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A07737 Summary:
BILL NO | A07737B |
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SAME AS | SAME AS S05473-D |
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SPONSOR | Weinstein |
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COSPNSR | Zinerman, Seawright, Colton, Simon, Zebrowski, Pretlow, Burdick, Bronson, Davila, Englebright, Dinowitz, Glick, Sayegh, Abinanti, Eichenstein, Rosenthal D, Weprin, Gallagher, Tapia, Forrest, Otis, Carroll, Hunter, Hyndman, Galef, Jackson, Anderson, Jean-Pierre, Fernandez, Cook, Bichotte Hermelyn |
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MLTSPNSR | |
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Amd §§203, 205 & 213, R3217, add §205-a, CPLR; amd §17-105, Gen Ob L; amd §1301, RPAP L | |
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Relates to the rights of parties involved in foreclosure actions; provides additional details regarding the commencement and termination of certain actions related to real property. |
A07737 Floor Votes:
Yes
Abbate
Yes
Colton
Yes
Galef
No
Lalor
Yes
Paulin
No
Smith
Yes
Abinanti
Yes
Conrad
Yes
Gallagher
Yes
Lavine
Yes
Peoples-Stokes
No
Smullen
Yes
Anderson
Yes
Cook
No
Gallahan
Yes
Lawler
Yes
Perry
Yes
Solages
No
Angelino
Yes
Cruz
No
Gandolfo
No
Lemondes
Yes
Pheffer Amato
Yes
Steck
No
Ashby
Yes
Cusick
Yes
Gibbs
Yes
Lucas
Yes
Pretlow
Yes
Stern
Yes
Aubry
Yes
Cymbrowitz
No
Giglio JA
Yes
Lunsford
Yes
Quart
Yes
Stirpe
No
Barclay
Yes
Darling
No
Giglio JM
Yes
Lupardo
No
Ra
No
Tague
Yes
Barnwell
Yes
Davila
Yes
Glick
Yes
Magnarelli
Yes
Rajkumar
No
Tannousis
Yes
Barrett
Yes
De Los Santos
Yes
Gonzalez-Rojas
Yes
Mamdani
Yes
Ramos
Yes
Tapia
Yes
Benedetto
No
DeStefano
No
Goodell
No
Manktelow
No
Reilly
Yes
Taylor
Yes
Bichotte Hermel
Yes
Dickens
Yes
Gottfried
Yes
McDonald
Yes
Reyes
Yes
Thiele
No
Blankenbush
Yes
Dilan
Yes
Griffin
No
McDonough
Yes
Rivera J
Yes
Vanel
Yes
Brabenec
Yes
Dinowitz
Yes
Gunther
Yes
McMahon
Yes
Rivera JD
Yes
Walczyk
Yes
Braunstein
No
DiPietro
No
Hawley
Yes
Meeks
Yes
Rosenthal D
Yes
Walker
Yes
Bronson
No
Durso
Yes
Hevesi
No
Mikulin
Yes
Rosenthal L
Yes
Wallace
No
Brown
Yes
Eichenstein
Yes
Hunter
No
Miller
Yes
Rozic
No
Walsh
Yes
Burdick
Yes
Englebright
Yes
Hyndman
Yes
Mitaynes
No
Salka
Yes
Weinstein
Yes
Burgos
Yes
Epstein
Yes
Jackson
No
Montesano
Yes
Santabarbara
Yes
Weprin
Yes
Burke
Yes
Fahy
Yes
Jacobson
No
Morinello
Yes
Sayegh
Yes
Williams
No
Buttenschon
Yes
Fall
Yes
Jean-Pierre
Yes
Niou
No
Schmitt
Yes
Woerner
No
Byrne
Yes
Fernandez
No
Jensen
Yes
Nolan
Yes
Seawright
Yes
Zebrowski
No
Byrnes
No
Fitzpatrick
Yes
Jones
No
Norris
ER
Septimo
Yes
Zinerman
Yes
Cahill
Yes
Forrest
Yes
Joyner
Yes
O'Donnell
Yes
Sillitti
Yes
Mr. Speaker
Yes
Carroll
No
Friend
Yes
Kelles
Yes
Otis
Yes
Simon
Yes
Clark
Yes
Frontus
Yes
Kim
No
Palmesano
No
Simpson
‡ Indicates voting via videoconference
A07737 Memo:
Go to topNEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)   BILL NUMBER: A7737B SPONSOR: Weinstein
  TITLE OF BILL: An act to amend the real property actions and proceedings law, the general obligations law and the civil practice law and rules, in relation to the rights of parties involved in actions commenced upon real property related instruments   PURPOSE AND INTENT OF BILL: The legislature finds that there is an ongoing problem with abuses of the judicial foreclosure process and lenders' attempts to manipulate statutes of limitations; that the problem has been exacerbated by recent court decisions which, contrary to the intent of the legislature, have given mortgage lenders and loan servicers opportunities to avoid strict compliance with remedial statutes and manipulate statutes of limitation to their advantage; and that the purpose of the present legislation is to clarify the meaning of existing statutes, and to rectify these erro- neous judicial interpretations thereof. Accordingly, this bill amends certain statutes and rules to clarify the existing law and overturn certain court decisions to ensure the laws of this state apply equally to all litigants, including those currently involved in mortgage foreclosure actions, in order to ensure that parties purporting