Provides for the filing of a certificate of merit in any residential foreclosure action involving a home loan in which the defendant is a resident of the property subject to the foreclosure.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A5582A
SPONSOR: Weinstein (MS) TITLE OF BILL: An act to amend the civil practice law and rules, in
relation to residential foreclosure actions
This measure is being introduced at the request of the Chief Judge of
the State and the Attorney General upon the recommendation of the Chief
Administrative Judge's Advisory Committee on Civil Practice.
This measure would add a new section 3012-b to the CPLR in relation to
residential foreclosure actions. This new section would create a proce-
dure whereby the plaintiff lender's attorney must take certain steps to
ascertain that his or her client has standing to maintain the action.
Specifically, before commencing such an action, he or she must be
assured that the plaintiff he or she represents holds the instrument of
indebtedness in the action. To evidence that the plaintiff's attorney
has received such assurance, the complaint he or she files in the action
must be accompanied by a certificate, signed by the plaintiff's attor-
ney, declaring that the attorney has reviewed the merits of the action
and that, based upon consultation with representatives of the plaintiff
or the attorney's review of pertinent documents, the attorney has
concluded to the best of the attorney's knowledge, information and
belief there is a reasonable basis for commencement of the action. Also,
if not attached to the complaint, the plaintiff's attorney must attach
to the certificate copies of the relevant instruments of indebtedness
and any instruments of modification, extension, consolidation and
assignment.
Where the required documents are lost whether by destruction, theft or
otherwise, the attorney shall attach to the certificate supplemental
affidavits by the attorney or by a representative of plaintiff. In such
a case, the plaintiff's obligations under the New York uniform commer-
cial code are not replaced or abrogated. This measure would also amend
rule 3408 of the CPLR to require a plaintiff to file proof of service
within 20 days of service.
This amendment will supply the necessary ingredient to ensure partic-
ipation by the parties in the mandatory foreclose conference with the
court. We believe that, in addition to helping the bar by clarifying in
statute the plaintiff attorney's obligation to the court in a residen-
tial foreclosure action, this measure is an appropriate public policy
response to the crisis in foreclosure cases. Statutory reform is needed
to ensure the integrity of the mortgage foreclosure process and elimi-
nate the cases brought without standing or merit. This measure seeks to
prevent completely the problem of "shadow dockets" in residential fore-
closure actions, a problem unforeseen at the time the recent affirma-
tions rule was promulgated by administrative order. Under this measure,
the trial court would have reasonable assurance that all of the instru-
ments of indebtedness underpinning these actions, and all instruments of
assignment, if any, are in place at the commencement of the action.
This measure shall take effect in 30 days and shall apply to actions
commenced on or after such effective date; provided, however that the
amendments to subdivision (a) of rule 3408 of the civil practice law and
rules made by section two of this act shall not affect the expiration of
such subdivision and shall be deemed to expire therewith.
2013 LEGISLATIVE HISTORY:
Senate 4530 (Senator Klein) (ref to Judiciary) Assembly 5582 (M. of A.
