She litigated for years but never raised the one defense that mattered
A Queens County homeowner spent more than a decade trying to undo a Wells Fargo foreclosure. Last week, she ran out of road.
New York’s Appellate Division, Second Department, ruled on October 28 that the borrower could not vacate a foreclosure judgment or set aside the sale of her property. The reason: she had waived her only viable defense - lack of personal jurisdiction - by actively litigating in court without raising it first.
The case dates to March 2013, when Wells Fargo Bank, N.A. filed a mortgage foreclosure action in Queens County Supreme Court. The borrower did not file a timely answer. By October 2014, Wells Fargo moved for a default judgment and an order of reference - the step where a court-appointed referee calculates what is owed on the loan.
The borrower asked for more time. The two sides agreed to adjourn. But when the motion came back, it went unopposed. In September 2016, the court granted Wells Fargo’s motion and appointed the referee.
Wells Fargo then moved to confirm the referee’s report and obtain a judgment of foreclosure and sale. The borrower opposed that motion and tried to serve an answer. Wells Fargo rejected it as untimely.
In January 2017, the borrower filed a motion to dismiss under CPLR 3211(a)(8), arguing the court lacked personal jurisdiction over her. The court denied the motion in May 2017. She did not appeal.
A foreclosure judgment was entered in October 2017. The property sold at auction on April 9, 2019.
Three years passed. In 2022, the borrower - and a nonparty in a separate motion - tried again to vacate the judgment, set aside the sale, and dismiss for lack of jurisdiction. The lower court denied both motions in June 2023.
A defense already given away
On appeal, the Second Department found the jurisdiction argument had no merit. The borrower had waived the defense by actively litigating before the Supreme Court without first objecting to jurisdiction.
The borrower’s remaining arguments were “not properly before this Court,” the panel said. All four justices concurred.
For servicers and default professionals, the practical signal is clear: once a borrower engages on the merits without preserving a jurisdiction objection, that defense is gone - even years later, even after the property has changed hands.
