On November 16, 2022, the Second Department issued a decision in HSBC Bank USA, N.A. v. Gordon, 2022 NY Slip Op. 06473, holding that a servicer affidavit failed adequately to document compliance with the RPAPL, explaining:
The plaintiff failed to establish, prima facie, its standing to commence the action. A plaintiff has standing to maintain a mortgage foreclosure action where it is the holder or assignee of the underlying note at the time the action is commenced. Here, in support of its motion, the plaintiff submitted the affidavit of Shamona Marisa Truesdale, a vice president of loan documentation for Wells Fargo Bank, N.A. (hereinafter Wells Fargo), the plaintiff’s loan servicer. Truesdale stated that she was familiar with Wells Fargo’s records and record-keeping practices. She further stated that the plaintiff was in possession of the note on October 8, 2009, the date this action was commenced. Truesdale’s statement that the plaintiff had possession of the note at the time this action was commenced was inadmissible hearsay. Although Truesdale stated that she was familiar with the records and record-keeping practices of Wells Fargo, the plaintiff’s loan servicer, she failed to state that she was familiar with the records and record-keeping practices of the plaintiff itself. Thus, Truesdale failed to lay a proper foundation for the admission of any of the plaintiff’s business records.
Contrary to the defendants’ contention, the plaintiff did not improperly submit evidence of its purported compliance with RPAPL 1304 with its reply papers. Although a party moving for summary judgment cannot meet its prima facie burden by submitting evidence for the first time in reply, exceptions to the rule arise when the evidence submitted is in response to allegations raised for the first time in the opposition papers. Here, the defendants did not raise noncompliance with RPAPL as a defense in their answer; the defense was raised for the first time in their opposition to the plaintiff’s motion.
However, the plaintiff failed to establish, prima facie, that it strictly complied with RPAPL 1304. RPAPL 1304(1) provides that at least ninety days before a lender, an assignee or a mortgage loan servicer commences legal action against the borrower or borrowers at the property address and any other address of record, including mortgage foreclosure, such lender, assignee or mortgage loan servicer shall give notice to the borrower. Strict compliance with RPAPL 1304 notice to the borrower or borrowers is a condition precedent to the commencement of a foreclosure action. RPAPL 1304 requires that the notice be sent by registered or certified mail, and also by first-class mail, to the last known address of the borrower. The plaintiff can establish strict compliance with RPAPL 1304 by submitting domestic return receipts, proof of a standard office procedure designed to ensure that items are properly addressed and mailed, or an affidavit from someone with personal knowledge that the mailing of the RPAPL 1304 notice actually happened.
Here, the plaintiff relied on the affidavit of Jack Whitmarsh, a vice president of loan documentation for Wells Fargo, who averred that, based on his review of Wells Fargo’s records, the required notice was sent by both certified mail and first-class mail. The plaintiff also submitted a copy of the RPAPL 1304 notice, which was sent to the defendants at the mortgaged premises, and which was stamped with a certified mailing number, as well as a printout of a record purportedly evidencing certified mailing of the notice. However, these documents were insufficient to prove the mailing of the notice by certified mail actually occurred. Moreover, the plaintiff failed to submit any evidence that the notice was mailed by first-class mail. Further, Whitmarsh did not aver that he had personal knowledge of the mailing and did not describe any standard office procedure designed to ensure that the notices are mailed.
(Internal quotations and citations omitted).