HSBC BANK USA NATIONAL ASSOCIATION v. MAK (2023)

DECISION & ORDER

In an action to foreclose a mortgage, nonparty MAK Assets, Inc., appeals from an order of the Supreme Court, Queens County (Denis J. Butler, J.), entered July 28, 2021.  The order, insofar as appealed from, denied the cross-motion of nonparty MAK Assets, Inc., for leave to intervene in the action and, thereupon, for leave to serve and file an answer.

ORDERED that the order is reversed insofar as appealed from, on the law, with costs, and the cross-motion of nonparty MAK Assets, Inc., for leave to intervene in the action and, thereupon, for leave to serve and file an answer is granted.

In 2007, the plaintiff commenced this action to foreclose a mortgage on certain real property located in Queens.  The defendants failed to interpose an answer.  During the pendency of the action, the property was conveyed to nonparty MAK Assets, Inc. (hereinafter MAK).  Subsequently, the plaintiff moved, inter alia, for leave to enter a default judgment and for an order of reference, and MAK cross-moved for leave to intervene in the action pursuant to CPLR 1012(a) or 1013 and, thereupon, for leave to serve and file an answer.  In an order entered July 28, 2021, the Supreme Court, inter alia, denied MAK's cross-motion.  MAK appeals.

“Upon timely motion, any person shall be permitted to intervene in any action ․ 2. when the representation of the person's interest by the parties is or may be inadequate and the person is or may be bound by the judgment;  or 3. when the action involves the disposition or distribution of, or the title or a claim for damages for injury to, property and the person may be affected adversely by the judgment” (id. § 1012[a]).  “ ‘[I]ntervention may occur at any time, provided that it does not unduly delay the action or prejudice existing parties’ ” (Deutsche Bank Natl. Trust Co. v. Allenstein, 201 A.D.3d 783, 785, 162 N.Y.S.3d 389, quoting Halstead v. Dolphy, 70 A.D.3d 639, 640, 892 N.Y.S.2d 897).  “[N]either the fact that the appellant obtained its interest in the subject property after this action was commenced and the notice of pendency was filed, nor the fact that the defendants defaulted in answering or appearing, definitively bars intervention” (Bank of Am., NA v. Nocella, 194 A.D.3d 900, 902, 149 N.Y.S.3d 195;  see Consumer Solutions, LLC v. Charles, 187 A.D.3d 1134, 1135, 131 N.Y.S.3d 626;  US Bank N.A. v. Carrington, 179 A.D.3d 743, 743–744, 113 N.Y.S.3d 558).  “ ‘In examining the timeliness of the motion, courts do not engage in mere mechanical measurements of time, but consider whether the delay in seeking intervention would cause a delay in resolution of the action or otherwise prejudice a party’ ” (Deutsche Bank Natl. Trust Co. v. Allenstein, 201 A.D.3d at 785, 162 N.Y.S.3d 389, quoting Yuppie Puppy Pet Prods., Inc. v. Street Smart Realty, LLC, 77 A.D.3d 197, 201, 906 N.Y.S.2d 231).

The Supreme Court should have granted that branch of MAK's cross-motion which was for leave to intervene in this action pursuant to CPLR 1012(a).  MAK was entitled to intervene as of right “since it established that the representation of its interest by the parties would be inadequate, that the action involved the disposition of title to real property, and that it would be bound and adversely affected by a judgment of foreclosure and sale” (Bank of Am., NA v. Nocella, 194 A.D.3d at 901, 149 N.Y.S.3d 195;  see CPLR 1012[a][2], [3];  6501;  US Bank N.A. v. Carrington, 179 A.D.3d at 743–744, 113 N.Y.S.3d 558;  Yuppie Puppy Pet Prods., Inc. v. Street Smart Realty, LLC, 77 A.D.3d at 201, 906 N.Y.S.2d 231).  Under the circumstances, MAK's cross-motion, inter alia, for leave to intervene was timely.  “Significantly, it was made in response to the plaintiff's motion, among other things, for leave to enter a default judgment and for an order of reference, ․ [and] since it was made before an order of reference or a judgment of foreclosure and sale was issued, the plaintiff was not prejudiced by the timing of the cross motion” (Deutsche Bank Natl. Trust Co. v. Allenstein, 201 A.D.3d at 785, 162 N.Y.S.3d 389;  see Bank of Am., NA v. Nocella, 194 A.D.3d at 901, 149 N.Y.S.3d 195;  Consumer Solutions, LLC v. Charles, 187 A.D.3d at 1135, 131 N.Y.S.3d 626).

Accordingly, the Supreme Court should have granted MAK's cross-motion for leave to intervene in the action and, thereupon, for leave to serve and file an answer (see US Bank N.A. v. Carrington, 179 A.D.3d at 744, 113 N.Y.S.3d 558).

The parties’ remaining contentions either are without merit, are not properly before this Court, or need not be reached in light of our determination.

DUFFY, J.P., CHRISTOPHER, WAN and LANDICINO, JJ., concur.