FEDERAL NATIONAL MORTGAGE ASSOCIATION v. CASSIS (2026)

DECISION & ORDER

In an action to foreclose a mortgage, the plaintiff appeals from an order of the Supreme Court, Kings County (Lawrence Knipel, J.), dated July 3, 2024.  The order, insofar as appealed from, granted (1) that branch of the motion of the defendant Madeleine Cassis which was to restore to the calendar that branch of that defendant's April 2016 cross-motion which was to dismiss the complaint insofar as asserted against her and thereupon, in effect, granted that branch of the cross-motion, and (2) that defendant's separate motion pursuant to CPLR 5015(a)(3) to vacate a note of issue filed by the plaintiff.

ORDERED that the order is reversed insofar as appealed from, on the law and in the exercise of discretion, with costs, and that branch of the motion of the defendant Madeleine Cassis which was to restore to the calendar that branch of that defendant's April 2016 cross-motion which was to dismiss the complaint insofar as asserted against her and that defendant's separate motion pursuant to CPLR 5015(a)(3) to vacate the note of issue filed by the plaintiff are denied.

On October 15, 2009, the plaintiff commenced this action against the defendant Madeleine Cassis (hereinafter the defendant), among others, to foreclose a mortgage on certain residential property located in Brooklyn.  On December 17, 2010, a limited notice of appearance was filed on the defendant's behalf “for the settlement conference pursuant to CPLR Rule 3408.”  Thereafter, settlement conferences were held.  On October 19, 2012, Petroff Law Firm, P.C., filed a notice of appearance on the defendant's behalf.

In April 2016, in opposition to the plaintiff's motion, inter alia, for leave to enter a default judgment against the defendant, the defendant cross-moved, among other things, to dismiss the complaint insofar as asserted against her for lack of personal jurisdiction.  The plaintiff opposed the cross-motion.  In an order dated August 8, 2016, the Supreme Court held the motion and the cross-motion in abeyance pending a hearing to determine the validity of service of process upon the defendant and referred the matter to a special referee “to hear and report.”  Pursuant to a subsequent order dated November 21, 2016, the parties stipulated that the reference for the hearing was “to [h]ear and [d]etermine.”  On March 23, 2017, the hearing was held.  In an order dated the same day, a court attorney referee found that the plaintiff failed to prove by a preponderance of the evidence that the defendant was served with process.

In April 2017, the plaintiff moved pursuant to CPLR 306–b for an extension of time to serve the defendant.  The defendant opposed the motion.  Also in April 2017, the defendant's April 2016 cross-motion, inter alia, to dismiss the complaint insofar as asserted against her was marked off the court's calendar.  In an order dated October 23, 2017, the Supreme Court granted the plaintiff's motion pursuant to CPLR 306–b for an extension of time to serve the defendant.  The defendant appealed from that order and served an answer with counterclaims dated December 7, 2017, in which she asserted, among other things, lack of personal jurisdiction as an affirmative defense.

In a decision and order dated October 28, 2020, this Court reversed the order dated October 23, 2017, and denied the plaintiff's motion pursuant to CPLR 306–b for an extension of time to serve the defendant (see Federal Natl. Mtge. Assn. v Cassis, 187 AD3d 1145).  On March 10, 2021, the plaintiff filed a note of issue.

In April 2021, the defendant moved, inter alia, to restore to the calendar that branch of her April 2016 cross-motion which was to dismiss the complaint insofar as asserted against her for lack of personal jurisdiction.  The plaintiff opposed the motion.

In May 2021, the defendant separately moved pursuant to CPLR 5015(a)(3) to vacate the note of issue filed by the plaintiff on March 10, 2021.  The plaintiff opposed the motion.

In an order dated July 3, 2024, the Supreme Court, among other things, granted that branch of the defendant's motion which was to restore to the calendar that branch of her April 2016 cross-motion which was to dismiss the complaint insofar as asserted against her for lack of personal jurisdiction and thereupon, in effect, granted that branch of the April 2016 cross-motion, and the defendant's separate motion pursuant to CPLR 5015(a)(3) to vacate the note of issue.  The plaintiff appeals.

