EMIGRANT FUNDING CORPORATION v. 2424 DAVIDSON AVENUE LLC USA LLC LLC LLC (2022)

In this action to foreclose a mortgage and sell the real property which it encumbers, defendants 2424 DAVIDSON AVENUE, LLC (Davidson), ARSENIO JIMENEZ (Jimenez) and ANA JIMENEZ A/K/A ANA LUISA GONZALEZ SOSA (Sosa) move seeking an order, inter alia, pursuant to CPLR § 5015(a)(1) vacating the Court's Order of Reference and Default Judgment ¹ and Order to Appoint a Receiver in Mortgage Foreclosure, dated December 24, 2019, which held that all defendants had been duly served with the summons and complaint and had failed to appear. Jimenez and Sosa contend, inter alia, that they were never served with the summons and complaint, such that their failure to interpose answers is excusable. Plaintiff opposes the instant motion, asserting that movants were served with process such that they have no reasonable excuse for failing to answer and that they fail to proffer any defense to the instant action. Plaintiff cross-moves seeking, inter alia, the entry of a Judgment of Foreclosure and Sale. Plaintiff's cross-motion is unopposed.

For the reasons that follow hereinafter, Davidson, Jimenez, and Sosa's motion is denied and plaintiff's cross-motion is granted without opposition.

According to the complaint, this action is for foreclosure on a mortgage and the sale of the properties which secure the corresponding promissory note. The complaint alleges that on January 8, 2015, Davidson executed a promissory note obligating it to repay non-party Fajim Limited the amount of $550,000. The promissory note was secured by a mortgage, which pledged real property located at 2352 University Avenue, Bronx, NY 10468 (2352) as collateral. On November 9, 2016, Davidson executed a promissory note obligating it to repay plaintiff $225,000. The promissory note was secured by a mortgage that pledged 2352 and real property located at 2424 Davidson Avenue, Bronx, NY 10468 (2424) as collateral. On that same day, Davidson executed an amended restated note, obligating it to repay plaintiff $775,000. The amended restated note was secured by an agreement of spreader, assumption, consolidation and modification of mortgage, which consolidated the two prior mortgages and pledged 2352 and 2424 as collateral for the amended restated note. Davidson also executed an assignment of leases, whereby leases and rents at 2352 and 2424 were assigned to plaintiff. Jimenez and Sosa executed a guaranty of payment, wherein they agreed to guarantee the loans made to Davidson. Plaintiff holds and owns the notes, the mortgages, the amended restated note, and agreement of spreader, assumption, consolidation and modification of mortgage. The foregoing documents require that Davidson repay the loans made to it via monthly installments and that the failure to make a payment when due constitutes a default. Upon default, plaintiff is authorized to accelerate the debt and if payment is not made, may institute an action to foreclose the mortgage and sell the collateral pledged thereunder. It is alleged that on May 1, 2018, Davidson failed to make a payment when due, that the debt was accelerated and that neither Davidson, Jimenez, nor Sosa satisfied the debt owed to plaintiff. It is alleged that $766,236.53 is due and owing on the loan and as a result thereof, plaintiff seeks a judgment of foreclosure and sale.

On December 24, 2019, the Court (Gonzalez, J.) granted plaintiff's application seeking, inter alia, the entry of default judgment against all defendants since they had failed to appear and/or interpose answers.

DAVIDSON, JIMENEZ, AND SOSA'S MOTION

CPLR § 5015

Because Jimenez and Sosa aver that they have a reasonable excuse for their default and a meritorious defense to the claims in the complaint, the instant motion is one pursuant to CPLR § 5015(a)(1). However, insofar as movants also aver that they were never served with the summons and complaint, they interpose the absence of personal jurisdiction as the excuse for failing to appear. Accordingly, this Court must first determine the jurisdictional portion of the instant motion pursuant to CPLR § 5015(a)(4) and then address the issue of vacating the instant judgment on grounds of excusable default pursuant to CPLR § 5015(a)(1).