Weinstein) (PASSED)
2012 LEGISLATIVE HISTORY:
S. 7571 (Rules) (ref to Rules) A. 10395 (M. of A. Weinstein) (Passed)
STATE OF NEW YORK
________________________________________________________________________
5582--A
Cal. No. 109
2013-2014 Regular Sessions
IN ASSEMBLY
March 4, 2013
___________
Introduced by M. of A. WEINSTEIN, ROBINSON, COLTON, PERRY, O'DONNELL,
STEVENSON, BARRETT, STECK, CRESPO, McDONALD, FAHY -- Multi-Sponsored
by -- M. of A. CLARK, GALEF, GOTTFRIED, JAFFEE, LENTOL, MARKEY,
PEOPLES-STOKES, SCHIMEL, WRIGHT -- (at request of the Office of Court
Administration) -- (at request of the Department of Law) -- read once
and referred to the Committee on Judiciary -- passed by Assembly and
delivered to the Senate, recalled from the Senate, vote reconsidered,
bill amended, ordered reprinted, retaining its place on the order of
third reading
AN ACT to amend the civil practice law and rules, in relation to resi-
dential foreclosure actions
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The civil practice law and rules is amended by adding a new
2 section 3012-b to read as follows:
3 § 3012-b. Certificate of merit in certain residential foreclosure
4 actions. (a) In any residential foreclosure action involving a home
5 loan, as such term is defined in section thirteen hundred four of the
6 real property actions and proceedings law, in which the defendant is a
7 resident of the property which is subject to foreclosure, the complaint
8 shall be accompanied by a certificate, signed by the attorney for the
9 plaintiff, certifying that the attorney has reviewed the facts of the
10 case and that, based on consultation with representatives of the plain-
11 tiff identified in the certificate and the attorney's review of perti-
12 nent documents, including the mortgage, security agreement and note or
13 bond underlying the mortgage executed by defendant and all instruments
14 of assignment, if any, and any other instrument of indebtedness includ-
15 ing any modification, extension, and consolidation, to the best of such
16 attorney's knowledge, information and belief there is a reasonable basis
17 for the commencement of such action and that the plaintiff is currently
18 the creditor entitled to enforce rights under such documents. If not
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD08975-11-3
A. 5582--A 2
1 attached to the summons and complaint in the action, a copy of the mort-
2 gage, security agreement and note or bond underlying the mortgage
3 executed by defendant and all instruments of assignment, if any, and any
4 other instrument of indebtedness including any modification, extension,
5 and consolidation shall be attached to the certificate.
6 (b) Where a certificate is required pursuant to this section, a single
7 certificate shall be filed for each action even if more than one defend-
8 ant has been named in the complaint or is subsequently named.
9 (c) Where the documents required under subdivision (a) are not
10 attached to the summons and complaint or to the certificate, the attor-
11 ney for the plaintiff shall attach to the certificate supplemental affi-
12 davits by such attorney or representative of plaintiff attesting that
13 such documents are lost whether by destruction, theft or otherwise.
14 Nothing herein shall replace or abrogate plaintiff's obligations as set
15 forth in the New York uniform commercial code.
16 (d) The provisions of subdivision (d) of rule 3015 of this article
17 shall not be applicable to a defendant who is not represented by an
18 attorney.
19 (e) If a plaintiff willfully fails to provide copies of the papers and
20 documents as required by subdivision (a) of this section and the court
21 finds, upon the motion of any party or on its own motion on notice to
22 the parties, that such papers and documents ought to have been provided,
23 the court may dismiss the complaint or make such final or conditional
24 order with regard to such failure as is just including but not limited
25 to denial of the accrual of any interest, costs, attorneys' fees and
26 other fees, relating to the underlying mortgage debt. Any such dismissal
27 shall be without prejudice and shall not be on the merits.
28 § 2. Subdivision (a) of rule 3408 of the civil practice law and rules,
29 as amended by chapter 507 of the laws of 2009, is amended to read as
30 follows:
31 (a) In any residential foreclosure action involving a home loan as
32 such term is defined in section thirteen hundred four of the real prop-
33 erty actions and proceedings law, in which the defendant is a resident
34 of the property subject to foreclosure, plaintiff shall file proof of
35 service within twenty days of such service, however service is made, and
36 the court shall hold a mandatory conference within sixty days after the
37 date when proof of service upon such defendant is filed with the county
38 clerk, or on such adjourned date as has been agreed to by the parties,
39 for the purpose of holding settlement discussions pertaining to the
40 relative rights and obligations of the parties under the mortgage loan
41 documents, including, but not limited to determining whether the parties
42 can reach a mutually agreeable resolution to help the defendant avoid
43 losing his or her home, and evaluating the potential for a resolution in
44 which payment schedules or amounts may be modified or other workout
45 options may be agreed to, and for whatever other purposes the court
46 deems appropriate.
47 § 3. This act shall take effect on the thirtieth day after it shall
48 have become a law and shall apply to actions commenced on or after such
49 effective date; provided, however that the amendments to subdivision (a)
50 of rule 3408 of the civil practice law and rules made by section two of
51 this act shall not affect the expiration of such subdivision and shall
52 be deemed to expire therewith.
