Practice point: The plaintiff has standing where it is the holder or assignee of the underlying note at the time the action is commenced. Either a written assignment of the underlying note or the physical delivery of the note prior to the commencement of the action is sufficient to transfer the obligation, and the mortgage passes with the debt as an inseparable incident. No special form or language is necessary to effect the assignment as long as the language shows the intention of the owner of a right to transfer it. However, the assignment of the mortgage without an effective assignment of the underlying note is a nullity. No interest is acquired by it because a mortgage is merely security for a debt or other obligation and does exist independently of the debt or obligation.
If a note and mortgage are validly assigned to a third party subsequent to the commencement of an action, the assignee can continue the action in the name of the original mortgagee without a formal substitution.
Csse: Arch Bay Holdings, LLC v. Albanese, NY Slip Op 00284 (2d Dep't January 18, 2017)
Here is the decision.
Tomorrow's issue: A challenge to the decedent's paternity of a child in a wrongful death action.