To be sure, it is well settled that when a defendant seeks to vacate a default judgment pursuant to CPLR § 5015(a)(1) by raising a jurisdictional defense pursuant to CPLR § 5015(a)(4), the court must resolve the jurisdictional question before determining whether a discretionary vacatur of the default under CPLR § 5015(a)(1) is warranted (Roberts v Anka, 45 AD3d 752, 753 [2d Dept 2007] [“When a defendant seeking to vacate a default judgment raises a jurisdictional objection pursuant to CPLR 5015 (a)(4), the court is required to resolve the jurisdictional question before determining whether it is appropriate to grant a discretionary vacatur of the default under CPLR 5015(a)(1).”], lv. dismissed 10 NY3d 851 [2008]; Delgado v Velecela, 56 AD3d 515, 516 [2d Dept 2008]; Marable ex rel. Ralph v Williams, 278 AD2d 459, 459 [2d Dept 2000]; Taylor v Jones, 172 AD2d 745, 746 [2d Dept 1991]). Only if the jurisdictional question is resolved in favor of the opponent (in this case, plaintiff), will the court reach the issue of whether vacatur pursuant to CPLR § 5015(a)(1) is warranted (Roberts at 752; Delgado at 516; Marable ex rel. Ralph at 459; Taylor at 746).

CPLR § 5015(a)(4) - Lack of Jurisdiction

Davidson, Jimenez, and Sosa's motion seeking to vacate this Court's order for lack of personal jurisdiction is denied. Significantly, there is nothing submitted in support of Davidson's application to vacate the prior order. As such, Davidson's application is denied. With regard to Jimenez and Sosa's application, the same is denied since they fail to rebut the presumption of service established by the affidavit of service submitted by movants.

CPLR § 5015(a)(4) authorizes a court to vacate a judgment when the same is obtained despite a “lack of jurisdiction to render the judgment or order” (CPLR § 5015[a][4]). The proponent of a motion to vacate a judgment for want of jurisdiction must establish either that the party to whom a judgment was granted failed to obtain personal jurisdiction over him or her (Toyota Motor Credit Corp. v Hardware Lam, 93 AD3d 713, 713 [2d Dept 2012]; Hossain v Fab Cab Corp., 57 AD3d 484, 485 [2d Dept 2008]), or that the court lacked the requisite subject matter jurisdiction to render judgment (Lacks v Lacks, 41 NY2d 71, 77 [1976]; HSBC Bank USA, N.A. v Ashley, 104 AD3d 975, 976 [2d Dept 2013]).

