On February 1, 2023, the Second Department issued a decision in US Bank N.A. v. Okoye-Oyibo, 2023 NY Slip Op. 00457, denying summary judgment of foreclosure because of the failure to prove possession of the note and properly-affixed allonges, explaining:
Generally, in a mortgage foreclosure action, a plaintiff demonstrates its prima facie entitlement to judgment as a matter of law by producing the mortgage, the unpaid note, and evidence of default. Where, as here, the plaintiff’s standing has been placed in issue by the defendant’s answer, the plaintiff must prove its standing as part of its prima facie showing on a motion for summary judgment.
Here, the plaintiff failed to establish, prima facie, the defendant’s default or the plaintiff’s standing to commence the action. A plaintiff may demonstrate its standing in a foreclosure action through proof that it was in possession of the subject note endorsed in blank, or the subject note and a firmly affixed allonge endorsed in blank, at the time of commencement of the action. Although the plaintiff attached to the complaint copies of the note and a chain of purported allonges ending with an undated purported allonge endorsed in blank, the plaintiff did not demonstrate that the purported allonges, which were on pieces of paper completely separate from the note, were so firmly affixed thereto as to become a part thereof, as required by UCC 3-202(2). None of the pieces of paper in the record comprising the note or the allonges bore any markings of having ever been attached to one another. Further, although the plaintiff submitted the affidavit of Alfreda Johnson, a foreclosure specialist for Fay Servicing, LLC (hereinafter Fay), the plaintiff’s loan servicer, who averred that Fay’s records evinced that the plaintiff was in physical possession of the note prior to commencement of the action, and that the defendant had defaulted in making required payments, Johnson relied entirely upon her review of Fay’s records. Johnson failed to identify the records upon which she relied in making the statements, and the plaintiff failed to submit copies of the records themselves, rendering the averments hearsay.
(Internal quotations and citations omitted).