WILMINGTON SAVINGS FUND SOCIETY FSB v. GUSTAFSON (2018)

MEMORANDUM AND ORDER

Plaintiff commenced this mortgage foreclosure action in April 2016, alleging that Steven E. Gustafson and Pam L. Gustafson (defendants) defaulted in the payment of their mortgage in May 2009 and in each subsequent month thereafter.  In moving to dismiss the complaint against them, defendants contended that the action is barred by the six-year statute of limitations (see CPLR 213[4];  see also CPLR 3211[a][5] ), and Supreme Court granted the motion.  We reverse.

We agree with plaintiff that defendants failed to meet their initial burden of establishing that the action is time-barred.  Where, as here, a mortgage is payable in installments, separate causes of action accrue for each unpaid installment, and the six-year statute of limitations begins to run on the date that each installment becomes due (see Wells Fargo Bank, N.A. v. Cohen, 80 A.D.3d 753, 754, 915 N.Y.S.2d 569 [2d Dept. 2010];  see also United States of Am. v. Quaintance, 244 A.D.2d 915, 915–916, 665 N.Y.S.2d 191 [4th Dept. 1997], lv dismissed 91 N.Y.2d 957, 671 N.Y.S.2d 717, 694 N.E.2d 886 [1998] ).  If, however, the mortgage holder accelerates the entire debt by a demand, the six-year statute of limitations begins to run on the entire debt (see Business Loan Ctr., Inc. v. Wagner, 31 A.D.3d 1122, 1123, 818 N.Y.S.2d 406 [4th Dept. 2006];  see also EMC Mtge. Corp. v. Patella, 279 A.D.2d 604, 605, 720 N.Y.S.2d 161 [2d Dept. 2001] ).

Here, defendants' own submissions in support of the motion establish that, although another entity purported to accelerate defendants' entire debt in 2010 and 2012, that entity was not the holder or assignee of the mortgage and did not hold or own the note.  Thus, the entity's purported attempts to accelerate the entire debt were a nullity, and the six-year statute of limitations did not begin to run on the entire debt (see EMC Mtge. Corp. v. Suarez, 49 A.D.3d 592, 593, 852 N.Y.S.2d 791 [2d Dept. 2008];  see also Wells Fargo Bank, N.A. v. Burke, 94 A.D.3d 980, 982–983, 943 N.Y.S.2d 540 [2d Dept. 2012] ).  Although this mortgage foreclosure action therefore is not time-barred, we note that, “in the event that the plaintiff prevails in this action, its recovery is limited to only those unpaid installments which accrued within the six-year [and 90–day] period immediately preceding its commencement of this action” (EMC Mtge. Corp., 49 A.D.3d at 593, 852 N.Y.S.2d 791;  see RPAPL 1304;  CPLR 204[a] ).

It is hereby ORDERED that the order so appealed from is unanimously reversed on the law without costs, the motion is denied and the complaint against defendants Steven E. Gustafson and Pam L. Gustafson is reinstated.

Memorandum: