant to demonstrate "both a reasonable excuse for its delay and a potentially meritorious defense to the claims to which it is responding" (Bank of N.Y. Mellon v Norton, 219 AD3d 680, 682-683; see 209 Barbey St. Trust v Scotland, 231 AD3d 778, 779). Here, the defendant failed to demonstrate a reasonable excuse for her default, as the only excuse she offered was lack of personal jurisdiction (see HSBC Bank USA, N.A. v Sanderson, 231 AD3d 1126, 1130; Deutsche Bank Natl. Trust Co. v Geslani, 222 AD3d 835, 837). Since the defendant failed to establish a reasonable excuse for her default, it is unnecessary to determine whether she demonstrated a potentially meritorious defense to the action (see HSBC Bank USA, N.A. v Sanderson, 231 AD3d at 1130; U.S. Bank N.A. v Rauff, 205 AD3d 963, 966).

The defendant's remaining contention is without merit.

CHAMBERS, J.P., WOOTEN, WAN and HOM, JJ., concur.

ENTER:

Darrell M. Joseph

Clerk of the Court