to sue on mortgage debt are bound by the same stat- utes of limitations that bind all other litigants. The aim of the bill is to thwart and eliminate abusive and unlawful litigation tactics that have been adopted and pursued in mortgage foreclosure actions to manipu- late the law and judiciary to yield to expediency and the convenience of mortgage banking and servicing institutions at the expense of the final- ity and repose that statutes of limitations are meant to ensure. The gravity of the aforementioned problem, and the legislature's deter- mination to remedy same, is illustrated by the determination of the legislature in passing this bill to apply to all actions governed by CPLR 213 (4) in which a final judgment of foreclosure and sale has not yet been enforced.   SUMMARY OF SPECIFIC PROVISIONS: Section 1 of the bill contains the title of the bill, the "foreclosure abuse prevention act". Section 2 amends the RPAPL to address the deleterious and onerous effect of a recent decision of the Appellate Division in Citi Mortgage, Inc. v. Ramirez, 192 AD3d 70 (2020), which effectively gives mortgagees a second bite of the mortgage apple, permitting actions to be instituted on a note after a foreclosure action based on the same debt has already been adjudicated to be barred by the statute of limitations, making a mockery of the well well-settled statutory and case law concerning election of remedies in connection with proceedings to enforce mortgage debts. Section 3 of the bill makes conforming changings to the General Obli- gations Law to create clear limits on when a cause of action to fore- close a mortgage accrues. Sections 4, 5 and 7 make conforming changes to the statute of limita- tions provisions in the CPLR to clarify the relevant accrual periods for actions upon a mortgage and note. Section 6 of the bill creates a new "savings" statute expressly for mortgage foreclosure cases in order to address judicial decisions that have been contrary to the spirit of this savings provision which have been overly indulgent of foreclosure plaintiffs whose cases have been dismissed for various forms of neglect, who are not entitled to the six months grace period meant for diligent plaintiffs whose cases were dismissed for reasons that do not reflect their own fault. This will ensure that mortgagees do not have an unfettered ability to bring numer- ous successive actions on the same mortgage, without any limitation in law. Section 8 of the bill amends CPLR Sec. 3217 as concerns discontinuance of mortgage foreclosure actions, and is a response to the Court of Appeals recent holding Freedom Mtge. Corp. v Engel,37 NY3d 1 (2021). This will restore longstanding law that made it clear that a lenders' discontinuance of a foreclosure action that accelerated a mortgage loan does not serve to reset the statute of limitations. Section 9 contains a severability clause. Section 10 contains the effective date and makes it clear that this legislation will apply immediately, and will apply to all such actions commenced where a final judgment of foreclosure and sale has not been enforced.   JUSTIFICATION: As a direct result of the aforementioned judicial decisions, thousands of New York homeowners who secured closure of their cases by operation of longstanding statute of limitations principles are at risk of an onslaught of successive foreclosure actions that would otherwise be barred by the statute of limitations under longstanding statutory and case law. This will cause the loss of countless homes and will burden the Courts, which had significant budget cuts and forced retirement of-dozens of senior judges, with cases that should be barred by the statute of limitations and with excessive motion practice now that the foreclosure moratoriums have ended. This bill levels the fields for all homeowners, and ensures the statute of limitation applies to all parties equally without exemption.   PRIOR LEGISLATIVE HISTORY: New Bill, 2021.   FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS: None.   EFFECTIVE DATE: Immediately and will apply to all such actions commenced where a final judgment of foreclosure and sale has not been enforced.
