The Secretary of the U.S. Department of Housing and Urban Development v. Richmond County Public Administrator, as Administrator of the Estate of Peter Stio

CourtDistrict Court, E.D. New York
DecidedFebruary 27, 2025
Docket1:24-cv-04111
StatusUnknown

This text of The Secretary of the U.S. Department of Housing and Urban Development v. Richmond County Public Administrator, as Administrator of the Estate of Peter Stio (The Secretary of the U.S. Department of Housing and Urban Development v. Richmond County Public Administrator, as Administrator of the Estate of Peter Stio) is published on Counsel Stack Legal Research, covering District Court, E.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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The Secretary of the U.S. Department of Housing and Urban Development v. Richmond County Public Administrator, as Administrator of the Estate of Peter Stio, (E.D.N.Y. 2025).

Opinion

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK -----------------------------------X THE SECRETARY OF THE U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT,

Plaintiff,

MEMORANDUM AND ORDER - against - 24-CV-4111(KAM)(PK)

RICHMOND COUNTY PUBLIC ADMINISTRATOR, AS ADMINISTRATOR OF THE ESTATE OF PETER STIO DECEASED; NEW YORK STATE DEPARTMENT OF TAXATION AND FINANCE; NEW YORK CITY TRANSIT ADJUDICATION BUREAU; RONALD SCHWEIZER; GERALDINE STIO; ROBERT JOSEPH SCHWEIZER; HAZEL STIO; SARAH STIO; PATRICIA STIO; ALICE STIO; JAMES STIO,1

Defendants. -----------------------------------X

KIYO A. MATSUMOTO, United States District Judge:

The Secretary of the United States Department of Housing and Urban Development (“HUD” or “Plaintiff”) commenced this action on June 10, 2024 to foreclose on a mortgage encumbering the property commonly known as 299 Greencroft Avenue, Staten Island,

1 The Court grants Plaintiff’s request to amend the caption to remove the John and Jane Doe defendants and to dismiss them from this action. (See ECF No. 41- 2, ¶¶ 44–46.) Whether such relief is sought pursuant to Federal Rule of Civil Procedure 12(f), 15(a), or 41(a)(1), “such relief is routinely granted in foreclosure actions.” U.S. Bank Nat’l Ass’n v 2150 Joshua’s Path, LLC, No. 13- cv-1598(DLI)(SIL), 2017 WL 4480869, at *6 (E.D.N.Y. Sept. 30, 2017) (citation omitted) (modifying caption to strike fictitious defendants); see also Secured Asset Mgmt., LLC v. Congregation Beth Joseph Zwi Dushinsky, No. 17-cv- 5588(DLI)(CLP), 2019 WL 4861411, at *10 (E.D.N.Y. Sept. 30, 2019) (same). Moreover, the Court sua sponte amends the caption in the interest of justice to substitute “Alice Stio” in place of “Alice Atio,” and will refer to the corresponding defendant in this action as Alice Stio. See 5A Charles Alan Wright and Arthur R. Miller, Federal Practice and Procedure § 1321 paras. 3–4 (4th ed. 2024). New York 10308 (“299 Greencroft”). (See generally ECF No. 1 (“Complaint” or “Compl.”).)2 The defendants in this action comprise Richmond County Public Administrator, as Administrator of

the Estate of Peter Stio, New York State Department of Taxation and Finance, New York City Transit Adjudication Bureau, Ronald Schweizer, Geraldine Stio, Robert Joseph Schweizer, Hazel Stio, Sarah Stio, Patricia Stio, Alice Stio, James Stio (collectively “Defendants” and each a “Defendant”). Presently before the Court is Plaintiff’s motion for entry of a default judgment of foreclosure and sale. (ECF No. 41 (“Motion” or “Mot.”).) For the reasons set forth below, Plaintiff’s Motion is GRANTED. BACKGROUND The following facts are taken from the Complaint, the instant Motion, and the attached affidavits and exhibits. Plaintiff brought this action seeking to foreclose on a home equity

conversion mortgage (“HECM”), also known as a reverse mortgage, encumbering 299 Greencroft. (See Compl. ¶¶ 1–10.) On or about May 15, 2012, Dorothy and Peter Stio executed a fixed rate note (the “First Note”), listing as collateral a mortgage in the amount of $577,500 (the “Mortgage”), which was later assigned to HUD. (Id. ¶¶ 8, 14.) Dorothy and Peter Stio also executed and delivered

