The lender missed every deadline - then waited six years to act
Deutsche Bank lost a foreclosure action in New York - not on the merits, but because it stopped showing up.
The Appellate Division, Third Department, on November 5, 2026, unanimously affirmed a lower court’s refusal to revive a residential mortgage foreclosure that the lender-trustee had let sit dormant for more than six years without explanation.
The foreclosure followed an alleged default on a promissory note executed by a Sullivan County homeowner who has since died. The note was secured by a mortgage on residential property executed by the homeowner and his wife. Deutsche Bank Trust Company Americas, as trustee, brought the action.
After mandatory settlement conferences, the Supreme Court in March 2017 ordered Deutsche Bank to file a motion for an order of reference - a procedural step needed to move a foreclosure toward judgment - by December 31, 2017. The order was explicit: miss the deadline, the case gets marked off the calendar. Fail to restore it within a year, dismissed.
Deutsche Bank missed the deadline. In January 2018, the court notified the lender the case had been marked off. Deutsche Bank did nothing. In January 2019, the court dismissed the action without prejudice under 22 NYCRR 202.27, the New York rule permitting dismissal of abandoned cases.
More than six years passed. Deutsche Bank then moved to vacate the dismissal. The lower court denied it. The Appellate Division agreed.
To undo this kind of dismissal under New York law, a party must show a reasonable excuse for the default and a potentially meritorious case. Deutsche Bank could not clear the first hurdle. It submitted no affidavit from anyone with personal knowledge explaining the missed deadlines. The court noted that while the lender cited authority for the idea that “law office failure” can excuse a default, its submissions were “devoid of any factual allegations to warrant invoking the doctrine.” No calendaring error, no miscommunication, no concrete facts.
Deutsche Bank also argued the defendants’ failure to file a notice of entry should excuse the delay. The court disagreed - a notice of entry goes to timeliness of the vacatur motion, not to whether the lender had a good reason for defaulting.
Because it failed on the excuse question, the court never reached whether the foreclosure had merit. The remaining arguments, including a plea to vacate “in the interest of justice,” were found unpersuasive.
For servicers and foreclosure teams, the takeaway is plain: courts enforce case-management deadlines, and six dormant years with no explanation cannot be papered over after the fact.
