indymac v yano-horoski justice skinner 01 dec 2009

8/8/2019 Indymac v Yano-horoski Justice Skinner 01 Dec 2009

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SUPREME COURT-STATE OF NEW YORKI.A.S. PART XXI-SUFFO LK C OUNTY

HON. JEFFREY ARLEN SPINNERJustice of the Supreme C ourt.

I UDYMAC H.4NK F.S.B.,Plaintiff

- against -

1)IANA YANO-HOROSKI, WELLS FARGOHANK MINNESOTA NATIONAL4SSOCIATION A S TRUSTEE FORSOUNDVIEW H OME EQUITY LOAN TRUST2001-1 and KIMBERLY HOROSKI ,

Defendants

Index No.: 2005-17926

AMENDED ORDER & JUDGMENTThis Amended Order & Judgment corrects typographicalerrors contained in the Orde r & Judgment dated November19 ,2009 .

Premises8 Oakland StreetEast Patchogue, New York 1 1572District 0200Section 979.50Block 05.00Lo t 00 1.000

Ihis I S m action wh erein the Plaintiff claims foreclosure of a mortgage d ated Aug ust 4, 2004 in the. :~.iginalprincipal amount of $ 292,500.00 recorded with the Clerk of Suffolk County, New York in Liber20826 of Mortgages at Page 285. The m ortgage secures an adjustable rate note of the same amount with anI i l i t a1 interest rate o f 10.375% . The m ortgage encum bers real property com mo nly Ernown as 8 Oakland I i - ~ c t . East Fatchogue, Tow n of Rro okhaven, Ne w Y ork and described as District 0 200 Section 979.50f + l o < h05.00 1,ot 001.000 on the Tax Map of S uffolk County . Plaintiff comm enced this action by filing a\i:inmons. Verified Complaint and Notice of Pendency on July 27, 2005. Th e Notice of Pendency wasc*rc*nded b) Order dated April 28 ,200 8 and a Judgment of Foreclosure & Sale was granted on January 12,2 0 0 9

, hi.reatil:r and in accordance with the Laws of 2008, C h. 472, Sec. 3-a and in v iew of the fact that theIoLi i i I issuc was d eem ed to be sub-prime or high cost in nature, Defendant seas onably requested thatti12 ourt ccnve ne a settlement conference. That request was granted and a conference was comm enced on! u q 4 .2 0 0 9 which w as continued five times in a series ofun succe ssfu l attem pts by the Court to obtainiiicmingfui cooperation from Plaintiff. In view of Pla intif fs intransigence in its continuing failure and3 -%iiisalo cooper& , both with the Court and with Defendants multiple and reasona ble requests, the Court~ i i.ctcd t ha t Plaintiff produc e an officer of the bank at the adjourne d conference schejduled for SeptemberI - 200)7

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I i th e conference held on Septem ber 22 ,20 09 , Karen Dickinson, Regional Manager ofLoss Mitigationn d y Mac Mo!.tgage Services, division of OneWest Bank F.S.B. (IndyMac) apipeared on behalf of

l I L i ~ i i ~ i C t ~iiclyMac purports to be the servicer of the loan for the benefit of Deutsche Bank who, it isi i i n c , l . 15 rhe own er and holder o f the note and mortgage (though the record holderis IndyMac Bank\ 13 an entity which no lon ger is in existence). At that conference, it was celeritously made clear to th e

I I uit that Plaintiff had no go od faith intention whatsoeverof resolving this matter in any man ner other thanicrmplete m d filrcible devolu tion of title from Defendan t. Althou gh Indy Mac had prepared a two paget i , u i iment entitled Mediation Yam-H oroski which con tained what purported to be a financial analysis,I t \ 1)ickinsons affirmative statemen ts made it abundantly clear that no form of medliation, resolution or~\c.ttlement ould be acceptable to Plaintiff. IndyMac asserts the total amo unt due i t to be in excess ofi, i r 5 .0 0 0 00 and freely concedes that the property securing the loan is worth no more than $27 5,00 0.00 .1 tliough M s Dickinso n insisted that Ms. Yano-Horoski had been offered a Forbearance Agreement inti c ecent pasr upon w hich sh e quickly defaulted, it was only after substantial prodding by the Court that

