Appeals in Foreclosure Litigation

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Often, as a matter of strategy, the Notice of Appeal to the Appellate Division, and a motion for reargument to the Supreme Court, are filed at the same time since both are due within 30 days of the notice of entry of the order or decision from which there is the appeal. The motion for reargument, is reviewed more expeditiously, but is often decided by the same Supreme Court judge, and is therefore difficult to have granted, even where there was a mistake or misunderstanding of the facts. However the knowledge by the Supreme Court judge that there is also a new and open appeals process that was started, may make the the Supreme Court judge more careful and cautious in deciding the case.

1. What is An Appeal? How Does it Work in Foreclosure Cases?

An “appeal” in a litigation takes a decision that a litigant believes was wrongly decided to the next level of adjudication. Foreclosure cases are predominantly litigated in the state court system, with the New York State Supreme Court, for each county in the state, handling the foreclosures in that county. So a foreclosure case for a property located in Suffolk County, NY or Nassau County, NY, would respectfully go to the Supreme Court for Suffolk County (which is in Riverhead and Central Islip, NY), or the Supreme Court for Nassau County (which is in Mineola NY). If the defendant in one of those courts believes that they have had a case wrongly decided they would bring it to the Appellate Division for the Second Department of the State of New York, which also hears appeals coming from Queens and Brooklyn, NY. The next level of appeals after the Appellate Division is the New York State Court of Appeals, which sits in Albany and which has a limited calendar and only takes selective cases and therefore is not an option for every appeal. See CPLR 5501.

2. The Time to Appeal

The “time to appeal” is met by filing a a Notice of Appeal in 30 days. The Notice of Appeal needs to filed within 30 days of the notice of entry of the order or decision from which there is an appeal for an appeal of right, but a motion may be made after that for an extension by permission to appeal. CPLR 5513-5514 and 5516. However, the Notice of Appeal, which must be served on opposing counsel and filed with the Court, is relatively brief and references and attaches the order appealed from and contains the questions on appeal and basis of appeal. CPLR 5515. More expansive argument and legal support are reserved for the memorandum on appeal with is due when perfection of the appeal is due within 6 months from the Notice of Appeal.

3. Notice of Appeal

The “Notice of Appeal” is the initial document which initiates the appeal by attaching the order or decision appealed from and a statement of the questions on appeal. Although this document is brief, the legal questions presented in a Notice of Appeal need to be carefully crafted so that just reading them, the appellate court understands the nuances of the argument that the appellant intends to present. CPLR 5515. Usually there is more than one question on appeal and usually each question presents both legal and factual issues; usually each legal question is presented with a smattering of the facts that advocate for the defendant-appellant and explain why in this specific case the defendant-appellant’s appeal should be viewed favorably.

4. Order to Show Cause for a Stay Pending Appeal

An “Emergency Order to Show Cause for a Stay Pending Appeal” is an expedited motion which seeks to stop the foreclosure action and usually a foreclosure sale pending appeal. The defendant often has an urgent need for a stay before the appeal gets decided which could be prolonged, often 1-2 years. Therefore an Emergency Order to Show Cause can be made in either Supreme Court or the Appellate Division. The Appellate Division may grant, modify or limit a preliminary injunction or temporary restraining order pending an appeal…..” CPLR 5518 and CPLR 6301. A stay without a court order, under CPLR 5519(a), is available in appeals where the appellant deposits an appropriate monetary amount with the court as an “undertaking”, which would be returned to the appellant contingent on their success in reversing the lower court determination. However, should the appellant lose, the undertaking would be used to compensate the Appelle. Most stays pending appeal, however, require a court order, either from the Supreme Court or from the Appellate Division. CPLR 5519(c).

5. Time to Perfect an Appeal

“Perfecting” the appeal entails filing the complete record on appeal and the memorandum or legal brief of the appellant. The time to “perfect” an appeal is usually six (6) months but such time can be extended briefly usually once or twice upon request by the appellant. The first discretionary extension given by is usually for 1-2 months. The second discretionary extension is shorter and usually several weeks. It is important not to default on the time to perfect because it would risk and potentially permanently lose the ability to appeal those issues. Once the appellant perfects, the Appellee needs to respond with a responding brief within one (1) month.

6. Record on Appeal

The “Record on Appeal” is composed of all documents filed in the Supreme Court case. The Appellate Division is not supposed to be reviewing new facts or documents not presented to the Supreme Court before the Order or Decision from which there is an appeal. The Record on Appeal needs to be published by appellate printer along with the appeal memorandum. Part of the Record on Appeal, may be a transcript of the hearing in which the decision which is being appealed, was made; such transcript must be typed by the stenographer and settled on the the respondent. CPLR 5525. Under CPLR 5526, the requirements for the Record on Appeal are very specific in terms of the technical aspects of how the record is prepared and and presented for filing. The appellate printing of Record on Appeal is usually a large expense (usually at least several thousand dollars) for the defendant-appellant because both the printed copies of the Record on Appeal and the searchable, internet versions require costly and detailed preparation. The result is a record that is comprehensive but at the same time easy to navigate in terms of documents relied on, key words used in the appeal, legal authorities used, and arguments made. The appellee-plaintiff, unlike the appellant does not need to prepare a record, unless it wants to add to the appellant’s record.

