In this underlying foreclosure action, defendant Pamela O’Neal, in her capacity as Executrix of the Estate of Max H. McComb, moves, pursuant to CPLR 3212, for summary judgment dismissing the complaint and for summary judgment on her counterclaim seeking entry of a declaratory judgment against plaintiff Citizen’s Bank, N.A., voiding the Credit Line and the Mortgage (motion sequence 001). In motion sequence 002, plaintiff moves, for summary judgment on its complaint and to strike defendant’s answer. The motions are consolidated herein for disposition. Papers Considered NYSCEF DOC NO. 19-59. 1. Notice of Motion/ Affirmation of Jeffrey A. Reich, Esq./Affidavit of Pamela O’Neal/ Exhibits A-G/Memorandum of law in support/Foreclosure addendum 2. Notice of Cross Motion/ Affirmation of Matthew E. Minniefield, Esq. in support/ Exhibits A-L/ Affidavit of Debbie. L. Biddle/Exhibits A-B/ Memorandum of Law 3. Affirmation of Jeffrey A. Reich Esq. in opposition/ Exhibits A-E 4. Memorandum of Law in Reply DECISION & ORDER FACTUAL AND PROCEDURAL BACKGROUND This is an action to foreclose on a mortgage lien against property located at 7 McKinley Avenue, Mt. Pleasant, New York (mortgaged premises).1 On or about December 12, 2012, Max McComb (McComb) entered into a Home Equity Line of Credit Agreement and a Credit Line Mortgage with plaintiff, in the amount of $180,000.00. This loan was secured by the mortgaged premises, which was solely owned by McComb. The mortgage was recorded in the Westchester Office of the County Clerk on January 4, 2013. McComb set up an automatic withdrawal from his bank accounts to pay the mortgage. McComb died on September 7, 2013. The monthly mortgage payments were made until April 14, 2016, when payment stopped. On April 13, 2022, plaintiff commenced this action to foreclose on the mortgage by filing, among other things, a summons and a complaint and a notice of pendency. Defendant, who is McComb’s step-daughter and the Executrix of the Estate of Max McComb, filed an amended answer and counterclaim on January 26, 2023 seeking a declaratory judgment to quiet title and void the mortgage entered into by McComb as he was under the auspices of a court appointed guardian at the time. Defendant asserted five affirmative defenses. The first affirmative defense states that plaintiff’s claims against the defendant are barred and plaintiff’s mortgage lien is dischargeable and void. Among other things, the remaining affirmative defenses allege that the claim is time barred and also barred by laches, ratification, and waiver. Defendant now moves for summary judgment. In support of the motion, defendant submits an affidavit and exhibits regarding the guardianship proceeding. Defendant states that she was issued Letters Testamentary on January 19, 2022, in the pending probate proceeding for the Last Will and Testament of Max McComb dated November 29, 2011. Defendant asserts that, on July 11, 2012, she filed an application in the Supreme Court for the State of New York, Westchester County, for the appointment of a Guardian for Max McComb. The Court found that McComb was in immediate need of a Temporary Guardian of his Person and Property in order to prevent him harm. On August 14, 2012, Pauline M. Galvin, Esq. (Galvin) was appointed as temporary guardian of the person and property, pending a hearing on the matter. The parties appeared before the Honorable J. Emmett Murphy on September 20, 2012. Pursuant to an order dated October 24, 2012, Galvin was appointed to act as a Temporary Limited Guardian of the Property for one year from the date the order was signed. Among other things, the Order provided Galvin with the authority to marshal all income, and assets, except as to a Wells Fargo checking account. McComb was allowed to retain control of the Wells Fargo account, which had up to $5000 deposited each month, as he was responsible for the payment of household and other bills from his Wells Fargo account. Galvin was responsible for paying the property tax and homeowner’s insurance, and had authority to review the bank statements. The Temporary Guardianship was to remain in affect pending a final order and Judgment of the Court in a proceeding. The Order also read as follows, in relevant part “pending a final order and judgment of this Court in this proceeding, Max McComb shall not place any encumbrances, liens, mortgages or confessing any judgment upon or transfer titled to any of the real, personal and tangible property and any other assets owned by Max McComb; and it is further Ordered, that Max McComb shall not sign and/or co-sign any mortgages, loans and/or promissory notes nor shall he execute any new powers of attorney….” NYSCEF Doc. 25 at 6-7. On November 7, 2012, Galvin issued a “Statement Identifying Real Property” that stated McComb’s property may not be sold, mortgaged or liened without prior court permission from the Article 81 Judge. This was filed with the Westchester County Clerk on November 15, 2012. Defendant states, “Notwithstanding the Recorded Statement, on or about December 13, 