It is well settled that the burden of establishing personal jurisdiction and proper service rests with the plaintiff (Frankel v Schilling, 149 AD2d 657, 659 [2d Dept 1989]; Torres v Corpus, 131 AD2d 463, 464 [2d Dept 1987]). Generally, an affidavit of service is prima facie evidence of proper service (Caba v Rai, 63 AD3d 578, 582-583 [1st Dept 2009]; NYCTL 1998-1 Trust Bank of NY v Rabinowitz, 7 AD3d 459, 460 [1st Dept 2004]; Scarano v Scarano, 63 AD3d 716, 716 [2d Dept 2009]; Simonds v Grobman, 277 AD2d 369, 370 [2d Dept 2000]). Accordingly, an affidavit evidencing proper service upon the defendant is sufficient to support a finding of personal jurisdiction (Skyline Agency, Inc. v Ambrose Coppotelli, Inc., 117 AD2d 135, 139 [2d Dept 1986]). Personal jurisdiction will be upheld without a traverse hearing if the only evidence submitted in opposition is a bare or conclusory denial of service (Caba at 583 [Sworn denial conclusorily stating that defendant was not served was insufficient to rebut service as evinced by the affidavit of service.]; Simonds at 370 [“The defendants failed to submit a sworn denial of service. Moreover, they did not swear to specific facts to rebut the statements in the process server's affidavits.”]; Beneficial Homeowner Service Corp. v Girault, 60 AD3d 984, 984 [2d Dept 2009][The affidavit of the process server constituted prima facie evidence of proper service pursuant to CPLR 308 (2), and the defendant's bare and unsubstantiated denial of receipt was insufficient to rebut the presumption of proper service created by the affidavit of service” (internal citations omitted)]; Scarano at 716 [“Here, the defendant's affidavit was insufficient. Since he never denied the specific facts contained in the process server's affidavit, no hearing was required.”]; Rabinowitz at 460 [Defendant negated service of process upon him by citing to the affidavit of service and pointing to the deficiencies therein.]; Chemical Bank v Darnley, 300 AD2d 613, 613 [2d Dept 2002]), or a minor discrepancy, such as a mistake in the description of the recipient listed in the server's affidavit (Green Point Savings Bank v Clark, 253 AD2d 514, 515 [2d Dept 1998]). Stated differently, in order to successfully assail and rebut service so as to warrant a hearing, a defendant's affidavit must specifically rebut the facts in the affidavit of service (Caba at 683; Simonds at 370; Rabinowitz at 460). If the denial of service is factually specific, then the court must hold a traverse hearing before deciding whether it has personal jurisdiction over the defendant (Frankel v Schilling, 149 AD2d 657, 659 [2d Dept 1989]; Powell v Powell, 114 AD2d 443, 444 [2d Dept 1985]).

In cases where a defendant claims that he did not reside at the address where service was effectuated, in order to rebut the presumption of service, he must submit corroborating proof (Bank of Am., N.A. v Lewis, 190 AD3d 910, 911 [2d Dept 2021] [“Here, the defendant submitted his affidavit, wherein he averred, inter alia, that he did not reside at the address in Rosedale when service was purportedly effectuated, and copies of his 2014 through 2016 tax returns indicating that the defendant resided at an address in Ridgewood. The defendant's submissions were sufficient to rebut the prima facie showing of proper service, and to necessitate a hearing.”]; Am. Home Mtge. Acceptance, Inc. v Lubonty, 188 AD3d 767, 770 [2d Dept 2020] [Motion to vacate a default judgment denied because, inter alia, “(a)lthough the defendant submitted an affidavit in which he averred that he resided at a Florida address at the relevant time, he failed to submit documentary evidence to support that claim.”]; Bank of New York Mellon v Lawson, 176 AD3d 1155, 1157 [2d Dept 2019] [“The defendants failed to submit any documentary evidence to support John Lawson's claim that he did not reside at the Brooklyn address at the time he was served, and they failed to submit an affidavit from a resident of that address denying receipt of a copy of the summons and complaint or stating that John Lawson did not live there.”]; cf. U.S. Bank v Arias, 85 AD3d 1014, 1016 [2d Dept 2011] [“However, to rebut that showing, the defendant submitted a sworn denial of service containing specific facts to rebut the presumption of proper service. Furthermore, in replying to contentions raised by the plaintiff in its opposition papers, the defendant submitted documentary evidence supporting his claim that he did not reside at the subject premises or at the Long Island City address in 2008. The defendant's submission was sufficient to rebut the prima facie showing of proper service, and to necessitate a hearing. Accordingly, the matter must be remitted to the Supreme Court, Queens County, for a hearing to determine whether the defendant was properly served with process pursuant to CPLR 308(2), and for a new determination thereafter of his motion to vacate the judgment of foreclosure and sale and to dismiss the complaint insofar as asserted against him for lack of personal jurisdiction.”]).

At a traverse hearing, plaintiff bears the burden of establishing service upon the defendant (Chaudry Const. Corp. v James G. Kalpakis & Assoc., 60 AD3d 544, 545 [1st Dept 2009]; Schorr v Persaud, 51 AD3d 519, 519—520 [1st Dept 2008]). Moreover, at the hearing, the trial court can resolve issues of credibility, such resolution is accorded great deference, and absent a determination that it is against the weight of the evidence, cannot be disturbed on appeal (McCray v Petrini, 212 AD2d 676, 676 [2d Dept 1995]; Avakian v De Los Santos, 183 AD2d 687, 688 [2d Dept 1992]).

