Justice Kenneth Sherman
Bobbitt Jr. moved to confirm a special referee’s report to toll all interest accrued on a loan and enjoin American Home Mortgage Servicing (AHMS) from collecting attorney fees related to this foreclosure action. The court confirmed the report, and set the matter for a hearing to decide if AHMS engaged in bad faith negotiations. The court noted mandatory settlement conferences were required in all residential foreclosure actions involving a defendant who was a resident of the property to subject to foreclosure, and mandated the parties negotiate in good faith. It stated while AHMS appeared by counsel at the settlement conferences, it was evident counsel did not have the appropriate contractual authority to negotiate in good faith towards a loan modification, and fully dispose of the matter. The court concluded that from April 23, 2009 to Oct. 5, 2010 AHMS failed to appear by counsel who was knowledgeable and had authority to negotiate in a meaningful manner. As such, AHMS failed to comply with CPLR 3408(c) requirements, and failed to negotiate in good faith. Thus, the court barred AHMS from collecting any claimed interest, penalties, attorney fees or costs incurred on the loan from April 23, 2009 to Oct. 5, 2010.