New York Appellate Division, Second Dept.
Filing of Foreclosure Action Accelerates Debt Notwithstanding Non-Service on Defendants/Limitations: Lender foreclosed in 2007, but then voluntarily discontinued the action.  Lender filed again in 2008 but was denied summary judgment based on service, which was upheld on appeal.  Assignee foreclosed in 2017 and defendant moved for summary judgment based on limitations.  The Supreme Court, Kings County granted, finding that the voluntary discontinuance of the 2007 action revoked the acceleration of the debt, but that in the second action, the plaintiff never discontinued the action.  Hence, limitations continued to run and had expired prior to the filing of the 2017 action.  Lender maintained that the 2008 action did not accelerate the debt as the defendants were never served. The Second Dept. sustained – “‘The determinative question is not what the noteholder intended or the borrower perceived, but whether the contractual election was effectively invoked’ (Freedom Mtge. Corp. v Engel, ___ NY3d ___, 2021 NY Slip Op 01090, *3). Here, the subsequent commencement of the 2008 action accelerated the loan anew regardless of whether the summons and complaint were served upon the defendants.” Wilmington Sav. Fund Socy., FSB v Rashed, 2021 NY Slip Op 03630, Appellate Division, Second Department, June 9, 2021