Wells Fargo Bank, N.A. v. Walker

Appeals (1) from an order of the Supreme Court (Melkonian, J.), entered April 28, 2015 in Ulster County, which, among other things, granted plaintiff’s motion for summary judgment, and (2) from the judgment entered thereon.

In April 2006, defendant Jonathan G. Walker (hereinafter defendant) executed a note in favor of New Century Mortgage

Corporation (hereinafter NCMC) that was secured by a mortgage on real property located in Ulster County. In a 2006 pooling and servicing agreement (hereinafter PSA), plaintiff was named as trustee of a loan trust and NCMC was designated predecessor in interest to Carrington Mortgage Services, LLC (hereinafter CMS), as servicer. After NCMC filed for bankruptcy in 2007, certain assets were transferred to New Century Liquidating Trust (hereinafter NCLT). Also, as part of NCMC’s bankruptcy, it sold its mortgage loan servicing business to CMS

A plaintiff can establish entitlement to summary judgment by producing evidence of the mortgage, the unpaid note and the defendant’s default (see Deutsche Bank Natl. Trust Co. v Monica, 131 AD3d 737 , 738 [2015]; Wells Fargo Bank, NA v Ostiguy, 127 AD3d 1375 , 1376 [2015]). However, where, as here, the defendant raised the issue of standing in the answer, the “plaintiff bore the additional burden of demonstrating that, ‘at the time the action was commenced, [it] was the holder or assignee of the mortgage and the holder or assignee of the underlying note’ ” (Bank of N.Y. Mellon v McClintock, 138 AD3d 1372 , 1373-1374 [2016], quoting Deutsche Bank Natl. Trust Co. v Monica, 131 AD3d at 738 ). “Either a written assignment of the underlying note or the physical delivery of the note prior to . . . commencement of the foreclosure action is sufficient to transfer the obligation” (Chase Home Fin., LLC v Miciotta, 101 AD3d 1307 , 1307 [2012], quoting U.S. Bank, N.A. v Collymore, 68 AD3d 752 , 754 [2009]). “That said, the note, and not the mortgage, is the dispositive instrument that conveys standing to foreclose under New York law” (Deutsche Bank Natl. Trust Co. v Monica, 131 AD3d at 738 ; see Aurora Loan Servs., LLC v Taylor, 25 NY3d 355 , 361-362 [2015]). Notably, as relevant here, the holder of a note is “the person in possession of a negotiable instrument that is payable either to bearer or to an identified person that is the person in possession” (UCC 1-201 [b] [21] [A]; see UCC 1-201 [b] [5]).

Here, plaintiff sought to establish standing by virtue of the 2012 assignment, coupled with its assertion that it has had possession of the note since 2006. To that end, plaintiff produced the affidavit of Elizabeth Ostermann, a vice-president for CMS, which, as noted, had been appointed attorney-in-fact for plaintiff in February 2012. As to the issue of possession, Ostermann avers that plaintiff, as trustee, has been in continu

As to the assignment, Ostermann avers that “[t]he [mjortgage was assigned by written agreement on May 14, 2012 . . . from New Century Corporation, to Wells Fargo Bank, N.A., as Trustee.” We recognize that, by its terms, the assignment conveys the mortgage “together with the bond or note or obligation described in said mortgage” — language that effects an assignment of both the note and mortgage. The focus here, however, is on whether the assignor had authority to actually assign the note (see Bank of N.Y. v Silverberg, 86 AD3d 274 , 281 [2011]). Plaintiff has the burden of proof on this issue (see id.). The assignment identifies the assignor as NCMC, while the document is executed on behalf of “New Century Liquidating Trust Successor-In-Interest to New Century Mortgage Corporation By Carrington Mortgage Services, LLC as Attorney-in-Fact” by Ostermann as vice-president of foreclosure for CMS. Plaintiff points to several documents in the record to establish the underlying authority for this assignment. Specifically, in November 2008, NCLT, as successor to NCMC, gave CMS a limited power of attorney to, among other things, execute mortgage assignments. Previously, NCMC had transferred its servicing rights to CMS. Significantly, in 2010, CMS and defendant entered into a “Loan Modification Agreement” restating the principal balance at $266,277 — a transaction memorializing a continuing ownership interest in the note held by NCLT as successor to NCMC and exercised through its agent CMS. Given the foregoing, we agree that plaintiff established authority for NCLT, as successor to NCMC, to effectuate the assignment of the note to plaintiff. That CMS

Lahtinen, J.P., Egan Jr., Devine and Mulvey, JJ., concur.

Ordered that the order and judgment are affirmed, with costs.