BANK NATIONAL ASSOCIATION AS TRUSTEE FOR LEHMAN MORTGAGE TRUST MORTGAGE PASS THROUGH CERTIFICATES SERIES 2007 v. SACKARIS HEL 2002 (2022)

It is

ORDERED that the plaintiff's motion for summary judgment are denied, and it is further

ORDERED that the cross motion of defendant for summary judgment is granted and the action is dismissed.

The basis facts of the action are articulated in the prior decisions and orders of Judge Hudson (NYSCEF Doc Nos. 53, 84, and 127). Presently, the plaintiff has moved for summary judgment and the defendant has cross motion for summary judgment.

The court first addresses defendants’ cross-motion as it finds that motion to be dispositive of the case. The court notes that when a defendant has raised compliance with RPAPL § 1304 in the answer, plaintiff is required to establish its compliance with the requirements of the statute (see Deutsche Bank Natl. Trust Co. v. Starr, 173 A.D.3d 836, 104 N.Y.S.3d 643 [2d Dept. 2019]; Bank of New York Mellon v. Zavolunov, 157 A.D.3d 754, 69 N.Y.S.3d 356 [2d Dept. 2018]). In support of its motion, plaintiff has submitted copies of the RPAPL § 1304 notices that it allegedly mailed in compliance with the statute (NYSCEF Doc No. 27).

RPAPL § 1304 (2) mandates that the required notices be mailed “in a separate envelope from any other mailing or notice.” Plaintiff's submission proves that the notices contain additional language not directed by the statute in violation of RPAPL § 1304 (2). The Second Department has recently held that “inclusion of any material in the separate envelope sent to the borrower under RPAPL 1304 that is not expressly delineated in these provisions constitutes a violation of the separate envelope requirement of RPAPL 1304(2)” (Bank of America, N.A. v. Kessler, 202 A.D.3d 10, 160 N.Y.S.3d 277 [2d Dept. 2021] see Wells Fargo Bank, N.A. v. DeFeo, 200 A.D.3d 1105, 161 N.Y.S.3d 218 [2d Dept., 2021]; Citimortgage, Inc. v. Dente, 200 A.D.3d 1025, 155 N.Y.S.3d 813 [2d Dept. 2021]). This “strict approach” provides clear guidelines that any “additional material” violates the requirements of RPAPL § 1304. Here, the additional material provided in the notice which is not within the section's language ¹ (Ocwen Loan Servicing, LLC v. Sirianni, 202 A.D.3d 702, 163 N.Y.S.3d 110 [2d Dept. 2022]). Strict compliance with RPAPL § 1304 is a condition precedent for the commencement of a foreclosure action (H & R Block Bank, FSB v. Liles, 186 A.D.3d 813, 130 N.Y.S.3d 521 [2d Dept. 2020]).

The plaintiff argues that the language was required by the Fair Debt Collection Practices Act (FDCPA). Specifically, the FDCPA states that the “failure to disclose in the initial written communication with the consumer and, in addition, if the initial communication with the consumer is oral, in that initial oral communication, that the debt collector is attempting to collect a debt and that any information obtained will be used for that purpose, and the failure to disclose in subsequent communications that the communication is from a debt collector, except that this paragraph shall not apply to a formal pleading made in connection with a legal action.” 15 USC 1692e(11). In Townsend v. Quantum3 Group, LLC, 535 B.R. 415 (M.D. Fla. 2015), the court held that a proof of claims filed by a debtor were “formal pleadings” so as not to require the disclosure notice. The notice under RPAPL is a condition precedent to commencing a foreclosure action required by the statute and compliance with the statute must be stated in the complaint ² and documents attached to the complaint establishing compliance. Furthermore proof of compliance is mandated to be filed with the superintendent of financial services pursuant to RPAPL § 1306. This is analogous to Townsend so the Court finds that the notice sent as required by RPAPL 1304 is a formal pleading exempted from the requirements of providing the statement under the FDCPA.³ This is harmony with many courts that have held that a broad application of the formal pleading exception should be applied (see e.g. Rivas v. Pollack and Rosen, P.A., 2019 WL 6468709 [S.D. Fla. 2019]). Consequently, there is no inconsistencies between federal statute and the state statute as interpreted by the Appellate Division, Second Judicial Department.⁴

As plaintiff's own submissions have established that it did not strictly comply with the statutorily mandated condition precedents of RPAPL § 1304, the court is compelled to grant defendant summary judgment dismissing the complaint. In light of this determination, it is unnecessary to address the other issues raised by defendants’ cross-motion, as well as those raised by plaintiff's motion, which is denied.

The foregoing constitutes the decision and order of the Court.

FOOTNOTES

1.   Additional language may take away the focus on the important language of the notice required by the legislature.

2.   The legislative history indicates that such “Affirmative Allegation” of compliance was required for the commencement of a foreclosure action (Sponsors’ Mem, Bill Jacket, L 2008, ch 472). The notice was “critical information early on in the process,” that is a foreclosure action (id.)

3.   Some analogous cases include Bohannon v. LVNV Funding, LLC, No. 14-0354, 2015 WL 893362, at *4 (E.D. Va. Mar. 2, 2015) (finding that affidavits attached to warrants in debt fall under the FDCPA's formal pleading exception); Lilly v. RAB Performance Recoveries, LLC, No. 12-0364, 2013 WL 4010257, at *4 (E.D. Tenn. Aug. 5, 2013) (finding that a sworn affidavit attached to a civil warrant is a formal pleading under the FDCPA).

4.   The plaintiff's argument of statutory interpretation that RPAPL 1304 should be strictly construed as in derogation of common law is inconsistent with precedent of the Second Department. However, it is noted that remedial statutes should be liberally construed to meet the legislature's intent (McKinney's Cons Laws of NY, Book 1, Statutes § 321).It is noted that section 1304 is in article 13 of the Real Property Actions and Proceeding Laws, titled Action to Foreclose a Mortgage, further indicating documents involve relate to a legal action.

Robert F. Quinlan, J.