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Second Department Addresses the Presumption of Receipt of a Properly Mailed Letter in the Context of a RPAPL 1304 Notice

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  • Posted on: Feb 25 2022

By Jonathan H. Freiberger

Just when you thought that there is nothing left to write about on RPAPL 1304 notices, a new case is decided with an interesting twist. Followers of this Blog know that we frequently address issues involving residential mortgage foreclosure.  Decisions involving the pre-foreclosure requirements of RPAPL 1304 are frequently rendered by the Appellate Courts in New York and, accordingly, are analyzed in this Blog’s articles.  See, e.g., [here], [here], [here], [here], [here], [here], [here] and [here].  By way of background and as previously noted in our Blog:

RPAPL 1304 requires that at least ninety days prior to commencing legal action against a borrower with respect to certain loans, a lender must: send written notice to the borrower by certified and regular mail that the loan is in default; provide a list of approved housing agencies that provide free or low-cost counseling; and, advise that legal action may be commenced after ninety days if no action is taken to resolve the matter.  The failure of a lender to comply with RPAPL 1304 will result in the dismissal of a foreclosure complaint (see, e.g., U.S. Bank N.A. v. Beymer, 161 A.D.3d 543 (1st Dep’t 2018)) when the issue is raised as an affirmative defense by the borrower (see, e.g., One West Bank, FSB v. Rosenberg, 189 A.D.3d 1600, 1602-3 (2nd Dep’t 2020) (citation omitted)).  Indeed, “proper service of the notice containing the statutorily mandated content is a condition precedent to the commencement of a foreclosure action.”  U.S. Bank N.A. v. Taormina, 187 A.D.3d 1095, 1096 (2nd Dep’t 2020) (citations omitted).  When failure to comply with RPAPL 1304 is raised as an affirmative defense, the foreclosing lender must demonstrate its compliance with the statute as part of its prima facie case.  Bank of America, N.A. v. Wheatly, 158 A.D.3d 736 (2nd Dep’t 2018) (citations omitted).

In many cases in which a borrower challenges compliance with RPAPL 1304, an issue often decided by the court is whether the required notice was properly mailed.  [Eds. Note: this issue was addressed, inter alia, [here].]   There is a “common law rule … that a letter properly stamped, addressed, and mailed is presumed to have been delivered.”  5421 Sylvan Ave. Associates Corp. v. New York City Conciliation and Appeals Board, 100 A.D.2d 812, 813 (1st Dep’t 1984); see also, Trusts & Guarantee Co. v. Barnhardt, 270 N.Y. 350, 352 (1936).  “The presumption is founded upon the probability that the officers of the government will do their duty, and the usual course of business”  (News Syndicate Co., Inc. v. Gatti Paper Stock Corp., 256 N.Y. 211, 214 (1931) (internal quotation marks omitted)), and may “be created by either proof of actual mailing or proof of a standard office practice or procedure designed to ensure that items are properly addressed and mailed” (Progressive Casualty Ins. Co. v. Infinite Ortho Products, Inc., 127 A.D.3d 1050, 1051 (2nd Dep’t 2015) (citations and internal quotation marks omitted)). “A mere allegation of non-receipt is not sufficient to rebut this presumption of receipt.”  5421 Sylvan, 100 A.D.2d at 813.  “In addition to a claim of no receipt, there must be a showing that routine office practice was not followed or was so careless that it would be unreasonable to assume that the notice was mailed.”  Nassau Ins. Co. v. Murray, 46 N.Y.2d 828, 829 – 830 (1978) (citation omitted).

The Appellate Division, Second Department, rejected lender’s attempt to avail itself of the presumption of mailing in Wilmington Savings Fund Society, FSB v. Kutch, decided on February 16, 2022.  Borrower, Kutch, in Wilmington, defaulted under a $900,000 loan from lender secured by a mortgage on real property.  [Eds. Note: through assignments or otherwise, several different lenders held the note and mortgage, but such is not germane to this article.]  Lender commenced a mortgage foreclosure action in which it alleged, inter alia, that it complied with the notice requirements of RPAPL 1304.  Kutch denied this allegation and asserted a “lack of standing” defense, among others.  