In support of their motion, movants submit the affidavits of of service, evincing service of the summons and complaint upon Sosa and Jimenez. The first affidavit states that on March 13, 2019, the summons and complaint was served upon Jimenez when a copy of the same was left with Sosa at his home, located at 2260 University Avenue, Apt 2N, Bronx, NY 10468 (2260). The second affidavit states that on the foregoing date, Sosa was served with the summons and complaint when a copy of the same was handed to her at 2260, her home.

Movants also submit two affidavits. The first is by Jimenez, wherein he states, in pertinent part, the following. Jimenez is Davidson's Managing Partner. Jimenez states that he and his wife reside at 2352 in apartment 4S. With regard to service of the summons and complaint, Jimenez states that he was never served with the same. To the extent that that it is alleged that Jimenez was served with the summons and complaint at 2260, he states that he does not live there. Jimenez further states that the guaranty agreement he executed required that he be served with process at 2352 and that had he been served there, he would have received the same. The second affidavit is by Sosa, wherein she states, in pertinent part, as follows. Sosa is Davidson's member. She and her husband reside at 2352 in apartment 4S. Sosa states that with regard to service of the summons and complaint, she was never served with the same. To the extent that it is alleged that she was served with process at 2260, Sosa alleges that she did not reside there.

Movants submit a portion of the guaranty agreement they executed, which indicates that delivery of items, not enumerated therein, be effectuated at 2352.

Based on the foregoing, the portion of the instant motion seeking vacatur of the Order of Reference and Default Judgment on grounds that Jimenez and Sosa were not served with the summons and complaint is denied. A noted above, an affidavit of service is prima facie evidence of proper service (Caba at 582-583; NYCTL 1998-1 Trust Bank of NY at 460; Scarano at 716; Simonds at 370), establishes proper service upon the defendant sufficient to support a finding of personal jurisdiction (Skyline Agency, Inc. at 139), and personal jurisdiction will be upheld without a traverse hearing if the only evidence submitted on a motion to vacate a judgment is a bare or conclusory denial of service (Caba at 583; Simonds at 370; Beneficial Homeowner Service Corp. at 984; Scarano at 716 Rabinowitz at 460). In other words, in order to successfully assail and rebut service so as to warrant a hearing, a defendant's affidavit must specifically rebut the facts in the plaintiff's affidavit of service (Caba at 683; Simonds at 370; Rabinowitz at 460). Only if the denial of service is factually specific, then the court must hold a traverse hearing before deciding whether it has personal jurisdiction over the defendant (Frankel at 659; Powell at 444).

Here, the affidavits of service submitted by movants establish that Sosa was properly served with process because the affidavit evincing service upon her establishes that the summons and complaint were handed to her at her home (CPLR § 308[1] [“Personal service upon a natural person shall be made ․ by delivering the summons within the state to the person to be served.”]). The affidavits of service also establish that Jimenez was duly served with process because the affidavit evincing service upon him establishes that the summons and complaint were left at his home with Sosa (CPLR § 308[2] [“Personal service upon a natural person shall be made ․ by delivering the summons within the state to a person of suitable age and discretion at the actual place of business, dwelling place or usual place of abode of the person to be served.”]).

The affidavits submitted by Jimenez and Sosa wherein they attempt to rebut service fail as a matter of law because nothing submitted by them corroborates their claim that they did not reside at 2260. Indeed, they submit no evidence to that effect at all and instead focus on one page of the guaranty agreement, which by itself, fails to support their assertion, namely, that they were required to be served at 2352. Since, where as here, Jimenez and Sosa claim that they did not reside at the address where service was effectuated, in order to rebut the presumption of service, they must submit corroborating proof (Bank of Am., N.A. at 911; Am. Home Mtge. Acceptance, Inc. at 770; Bank of New York Mellon at 1157; cf. U.S. Bank at 1016), and this alone warrants denial of their motion.

