Present: HON. JOSEPH A. DE MAR0 Justice TRIAL/IAS, PART 13 NASSAU COUNTY BANKERS TRUST as Trustee, Plaintiff, Defendants.

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1 5 SHORT FORM ORDER SUPREME COURT - STATE OF NEW YORK Present: HON JOSEPH A DE MAR0 Justice TRIAL/IAS, PART 13 NASSAU COUNTY BANKERS TRUST as Trustee, -against- Plaintiff, TAMARA MCFARLAND, KAMCO SUPPLY CORP, "JOHN DOE" and "JANE DOE", said names being fictitious, parties intended being possible tenants or occupants of premises, MOTION DATE: June 7, 2000 INDEX No 25492/98 SEQUENCE No 1 Defendants The following papers read'on this motion: 1 Order to Show Cause and Supporting Papers Memorandum of Law (Plaintiff) J Affirmation in Opposition Reply Affirmation Motion by defendant Tamara McFarland pursuant to CPLR 317 to (1) vacate the judgment of foreclosure and sale and (2) dismiss the complaint or in the alternative, (3) vacate the default judgment and grant defendant leave to answer the complaint is granted to the extent that a traverse hearing is ordered to determine whether defendant was properly served by substituted service and, if she

2 was, whether or not she received actual personal notice of the summons in time to defend Plaintiff is the assignee of a mortgage dated May 30, 1997 between the original lender, Walsh Securities, Inc, and defendant who, on that date, purchased a home at 98 W Milton Avenue in Freeport, New York This action was commenced in October 1998 by substituted service of a summons and complaint alleging that defendant failed to make the monthly mortgage payments from December 1997 forward The affidavit of service alleges the summons and complaint were delivered on October 13, 1998 to a person of suitable age and discretion at 98 W Milton Avenue, address pursuant to CPLR the complaint Upon defendant's default, an'order of reference was C* made on February 26, 1999 and a judgment of foreclosure was entered on May 6, 1999 On July 13, 1999 defendant moved by order to show cause for the above mentioned relief Defendant moves pursuant to CPLR 317 which provides in relevant part that in cases of substituted service such as plaintiff relies upon here: 3215(g)3(i) A person served with a summons other than by personal delivery to him or to his agent for service designated under rule 318, within or without the state, who does not appear may 2 Freeport New York who identified himself as-mark Carty An additional copy was mailed to defendant at her home at the above mentioned address on October 19, 1998 On March 8, 1999 another copy was mailed to defendant at the same Defendant alleges that somehow she never received any of these copies of the summons or

3 be allowed to defend the action within one year after he obtains knowledge of entry of the judgment, but in no event more than five years after such entry, upon a finding of the court that he did not personally receive notice of the summons in time to defend and has a meritorious defense To obtain relief, defendant must show [she] 188; see also, Halali v Gabbav, 223 Federal Savinss Bank v Frank, 243 " [A] party must submit an affidavit from an individual with knowledge of the facts affidavit submitted factual allegations; AD2d 521) AD2d 623; City AD2d 670) The from such individual must make sufficient it must do more than merely make conclusory allegations or "vague assertions" (Peacock v Kalikow, 239 did not personally receive notice of the summons in time to defend and that [she] has a meritorious defense" (See Nicolosi v Sleuth Security Systems, Ltd, 247 AD2d & Suburban Defendant claims that she was not,properly served and that she never received personal notice of this action before the entry of judgment despite one delivery and two mailings to her home further alleges that the lender, Walsh Securities, and the mortgage *a broker, United Mortgage Corp, violated the Federal Truth in Lending Act and the Real Estate Settlement Procedures Act (RESPA) She I in that the fees paid by the lender to the broker out of the mortgage proceeds ie, the points and the Yield Point Spread (YSP) were not disclosed or were not timely and adequately disclosed In her proposed answer defendant seeks recission of the mortgage and in her papers alleges that she is prepared to tender a return of the mortgage proceeds 3

4 The parties agree that payments such as a YSP by a lender to a broker do not violate the federal regulations if they are reasonably related to the services rendered by the broker If, however, such payments are unreasonably high and not related to the services rendered they clearly may In any event, federal regulations require timely adequate disclosure of these payments which defendant denies was given She has therefore alleged facts which, if true, may constitute a meritorious defense The question then becomes whether or not plaintiff received personal notice of the summons in time to defend the action Resolution of this question requires a traverse hearing The questions to be determined are whether or not process was properly served so as to confer jurisdiction over the defendant and, if so, whether or not defendant had actual personal notice of the summons in time to defend the action If jurisdiction is found and the court concludes that the defendant did receive personal notice of the summons then the hearing court should deny defendant's motion in its entirety If service is determined to be improper the hearing court'should vacate the default judgment and dismiss the"" action If the hearing court concludes that service was proper but that the defendant did not receive personal notice of the summons, then the hearing court should vacate the judgment and permit the defendant leave to file an answer within twenty (20) days of receipt of the court's decision from any source hearing is to be scheduled as hereinafter provided The 4

5 Subject to the approval of the Justice there presiding and provided a Note of Issue has been filed at least 10 days prior thereto, this matter shall appear on the calendar of CCP for the 22nd day of September, 2000 at 9:30 AM A copy of this order shall be served on the calendar accompany the Note of Issue when filed event jurisdiction is sustained but the default is vacated and defendant given leave to serve,an answer, plaintiff shall within 10 days of receiving such answer contact the Preliminary Conference Part to schedule a Preliminary Conference date Failure to file clerk and a Note of Issue or to appear as directed shall be deemed an abandonment of the claim giving rise to the hearing The directive with respect to a hearing is subject to the right of the Justice presiding in CCP to refer the matter to a Justice, Judicial Hearing Officer or a Court Attorney/Referee as he or she deems appropriate In the JSC Dated: August 11,