Windward Bora LLC v. Thomas

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

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WINDWARD BORA LLC,

Plaintiff, MEMORANDUM & ORDER

20-CV-6046 (JS)(SIL)

-against-

MELISSA THOMAS,

Defendant.

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APPEARANCES

For Plaintiff: Alan H. Weinreb, Esq.

The Margolin & Weinreb Law Group, LLP

165 Eileen Way, Suite 101

Syosset, New York 11791

For Defendant: Melissa Thomas, pro se

135 Marvin Avenue

Hempstead, New York 11550

SEYBERT, District Judge:

Winward Bora LLC (“Plaintiff”) commenced this action

pursuant to New York Real Property Actions and Proceedings Law

(“RPAPL”) § 1301 et seq. against Melissa Thomas (“Defendant”) to

foreclose on a mortgage encumbering 135 Marvin Avenue, Hempstead,

New York 11550 (the “Property”). (See generally Compl., ECF

No. 1.) Although Defendant requested an extension of time to

answer or otherwise respond to the Complaint (see Dec. 30, 2020

Ltr., ECF No. 9), she failed to do so. The Clerk of Court issued

a certificate of default on January 19, 2022. (Entry of Default,

ECF No. 13.) Thereafter, Plaintiff moved for entry of a default

judgment of foreclosure and sale against Defendant. (Mot., ECF

No. 14.) For the reasons that follow, Plaintiff’s motion is

GRANTED.

BACKGROUND

The following facts are taken from the Complaint and are

assumed to be true for purposes of this motion. See Nero v. Law

Office of Sam Streeter, P.L.L.C., 655 F. Supp. 2d 200, 204

(E.D.N.Y. 2009) (“[W]hen the court determines that defendant is in

default, the factual allegations of the complaint, except those

relating to the amount of damages, will be taken as true.”

(internal quotation marks and citation omitted)).

Plaintiff is a single-member limited liability company

organized under the laws of the State of Delaware. (Compl. ¶ 2.)

Plaintiff’s sole member, Yonel Devico (“Devico”), is a citizen of

the Kingdom of Morocco, lawfully admitted for permanent residence

in the United States and domiciled in Florida. (Id.) Defendant

is the borrower on the subject loan and is the mortgagor under the

subject mortgage. (Id. ¶ 3.) On March 19, 2007, Defendant

executed a mortgage (the “Mortgage”) against the Property in favor

of Continental Home Loans, Inc. (“Continental”) to secure the sum

of $81,620.00 plus interest. (Id. ¶ 7.) The Mortgage was recorded

on April 5, 2007 in Liber 31742, Page 239 in the Nassau County

Clerk’s Office. (Id.; see Mortgage, ECF No. 1-1, 4-18.) On March

19, 2017, Defendant executed and delivered a note (the “Note”) to

Continental in the amount of $81,620.00. (See Compl. ¶ 8; Note,

ECF No. 1-1, 19-23.)

“The Note was transferred by the affixation of proper

endorsements and allonge thereto.” (Compl. ¶ 9.) The assignments

of the Mortgage are as follows:

a) Assignor: Mortgage Electronic Registration

Systems, Inc., as nominee for Continental Home

Loans, Inc.

Assignee: Aspen Properties Group, LLC as

Trustee for Aspen G. Revocable Trust

Dated: July 9, 2018 Recorded: July 25, 2018

Book 42957, page 747

b) Assignor: Aspen Properties Group, LLC as

Trustee for Aspen G. Revocable Trust

Assignee: Windward Bora LLC

Dated: June 3, 2019 Recorded: June 28, 2019

Book 43515, page 82

(Id. ¶ 9; Assignments of Mortgage , ECF No. 1-1, 27-32.) Any

applicable recording tax was paid at the time the Mortgage was

recorded. (Compl. ¶ 10.)

Plaintiff is in physical possession of and the owner of

the original Note and Mortgage. (Id. ¶ 11; see Affidavit of

Possession, ECF No. 1-1, 24-26.) Defendant is non-compliant with

the terms and provisions of the Mortgage and the instruments

secured by the Mortgage by failing to make monthly payments as of

June 1, 2015. (Compl. ¶ 12.) Plaintiff’s default under the

Mortgage continues to date. (Id.)