\ l \ I l i c k i i i son conce ded, with great reluctance, that it had no t been se nt to Defend ant untilafter its stated ~ T . S I payment dul: date and hence, Defendant could not have consummated it under any circumstances le tcndant, through Pla in tif fs duplicity, found herself to be in the uniqu e and uncomfortable position of

Seiiig placed in default of the agreem ent even before she had received it). Plaintiff flatly rejected ani hy Delen dants dau ghter to purch ase the house for its fair market v alue (a so-called short sale) withi h i i ( i party financing. Plaintiff refused to consider a loan mod ification utilizing any more than 25% o f thel i i c i )m eof Plai ntiff s husband and daugh ter (both of whom reside in the premises with her), the excuse beingi h & i tW e c a n - t control wha t non-ob ligors d o with their mon ey (the log ical follow up to this statement ishov does the bank control what the obligor does with her money? ). The Cou rt found IndyMacs positioni t . he deeply troubling, especially since a plethora of sub-prime loans in this Countys Foreclosure

0 1 h e n c e Part have been successfully modified with the lenders reliance upon the income of non-obligors~ \ i i c > eside i n the premises under foreclosure. The Plaintiff also summarily rejected an offer by bothi k f nclantc; husband and daug hter to voluntarily obligate them selves for payrnent upon th e full!nd(+tedness. thus com mittin g their individual incomes expressly to the purpose of a loan modification. It. ~ f i o . t l de noted here that Defenda nt did not even request any waiver or forgiveness of the indebtedness.141ilc rom some tinkering w ith the interest rate, just a mo dification of term s so as to enable her to repay thesLiii-c. t was evident from Ms. Dick insons opprobrious demeanor and cond escend ing attitude that no profferiktendant (short of consent to foreclosure and ejectment of Defendant and her family) would becIc.ct:ptable to Plaintiff. Even a final and desperate offerof a deed in lieu of foreclosure was met with blandccluiwcatioii 11 1 short, each and every proposal by Defendant, no matter how reasonable, was soundlyr c i ~ i f k d) Plaintiff. Viewed objectively, it is apparent that Pla in tiff s co nduct in this matter falls withinjiic defin itions set forth in 22 N YC RR tj 130-1.1( c)(2), which might well warrant the imposition of:-ionetnrq sanctions.

) I I th e ( our t s own motion, a hearing was held on November 18, 2009 in order10 explore the issuesI - ~ I . i n At the hearing, Ms. Dickinso n appeared as well as Mr. Ho roski. IndyM ac claimed a balance due,1. $ 1 Septcnibcr 22, 2009 of $ 527,437.73 which included an e scrow overdraft of $ 46,627.88 for taxesl~ . i \ meed \ i nce the date of default bu t did not include attorneys fees and c osts. Plaintiff was unable to tell

c I C \ ( \un he amount of the principal balance ow ed. Mr. Horosk i advised the Cou rt that according to twoii.rtc-rs r c c t i \ ~ drom Plaintiff, the principal balance was said to be $2 85 ,381.70 as of February 9,2 00 9 andY 18-3.992 48 as of August I O , 200 9. Plaintiff stated was that Defendant m ust have made payments thoughi \\.(is onceded that in fact no paym ent had been made. Plaintiff insisted that it had remained in regular

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{ 3 1 I Lct u 1111Defendant in an effort to reach an am icable resolution, that it had extended two modification~ l t t c i so Iktkndmt which she did not accept and further. that due to her financial status she was not(iii,ii iticd l i )~ y m odification, even unde r the Federal HAM P guidelines. Plaintifi' denied that it had

I !i!:IeJ out" Defend ants, simply stating that her status was such that she fell outside ap plicable guidelines.\ i I I t i . thesc lssertions were disputed by D efendant.

