The vice president's affidavit didn't attach a single record
A New York appeals court threw out a Brooklyn foreclosure after finding the lender never properly proved the borrowers missed a payment.
The Appellate Division, Second Department, reversed a foreclosure judgment and sale order on September 30, ruling that Banc of California failed to establish default when it moved for summary judgment - a ruling without a full trial - on a mortgage encumbering property in Brooklyn.
Banc of California filed the action in 2021 against several LLC entities and two individuals. The lender moved for summary judgment, and the Supreme Court, Kings County, granted it in May 2024. A referee's report followed, the court confirmed it that December, and a foreclosure and sale order came down in March 2025.
The defendants appealed. And won.
The problem sat with the affidavit the lender submitted from its vice president. To win summary judgment in a New York foreclosure, a lender has to produce the mortgage, the unpaid note, and evidence of default. That evidence must come from someone with personal knowledge of the facts or through properly authenticated business records.
The vice president's affidavit delivered neither. He did not claim personal knowledge of the alleged default. To the extent his knowledge came from business records, he did not identify which records he relied on and did not attach them. The court pointed to established precedent: the business records exception to the hearsay rule covers the records themselves, not an affidavit about them. Without the actual records, testimony about what they contain is inadmissible hearsay.
Because the lender failed to establish default, it failed to establish its right to judgment as a matter of law. That failure required denial of the motion "regardless of the sufficiency of the opposing papers," the court wrote.
The reversal did not just undo the foreclosure sale. The court also reversed the underlying summary judgment and the order of reference, sending the case back to square one. Costs were awarded to the defendants.
For servicers and foreclosure counsel, the case is a clean illustration of what happens when the affidavit behind a summary judgment motion does not bring the records with it. Personal knowledge or properly identified and attached business records are not optional steps - they are the whole foundation.
The decision is a slip opinion, uncorrected and subject to revision before publication in the Official Reports.