A07737 Text:
Go to top STATE OF NEW YORK ________________________________________________________________________ 7737--B Cal. No. 274 2021-2022 Regular Sessions IN ASSEMBLY May 20, 2021 ___________ Introduced by M. of A. WEINSTEIN, ZINERMAN, SOLAGES, SEAWRIGHT, COLTON, SIMON, ZEBROWSKI, PRETLOW, BURDICK, BRONSON, DAVILA, ENGLEBRIGHT, DINOWITZ, GLICK, SAYEGH -- read once and referred to the Committee on Judiciary -- reported and referred to the Committee on Rules -- Rules Committee discharged, bill amended, ordered reprinted as amended and recommitted to the Committee on Rules -- ordered to a third reading, amended and ordered reprinted, retaining its place on the order of third reading AN ACT to amend the real property actions and proceedings law, the general obligations law and the civil practice law and rules, in relation to the rights of parties involved in actions commenced upon real property related instruments The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Short title. This act shall be known and may be cited as 2 the "foreclosure abuse prevention act". 3 § 2. Subdivision 3 of section 1301 of the real property actions and 4 proceedings law, as added by chapter 312 of the laws of 1962, is amended 5 and a new subdivision 4 is added to read as follows: 6 3. While the action is pending or after final judgment for the plain- 7 tiff therein, no other action shall be commenced or maintained to 8 recover any part of the mortgage debt, including an action to foreclose 9 the mortgage, without leave of the court in which the former action was 10 brought. The procurement of such leave shall be a condition precedent to 11 the commencement of such other action and the failure to procure such 12 leave shall be a defense to such other action. For purposes of this 13 subdivision, in the event such other action is commenced without leave 14 of the court, the former action shall be deemed discontinued upon the 15 commencement of the other action, unless prior to the entry of a final 16 judgment in such other action, a defendant raises the failure to comply 17 with this condition precedent therein, or seeks dismissal thereof based EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD11254-08-2A. 7737--B 2 1 upon a ground set forth in paragraph four of subdivision (a) of rule 2 thirty-two hundred eleven of the civil practice law and rules. This 3 subdivision shall not be treated as a stay or statutory prohibition for 4 purposes of calculating the time within which an action shall be 5 commenced and the claim interposed pursuant to sections two hundred four 6 and two hundred thirteen of the civil practice law and rules. 7 4. If an action to foreclose a mortgage or recover any part of the 8 mortgage debt is adjudicated to be barred by the applicable statute of 9 limitations, any other action seeking to foreclose the mortgage or 10 recover any part of the same mortgage debt shall also be barred by the 11 statute of limitations. 12 § 3. Subdivisions 4 and 5 of section 17-105 of the general obligations 13 law are amended to read as follows: 14 4. [Except as provided in subdivision five, no] An acknowledgment, 15 waiver [or promise has any effect to], promise or agreement, express or 16 implied in fact or in law, shall not, in form or effect, postpone, 17 cancel, reset, toll, revive or otherwise extend the time limited for 18 commencement of an action to foreclose [or] a mortgage for any greater 19 time or in any other manner than that provided in this section, [nor] 20 unless it is made as provided in this section. 21 5. This section does not change the requirements[,] or the effect with 22 respect to the accrual of a cause of action, nor the time limited for 23 commencement of an action[, of] based upon either: 24 a. a payment or part payment of the principal or interest secured by 25 the mortgage, or 26 b. a stipulation made in an action or proceeding. 27 § 4. Section 203 of the civil practice law and rules is amended by 28 adding a new subdivision (h) to read as follows: 29 (h) Claim and action upon certain instruments. Once a cause of action 30 upon an instrument described in subdivision four of section two hundred 31 thirteen of this article has accrued, no party may, in form or effect, 32 unilaterally waive, postpone, cancel, toll, revive, or reset the accrual 33 thereof, or otherwise purport to effect a unilateral extension of the 34 limitations period prescribed by law to commence an action and to inter- 35 pose the claim, unless expressly prescribed by statute. 36 § 5. Subdivision (c) of section 205 of the civil practice law and 37 rules, as amended by chapter 216 of the laws of 1992, is amended to read 38 as follows: 39 (c) Application. This section also applies to a proceeding brought 40 under the workers' compensation law but shall not apply to any proceed- 41 ing governed by section two hundred five-a of this article. 