United States of America v. Bowen et al
Filing
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OPINION AND ORDER denying 9 Motion to Vacate Clerk's Entry of Default ; granting 11 Motion for Summary Judgment; granting 18 Motion allowing nunc pro tunc service of notice required by Local Rule 56 ; denying 22 Motion for free PACER services ; denying 29 Motion for production of free copies. Signed by Hon. William K. Sessions III on 3/20/20. (SG)
UNITED STATES DISTRICT COURT
FOR THE
WESTERN DISTRICT OF NEW YORK
UNITED STATES OF AMERICA,
Plaintiff,
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v.
OLENA BOWEN, MORELL DAVID
BOWEN, JR., NEW YORK STATE
DEPARTMENT OF TAXATION AND
FINANCE,
Defendants.
Case No. 18-cv-437
OPINION AND ORDER
This is an action brought by Plaintiff United States of
America to foreclose on a mortgage.
Pending before the Court are
Plaintiff’s motion for summary judgment and motion to validate
service of a special notice.
Defendants Olena Bowen and Morell
David Bowen, Jr. (“the Bowens”), proceeding pro se, have moved
the Court for access to certain documentation and pleadings.
Counsel for Plaintiff submits that those documents and pleadings
have been served and that the case is ready for final judgment.
For the reasons set forth below, Plaintiff’s motions are
granted and the Bowens’ motions are denied.
Factual Background
On January 14, 2005, defendants Olena Bowen and Morell David
Bowen, Jr. executed a promissory note in the amount of $146,600
plus interest at a rate of 6% per year.
a mortgage to secure the note.
The Bowens also executed
The lender is the United States
of America, acting by and through the USDA Rural Housing Service,
formerly known as the Farmers Home Administration.
The Bowens’ loan was accelerated on October 3, 2005, but was
reinstated to allow them to apply for special servicing.
Their
application for moratorium assistance was denied in December
2005.
The loan was subsequently accelerated on January 11, 2006,
but was again reinstated.
On January 30, 2006, the Bowens
entered into a delinquency workout, though that agreement was
later terminated.
On November 14, 2006, the loan was reamortized.
The Bowens
were granted a moratorium from January 14, 2009 through December
14, 2010.
At the end of the moratorium, their account was
reamortized again.
The Bowens were granted a second round of
moratorium assistance between April 14, 2013 and March 14, 2015.
The loan was accelerated a final time on February 4, 2016.
Plaintiff submits that the Bowens have not made a payment on
the loan since the most recent moratorium expired on March 14,
2015.
On March 13, 2017, Plaintiff allegedly sent the Bowens a
90-day notice as required under RPAPL § 1304.
As of June 18,
2018, the reported amount due on the note was $230,113.25, with
interest accruing at a rate of $24.53 per day.
Procedural History
Plaintiff filed its Complaint for foreclosure on April 13,
2018.
The New York State Department of Taxation and Finance was
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named as a party in the event that it had a claim or other
interest in the mortgaged property.
The Complaint also named
John Doe, Mary Roe, and XYZ Corporation as Defendants in the
event that there were tenants, occupants, or others who might
have an interest in the property.
Plaintiff has since determined
that there are no such tenants, occupants, or other interest
holders.
On May 11, 2018, the Bowens filed an Answer to the
Complaint.
The Answer accuses Plaintiff’s counsel of trying to
“trick” the Court into believing that the Bowens received an
acceleration letter dated February 4, 2016.
14.
ECF No. 6 at 2, 5-
The Answer also submits that the Bowens are awaiting balance
and reconciliation information to support the alleged amount of
their debt.
Finally, the Answer claims that the Bowens are
entitled to an “informal discussion” and an administrative appeal
hearing prior to foreclosure.
Id. at 2.
On June 18, 2018, Plaintiff moved for entry of default
against the New York Department of Taxation and Finance for
failure to plead or otherwise defend against the Complaint.
Bowens moved to vacate the request, citing their Answer.
The
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other party responded to the request for entry of default.
On July 17, 2018, Plaintiff filed its motion for summary
judgment.
12-10.
The motion included a certificate of service.
ECF No.
On March 22, 2019, the Court required Plaintiff to file
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proof of service of the special notice to pro se litigants
required by the Western District of New York’s Local Rule 56.
The special notice form has since been served, and Plaintiff has
filed a motion for validation of the notice form nunc pro tunc.
ECF No. 18.
On April 1, 2019, in response to the motion for summary
judgment, the Bowens acknowledged receipt of the special notice
to pro se litigants but stated that they had not received the
summary judgment motion itself.
ECF No. 19.
Their response
requested service of the motion and production of factual support
for the alleged debt.
The Bowens also reiterated their request
for an informal discussion and an administrative appeal, and
noted that they had been to the federal courthouse in Buffalo to
review the case docket.
Id.
On April 5, 2019, counsel for Plaintiff submitted a sworn
affirmation attesting that he had served the motion for summary
judgment by mail on July 17, 2018.
After receiving the Bowens’
April 1, 2019 filing, which included a request for communication
via email, counsel sent a copy of the summary judgment motion to
the email address provided by the Bowens.
ECF No. 20.
On May 1, 2019, the Bowens again asked the Court to order
Plaintiff to provide a copy of the motion for summary judgment.
Their filing stated that they did not receive a copy of the
summary judgment motion “prior to April 5, 2019,” and that they
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had “no certainty” that the email and attachments received from
Plaintiff’s counsel were “complete[] and accurate[].”
at 1-2.
ECF No. 21
The filing also asserted several new claims, including:
that Plaintiff had returned more than ten of their mortgage
payments; that when Plaintiff demanded a payment of $5,040.15,
they sent a payment in that amount but the payment was returned;
and that prior to the execution of the note and mortgage,
Plaintiff colluded with the previous owner of the property.
On May 2, 2019, the Bowens moved the Court to allow free
access to PACER on their home computer.
For support, they
informed the Court that they live 22 miles from the nearest
federal courthouse, and again stated that they have “no
certainty” the documents mailed and emailed to them “are complete
and accurate.”
ECF No. 22 at 2.
In response to the May 1 and May 2, 2019 filings,
Plaintiff’s counsel filed another affirmation explaining that he
had served both hard copies and electronic copies of the summary
judgment motion.
With regard to the Bowens’ assertions about
returned payments, including the check for $5,040.15, counsel
provided an affidavit from Jennifer Jackson, an employee of the
USDA Rural Housing Service.
Jackson’s affidavit states that: (1)
required pre-foreclosure notice was sent to the Bowens via
regular and certified mail; (2) the Bowens’ assertion that they
tendered a check in the amount of $5,040.15 “is not true” as
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there is no record of any such payment; (3) any check returned
for insufficiency would have been accompanied by a letter stating
the reason, and there is no record of such a letter being sent;
(4) even if such a payment had been made, it would not have
included the most recent payment due and would therefore have
been insufficient to cure the default; and (5) any claim of
collusion with the prior property owner is “completely
unfounded.”
ECF No. 24.
On June 5, 2019, the Bowens responded to these latter
filings, claiming that Jackson’s statements about their $5,040.15
check were “visibly disingenuous” and constituted “trickery.”
ECF No. 26
at 3.
The Bowens also restated their claim that they
never received the acceleration notices setting forth their
rights to an informal discussion and an administrative appeal
hearing.
ECF No. 6 at 5-10.
Finally, the Bowens reiterated that
they never received hard copies of the summary judgment motion,
and that they are entitled to transaction and correspondence
histories.
The Bowens followed their June 5 filing with a submission on
June 12, 2019 asking the Court to order: a copy of the original
loan; a monthly accounting, including monthly balances; notices
of acceleration; and any notice of intent to foreclose and right
to a hearing.
ECF No. 29.
The June 12 filing prompted another affirmation from
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Plaintiff’s counsel, in which he confirmed that he “provided
Defendants with all the required notices in this foreclosure
action.
The United States has proven both statutory and
contractual notice compliance by way of its original moving
papers.”
ECF No. 30 at 2.