2012, McComb obtained a Home Equity Line of Credit with RBS Citizens N.A. in the amount of $180,000.00 (the “Credit Line”) [and executed] a Credit Line Mortgage (the “Mortgage”) [against the property to secure] the Credit Line.” NYSCEF Doc. No. 21, 10. Defendant’s counterclaim alleges that, prior to issuing the Credit Line, plaintiff conducted a title search on the property and was on notice of the Statement Identifying Real Property. The record indicates that Judge Murphy ordered the termination of the guardianship proceeding by Order dated April 3, 2013. The Order stated, in relevant part, that the “Temporary Guardianship of Max McComb, made on consent by Max McComb, and who has subsequently withdrawn said consent, is terminated, as Max McComb has moved out of the jurisdiction of this court and is no longer residing in or domiciled in the State of New York.” Defendant’s Motion for Summary Judgment (motion sequence 001) Defendant now moves for summary judgment seeking to void the Home Equity Line of Credit Agreement and Credit Line mortgage granted by McComb to plaintiff against the real property. According to the defendant, the Guardianship Order was filed with the Westchester County Clerk’s Office and provided notice that Max McComb was not to place any encumbrances, liens or mortgages on the Property. In addition, Galvin’s filed Statement provided similar notice when it expressly stated that the Property was not to be sold, mortgaged or liened without permission from the Article 81 Judge. Plaintiff entered into the subject mortgage on December 12, 2012, after these Orders and notice were executed and filed. As a result, defendant argues that the documentary evidence establishes that plaintiff had actual and/or constructive notice that McComb was not able to enter into the Credit Line agreement and/or grant him a mortgage securing the Credit Line, and therefore these must be determined to be and declared void, ab initio. Plaintiff’s Opposition and Motion for Summary Judgment (motion sequence 002) Plaintiff opposes defendant’s motion and argues that it has established its right to summary judgment. Plaintiff also requests the defendant’s answer be stricken. Plaintiff is seeking an order of reference, including among other things, a judgment decreeing the amount due to plaintiff, for the mortgaged premises to be ordered to be sold; for a referee to be appointed to compute the sums due to plaintiff on its note, and for the Court to adjudge and decree that defendants be barred and forever foreclosed of and from all lien and equity of redemption of, in and to the mortgaged premises. Plaintiff states that it has provided the mortgage, unpaid note and competent evidence of the defendant borrower’s default on the loan, to establish that there are no triable issues of fact. Plaintiff submits an affidavit from Debbie Biddle, a foreclosure operations manager who reviewed McComb’s account. Biddle stated that “[m]y review of the attached payment history shows the mortgage loan is due for the April 14, 2016 installment and all subsequent installments, and by reason thereof, the Note and Mortgage are in default.” NYSCEF Doc. No. 47, 6. In opposition to defendant’s motion, plaintiff argues that the first affirmative defense and counterclaim fail as a matter of law because the underlying mortgage has been ratified by defendant. Defendant contends that plaintiff has conflated the doctrines of void and voidable. She argues that where, as here, the mortgage was signed by someone who purportedly had the legal capacity to do so, the mortgage is voidable and subject to ratification. The Guardianship proceeding was terminated by a final court order filed and entered on April 3, 2013. Automatic payments continued to be made to plaintiff pursuant to the debit authorization from January 14, 2013 through May 14, 2015. As a result, the borrower ratified the transactions. Plaintiff also notes that, although defendant was purportedly aware of the subject mortgage for a decade, defendant did not move for contempt in the underlying guardianship proceeding, nor did defendant attempt to invalidate the mortgage. In opposition, defendant argues that the account history, as relied upon by plaintiff, established that the agreements were not ratified. Here, McComb signed an automatic withdrawal form on the same date that he entered into the agreements. Payments were then withdrawn automatically from McComb’s account. According to defendant, plaintiff provides no evidence that McComb had knowledge of the material facts as every payment was automatically withdrawn and the majority of the payments were made either during the time he was under the Guardianship, or subsequent to his death. During litigation over McComb’s will, the court appointed administrator, James W. Malys, Esq. (Malys), sent two letters to plaintiff. The first letter, dated January 5, 2016, advised plaintiff that a question exists as to whether the mortgage and note are valid due to a prior order of Guardianship affecting McComb’s ability to enter into such an agreement. The letter requested that plaintiff’s legal department contact Malys. Although Malys sent a check for some of the payments on the note, he advised that he was doing so with full reservation of rights pending investigation of the matter. Malys sent plaintiff another letter on May 6, 2016. He advised plaintiff that he received no response from them regarding his previous letter. He stated the following, in relevant part: “Pursuant to a Petition for appointment of a Guardian for Max McComb, there existed an Order of Court dated October 24, 2012 stating that ‘…Max McComb shall not sign and/or co-sign any mortgages, loans and/or promissory notes…’. This Order and a statement of affected property was on record in the Westchester County Clerk’s office prior to the December 2012 signing and recording of the Valhalla NY property mortgage. As Mr. McComb apparently lacked the legal capacity to obtain a mortgage loan, it is our position at this time that no further payments should be made on the above-referenced loan.” NYSCEF Doc. No. 57. DISCUSSION I. Summary Judgment “The proponent of a motion for summary judgment must demonstrate that there are no material issues of fact in dispute, and that it is entitled to judgment as a matter of law.” Dallas-Stephenson v. Waisman, 39 AD3d 303, 306 (1st Dept 2007). The movant’s burden is “heavy,” and “on a motion for summary judgment, facts must be viewed in the light most favorable to the non-moving party.” William J. Jenack Estate Appraisers & Auctioneers, Inc. v. Rabizadeh, 22 NY3d 470, 475 (2013) (internal quotation marks and citation omitted). Upon proffer of evidence establishing a prima facie case by the movant, “the party opposing a motion for summary judgment bears the burden of produc[ing] evidentiary proof in admissible form sufficient to require a trial of material questions of fact.” People v. Grasso, 50 AD3d 535, 545 (1st Dept 2008) (internal quotation marks and citation omitted). “A motion for summary judgment should not be granted where the facts are in dispute, where conflicting inferences may be drawn from the evidence, or where there are issues of credibility.” Ruiz v. Griffin, 71 AD3d 1112, 1115 (2d Dept 2010) (internal quotation marks and citation omitted). Specifically, Specifically, “[t]o obtain summary judgment in an action to quiet title pursuant to Real Property and Proceedings Law (RPAPL) Article 15, the movant must establish prima facie, that it holds title, or that the nonmovant’s title claim is without merit.” 1259 Lincoln Place Corp. v. Bank of N.Y., 159 AD3d 1004, 1005 (2d Dept 2018) (internal quotation marks omitted). In response to plaintiff’s foreclosure action, defendant asserted a counterclaim to quiet title. Defendant seeks to void all agreements and the mortgage, asserting they are voidable due to the incapacity of the mortgagor. At the outset, as set forth below, defendant has not established that McComb lacked capacity to enter into the agreements at the time of the signing. A party’s competence is presumed and the party asserting incapacity bears the burden of proving incompetence. Crawn v. Sayah, 31 AD3d 367, 368 (2d Dept 2006) (internal quotation marks committed). For instance, even “[p]ersons suffering from diseases, such as dementia, are not presumed incompetent and may still execute a valid deed.” Matter of Nurse, 160 AD3d 745, 746 (2d Dept 2018). “In exercising its discretion to appoint a guardian for an individual’s property…a court must make a two-pronged determination: first, that the appointment is necessary to manage the property or financial affairs of that person, and, second, that the individual either agrees to the appointment or that the individual is ‘incapacitated’ as defined in Mental Hygiene Law §81.02 (b) (Mental Hygiene Law §81.02 [a]).” Matter of Maher, 207 AD2d 133, 139-140 (2d Dept 1994). As set forth in the facts of this case, the Court did find that McComb was in immediate need of a Temporary Guardian of his Person and Property in order to prevent him harm. However, as this was a “consent” guardianship, there was no finding of incapacity. Defendant has not produced any evidence in support of McComb’s lack of capacity. Nonetheless, defendant has met its prima facie burden on its counterclaim by submitting evidence that the agreements were unauthorized, and voidable. It is undisputed that, at the time McComb entered into the agreements, there was a Guardianship Order and a Statement Identifying Real Property filed with the Westchester County Clerk’s office. The Guardianship Order stated, among other things, that McComb may not place any mortgages or liens on the property or sign any loans or mortgages. The Statement Identifying Real Property stated that McComb’s property may not be sold, mortgaged or liened without prior court permission from the Article 81 Judge. See e.g. HSBC Bank USA, N.A. v. Decaudin, 49 AD3d 694, 695 (2d Dept 2008) (“The documentary evidence submitted by the defendant Naida I. Velazquez was sufficient to demonstrate that the subject conveyance to the defendant Bruno Decaudin was