! ,i:ii having been said, the C ourt is greatly disturbed by Plaintiffs assertions of the amount claimed toi x ilue from Ilefznd ant. The Referee's Report dated June 30, 2008, which has its genesis in a sworn

t f t iL i~ ' ib! 4 representative of Plaintiff (presumably on e with know ledge of the acco unt), reflects a total, i i n o i r n ~ ue and owing of $ 392,983.42. The principal balance is reported to be $29 0,6 87 .85 with interest

oinputed at th e r'ites of 1 0.375% from Novem ber 1,2 00 5 through August 3 1,2 00 6($ 25,118.62), 12.50%I L 'IT'September I , 2006 to February 28, 2007 ($ 18,018.66), 12.375% from M arch 1. 2007 to March 31,I f O h (5 30> 26.3'3) and 11.375% from April 1, 2008 to June 24, 2008 ($ 7,700.24) totalling $ 89,963.91.~'l:~iiiti! t also claims $ 20.00 in non-sufficient funds charges, $2 95 .00 in property inspection fees and

3 0 1 6.66 lhr tax and insurance advances. The Judgment of Foreclosure& Sale dated January 1 2,2 009$ \ < I \ g r mt c d in the amount of $ 392 ,983.4 2 with interest at the contract rate from Ju ne 24, 2008 throughjonuar? 13. 7009 and a t the statutory rate thereafter plus attorney's fee s of $ 2,30 0.00 #and bill of costs inilic m o u n t of $ 1,705.00. Even c ompu ting the accrual of pre-judgment interest of$ 18,299.18 (using~'1,iintiW'fSsper diem rate in the Referee's Report) together with post-judgment interest at a statutory 9%1 tirough Nov ember 19, 2009 (an additional$ 3 1,740.90 ), the application o f sim ple a ddition yields a totalt i ~ i i o u n t ue o f $ 347,028 .50. This figure is $ 80,409.23 less than the $ 527 ,437 .73 asserted by Plaintiff to'JC liie and owin: from Defendant. The Court is astounded that Plaintiff now claims to be owed an escrow~.ii-\memount of $ 46,62 7.88 w hen, under oath, its officer swore that as of June 24 ,20 08 that amount was

iually $ 74.6 1 1 22 less. Moreo ver, it no w appears that the elusive principal balance is either $290,687 .85,Y ' S5 . 18 1.70 or S 283,992.48.

i i \ th e province and ind eed the obligation of the trial court to assess and to d etermine issues regardingLrc~clibilit>( Adorgan v McCaffie-y 13 A D 3d 670 2"" Dept 2005). In the matter before the Court, thei ~ e ~ i ~ , f u I u n if credibility swings heavily in favor of Defe nda nt. Whe n the conduct of Plaintiff in thispro(-eeding IS viewed in its entirety, it com pels the Court to invoke the anc ient and venerab le principle of

1 ( [ / $ 1 1 > 111 iiiio, rnl.w,r in omni '(Latin; "false in one, false in all 'y upo n Defend ant which , after review,11 ho114 appropriate in the context presented, Deering 17 Metcalf 74 NY 501 (1878). Regrettably, the< oiir t ha s hecn iinable to find eve n so much as a scintilla of good faith on th e part of Plaintiff. Plaintiff

~ ~ ~ t x c sefore this Court with unclean hands yet has the insufferable temerity to demand equitable reliefi ; c i ~ ~ i ~ ! efendant.

[ i t ' I'ourt. o\ t'r the course of some six substantive appearances in sev en mo nths, has been afforded more* m p l e opportun ity to assess the dem eanor, credibility and general state of relevant affairs of Defendantj n t l Pl.iintifT 4lth ou gh not actually relevant to the disposition ofthis matter, the Cou rtis constrained to note

T f iL i l Defendant I S afflicted with multiple health problem s which ou twardly manife st in her experiencing greatc f't ic i i l t> i n ambulation, necessitating the use ofm echanical supports. M oreover, Defendant's husband, Mr.( 1jCgi ) rJ I Iornshl, suffers from a myriad of serious medical conditions which g reatly im pede most aspects9 $ 1 iiis dai14 existence. Non etheless, both of these persons, together with their adult daughter who residesii I t w n i mci who is substantially and gainfully employed, receive incom e which they are more than\ r ! inc to comm it. in goo d faith, toward repaym ent of the debt to Plaintiff and indeed, desp ite their physical

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.i-_iitcn~~es.hey lave appeared at each and every scheduled conference before this Court. At eachciprcLu:ince.hey have assiduously attempted to reso lve this controversy in an am icable fashion, only to bei ~ ! O U S ! ~nd arbitrarily turned away by Plaintiff. This has been so even in spite of the C ourts continuing11 h \ r t fiitile crideavors at brokering a settlement.

