FEDERAL NATIONAL MORTGAGE ASSOCIATION v. Unknown Heirs of the Estate of Rosa Hartsfield et al., Defendants. (2026)

Judgment, Supreme Court, Bronx County (Naita A. Semaj, J.), entered August 25, 2025, dismissing the action, and bringing up for review an order, same court and Justice, entered on or about July 8, 2025, denying plaintiff's motion for a default judgment and dismissing the action without prejudice pursuant to CPLR 3215(c), unanimously affirmed, without costs.

Defendant defaulted in answering the amended complaint served on her on September 12, 2018.  Nonetheless, plaintiff failed to “take proceedings for the entry of judgment within one year after the default” pursuant to CPLR 3215(c).  Instead, plaintiff untimely moved for an order of reference in October 2021.  The COVID–19 pandemic did not excuse plaintiff's failure, because the pandemic did not begin until March 2020, more than a year after defendant defaulted.

Plaintiff is judicially estopped from arguing that because the amended complaint was substantively identical to the original complaint, defendant did not need to file an answer, as plaintiff had previously asserted that defendant had defaulted by not answering the amended complaint (see Karasik v Bird, 104 AD2d 758, 758–59 [1st Dept 1984] [“It is a well-settled principle of law in this State that a party who assumes a certain position in a legal proceeding may not thereafter, simply because his interests have changed, assume a contrary position”] ).  Even if plaintiff were not judicially estopped, the argument would be unavailing.  The court properly exercised its discretion in dispensing with an answer requirement to the amended complaint because there were no new factual allegations asserted therein;  the new material in the amended complaint had no bearing on the counterclaims asserted in the original answer;  and plaintiff had notice of the counterclaims being asserted (see Bahar v Sanieoff, 210 AD3d 459, 460 [1st Dept 2022] ).  However, plaintiff never raised this as an issue before the court, but instead sought a default judgment based on defendant's failure to answer the amended complaint.  Accordingly, the court was not furnished with the occasion to waive the need for defendant to answer and to resolve the action on the merits.  Moreover, this is not a case in which “unusual circumstances” were present to warrant the use of this Court's exercise of discretion (see Triolo v Greenwood, 216 AD3d 1035, 1036 [2d Dept 2023] ).

Defendant did not waive her right to seek dismissal pursuant to CPLR 3215(c) by participating in the litigation.  As the motion court aptly noted, until the time in which plaintiff could move for a default judgment on the amended complaint had expired, defendant did not have a “known right” that she could intentionally relinquish (Ess & Vee Acoustical & Lathing Contrs. v Prato Verde, Inc., 268 AD2d 332, 332 [1st Dept 2000] ).  The fact that defendant appeared in 2015, before the amended complaint was filed in 2018, did not constitute a waiver of defendant's right to move to dismiss based on CPLR 3215(c) (see Hoppenfeld v Hoppenfeld, 220 AD2d 302, 303 [1st Dept 1995] ).  Indeed, defendant's ability to move pursuant to CPLR 3215(c) did not accrue until in or around early October 2019, a year after she had defaulted in answering the amended complaint.  Defendant's filing of a COVID–19 hardship declaration in November 2021 following her default in 2018, the only activity alleged by plaintiff as constituting a waiver, did not constitute “active litigation of the action or participation in the action on the merits” so as to give rise to a waiver (U.S. Bank Trust, N.A. v Lane, 241 AD3d 745, 747 [2d Dept 2025] [hardship declaration did not constitute formal or informal appearance sufficient to waive defense of lack of personal jurisdiction] ).

While defendant disputes the applicability of CPLR 3408 to this appeal, the motion court's ability to dismiss the action was not affected by the residential foreclosure settlement conference pursuant to CPLR 3408(m).  The statute provides that a defendant “who appears at the settlement conference but who failed to file a timely answer ․ shall be permitted to serve and file an answer ․ within thirty days of initial appearance at the settlement conference” but also that “[t]he default shall be deemed vacated upon service and filing of an answer.”  Considering that defendant never filed an answer, her 2018 default was never vacated.  Plaintiff's suggestion that the court dismissed the action prematurely is unavailing.  Contrary to plaintiff's argument otherwise, the motion court dismissed the action after the 30–day grace period had expired.

We decline to consider plaintiff's argument that the motion court should not have dismissed the action as against the remaining defendants.  Plaintiff did not raise the argument in opposition to defendant's cross-motion to dismiss, and whether defendant is a fee owner of the property, and thus an indispensable party whose absence in the case requires dismissal (see LaSalle Bank N.A. v Benjamin, 164 AD3d 1223, 1225 [2d Dept 2018] ), cannot be determined on the face of the record (see Rojas–Wassil v Villalona, 114 AD3d 517, 517 [1st Dept 2014] ).

We have considered plaintiff's remaining contentions and find them unavailing.