2 The Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1345. 2 a second note and collateral mortgage (the “Second Note” and “Collateral Mortgage,” respectively) to HUD, with the Collateral Mortgage serving as additional security for the reverse mortgage. (Id. ¶¶ 11–13.) By 2019, both Dorothy and Peter Stio had passed

away, which, under the term of the First and Second Notes, permitted HUD to require immediate payment in full of the principal and accrued interest. (Id. ¶¶ 17–22.) On January 31, 2024, a state surrogate court appointed Richmond County as administrator of Peter Stio’s estate for the limited purpose of accepting service of process in this action. (Id. ¶¶ 26–28; id. Ex. E.) More than 90 days before commencing this action on June 10, 2024, HUD individually delivered, by first class mail, notices required by Section 1304 of New York Real Property Actions and Proceedings Law (“RPAPL”) to Ronald Schweizer, Geraldine Stio, Robert Joseph Schweizer, Hazel Stio,

Sarah Stio, Patricia Stio, Alice Stio, James Stio. (Compl. ¶¶ 42– 43; id. Ex. F (certified mail receipts stamped March 1, 2024).) From July 19, 2024, until July 30, 2024, HUD requested certificates of default against all Defendants in this action on the basis that each Defendant, although duly served, had failed to plead or otherwise defend. (ECF Nos. 17–18, 21–24 & 31–35.) The Clerk of Court subsequently entered certificates of default as to each Defendant. (ECF Nos. 19–20, 27–30 & 36–40.) 3 HUD now moves for a default judgment of foreclosure and sale in its favor. (See ECF No. 41, 41-1 (“Collins Affidavit” or “Collins Aff.”) ¶ 38; ECF No. 41-5 (“Proposed Judgment”), at 2– 5.3) HUD seeks a judgment of $277,787.81 in principal, $248,967.99

in accrued interest as of February 12, 2025, $61,903.10 in mortgage insurance, and $3,137.74 in costs (for a total of $588,658.90 and $3,137.74 in costs), and seeks an order that the property at 299 Greencroft be sold in accordance with RPAPL, with the proceeds of such sale being used to, among other things, satisfy HUD’s judgment. (Proposed Judgment at 2–3; ECF No. 42-1 (“Supplemental Collins Affidavit” or “Suppl. Collins Aff.”) ¶ 3.) According to Plaintiff’s submissions, interest has continued to accrue at a rate of $89.67 each day since February 12, 2025. (ECF No. 42-1 (“Statement of Account”) at 1.) Plaintiff does not seek attorneys’ fees or a deficiency judgment. (See Collins Aff. ¶¶ 37–38; ECF

No. 41-2 (“Memorandum of Law” or “Mem.”) ¶¶ 41–42.) LEGAL STANDARDS I. Default Judgment Under Federal Rule of Civil Procedure (“Rule”) 55, a party defaults when he or she “has failed to plead or otherwise defend” a pending action. Fed. R. Civ. P. 55(a); accord Guggenheim

3 As Plaintiff’s Proposed Judgment is not paginated, pin citations refer to the pagination assigned by the Court’s online CM/ECF system. 4 Cap., LLC v. Birnbaum, 722 F.3d 444, 454 (2d Cir. 2013). Entry of default against a defendant does not, however, automatically entitle a plaintiff to an entry of a default judgment. Bricklayers and Allied Craftworkers Local 2 Pension Fund v. Moulton Masonry & Constr., LLC, 779 F.3d 182, 187 (2d Cir. 2015). Rather, the court

may enter a default judgment on a plaintiff’s motion “if liability is established as a matter of law when the factual allegations of the complaint are taken as true.” Id. (citing City of N.Y. v. Mickalis Pawn Shop, LLC, 645 F.3d 114, 137 (2d Cir. 2011)). “[A] default is an admission of all well-pleaded allegations against the defaulting party.” SEC v. Amerindo Inv. Advisors, 639 F. App’x 752, 754 (2d Cir. 2016) (quoting Vt. Teddy Bear Co., Inc. v. 1-800 Beargram Co., 373 F.3d 241, 246 (2d Cir. 2004)). The Court must therefore “accept as true the well-pleaded allegations in the complaint,” except those relating to damages. Trs. of Local 7 Tile Indus. Welfare Fund v. City Tile, Inc., No.

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The Secretary of the U.S. Department of Housing and Urban Development v. Richmond County Public Administrator, as Administrator of the Estate of Peter Stio, Counsel Stack Legal Research, https://law.counselstack.com/opinion/the-secretary-of-the-us-department-of-housing-and-urban-development-v-nyed-2025.