\,, r-cieka n t aside, the sce nario presented here raises the specter of a much greater social problem, thatI~oiisingliose persons w hose hom es are foreclosed and who are thereafter dispossessed. It is certainlyI I( \ C C I et thal Sufio lk Coun ty is in the yawning abyss of a deep mortgage and hou sing crisis with foreclosurel i , i i i :s 11 ii record high rate and a corresponding paucity of emergency h ousing. While foreclosure and its, i t ~ t ~ i ~ c I a n tbiction a re clearly the inevitable (and in some cases, proper) result in anum ber o fthese situations,:hi. oi i r t I C persuaded that this need not be the ca se here. In this matter, Defendant is plainly willing to*r.ihc arran gem ents for repa ym ent and both her husb and and dau ghter are likew ise wil1,ing to allocate their

r x t l ve incoinrbsin order to reach the same end. Were Plaintiff am enable, she would presumably continueIII niaintain the propertys physical plant, pay taxes thereon and the property would retain or perhapsiii~rcase ts iiiarkzt value. Plaintiff would receive a regular income stream , albeit with a reduced rate ofI i Ici esI and without sustaining a loss of several hundred thousand dollars. In addition, no neighborhoodhiig t \vould occur from the b oarding o fth e property after foreclosure which wo uld, in turn, avert problems< ) I Iiltcr-, dum ping, vagrancy an d vandalism as well as a corresponding decline in the property values in thernniediate area. In short, a loan modification w ould result in a proverbial win-win for all partiesn \ o l \ d . 7 do o therwise w ould result in virtually certain undomiciled status for two physically unhealthyi7ciwni and their daug hter, leading to an additional level of problems, both for them and for society.

1iic.e iiri action claiming foreclosure of a mortgage is one sounding in equity,Jama ica Savings Bank v.-______i s ~ n ~ v s 1 1 ~ 7 ~o 274 NY 21.5 ( f 9 3 7 ) , he very commencement of the action by Plaintiff invokes thei \ L I ~ I u i t ) ju i isdiction. While it must be noted that the formal distinctions between an action at law andI 4 ~ i i t 11 equity h m e long since been abolished in Ne w York (seeCPLR 103, Field C ode Of1848 $ 2 , 3 ,+ 79). the Suprem e Co urt nev ertheless has equity jurisdiction and distinct rules regarding equity are still.!\iiiit. ( u 1 . 1 ~ ~ 1 1ullock 207N Y.567 , 101 NE 438 (1913). Speaking generally and broadly, it is settled lawihit \iuhrlitj o,/ contract obligations must not be undermined by judicia l sym pathy .. G r a f v . Hope/$ i! / i dingorportition 25 4 N Y I (1930). However, it is true with equal force and effect that equity must not i i icl cannot slavishly and blindly follow the law, Hedges v. Dixon CounQ 150 US 182, 192 (1893).eover. as succinctly decreed by our Court of Appeals in the matter of Noyes v. Anderson 124 N Y I75

* 1 pur ty having a legal right shull not be permitted to avail himself of i t fo r the purposes ofd ) 0 i1( CJ 0 1 . o p p c s s i o n . I2 4 NY at 179.

i: [lie m2lter i ~ f astmun Koduk Co v. Schwartz I3 3 N Y S 2d 908 (Sup. Ct., New York County, 1954),maxim o clean hands fundamentally was conceived in equityipiwdclnw io refuse to lend its aid in any munner to one seeking its active interposition who has been. / l / i of i d i m f i / l ,unconscionable or inequitable conduct in the matter with relation to which he seeksiif 13 3 A 1 3 2d at 925, citing First Trust & Savin zs Bank v Iowa- Wisconsin Bridge Co 98 F 2d 416

t 11 I c / - !K ! , L2i.t. denied 305 l J S 650, 59 S. Ct. 243, 83 L Ed 240 (1938), reh derzied 305 US 676, 59- 1 ;5 6 I Ld 437 (1939): General Excavator Co. v. Keystone Driller Co 65 F :?d 39 (61h Cir. 193 3),L i i _ #cgi.iinied280 US 721, 53 S Ct 791, 77 L Ed 1472 (1933), affd 290 US240,54 S. Ct. 146, 78 L Ed

I e m stated that The

I I 1334:

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I ,irtcnipting to arrive at a determination as to whether or not equ ity should properly intervene in thisI .o cis t o permit foreclosure o ft h e m ortgage, the Court is required to look at the situattion in toto,