Counsel also represented that on
February 27, 2018, he sent the Bowens a letter setting forth the
amount currently owed, as well as a payment history from January
2005 to February 2018.
Id.
On July 1, 2019, the Bowens filed a response in which they
accused Plaintiff’s counsel of perjury.
Discussion
I.
Motion for Nunc Pro Tunc Validation
As discussed above, Plaintiff’s counsel initially failed to
provide the Bowens with the required special notice to pro se
litigants.
Counsel has since rectified the error, and the Bowens
have acknowledged receipt of the special notice.
Plaintiff’s
motion for nunc pro tunc validation of the notice is granted.
II.
Motion for Summary Judgment and To Amend the Caption
Summary judgment is appropriate if “the pleadings, the
discovery and disclosure material on file, and any affidavits
show that there is no genuine issue as to any material fact and
that the movant is entitled to judgment as a matter of law.”
Sousa v. Roque, 578 F.3d 164, 169 (2d Cir. 2009) (quoting Fed. R.
Civ. P. 56).
A “genuine issue” exists “if the evidence is such
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that a reasonable jury could return a verdict for the non-moving
party.”
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248
(1986).
The Court resolves all ambiguities and draws all factual
inferences in favor of the non-movant, but “only if there is a
‘genuine’ dispute as to those facts.”
Scott v. Harris, 550 U.S.
372, 380 (2007) (citing Fed. R. Civ. P. 56).
Summary judgment may be sought in foreclosure actions.
United States v. Simmons, No. 13-CV-00789(S)(M), 2015 WL
12591683, at *2 (W.D.N.Y. Jan. 16, 2015) (citation omitted)
report and recommendation adopted No. 13-CV-00789(S)(M), at ECF
No. 37 (W.D.N.Y. Feb. 5, 2015).
Under New York law, summary
judgment is appropriate “where the foreclosing party produces
documentary evidence establishing the three elements of a
foreclosure claim: (1) a mortgage, (2) a note, and (3) proof of
default on the note by the mortgagor.”
OneWest, N.A. v. Aikey,
No. 13-CV-6453T, 2015 WL 1472265, at *2 (W.D.N.Y. Mar. 31, 2015)
(citations omitted); see also CIT Bank, N.A. v. O’Sullivan, No.
14-cv-5966 (ADS)(AYS), 2016 WL 2732185, at *4 (E.D.N.Y. May 10,
2016); United States v. Paugh, 332 F. Supp. 2d 679, 681 (S.D.N.Y.
2004).
If the plaintiff establishes these three elements, “it is
entitled to foreclose unless the defendant/mortgagor makes an
affirmative showing of a bona fide defense to the mortgage.”
Simmons, 2015 WL 12591683, at *2 (citations omitted); see Paugh,
332 F. Supp. 2d at 681.
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In this case, there is no dispute that the note and mortgage
were signed by the Bowens, that the note is proof of the debt,
and that the note is secured by the mortgage.
The Bowens have
not directly countered Plaintiff’s claim that they are in default
on their obligations, or that the calculation of the amount due
is incorrect.
Instead, they claim that they never received the
notice of acceleration which, among other things, would have
alerted them to certain rights.
The Bowens also contend that
they may not have received the complete summary judgment filing,
and that they are entitled to copies of all loan documents and a
complete accounting.
Plaintiff has addressed these issues.
With respect to
notice, copies of the acceleration notice were sent to each of
the Bowens via regular and certified mail.
There is no dispute
that the notices complied with the relevant federal guidelines.
Specifically, the notices stated the reason for the acceleration,
the amount due, the method of payment, the opportunity for an
informal discussion, and the process for requesting an
administrative hearing.
ECF No. 13-3 at 18-20.
The acceleration notices were “returned to sender.”
The
fact that the Bowens did not sign for the notices is immaterial.
The mortgage states that “notice shall be directed to the
Property Address or any address Borrower designates by notice to
the Lender.”
ECF No. 13-1 at 10.
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In this case, the notices were
sent to the property address, as the Bowens had not provided an
alternative.
ECF No. 13 at 4.
Consequently, lack of receipt is
not a defense.
