Adam Leitman Bailey, P.C. was retained by a Lender to take over a disastrous 7-year-old foreclosure action that was already plagued with an order tolling interest to the detriment of the Lender for prior delays in the action.
Defendants moved to dismiss the action pursuant to CPLR § 3215(c) for the Lender failing to take a default within a year, and also sought additional tolling of interest. Defendants, a married couple, strategically appeared in the action to facilitate the CPLR § 3215(c) motion. Despite being married, only the husband initially appeared in the action. Litigation ensued, and so prior counsel to Lender did not move to default the wife within one year, as is required. Defendants argued that not only should the action be dismissed, but that all interest should continue to be tolled.
In opposition to the motion, Adam Leitman Bailey, P.C. argued that the wife was neither a party to any of the loan documents nor was she an owner on the deed. Adam Leitman Bailey, P.C. argued that it was clearly a litigation tactic to appear for one spouse, and that the parties waived any right to seek dismissal by appearing in the action and participating in prior motion practice. Furthermore, it was evident that the spouses’ interests were and are aligned, and that the spouses were acting in concert.
With regard to the tolling, ALBPC argued that any recent delays were attributed to the stays that were issued by the Governor and the Court and that the Lender should not be held responsible for such delays.
The Court adopted Adam Leitman Bailey, P.C. ’s arguments and denied the portion of the motion seeking dismissal as against the Defendants, despite the default not being taken within one year. The Court held that defendants waived any rights under CPLR § 3215(c) by participating in the action. The Court also ruled in favor of the Lender by not imposing additional tolls on interest on the Loan.