unauthorized. The conveyance was made by one of the two attorneys-in-fact of Velazquez’s mother, in disregard of the requirement set forth in the power of attorney that they ‘act together’”). Moreover, “[a] mortgagee is under a duty to make an inquiry where it is aware of facts that would lead a reasonable prudent lender to make inquiries of the circumstances of the transaction at issue. A mortgagee who fails to make such an inquiry is not a bona fide encumbrancer for value.” Mortgage Elec. Registration Sys., Inc. v. Rambaran, 97 AD3d 802, 804 (2d Dept 2012) (internal quotation marks and citations omitted). In response to defendant’s motion, plaintiff has not disputed that documents prohibiting the mortgage were filed in the Westchester County Clerk’s office at the time McComb entered into the agreements. In opposition to defendant’s motion, plaintiff argues that, even if the mortgage was purportedly voidable as a result of the guardianship proceeding, the mortgage should not be invalidated as it was ratified. See Rosen v. Rosen, 243 AD2d 618, 619 (2d Dept 1997) (Voidable conveyances are “subject to ratification”). According to plaintiff, after the guardianship proceeding was terminated, payments continued to be made on the mortgage, thereby ratifying its existence. Plaintiff claims that McComb, the borrower himself, ratified the transactions by making payments after the guardianship proceeding was terminated. Automatic payments were made from January 14, 2013 through May 14, 2015. Ratification is the affirmance by a person of a prior act of another which did not bind him because it was done without his authority, but which was done on his account, thus giving effect to the act as if originally authorized. Sullivan Realty Organization, Inc. v. Syart Trading Corp., 68 AD2d 756, 770 (2d Dept 1979); see also Green Tree Servicing, LLC v. Feller, 159 AD3d 1246, 1248 (3d Dept 2018) (internal quotation marks and citations omitted) (“[a] ratification presupposes an unauthorized act on behalf of someone else, which that person later authorizes or ratifies”). Courts have held that “[t]he act of ratification, whether express or implied, must be performed with full knowledge of the material facts relating to the transaction, and the assent must be clearly established and may not be inferred from doubtful or equivocal acts or language.” American Motorists Ins. Co. v. Keep Servs., 63 AD3d 865, 867 (2d Dept 2009) (internal quotation marks omitted). Applying these principles to the facts at hand, the Court finds that plaintiff fails to raise a triable issue of fact as to whether ratification occurred. The borrower signed the agreements and executed the mortgage when he was unauthorized to do so. It was at that time that he also entered into the automatic monthly payments. At no time did anyone else ratify the agreements entered into by McComb. In fact, plaintiff was advised that the McComb estate would not be making future payments on the agreements and it was its position that he lacked the legal capacity to obtain a mortgage loan. It is also noted that defendant was only recently appointed as Executrix of the Estate. The Court is unpersuaded that McComb ratified his own actions by continuing to pay after the guardianship proceeding was terminated. The monthly payments were withdrawn automatically from McComb’s checking account. There is no indication that McComb “performed with full knowledge of the material facts relating to the transaction,” for these monthly payment agreement. Plaintiff’s only agreement with respect to the automatic payments occurred during McComb’s guardianship, and the majority of the automatic payments were made subsequent to his death in September 2013. Accordingly, defendant’s motion for summary judgment dismissing the complaint is granted, and the defendant is granted summary judgment on its counterclaim.2 Plaintiff’s Motion for Summary Judgment (motion sequence 002). As a result of this decision, defendant has been granted summary judgment dismissing plaintiff’s foreclosure complaint. Accordingly, plaintiff’s motion for summary judgment seeking, among other things, an order of reference, and the striking of defendant’s answer, is denied as moot. The Court has considered the remaining contentions of the parties and finds them to be without merit. CONCLUSION Accordingly, it is hereby ORDERED that defendant’s motion (motion sequence 001) for summary judgment dismissing plaintiff’s complaint and for summary judgment on its counterclaim for a declaratory judgment to quiet title is granted; and it is further ORDERED as void: the Home Equity Line of Credit Agreement and Credit Line Mortgage granted by Max H. McComb to RBS Citizens N.A. against the real property located at 7 McKinley Avenue, Mt. Pleasant, New York 10595; and it is further ORDERED that plaintiff’s motion (motion sequence 002), is denied it its entirety; and it is further ORDERED that defendant is directed to settle order on notice to the other parties within thirty days of notice of entry of this Order Dated: July 20, 2023