Plaintiff has complied with the contractual provisions

in the loan documents. (Id. ¶ 13.) For example, on August 14,

2020, Plaintiff issued a “Default Notice” to cure to Defendant to

advise her of the “possible acceleration of the loan and that by

virtue of her continuing default . . . if the arrears are not

cured, Plaintiff may declare that the outstanding principal

balance due under the Note, together with all accrued interest, is

immediately due and payable.” (Id.) Plaintiff also complied with

RPAPL’s 90-day notice requirement pursuant to Section 1304(1), as

well as the registration requirements of Section 1306(1).

Plaintiff has provided copies of these notices and registration.

(See Notices, ECF No. 1-1, 33-41; RPAPL § 1320 Notice, ECF No. 1-

2.) Further, Plaintiff complied “with all the provisions of

Section 595a and Section 6-1 of the Banking Law and RPAPL Section

1304, except where it is exempt from doing so.” (Compl. ¶ 14.)

Defendant has failed to respond to the default notices

and is indebted to Plaintiff pursuant to the terms of the Note and

Mortgage for:

a. The unpaid principal amount due under the

Note, and all accrued and unpaid interest and

late charges which sum as of August 14, 2020

amounts to $133,329.45[;]

b. Attorney’s fees and other costs and

disbursements, payable to Windward Bora LLC

under the terms of the Note, which will accrue

until the amount due and payable under the

Note is paid in full; and

c. Any and all additional fees that are due or

may become due and payable as provided under

the terms and conditions of the Note and

Mortgage are paid in full.

(Id. ¶¶ 16-17.)1

Plaintiff also requests that in the event this action

proceeds to judgment of foreclosure and sale, the Property should

be sold subject to the following conditions:

a. Any state of facts that an inspection of

the premises would disclose.

b. Any state of facts that an accurate survey

of the premises would show.

c. Covenants, restrictions, easements and

public utility agreements of record, if any.

d. Building and zoning ordinances of the

municipality in which the Mortgaged premises

are located and possible violations of same.

e. Any right of tenants or person in

possession of the subject premises.

f. Any equity of redemption of the United

States of America to redeem the premises

within 120 days from date of sale.

g. Prior lien(s) of record, if any.

(Id. ¶ 18.)

Plaintiff confirms that “[n]o other action or proceeding

has been commenced or maintained or is now pending at law or

otherwise for the foreclosure of said Mortgage or for recovery of

the said sum secured by said Note and Mortgage or any part

thereof.” (Id. ¶ 21.)

1 In its motion for default judgment, Plaintiff does not seek an

award of attorneys’ fees and costs. (See Support Decl.,

ECF No. 14-1, at ¶ 8.)

PROCEDURAL HISTORY

Plaintiff commenced this action on December 11, 2020 by

filing a verified Complaint. Defendant was served with copies of

the Summons and Complaint on December 23, 2020. (Summons Service

Aff., ECF No. 10.) Defendant appeared pro se in this action twice:

(1) on December 30, 2020, Defendant filed a request for an

extension of time to respond to the Complaint; and (2) on March

31, 2021, Defendant filed a signed hardship declaration pursuant

to the COVID-19 Emergency Eviction and Foreclosure Prevention Act.

(See Dec. 30, 2020 Ltr., Hardship Decl., ECF No. 11.) Although

Defendant was granted an extension of time to April 7, 2021 to

respond to the Complaint (see Jan. 7, 2021 Elec. Order), she has

failed to do so.

Thereafter, Plaintiff requested a certificate of default

on January 19, 2022, and the Clerk of Court entered default against

Defendant that same day. Plaintiff filed the instant motion for

default judgment of foreclosure and sale on January 19, 2022.

Plaintiff also filed an affidavit of service confirming that a

copy of the default motion, along with all supporting papers and

exhibits, were mailed to Defendant on January 26, 2022. (Mot.

Service Aff., ECF No. 14-7.) Defendant has failed to respond to

Plaintiff’s default motion.

ANALYSIS

I. Legal Standard

Motions for default judgment are governed by Federal

Rule of Civil Procedure (“Rule”) 55 of the Federal Rules of Civil

Procedure, which provides for a two-step process. See Priestley

v. Headminder, Inc., 647 F.3d 497, 504-05 (2d Cir. 2011).

