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Current Developments in the Commercial Divisions of the
New York State Courts by Schlam Stone & Dolan LLP
Posted: August 3, 2019

Failure Timely to Move for Default Judgment Leads to Dismissal of Claim

On July 17, 2019, the Second Department issued a decision in U.S. Bank N.A. v. White, 2019 NY Slip Op. 05713, holding that the failure timely to move for a default judgment is grounds for dismissal, explaining:

CPLR 3215(c) provides: If the plaintiff fails to take proceedings for the entry of judgment within one year after the default, the court shall not enter judgment but shall dismiss the complaint as abandoned, without costs, upon its own initiative or on motion, unless sufficient cause is shown why the complaint should not be dismissed. To vacate the order directing dismissal of the complaint pursuant to CPLR 3215(c), the plaintiff was required to demonstrate a reasonable excuse for its delay in seeking a default judgment and a potentially meritorious cause of action.

Here, the plaintiff failed to offer a reasonable excuse for its failure to take proceedings for the entry of a judgment for more than one year after the action was released from the foreclosure settlement conference part and the 60-day stay expired. The plaintiff submitted an attorney’s affirmation containing conclusory and unsubstantiated allegations regarding a delay occasioned by a loss mitigation hold, the collection of unspecified documents, and an unexplained investigation into the scope of the guardianship of a guardian ad litem appointed for White. Under these circumstances, the Supreme Court did not improvidently exercise its discretion in denying that branch of the plaintiff’s motion which was to vacate the order entered November 9, 2015.

(Internal quotations and citations omitted).

If you are served with a complaint (or counterclaims, as happened in this case) and fail timely to answer, the court can enter judgment against you: a default judgment. But as this decision shows, failing timely to seek such a judgment can result in the dismissal of the claims that were the subject of the default. Contact Schlam Stone & Dolan partner John Lundin at jlundin@schlamstone.com if you or a client have questions regarding whether you have been properly served or if a default judgment has been entered against you.

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