Additionally, to the extent that Jimenez and Sosa's salient basis for negating personal jurisdiction is that the agreement between the parties required service of process upon them at 2352 rather than 2260, the place that plaintiff believed constituted their residence, their contention is without merit. Specifically, plaintiff's evidence belies the foregoing claim.

In opposition to the instant motion and in support of its cross-motion, plaintiff submits the guaranty agreement between plaintiff and Jimenez and Sosa, dated November 9, 2016, and executed by Jimenez and Sosa. Paragraph 16 of the agreement governs service of process upon Jimenez and Sosa and states that

[t]he undersigned agree to submit to personal jurisdiction in the State of New York in any action or proceeding arising out of this Guaranty and, in furtherance of such agreement, the undersigned hereby agree and consent that without limiting other methods of obtaining jurisdiction, personal jurisdiction over the undersigned in any such action or proceeding may be obtained within or without the jurisdiction of any court located in New York and that any process or notice of motion or other application to any such court in connection with any such action or proceeding may be served upon the undersigned by registered or certified mail to or by personal service at the last known address of the undersigned, whether such address be within or without the jurisdiction of any such court (emphasis added).

Paragraph 14 of the foregoing agreement, governing the mailing of notices to Jimenez and Sosa, and which they fail to provide in full, states that

[a]ny notice, request or demand given or made under this Guaranty shall be in writing and shall be hand delivered or sent by Federal Express or other reputable courier service or by postage prepaid registered or certified mail, return receipt requested, and shall be deemed given (i) when received at the following addresses if hand delivered or if sent by Federal Express or other reputable courier service, and (ii) three (3) business days after being postmarked and addressed as follows if sent by registered or certified mail, return receipt requested ․ If to the undersigned: Arsenio Jimenez[,] 2352 University Avenue Bronx, New York 10468 (emphasis added).

Plaintiff also submits a copy of Jimenez’ driver's license, issued in 2012 and not expiring until 2020, which lists 2260 as his address. Plaintiff submits a skip tracer address search performed on March 13, 2019, which lists 2260 as Jimenez’ address. Lastly, plaintiff submits an email from Sosa to David Rivas ² , sent on December 20, 2017, wherein she asserts that 2260 is her new address.

Based on the foregoing, plaintiff demonstrates that Jimenez and Sosa were served in accordance with paragraph 16 of the guaranty agreement by submitting evidence that at the time Jimenez and Sosa were served, they resided at 2260, the address at which they were served.

First, contrary to movants’ contentions, plaintiff was required to serve them with process at their last known address and not the address listed in paragraph 14 of the guaranty agreement.

Preliminarily, it is well settled

that a person who has agreed to receive a particular mode of notification of legal proceedings should be bound by a judgment in which that particular mode of notification has been followed

(Credit Car Leasing Corp. v Elan Group Corp., 185 AD2d 109, 109 [1st Dept 1992]; see Gilbert v Burnstine, 255 NY 348, 356 [1931] [“It was necessary that he be brought within the jurisdiction of Pennsylvania either by service of process, or by his voluntary appearance, or, as the court significantly added, the fact must appear that he had in some manner authorized the proceeding, follows the general rule that where a written notice is required it must be served personally upon a defendant within the territorial jurisdiction of the court by whose order or judgment personal liability is to be fixed, unless he has agreed in advance to accept, or does in fact accept, some other form of service as sufficient” [internal citations and quotation marks omitted]; Lease Fin. Group, LLC v Moore, 42 Misc 3d 135(A) [App Term 2014]; Natl. Equip. Rental, Ltd. v Dec-Wood Corp., 51 Misc 2d 999, 1000 [App Term 1966]). Indeed, this principle dates back to at least 1877, when the United States Supreme Court noted that

[i]t is not contrary to natural justice that a man who has agreed to receive a particular mode of notification of legal proceedings should be bound by a judgment in which that particular mode of notification has been followed, even though he may not have actual notice of them

(Pennoyer v Neff, 95 US 714, 735 [1877], overruled on other grounds by Shaffer v Heitner, 433 US 186 [1977]).