Initially, the moving party must obtain a certificate of default

from the Clerk of the Court. See FED. R. CIV. P. 55(a). Once the

certificate of default is issued, the moving party may apply for

entry of a default judgment. See FED. R. CIV. P.55(b). Where a

default occurs, the well-pleaded factual allegations set forth in

a complaint relating to liability are deemed true. See Vermont

Teddy Bear Co. v. 1-800 Beargram Co., 373 F.3d 241, 246 (2d Cir.

2004); see also FED. R. CIV. P.8(b)(6). However, the entry of a

default judgment is “entrusted to the sound judicial discretion of

the court,” and a party is not entitled to a default judgment as

a matter of right. Allstate Ins. Co. v. Howell, No. 09-CV-4660,

2013 WL 5447152, at *1 (E.D.N.Y. Sept. 30, 2013) (citation

omitted). In light of the Second Circuit’s “oft-stated preference

for resolving disputes on the merits,” default judgments are

“generally disfavored,” and doubts should be resolved in favor of

the defaulting party. See Jiao v. Shang Shang Qian Inc., No. 18-

CV-562, 2020 WL 6370148, at *10–11 (E.D.N.Y. Aug. 11, 2020).

A plaintiff seeking a default judgment must demonstrate

that its “uncontroverted allegations, without more, establish the

defendant’s liability on each asserted cause of action.” Gunawan

v. Sake Sushi Rest., 897 F. Supp. 2d 76, 83 (E.D.N.Y. 2012). In

determining whether to grant a motion for default judgment, the

court has the “responsibility to ensure that the factual

allegations, accepted as true, provide a proper basis for liability

and relief.” Ferrera v. Tire Shop Ctr., No. 14-CV-4657, 2015 WL

3562624, at *2 (E.D.N.Y. Apr. 6, 2015). Accordingly, prior to

entering a default judgment, the court must determine whether the

plaintiff’s allegations establish the defendant’s liability “as a

matter of law.” Bricklayers & Allied Craftworkers Local 2, Albany,

N.Y. Pension Fund v. Moulton Masonry & Const., LLC, 779 F.3d 182,

187 (2d Cir. 2015).

II. Discussion

A. Liability

1. Procedural Requirements

As set forth above, Plaintiff has complied with all

procedural requirements for seeking a default judgment. Defendant

was served copies of the summons and Complaint, and despite

receiving an extension of time, failed to answer or otherwise move

to defend the instant case. After the Clerk of Court entered

default against Defendant, Plaintiff served copies of its default

motion, supporting papers, exhibits, and proposed judgment upon

Defendant. To date, Defendant has failed to respond to Plaintiff’s

motion.

2. Foreclosure

A plaintiff seeking to foreclose upon a mortgage must

demonstrate: (1) the existence of the mortgage and note;

(2) ownership of the mortgage; and (3) the defendant’s default in

payment on the loan secured by the mortgage. Windward Bora, LLC

v. Brown, No. 21-CV-3147, 2022 WL 875100, at *3 (E.D.N.Y. Mar. 24,

2022) (citing Windward Bora LLC v. Baez, No. 19-CV-5698, 2020 WL

4261130, at *3 (E.D.N.Y. July 24, 2020)). “[O]nce a plaintiff

mortgagee in a foreclosure action has established a prima facie

case by presenting a note, a mortgage, and proof of default, it

has a presumptive right to foreclose that can only be overcome by

an affirmative showing by the mortgagor.” United States v. Watts,

No. 13-CV-3211, 2014 WL 4275628, at *2 (E.D.N.Y. May 28, 2014)

(citations omitted), report and recommendation adopted, 2014 WL

4293815 (E.D.N.Y. Aug. 28, 2014).

Here, Plaintiff has demonstrated prima facie entitlement

to foreclose upon the Property. First, Plaintiff has established

the existence of the Mortgage and Note. (See Note; Mortgage.)

