Wednesday, April 9, 2014

Allegations of improper increased mortgage payments.

Practice point:  The Appellate Division found that plaintiff's allegations of improper increased mortgage payments and improper notices of such increases were contradicted by provisions in the loan documents.  The motion court correctly found that plaintiff had failed to allege that his next mortgage payments of the minimum amount authorized under the loan documents would not have triggered defendants' right to increase his monthly payment obligations; his assertion that he had not triggered such right at the time of the notices begged the question. The loan documents lacked any provision imposing on defendants a duty to modify the notes or negotiate a workout, and, pursuant to the covenant of good faith, such terms cannot be added.

Student note:  The Appellate Division further found that plaintiff's cause of action for violation of General Business Law § 349 was untimely, as it accrued upon defendants' first notice of mortgage payment increases, more than three years before the service of the pleadings in this action, pursuant to CPLR 214.

Case:  Brown v. Deutsche Bank Natl. Trust Co., NY Slip Op 02336 (1st Dept. 2014).

Here is the decision.

Tomorrow's issue: Disqualifying an attorney.