; \ iig due and caieful consideration as to whether the remedy sou ght by Plaintiff would be repugnant to theinterest %he n seen from the point of view of public morality, see, for example, 55 N YJ ur . EquiQ-__i J o 1 t n ~ i )1 P o d l o f f l 3 3 NYS 2d 743 (Sup Ct.,New York County, 19.54). Equ itable relief will not lie

l I - i IL o i 01 ' on e u 110 acts in a mann er which is shocking to the conscience, D u g m n v Platz 238 A D 197,'( 1 i \ 1 ,C40:; 3' Dept 1933),mod on other g r o m d s 263 NY 505, 189 N E 566 (1934), neither will equity

, i ta i lable to one who acts in a manner that is oppressive or unjust or whose conduct is sufficientlyc y ~ c g i o i i ~o '1s to prohibit the party from asserting its legal rights against a defaulting adversary,In Re1- ); 1 1 ~ osiit.e Of Tux Liens 1I 7 NY S 2d 725 (Sup Ct Kings County, 1952), aff'd on other grounds 286 A D' I ' i 4.j L I'S 311 97 (2"" Dept 19-55), mo d on other grounds on rear mm en t I A D 2d 95, 148 NYS 2d 173_ ' DLJIJ~Oj.iJ, p e a l g a n t ed 7 A D 2d 784, 149 NYS 2d 227 (TIDept 1956). The compass by whichiiuestionetl coliduct mus t be mea sured is am ora l one and the acts comp lained of (those that are sufficient- o c > 10 prevznt equ ity's intervention) n eed not be criminal nor actionable at law but mu st merely be willful

4 i n i i iinconscionahle or be of such a nature that honest and fair min ded fo lk would roundly denounce suc h1 L t i ons as being morally and ethically wrong, Pecorella v. Greater BuffaloPress Inc. 1 0 7 A D 2d 1064, 4681 ,53d JCi2 (-1''' Lkp t 1985). Thu s, where a party acts in a m anner that is offensive to good conscience andl u i t ~ c c e mi11 be comp letely without recou rse in a court of equity, regardless of what his legal rights mayI>


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i ,iii cci on Januarv 12 ,20 09 and entered o n January 23 ,20 09 should be vacated and set aside and the Noticet $ 1 ! ' imiency should be ca ncelled and discha rged of record. For this Court to decree a nything less than thei I (:COI ng ould he fo r the Co urt to be wholly de relict in the performance of its obligations.

1 t i t 1 )11KI.I) th 'tt the Adjustable Rate Note in the amount of $2 92 ,50 0.00 dated August 4,2 00 4 made byi hii i ia .I !'am-Horoski in favor of Indy Ma c Bank F.S.B. shall be and the same is hereby cancelled, voided,

t i i r k t i . nullitiec!. set aside and is of no further force an d effect; and it is further

) I < l ) E R I ~ l )hat the Mortgage in the amount of $ 292,500.00 which secures said Adjustable Rate Note. \ C I I t? ? Iliana I.Yano -Horosk i to Mortgag e Electronic Registration Syste ms Inc. As Nominee Fori n t k M x 3ank F S.B. dated August 4, 20 04 and recorded with the Clerk of Suffolk County on August 16,' i H ) J i n Liber 20826 of Mortgages as Page 285, as assigned to IndyMac Bank F.S.B. by Assignmenti . c ~ i ~ t . d t t d i t hhe Clerk of Suffolk County in Liber 21273 of M ortgages at Page 80 8 shall be and the same

iw reh~ acated, cancelled, released and disch arged of record; and it is further

1 ) K I ) l X l - 1) that the P laintiff, its successors and a ssigns are hereby barred, prohibited an d foreclosed fromi ~ t ~ m p t i n g .n anv ma nner, directly or indirectly, to enforce any provision of the afo resaid Adjustable Rate\(ot: and Mo rtgage or any portion thereof as against Defend ant, her heirs or successors; and it is k rt h er

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) I l l ) l ~ R P l lhat Plaintiff shall pay to the Clerk of Suffolk C ounty, within ten(10) days from the date ofLz t r l ' l hereof. a n j and a ll fees and costs required to effect cancellation of record of the M ortgage, Noticesof~ ' L T I Lnc! and an! other fees so levied; and it is further

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indymac v yano-horoski justice skinner 01 dec 2009

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