Here, applying the well settled principle that parties should be bound by their agreements, it is clear that service of process was required at Jimenez and Sosa's last known address. To be sure, in order to enforce an agreement, the court must construe it in accordance with the intent of the parties, the best evidence of which is the very contract itself and the terms contained therein (Greenfield v Philles Records, Inc., 98 NY2d 562, 569 [2002]). Thus, “when the parties set down their agreement in a clear, complete document, their writing should be enforced according to its terms” (Vermont Teddy Bear Co., Inc. v 583 Madison Realty Company, 1 NY3d 470, 475 [2004] [internal quotation marks omitted]). Moreover, “a written agreement that is complete, clear and unambiguous on its face must be enforced according to the plain meaning of its terms” (Greenfield at 569).

A review of the guaranty agreement clearly evinces that for purposes of obtaining personal jurisdiction over Jimenez and Sosa, service of a summons and complaint is governed by paragraph 16 of the agreement, which discusses jurisdiction in the event of an action and prescribes the method of service. Contrariwise, paragraph 14, relied upon by movants, is bereft of any of the foregoing language and instead prescribes the method of providing notices or demands to Jimenez and Sosa.

Second, plaintiff's evidence establishes that 2260, where Jimenez and Sosa were served, was their last know address. As noted above, in 2019, Jimenez’ then current driver's license listed 2260 as his address, as did the skip tracer performed on the date of service. Moreover, Sosa herself, via email, designated 2260 as her last known address prior to the date she was served thereat.

CPLR § 5015(a)(1) - Excusable Default & Meritorious Defense

Movants’ motion seeking vacatur of the Court's Order of Reference and Default Judgment and Order to Appoint a Receiver in Mortgage Foreclosure judgment pursuant to CPLR § 5015(a)(1), on grounds of excusable default, is denied. Significantly, having denied movants’ motion pursuant to CPLR § 5015(a)(4), thereby finding that they were properly served, movants’ excuse for their failure to answer is unreasonable as a matter of law. Moreover, here, movants fail to allege any defense to the claims in the complaint, let alone a meritorious one.

Vacatur of an order or judgement pursuant to CPLR § 5015(a)(1), on grounds that it was obtained upon default, requires that the moving party demonstrate both a reasonable excuse for the default and the legal merit of the claim or defense asserted (M-Dean Realty Corp., v General Security Insurance Company, 6 AD3d 169, 171 [1st Dept 2004]; Goldman v Cotter, 10 AD3d 289, 291 [1st Dept 2004]). On a motion to vacate a default, movant is only required to “demonstrate the existence of a possibly meritorious defense [or cause of action and it is] ․ not necessary for [the movant] to establish its defense [or cause of action] as a matter of law but merely to set forth facts sufficient to make out a prima facie showing” (Kwong v Budge-Wood Laundry Serv., 97 AD2d 691, 692 [1st Dept 1983]; Quis v Bolden, 298 AD2d 375, 375 [2d Dept 2002]).

Whether the excuse proffered and the merits asserted are legally sufficient rests within the sound discretion of the court (Goldman at 291). When a party fails to establish a reasonable excuse for the default, the court need not determine whether the party has established the merits of the claim or defense (Lutz v Goldstone, 31 AD3d 449, 450 [2d Dept 2006]). Similarly, the failure to demonstrate the merits of the claim or defense, is by itself, enough to warrant denial of a motion to vacate a default (Matter of William O., 16 AD3d 511, 511 [2d Dept 2005]).

