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The Saving Provisions of CPLR 205(a)

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  • Posted on: Mar 5 2021

Many times, the applicable statute of limitations expires during the pendency of an already commenced action.  No problem – right?,  While generally speaking such an occurrence should not be a problem, issues may arise when an otherwise timely action is dismissed subsequent to the expiration of the limitations period.  Depending on the nature of the dismissal, a plaintiff may be permitted to commence a new action notwithstanding the expiration of the applicable statute of limitations by virtue of the savings provisions of CPLR 205(a), which provides:

New action by plaintiff. If an action is timely commenced and is terminated in any other manner than by a voluntary discontinuance, a failure to obtain personal jurisdiction over the defendant, a dismissal of the complaint for neglect to prosecute the action, or a final judgment upon the merits, the plaintiff … may commence a new action upon the same transaction or occurrence or series of transactions or occurrences within six months after the termination provided that the new action would have been timely commenced at the time of commencement of the prior action and that service upon defendant is effected within such six-month period. Where a dismissal is one for neglect to prosecute the action made pursuant to rule thirty-two hundred sixteen of this chapter or otherwise, the judge shall set forth on the record the specific conduct constituting the neglect, which conduct shall demonstrate a general pattern of delay in proceeding with the litigation.  (Hyperlink added.)

CPLR 205(a) is a “remedial” statute that “has existed in New York law since at least 1788” and can [t]race[] its roots to seventeenth century England.”  Wells Fargo Bank, N.A. v. Eitani, 148 A.D.3d 193, 199 (2nd Dep’t 2017), appeal dismissed, 29 N.Y.3d 1023 (2017).  The purpose of CPLR 205(a) is to “ameliorate the potentially harsh effect of the Statute of Limitations in certain cases in which at least one of the fundamental purposes of the Statute of Limitations has in fact been served, and the defendant has been given timely notice of the claim being asserted by or on behalf of the injured party.”  George v. Mt. Sinai Hospital, 47 N.Y.2d 170, 177 (1979).  Thus, the statute provides “a second opportunity to the claimant who has failed the first time around because of some error pertaining neither to the claimant’s willingness to prosecute in a timely fashion nor to the merits of the underlying claim.”  George, 47 N.Y.2d at 178-79.

For example, the foreclosing lender in CitiMortgage, Inc. v. Moran, 188 A.D.3d 407 (1st Dep’t 2020), the Court found that the underlying action was “timely brought within six months after this Court dismissed plaintiff’s first foreclosure action, ‘without prejudice,’ for failure ‘to establish a presumption that it properly served defendant RPAPL 1304 notice….”  CitiMortgage, 188 A.D.3d 407 (citations omitted).  [Editor’s Note – this BLOG has analyzed RPAPL 1304 [HERE], [HERE], [HERE], [HERE].]

An action is generally deemed to be “terminated,” and the commencement of the six-month period for the purposes of CPLR 205(a) begins, “when all appeals as of right have been exhausted.”  Bank of New York Mellon v. Slavin, 156 A.D.3d 1073, 1074 (3rd Dep’t 2017) (citations omitted).  In Bank of New York, the first action was dismissed based on plaintiff’s default and, therefore, was not appealable as of right.  Id.  However, plaintiff moved to vacate the default, the denial of which motion was appealable.  Once the Third Department affirmed the denial of the motion to vacate the default, the first action was deemed terminated and the six-month clock under CPLR 205(a) began to run.  Bank of New York, Id. at 1075 (citations omitted) 

Consistent with the wording of the statute, plaintiffs will not be able to avail themselves of the benefits of CPLR 205(a) if the prior action was dismissed for failure to prosecute and specific findings of conduct reflecting “a general pattern of delay” are “set forth in the record.”  See CPLR 205(a); U.S. Bank Trust, N.A. v. Moomey-Stevens, 168 A.D.3d 1169, 1171 (3rd Dep’t 2019); Wells Fargo, 148 A.D.3d at 198.  Thus, where a dismissal is based on abandonment for failure to enter a default judgment within one year pursuant to CPLR 3215(c), the exception to CPLR 205(a) is inapplicable and, therefore, a subsequent action would be permitted if commenced within six months of dismissal despite the expiration of the applicable statute of limitations in the interim.  U.S. Bank Trust, 168 A.D.3d at 1170-71.  [Editor’s Note – this BLOG has analyzed CPLR 3215(c) [HERE], [HERE].]