“ ‘A defendant may waive the issue of lack of personal jurisdiction by appearing in an action, either formally or informally, without raising the defense of lack of personal jurisdiction in an answer or pre-answer motion to dismiss' ” (Nationstar Mtge., LLC v. Stroman, 202 AD3d 804, 806, quoting Cadlerock Joint Venture, L.P. v Kierstedt, 119 AD3d 627, 628;  see CPLR 320[b];  U.S. Bank Trust, N.A. v. Lane, 241 AD3d 745, 746).  “A defendant appears formally in an action ‘by serving an answer or a notice of appearance, or by making a motion which has the effect of extending the time to answer’ ” (Eastern Sav. Bank, FSB v. Campbell, 167 AD3d 712, 714, quoting CPLR 320[a];  see U.S. Bank Trust, N.A. v. Lane, 241 AD3d at 746–747).  “A defendant ‘may appear informally by actively litigating the action before the court’ ” (Eastern Sav. Bank, FSB v. Campbell, 167 AD3d at 714, quoting Taveras v. City of New York, 108 AD3d 614, 617).

Contrary to the plaintiff's contention, the defendant's participation in settlement conferences pursuant to CPLR 3408 and the limited notice of appearance filed for that purpose on December 17, 2010, “did not demonstrate a clear intent to participate in the lawsuit on the merits and thus did not constitute a formal or informal appearance in the action” (Deutsche Bank Natl. Trust Co. v O'Connor, 223 AD3d 872, 875 [internal quotation marks omitted];  see Citimortgage, Inc. v. Barton, 212 AD3d 706, 708).  However, the defendant's counsel filed a general notice of appearance on October 19, 2012, and did not move to dismiss the complaint on the ground of lack of personal jurisdiction at that time or assert lack of personal jurisdiction in a responsive pleading.  By waiting another 31/212 years before making her April 2016 cross-motion, inter alia, to dismiss the complaint insofar as asserted against her for lack of personal jurisdiction, the defendant waived any claim that the Supreme Court lacked personal jurisdiction over her in this action (see Wilmington Trust Co. v. Valdivieso, 207 AD3d 783, 785;  JP Morgan Chase Bank, N.A. v. Jacobowitz, 176 AD3d 1191, 1192–1193;  Deutsche Bank Natl. Trust Co. v Vu, 167 AD3d 844, 846).  The defendant's contention that the plaintiff waived this issue by failing to raise it in opposition to her April 2016 cross-motion or at the hearing to determine the validity of service of process upon the defendant is without merit (see Deutsche Bank Natl. Trust Co. v Vu, 167 AD3d at 846–847).

Accordingly, since the defendant waived the issue of lack of personal jurisdiction, the Supreme Court erred in granting that branch of the defendant's motion which was to restore to the calendar that branch of her April 2016 cross-motion which was to dismiss the complaint insofar as asserted against her for lack of personal jurisdiction and thereupon, in effect, granting that branch of her April 2016 cross-motion.

The Supreme Court also should have denied the defendant's separate motion pursuant to CPLR 5015(a)(3) to vacate the note of issue filed by the plaintiff.  A motion to vacate a note of issue is governed by 22 NYCRR 202.21, pursuant to which any party to an action may, within 20 days of service of the note of issue and certificate of readiness, move to vacate the note of issue upon an affidavit demonstrating that the case is not ready for trial (see 22 NYCRR 202.21[e] ).  Where a party's motion to vacate a note of issue is timely, “the party is ‘required only to demonstrate why the case [is] not ready for trial’ ” (Cioffi v. S.M. Foods, Inc., 178 AD3d 1003, 1004, quoting Jacobs v. Johnston, 97 AD3d 538, 538;  see 22 NYCRR 202.21[e];  Echavarria v Rego Park Gardens Owners, Inc., 240 AD3d 744, 745–746;  Reardon v. Macy's, Inc., 191 AD3d 712, 714).  However, where the motion is not timely, the party seeking relief must meet the “ ‘more difficult standard’ ” of 22 NYCRR 202.21(d) which “ ‘requires the movant to demonstrate unusual or unanticipated circumstances and substantial prejudice’ ” (Reardon v. Macy's, Inc., 191 AD3d at 714 [emphasis omitted], quoting Audiovox Corp. v. Benyamini, 265 A.D.2d 135, 138;  see Echavarria v Rego Park Gardens Owners, Inc., 240 AD3d at 746).

Here, the defendant's motion to vacate the note of issue was untimely as it was made in May 2021, more than 20 days after the note of issue was filed on March 10, 2021.  Moreover, the defendant failed to demonstrate the existence of unusual or unanticipated circumstances since the filing of the note of issue warranting its vacatur (see Echavarria v Rego Park Gardens Owners, Inc., 240 AD3d at 746).

GENOVESI, J.P., CHRISTOPHER, WARHIT and VENTURA, JJ., concur.