Thereafter, in 2013 lender’s motion for summary judgment was denied but, later that year, upon reargument, the motion was granted.  On Kutch’s related appeal, the Second Department reversed [here] and held that lender failed to prove compliance with RPAPL 1304.  The Court found that the moving affidavit from lender’s vice president, in which she averred that based upon her review of business records maintained in the ordinary course “the RPAPL 1304 notice was mailed to the borrower ‘by registered or certified and first class mail’ on December 4, 2009,” was “unsubstantiated and conclusory”.  The Court concluded, therefore, that such statements “were insufficient to establish” compliance with RPAPL 1304 and, upon reargument, supreme court should have adhered to its initial decision.

Thereafter, Kutch moved for summary judgment dismissing the complaint for lender’s failure to comply with RPAPL 1304, which motion was denied.  Kutch then moved for reargument and lender cross-moved, inter alia, “for leave to renew those branches of its prior motion which were for summary judgment on the complaint insofar as asserted against the defendant, to strike her answer, and for an order of reference ….”  Supreme court denied Kutch’s motion and granted lender’s cross-motion.  Subsequently, supreme court, inter alia, issued a judgment of foreclosure and sale and directed the sale of the property.  Kutch appealed. 

The Second Department found that lender failed to demonstrate that it complied with the mailing requirements of RPAPL 1304.  The Court found that the “’Affidavit of Mailing’” from lender’s “authorized signer” was inadequate because he “did not attest to personal knowledge of the actual mailings [and did not] state that he had personal knowledge of a standard office mailing procedure designed to ensure that items are properly addressed and mailed.”  (Citations and internal quotation marks omitted.)  The records annexed to the affidavit demonstrated mailing by certified mail, but not regular mail.  The affidavit, which merely averred mailing by regular mail, was insufficient because “it is the business record itself, not the foundational affidavit, that serves as proof of the matter asserted.”  (Citations and internal quotation marks omitted.)  “Without business records proving the matter asserted, [the authorized signer’s] “unsubstantiated and conclusory” statement, by itself, was insufficient to establish that the RPAPL 1304 notice was mailed to the defendant by first-class mail.”  (Citations and internal quotation marks omitted.)

The Court rejected lender’s argument regarding the presumption of mailing and stated:

The plaintiff’s reliance on the “long-standing common-law presumption” that “a letter or notice that is properly stamped, addressed, and mailed is presumed to be received by the addressee,” is unavailing. Without proof that the letter or notice was, in fact, “properly stamped, addressed, and mailed,” there can be no presumption that the mailing was received by the addressee. 

In another interesting note, defendant Allison Quinn was not named as a “borrower” on the note but was named as a “borrower” on the mortgage.  Quinn, however, defaulted in appearing.  The Court found that lender was required to comply with RPAPL 1304 with respect to Quinn “because she was a borrower for purposes of RPAPL 1304”  (citation omitted), but nonetheless found that Kutch did not have standing to contest lender’s “compliance with the notice requirements of RPAPL 1304 with respect to Quinn inasmuch as that claim is personal to Quinn, and thus may be raised, if at all, only by Quinn.”  (Citations and internal quotation marks and brackets omitted.)  The Court further found that, since compliance with RPAPL 1304 is not a jurisdictional defect, lender was not required to prove compliance as to Quinn because she never raised it as a defense.  Additionally, because a notice of appeal was never filed on Quinn’s behalf, she “is not a party to this appeal.”  Thus, supreme court properly denied Kutch’s motion to the extent that it sought summary judgment dismissing the complaint as to Quinn.

Finally, the Court found that lender established that it had standing to bring the action.


Jonathan H. Freiberger is a partner and co-founder of Freiberger Haber LLP.

This article is for informational purposes and is not intended to be and should not be taken as legal advice.

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