On March 3, 2021, the Appellate Division, Second Department, decided Deutsche Bank National Trust Co. v. Baquero, a mortgage foreclosure action in which defendant brought counterclaims to discharge the mortgage pursuant to Article 15 of the RPAPL.  [Editor’s Note – this BLOG has analyzed the mortgage discharge provisions of RPAPL Article 15 [HERE].]  The lender in Deutsche Bank, after borrower’s default, commenced its first action to foreclose defendant’s mortgage in November of 2007.  Three years later, the court granted plaintiff’s motion to voluntarily discontinue the first action.  In June of 2010, lender commenced a second action to foreclose the mortgage.  “In an order dated April 6, 2017, the Supreme Court dismissed the 2010 action “without prejudice” based on a Court Attorney Referee’s finding that the plaintiff had failed to file an order of reference, as directed by two court orders.”  

In September of 2017, lender commenced a third action, in which borrower moved for summary judgment to dismiss the complaint as time barred and, on his counterclaims, to cancel and discharge the mortgage of record pursuant to RPAPL Article 15.  Lender cross-moved for summary judgment on its complaint.  Supreme court granted lender’s cross motion and denied borrower’s motion.  

On borrower’s appeal, the Second Department affirmed supreme court.  Initially, the Court found that the lender’s third action was commenced more than six years after the mortgage debt was accelerated by the commencement of the second action.  “However, in opposition to the defendant’s prima facie showing and in support of its own cross motion, the plaintiff established that this action was timely commenced based upon the savings provision of CPLR 205(a)” because the third action was commenced within six months of the entry of the order dismissing the second action.  Specifically, the Court found that the action was “not dismissed for neglect to prosecute, a category of dismissal that renders CPLR 205(a) inapplicable.”  The Court explained its ruling as follows:

“Where a dismissal is one for neglect to prosecute the action …, the judge shall set forth on the record the specific conduct constituting the neglect, which conduct shall demonstrate a general pattern of delay in proceeding with the litigation” (CPLR 205[a]). Here, the order dated April 6, 2017, “did not include any findings of specific conduct demonstrating ‘a general pattern of delay in proceeding’” (Wells Fargo Bank, N.A. v Eitani, 148 AD3d 193, 198, quoting CPLR 205[a]; see Sokoloff v Schor, 176 AD3d 120, 128). Moreover, by dismissing the 2010 action without prejudice, the Supreme Court “permitted the plaintiff to avail itself of CPLR 205(a) to recommence the foreclosure action” (Wells Fargo Bank, N.A. v Eitani, 148 AD3d at 199). 

It should be noted that Justice Borros authored a lengthy dissent in Deutsche Bank, in which she wrote that she would have reversed.  Among other things, Justice Borros stated:

In an order dated April 6, 2017, the Supreme Court dismissed the plaintiff’s second foreclosure action, which had been pending for more than six years, on the ground that the plaintiff failed, without good cause shown, to comply with two prior court orders directing the plaintiff, inter alia, to file both an application for an order of reference and an attorney’s certificate of merit. For the reasons set forth herein, this was a dismissal for a “neglect to prosecute” within the meaning of CPLR 205(a), and therefore, the plaintiff’s third foreclosure action, which was commenced well after the expiration of the six-year limitations period, was time-barred.

Justice Borros was moved by the fact that the order dismissing the second action did not refer to any technical defect that could be remedied in a new action, but rather referred to the plaintiff’s repeated violation of court orders.” 

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