As set forth in the acceleration notices, the Bowens had the
opportunity to request an informal hearing and pursue an
administrative appeal.
The notices stated that an informal
discussion could be requested on or before February 19, 2016.
ECF No. 13-3 at 19.
that date.
There is no evidence of a request prior to
The acceleration decision notified the Bowens that
acceleration could be appealed within 30 days of the day the
notice was received.
The U.S. Postal Service tried to deliver
the notices multiple times in February 2016.
Id. at 23-24.
On
October 14, 2016, the Bowens sent a request for reconsideration
which was denied as untimely.
ECF No. 13-4 at 2.
Accordingly,
any entitlement to either an informal decision or an
administrative appeal has passed.
The Bowens have not opposed the summary judgment motion,
though it is clear they have been on notice of the motion for
several months.
The motion was served by mail in July 2018.
Bowens say it was never received.
The
The notice to pro se litigants
was served in March 2019, and the Bowens acknowledge receipt.
That prompted at least one of them to travel to the courthouse,
where they were able to review the docket.
The motion for
summary judgment would have been apparent and attainable at that
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time.
On April 1, 2019, the Bowens requested that all
communications be made via email.
ECF No. 19 at 3.
Plaintiff’s
counsel subsequently sent them another copy of the summary
judgment filing via email.
The Bowens do not deny receiving that
email.
“[I]n considering a motion for summary judgment, [the Court]
must review the motion, even if unopposed, and determine from
what it has before it whether the moving party is entitled to
summary judgment as a matter of law.”
Vermont Teddy Bear Co. v.
1-800 Beargram Co., 373 F.3d 241, 246 (2d Cir. 2004).
The
material facts in this case are set forth in Plaintiff’s
affidavits, and in particular the affidavits of Jennifer Jackson.
The first Jackson Affidavit (ECF No. 13) confirms the executed
note and mortgage, default, proper notice of acceleration and
foreclosure, and the amount of the debt.
The second Jackson
Affidavit (ECF No. 24) counters allegations of collusion with a
prior owner and the alleged payment of $5040.15, making clear
that even the receipt of that payment would have been
insufficient to resolve the default.
Any collusion claim is
clearly out of time, as the note and mortgage were executed in
2005.
Absent genuine issues of material fact with respect to
Plaintiff’s right to foreclose, the motion for summary judgment
is granted.
As Plaintiff represents to the Court that there are
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no tenants or other third-party occupants on the premises,
Defendants John Doe, Mary Roe, and XYZ Corporation are dismissed
and the caption is amended accordingly.
III.
The Bowens’ Motions
The Bowens have filed motions seeking various forms of
relief, including free access to PACER, an accounting of their
debt and additional copies of acceleration notices.
Counsel for
Plaintiff describes these requests as delay tactics.
The record makes clear that the Bowens have had multiple
opportunities to address this debt, and have received at least
one full accounting of the balances owed.
They have been sent
notices of acceleration, notifications of their rights, and
actual notice of the summary judgment filings.
for additional information are meritless.
Their requests
The Bowens also failed
to provide any legal or factual support for their request for
free access to PACER on their home computer.
The pending motions
for PACER access and additional documentation are denied.
Finally, Plaintiff has requested a clerk’s entry of default
against the New York State Department of Taxation and Finance.
The Bowens moved to vacate the request, citing their answer.
clerk’s entry of default was not targeted at the Bowens, and
their answer thus has no impact on Plaintiff’s request.
The
motion to vacate the request for clerk’s entry of default is
denied.
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The
Conclusion
For the reasons set forth above, Plaintiff’s motion for
summary judgment (ECF No. 11) and motion for an order allowing
nunc pro tunc service of the notice required by Local Rule 56
(ECF No. 18) are granted.
The Bowens’ motion to vacate the
request for a clerk’s entry of default (ECF No. 9), motion to
allow free PACER services (ECF No. 22), and motion for an order
directing Plaintiff to provide copies of documents (ECF No. 29)
are denied.
DATED at Burlington, Vermont, this 20th day of March, 2020.
/s/ William K. Sessions III
William K. Sessions III
U.S. District Court Judge
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