The time within which to move for the vacatur of the default judgment is usually one year after the service of the order or judgment entered upon the default (CPLR § 5015[a][1]). Thus, the failure to move to vacate the default within a year of its entry usually bars vacatur regardless of the reasonableness of the excuse or the existence of the action's merit (Lopez v Imperial Delivery Service, Inc., 282 AD2d 190, 197 [2d Dept 2001]; Nahmani v Town of Ramapo, 262 AD2d 291, 291 [2d Dept 1999]). However, as an exception to this general rule, when vacatur of a default judgment is warranted in the interests of justice, a court can entertain and grant an untimely motion to vacate a default judgment (Johnson v Sam Minskoff & Sons, Inc., 287 AD2d 233, 236 [1st Dept 2001]); State of New York v Kama, 267 AD2d 225, 225 [1st Dept 1999] [Defendant's failure to answer resulting in a default judgment entered against her vacated in the interests of justice despite her five year delay in seeking vacatur. The court found that the interests of justice mandated a vacatur of the default and a restoration of the case since the default was taken even though plaintiff knew that defendant lacked the ability to defend the action due to a mental disability and thus might have needed a guardian appointed to avoid the default.]). Thus, should the party seeking to vacate a judgment or order issued on default fail to move within the year prescribed, the court has the authority to entertain such motion, and if the circumstances warrant it, vacate the default in the interests of justice (id.). In such cases, however, the excuse for belatedly seeking to vacate a default judgment must be more compelling (id.; Siegel, NY Prac § 108, at 187 [3d ed] [“but if the year has expired the excuse for the default had best be all the more compelling”]).

Here, the excuse proffered by Jimenez and Sosa for their failure to answer the summons and complaint in this action is the absence of service of the summons and complaint upon them. In other words, they contend that because they were not served with the summons and complaint, they were unable to answer and litigate this matter prior to the issuance of the Order of Reference and Default Judgment.

Since movants’ excuse for failing to answer is the lack of personal jurisdiction, which here, has been established by the denial of their motion to the extent premised on that basis, Jimenez and Sosa have not established a reasonable excuse as a matter of law. Moreover, the affidavits submitted by Jimenez and Sosa are bereft of any defense to this action, let alone a meritorious one. Accordingly, movants’ motion, pursuant to CPLR § 5015, is denied.

CPLR § 317

Movants’ motion pursuant to CPLR § 317 is denied. Significantly, as noted above, neither Jimenez nor Sosa establish a meritorious defense to the instant action, a requirement of vacatur under CPLR § 317.

CPLR § 317 states that

[a] person served with a summons other than by personal delivery to him or to his agent for service designated under rule 318 ․ who does not appear may be allowed to defend the action within one year after he obtains knowledge of entry of the judgment, but in no event more than five years after such entry, upon a finding of the court that he did not personally receive notice of the summons in time to defend and has a meritorious defense.

Accordingly, a defendant against whom a judgment is entered, but who was never aware of the action or the default precipitating the same may have said judgment vacated upon demonstration of a meritorious defense and upon a showing that he/she/it was never personally served with process.

To obtain relief under CPLR § 317, a defendant need only demonstrate the absence of personal service of the summons and complaint in time to defend the action and the existence of a meritorious defense (Brooke Bond India, Limited v Gel Spice Co., Inc., 192 AD2d 458, 460 [1st Dept 1993]. “For the purposes of this section, personal delivery has been defined as in-hand delivery (Fleetwood Park Corp. v Jerrick Waterproofing Co., Inc., 203 AD2d 238, 239 [2d Dept 1994] (internal quotation marks omitted)]; Di Lorenzo, Inc. v A.C. Dutton Lumber Co., Inc., 67 NY2d 138, 142 [1986]; Natl. Bank of N. New York v Grasso, 79 AD2d 871, 871 [4th Dept 1980]). Accordingly, it is well settled that service upon a corporate defendant upon the secretary of state is not personal service upon the defendant as described by CPLR § 308 (Eugene Di Lorenzo, Inc. at 142 [“It is also well established that service on a corporation through delivery of process to the Secretary of State is not ‘personal delivery’ to the corporation or to an agent designated under CPLR 318.”]; Solomon Abrahams, P.C. v Peddlers Pond Holding Corp., 125 AD2d 355, 357 [2d Dept 1986]; Bank of N. New York at 871).