Second, Plaintiff has proven that it is the owner of the Note and

in physical possession of the Note. (See Aff. of Possession ¶ 9

(“Windward Bora is the owner and holder of the Note, with all

corresponding allonges. Said Note was and is held in Plaintiff’s

custodian’s office located at 82 Jim Linegar Lane, Branston West,

MO 65737, where it remains today.”).) See also Winward Bora, 2022

WL 875100, at *4 (“Plaintiff’s demonstrated possession of the Note

grants Plaintiff the rights to enforce the corresponding Mortgage

and to initiate the foreclosure action.” (citing In re Escobar,

457 B.R. 229, 240 n.10 (Bankr. E.D.N.Y. 2011))). Last, Plaintiff

has demonstrated that Defendant defaulted on her contractually

required payments to Plaintiff. As alleged in the Complaint,

Defendant failed to make her monthly payment due on June 1, 2015,

as well as each monthly payment due thereafter. (See Compl. ¶ 12.)

Accordingly, Plaintiff’s motion for a default judgment of

foreclosure and sale is GRANTED.

B. Damages and Remedies

Although a party’s default is viewed as “a concession of

all well pleaded allegations of liability, it is not considered an

admission of damages.” Greyhound Exhibitgroup, Inc. v. E.L.U.L.

Realty Corp., 973 F.2d 155, 158 (2d Cir. 1992) (citing Flaks v.

Koegel, 504 F.2d 702, 707 (2d Cir. 1974)). Therefore, once a

party’s default as to liability is established, a plaintiff still

must prove damages. See Cement and Concrete Workers Dist. Council

Welfare Fund, Pension Fund, Annuity Fund, Educ. & Training Fund &

Other Funds v. Metro Found. Contractors, Inc., 699 F.3d 230, 234

(2d Cir. 2012) (citing FED. R. CIV. P. 55(b)(2)); see also Gutman

v. Klein, No. 03-CV-1570, 2010 WL 4975593, at *1 (E.D.N.Y. Aug.

19, 2010) (“While a default judgment constitutes an admission of

liability, the quantum of damages remains to be established by

proof unless the amount is liquidated or susceptible of

mathematical computation.” (quoting Flaks, 504 F.2d at 707)),

report and recommendation adopted, 2010 WL 4916722 (E.D.N.Y.

2010), affirmed, 515 F. App’x 8 (2d Cir. 2013).

Here, in support of its requested damages, Plaintiff

submitted an Affidavit of Amounts Due to Plaintiff by Devico

(“Devico Aff.) (See Devico Aff., ECF No. 14-6.) Plaintiff seeks

to recover $144,989.84, which is comprised of: (1) $81,354.88 in

unpaid principal; and (2) $81,354.88 for the total past due

interest calculated from May 1, 2015 through January 20, 2022.

(Id. ¶¶ 5-8.) Interest was calculated by taking the principal

balance and multiplying it by 11.6250%, the interest rate pursuant

to the terms of the Note, then dividing that number by 365 to

obtain the per diem rate: $81,354.88 x 0.11625 ÷ 365 = $25.91 per

diem. (Id. ¶ 7; Note, ECF No. 1-1, at 20.) The date of default

is June 1, 2015, therefore, interest is calculated from May 1,

2015 through January 20, 2022, which is 2,456 days:

$25.91 x 2,456 = $63,634.96 in total past-due interest. (Devico

Aff. ¶ 7.) Accordingly, the Court awards $144,989.94 to Plaintiff

plus per diem interest of $25.91 as of January 20, 2022, continuing

through the date judgment is entered.

Plaintiff also asks to sell the Property as one parcel

and that the sale of the Property be conducted through the

appointment of a referee. The Court grants this relief, which is

routinely provided in cases of mortgage foreclosures and sales.

See Brown, 2022 WL 875100, at *5 (first citing Windward Bora LLC

v. Valente, No. 18-CV-4302, 2019 WL 3872853, at *3 (E.D.N.Y. July

16, 2019); then citing Gustavia Home, LLC v. Bent, 321 F. Supp. 3d

409, 414 (E.D.N.Y. 2018)).

CONCLUSION

For the stated reasons, IT IS HEREBY ORDERED that

Plaintiff’s motion for default judgment is GRANTED. Plaintiff is

directed to serve Defendant with copies of this order and the

accompanying judgment forthwith, and to file proof of such service

by October 7, 2022.

SO ORDERED.

/s/_JOANNA SEYBERT______

Joanna Seybert, U.S.D.J.

Dated: September 30, 2022

Central Islip, New York