HSBC Bank USA v Merrill Lynch Mtge. Lending, Inc.

HSBC Bank USA v Merrill Lynch Mtge. Lending, Inc.

Opinion

 [**253]   [*1149] Order, Supreme Court, New York County (Marcy S. Friedman, J.), entered June 6, 2018, which, to the extent appealed from as limited by the briefs, granted in part and denied in part defendants' motions to dismiss plaintiff's claims for failure to give notice of non-conforming loans, unanimously modified, on the law, to deny the part of the motion seeking to dismiss the claims based on untimely notices of breach, and otherwise affirmed, without costs.

 [*1150] This Court has discretion to consider defendants' arguments under the Pooling and Servicing Agreement (PSA) § 2.03 (b), although they were first raised in reply on the motion, because they involve questions of law that can be resolved on the existing record (see Facie Libre Assoc. I, LLC v SecondMarket Holdings, Inc., 103 AD3d 565, 961 NYS2d 44 [1st Dept 2013], lv denied 21 NY3d 866, 997 NE2d 144, 974 NYS2d 319 [2013]).

The motion court correctly found that plaintiff had standing to assert the breach of notice claims. Defendants' reading of PSA § 2.03 (a) contradicts the definition of the Assignment and Assumption Recognition Agreement (AARA) set forth in the PSA. Any [***2]  conflict must be resolved in favor of that definition, which with regard to this term is more specific (see Isaacs v Westchester Wood Works, 278 AD2d 184, 185, 718 NYS2d 338 [1st Dept 2000]).

Defendants' reading also contradicts the AARA, which should be read together with the PSA (see Ambac Assur. Corp. v EMC Mtge. LLC, 121 AD3d 514, 515, 995 NYS2d 545 [1st Dept 2014] [various agreements governing residential mortgage-backed securitization are "interlocking"]).

Defendants failed to establish by documentary evidence that the notice obligations were not transferred to defendant Countrywide Home Loans, Inc. and thereafter to defendant Bank of America, N.A., because the transfer agreement is not included in the record.

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