To obtain relief under CPLR § 317 there is no need to demonstrate a reasonable excuse for any delay in seeking to vacate a prior judgment (id. at 460; Di Lorenzo, Inc. at 141; Solomon Abrahams, P.C. at 356). Notably, even where there is no personal service upon the defendant, vacatur pursuant to CPLR § 317 shall be denied if defendant had actual notice of the action, meaning it received a copy of the summons and complaint by some other means, prior to the entry of default and judgment (Associated Imports, Inc. v Leon Amiel Publisher, Inc., 168 AD2d 354, 354 [1st Dept 1990] [“The record reveals that the corporate defendants had actual notice of the summons and complaint in time to defend.”]; Fleetwood Park Corp. at 239; Essex Credit Corporation v Theodore Taranti Associates, Ltd., 179 AD2d 973, 973-974 [3d Dept 1992]).

Here, as already discussed above, the wholesale absence of any defense, let alone a meritorious one, precludes the grant of the instant motion pursuant to CPLR § 317.

PLAINTIFF'S CROSS-MOTION

Plaintiff's motion seeking, inter alia, the entry a Judgment of Foreclosure and Sale is granted.

CPLR § 1351(1) states that the

judgment shall direct that the mortgaged premises, or so much thereof as may be sufficient to discharge the mortgage debt, the expenses of the sale and the costs of the action, and which may be sold separately without material injury to the parties interested, be sold by or under the direction of the sheriff of the county, or a referee within ninety days of the date of the judgment.

Here, plaintiff establishes entitlement to a Judgment of Foreclosure and Sale since all defendants having any interest in the instant premises have defaulted. It is hereby

ORDERED that plaintiff's motion is granted in accordance with the Order Confirming Referee Report and Judgment of Foreclosure and Sale annexed hereto. It is further

ORDERED that all parties appear for a settlement conference on August 26, 2022 at 11am.

ORDERED that plaintiff serve a copy of this Decision and Order and the Order Confirming Referee Report and Judgment of Foreclosure and Sale with Notice of Entry upon defendants and the referee within 30 days hereof.

This constitutes this Court's decision and Order.

FOOTNOTES

1.   Although the Court has not yet formally entered a judgment against the defendants in this action, for purposes of this motion it is a distinction without a difference. To be sure, pursuant to RPAPL § 1321 (1), an order of reference is authorized when the defendants fail to answer (id. [“If the defendant fails to answer within the time allowed or the right of the plaintiff is admitted by the answer, upon motion of the plaintiff, the court shall ascertain and determine the amount due, or direct a referee to compute the amount due to the plaintiff and to such of the defendants as are prior incumbrancers of the mortgaged premises, and to examine and report whether the mortgaged premises can be sold in parcels and, if the whole amount secured by the mortgage has not become due, to report the amount thereafter to become due. Where the defendant is an infant, and has put in a general answer by his guardian, or if any of the defendants be absentees, the order of reference also shall direct the referee to take proof of the facts and circumstances stated in the complaint and to examine the plaintiff or his agent, on oath, as to any payments which have been made.”]), which is the functional equivalent of a default judgment and is the burden to which the Court held plaintiff prior to issuing its prior order.

2.   In an affidavit submitted by plaintiff, David Rivas (Rivas) states that he is plaintiff's Assistant Treasurer, whose duties include communicating with borrowers once they default on a loan with plaintiff. Rivas states that he received an email from Sosa on December 20, 2017, notifying him that 2260 was her new address. Thereafter, all mortgage statements and correspondence were sent to 2260.

Fidel E. Gomez, J.