In this foreclosure action, the Appellate Division affirmed the granting of plaintiff's motion for summary judgment dismissing defendant's affirmative defenses and counterclaims.
Defendant did not establish that plaintiff or its predecessor lenders or servicers frustrated her performance under the terms of the subject note and mortgage. While she may have experienced frustration in dealing with various lenders and servicers, she proffers no evidence that they prevented or frustrated her from making payments on the indebtedness or rejected or returned payments.
Defendant's claim of estoppel is unsubstantiated. In order to establish an estoppel, a party must prove that it relied upon another's actions, its reliance was justifiable, and that, in consequence of such reliance, it prejudicially changed its position. Here, there is nothing in the record that reflects any representation by plaintiff or its predecessors that would have induced defendant's reliance in obtaining a new modification agreement. There are no representations that plaintiff or its predecessors promised to modify her loan, and to the extent defendant claims that delay in processing her loan modification applications increased her indebtedness, any dispute about the amount owed would be resolved by a referee and does not affect the validity of the mortgage. For the same reason, defendant's claim of offset was dismissed.
Defendant's claim that plaintiff or its predecessors violated General Business Law § 349 is likewise unavailing. An act or practice is consumer-oriented when it has a broader impact on consumers at large. Conduct must extend beyond a particular contractual relationship, because the consumer-oriented element precludes a General Business Law § 349 claim based on private contract disputes, unique to the parties. Defendant alleges only purported actions taken against her related to her loan, not actions that were recurring and harmful to the public at large.
Nor has defendant raised any triable issues of fact with respect to her claim that plaintiff or its predecessors breached the terms of the note and mortgage. The correspondence submitted in support of her claim reflects that plaintiff and its predecessors explained changes in monthly payments and provided loan payment histories and escrow statements. The motion court's dismissal of both the breach of contract claim and the breach of the covenant of good faith and fair dealing defense was likewise not in error, as the allegations for each were duplicative and similarly unavailing.
Nor does the defense of unclean hands survive. Even accepting the truth of defendant's allegations, plaintiff was under no obligation to modify the loan or respond to defendant's questions consistent with her time frame, and there is nothing immoral or unconscionable about its decision to proceed with foreclosure.
Defendant's fraud defense, in which she claims that plaintiff told her that her loan modification would be reviewed, inducing her reliance on a timely response and foreclosing opportunities to obtain other financing, lacks evidentiary support that plaintiff made any specific representations to her in that regard, much less any material misrepresentations of fact, a necessary component of a fraud claim.
As defendant's counterclaims are largely reflective of her affirmative defenses, they suffer from the same issues, and were also properly dismissed.
Deutsche Bank Natl. Trust Co. v. Marino, NY Slip Op 00374 (1st Dep't January 23, 2024)
