Tracy DeWitt, Scott Parker and Ben Raindorf Co-Author New York Law Journal Article on New York Court of Appeals Resolves Divisions in the Acceleration and De-acceleration of Mortgage Loan Debt Print PDF
Tracy DeWitt, Scott Parker and Ben Raindorf co-authored an article for the New York Law Journal titled, "New York Court of Appeals Resolves Divisions in the Acceleration and De-acceleration of Mortgage Loan Debt."
The article explores a joint opinion issued on February 18 addressing four separate appeals where the New York Court of Appeals overturned a plethora of anti-lender decisions on the statute of limitations to foreclose.
Two of those appeals were cases where the trial court had found that a voluntary discontinuance de-accelerated the loan, only to have those decisions overturned by New York’s Appellate Division, Second Department.
The third appeal sought to answer whether a notice of default containing the phrase “will accelerate” constituted an acceleration of the loan.
The fourth appeal involved whether a borrower could, on the one hand, successfully move to dismiss prior complaints based upon a pleading deficiency, while arguing years later that the complaints accelerated the loan.
In all of these cases, the Court of Appeals found in favor of the lender, while being largely guided by the principle that “[t]his Court has emphasized the need for reliable and objective rules permitting consistent application of the statute of limitations to claims arising from commercial relationships.”
The authors note that with these four cases, the Court of Appeals has now provided clarity for all parties in actions relating to mortgage foreclosures in New York. While there will undoubtedly be ongoing litigation relating to the interpretation of certain provisions of the opinion, the Court’s bright line rules should help facilitate negotiation and reduce overall litigation costs.