42 § 6. The civil practice law and rules is amended by adding a new 43 section 205-a to read as follows: 44 § 205-a. Termination of certain actions related to real property. (a) 45 If an action upon an instrument described under subdivision four of 46 section two hundred thirteen of this article is timely commenced and is 47 terminated in any manner other than a voluntary discontinuance, a fail- 48 ure to obtain personal jurisdiction over the defendant, a dismissal of 49 the complaint for any form of neglect, including, but not limited to 50 those specified in subdivision three of section thirty-one hundred twen- 51 ty-six, section thirty-two hundred fifteen, rule thirty-two hundred 52 sixteen and rule thirty-four hundred four of this chapter, for violation 53 of any court rules or individual part rules, for failure to comply with 54 any court scheduling orders, or by default due to nonappearance for 55 conference or at a calendar call, or by failure to timely submit any 56 order or judgment, or upon a final judgment upon the merits, theA. 7737--B 3 1 original plaintiff, or, if the original plaintiff dies and the cause of 2 action survives, his or her executor or administrator, may commence a 3 new action upon the same transaction or occurrence or series of trans- 4 actions or occurrences within six months following the termination, 5 provided that the new action would have been timely commenced within the 6 applicable limitations period prescribed by law at the time of the 7 commencement of the prior action and that service upon the original 8 defendant is completed within such six-month period. For purposes of 9 this subdivision: 10 1. a successor in interest or an assignee of the original plaintiff 11 shall not be permitted to commence the new action, unless pleading and 12 proving that such assignee is acting on behalf of the original plain- 13 tiff; and 14 2. in no event shall the original plaintiff receive more than one 15 six-month extension. 16 (b) Where the defendant has served an answer and the action upon an 17 instrument described under subdivision four of section two hundred thir- 18 teen of this article is terminated in any manner, and a new action upon 19 the same transaction or occurrence or series of transactions or occur- 20 rences is commenced by the original plaintiff, or a successor in inter- 21 est or assignee of the original plaintiff, the assertion of any cause of 22 action or defense by the defendant in the new action shall be timely if 23 such cause of action or defense was timely asserted in the prior action. 24 § 7. Subdivision 4 of section 213 of the civil practice law and rules 25 is amended by adding two new paragraphs (a) and (b) to read as follows: 26 (a) In any action on an instrument described under this subdivision, 27 if the statute of limitations is raised as a defense, and if that 28 defense is based on a claim that the instrument at issue was accelerated 29 prior to, or by way of commencement of a prior action, a plaintiff shall 30 be estopped from asserting that the instrument was not validly acceler- 31 ated, unless the prior action was dismissed based on an expressed judi- 32 cial determination, made upon a timely interposed defense, that the 33 instrument was not validly accelerated. 34 (b) In any action seeking cancellation and discharge of record of an 35 instrument described under subdivision four of section fifteen hundred 36 one of the real property actions and proceedings law, a defendant shall 37 be estopped from asserting that the period allowed by the applicable 38 statute of limitation for the commencement of an action upon the instru- 39 ment has not expired because the instrument was not validly accelerated 40 prior to, or by way of commencement of a prior action, unless the prior 41 action was dismissed based on an expressed judicial determination, made 42 upon a timely interposed defense, that the instrument was not validly 43 accelerated. 44 § 8. Rule 3217 of the civil practice law and rules is amended by 45 adding a new subdivision (e) to read as follows: 46 (e) Effect of discontinuance upon certain instruments. In any action 47 on an instrument described under subdivision four of section two hundred 48 thirteen of this chapter, the voluntary discontinuance of such action, 49 whether on motion, order, stipulation or by notice, shall not, in form 50 or effect, waive, postpone, cancel, toll, extend, revive or reset the 51 limitations period to commence an action and to interpose a claim, 52 unless expressly prescribed by statute. 53 § 9. Severability clause. If any clause, sentence, paragraph, section 54 or part of this act shall be adjudged by any court of competent juris- 55 diction to be invalid, such judgment shall not affect, impair or invali- 56 date the remainder thereof, but shall be confined in its operation toA. 7737--B 4 1 the clause, sentence, paragraph, section or part thereof directly 2 involved in the controversy in which such judgment shall have been 3 rendered. 4 § 10. This act shall take effect immediately and shall apply to all 5 actions commenced on an instrument described under subdivision four of 6 section two hundred thirteen of the civil practice law and rules in 7 which a final judgment of foreclosure and sale has not been enforced.