7. Memorandum on Appeal

The “Memorandum on Appeal” is the legal brief giving legal argument in the foreclosure appeal. Pursuant to CPLR 5528, the contents of the the briefs and appendices include the following: a) a table of contents, b) concise statements of the questions on appeal, nature of the case and the facts, c) the argument, divided into appropriate headings, and d) an appendix. The Appellant’s Brief, the Respondent’s Brief and the Appellant’s Reply all have very specific requirements which, pursuant to CPLR 5528(e), if not followed may result in sanctions by the Court. Pursuant to CPLR 5529, there are specific requirements for the page sizes, page numbering, page headings, quotations and citations to decisions. Pursuant to CPLR 5531, the appellant has to give certain information describing the action from which the appeal is taken including: the index number, party names, court and county, nature of the action, whether an order or judgment is being appealed and a statement as to the papers constituting the record on appeal.

8. Oral Argument on Appeal

The “oral argument on appeal” is the actual argument of the litigants in front of the court with appellate jurisdiction, here it is front of the Appellate Division. The oral argument used to be in person, but post-Covid it has largely been by teleconference. The oral argument is usually within approximately one (1) year of the appeal. The appellant is usually given a choice whether they want oral argument or whether they prefer to depend on their written brief. Given that the foreclosure defendant-appellant is usually the underdog, and every opportunity to advocate should be seized upon, oral argument should always be requested. Under CPLR 5521(a) “Preferences in the hearing of an appeal may be granted in the discretion of the court to which the appeal is taken.” At the oral argument the Appellate Division Judges usually ask tough questions from each side to explore any weakness in their argument and to feel out where the law should be and what lines to set. The defendant-appellant should prepare to be interrupted with their presentation by judges who are often prepared and perceptive and who are looking not only to decide the case before them but also to articulate broader president and law.

9. The Decision on the Appeal

The “decision on the appeal” is the determination of the court with appellate jurisdiction which reverses or affirms or modifies the lower courts decision. The lower court and the appealing litigants all need to abide by the decision on the appeal. In a foreclosure case, the decision of the Appellate Division, can be very consequential and may cause the dismissal of the foreclosure if there is a reversal of the Supreme Court and the decision of the Appellate Division favors the appellant. On the other hand, the decision may without much elaboration affirm the Supreme Court. Under CPLR 5522(a), “A court to which an appeal is taken may reverse, affirm, or modify, wholly or in part, any judgment, or order before it, as to any party. The court shall render a final determination or, where necessary or proper, remit to another court for further proceedings.” The decision on the appeal is very consequential in that it potentially creates broader precedent and potentially influences the direction of foreclosure case law on issues that are frequently litigated.

10. If the Foreclosure Defendant Prevails or Does Not Prevail on the Appeal, What is Next?

If the defendant prevails then is would change the momentum in the foreclosure case and the defendant should drive home that victory with further motion practice. Under CPLR 5015(a)(5), the Supreme Court, upon a motion to vacate the judgment or order appealed from successfully, can give relief from the decision or modify the decision the extent the decision affects a matter material to the case. CPLR 5015(a)(5) states: “The court which rendered a judgment or order may relieve a party from it upon such terms as may be just, on motion of any interested person with such notice as the court may direct, upon the ground of…. reversal, modification or vacatur of a prior judgment or order upon which it is based.” – Because the issues on appeal are usually critical to the foreclosure – such as jurisdiction, standing and RPAPL 1304 – upon a successful appeal, the foreclosure action may be subject to dismissal or a serious setback in terms of its progression and/or timing and ability of the plaintiff to proceed with the foreclosure.

If defendant-appellant does not prevail, the appeal may have given the defendant-appellant time in the litigation by adding layers of complexity to the litigation and/or leverage to negotiate a potential resolution, however, now there would be a further need to look at other alternatives besides just litigation. Alternatives like further efforts towards modification, negotiation, short sale and/or Chapter 13 or Chapter 11 bankruptcy to save the property should be further explored. The question of whether to appeal to the Court of Appeals is not the same as an appeal to the Appellate Division. An appeal to the New York State Court of Appeals is uncertain in that it not every case that appeals to the Court of Appeals is adjudicated and decided by the Court of Appeals which selects a minority of cases that have larger, societal impact for its docket of cases to be decided. If the defendant-appellant decides to further appeal, the appeal needs to be cast as affecting larger issues and many cases.

11. Why Use Our Law Office for a Foreclosure Appeal?

Our office has mastery over foreclosure litigation and foreclosure appeals and can strategize, implement pursue and finalize any foreclosure appeal in the State of New York. We have especially have expertise in dealing with complex factual and legal matters and foreclosure cases with a long history. We can also combine our litigation and appeal strategy with any other methods of resolving the foreclosure including, possible negotiation, modification, bankruptcy and real estate options which could ultimately resolve the foreclosure, while the appeal provides leverage and incentive for both sides to work on a resolution. Our approach and methods are creative, well thought out and nuanced and can help foreclosure defendants who have not found sufficient help and legal resources with other law firms. At the same time, we are relatively affordable in pursuing most legal matters, including pursing foreclosure appeals, which are considered to be a relatively larger and more demanding strategy. Please call us at 631-271-3737 for a free legal consultation, regarding a potential or actual foreclosure appeal, where the right legal representation may make a large difference with the possible outcome.