Two weekday attempts and no follow-up undid nearly two decades of default
A New York appeals court wiped out a foreclosure judgment against a Brooklyn homeowner because Citibank’s process server knocked twice and stopped there.
The Appellate Division, Second Department, reversed a lower court on October 7, finding that Citibank, N.A. had failed to properly serve the homeowner before obtaining a default judgment of foreclosure and sale. The court vacated the judgment and an earlier order of reference, and dismissed the complaint against the homeowner for lack of personal jurisdiction.
The timeline stretches back to December 2006, when Citibank filed the foreclosure action. The homeowner never appeared or answered. By July 2007, the bank had an order of reference. By July 2008, it had a judgment of foreclosure and sale.
That might have been the end of the story. It wasn’t.
The homeowner moved to vacate both orders and dismiss the case, arguing the court never had jurisdiction over him because he was never properly served. The Supreme Court, Kings County, denied that motion in August 2023. He appealed.
The Second Department sided with the homeowner.
Under New York’s CPLR 308, serving a person by affixing papers to their door and mailing a copy - what lawyers call “nail and mail” service under CPLR 308(4) - is a last resort. A plaintiff can only use it after showing that personal delivery under CPLR 308(1) and (2) could not be accomplished “with due diligence.”
Citibank’s process server fell short, the court found. The server attempted personal delivery only twice, both during weekday hours - when, the court noted, “it could reasonably have been expected that the defendant was either working or in transit to or from work.” There was also “no evidence that the process server made any genuine inquiries about the defendant’s whereabouts and place of business.”
Two weekday attempts and no follow-up. That was not due diligence.
Citibank argued the homeowner waited too long to raise the issue - a defense known as laches. The court rejected that, too, citing precedent that “the doctrine of laches cannot be used to defeat an application to vacate a judgment that was issued in the absence of personal jurisdiction.”
Without valid service, the court never had jurisdiction. Without jurisdiction, everything that followed was void.
For lenders and servicers managing legacy foreclosure files, the takeaway is clear: a service-of-process shortcut taken years ago can still unravel a judgment today.
