Absent Substitution, a Successor in Interest Can Only Participate in an Action Under the Predecessor’s Name

On May 22, 2024, the Second Department issued a decision in Wells Fargo Bank, N.A. v. Welsh, 2024 NY Slip Op. 02838, holding that absent substitution, a successor in interest can only participate in an action under the name of its predecessor’s name, explaining:

Pursuant to CPLR 1018, upon any transfer of interest, the action may be continued by or against the original parties unless the court directs the person to whom the interest is transferred to be substituted or joined in the action. Contrary to Yehoshua’s contention, in the absence of formal substitution, Yehoshua, as successor to Welsh’s interest in the subject property, was only entitled to defend the action in Welsh’s name, not in its own name. In any event, Yehoshua failed to establish any basis upon which to vacate the order of reference or the judgment of foreclosure and sale in the interest of substantial justice.

(Internal quotations and citations omitted).

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