When the Bank’s Affidavit Was Not Enough: HSBC v Pacifico

What happened

The case arose from a residential mortgage foreclosure on a home in Huntington, in Suffolk County. The homeowner, Joseph H. Pacifico, Jr., answered the complaint and raised affirmative defenses, including lack of standing. In 2017, the plaintiff moved for summary judgment, to strike the homeowner’s answer, and for an order of reference — the procedural steps that move a New York foreclosure toward judgment.

The homeowner’s opposition to that motion was rejected as untimely. As a result, in an order dated August 27, 2018, the Supreme Court (Howard H. Heckman Jr., J.) granted the bank’s motion as unopposed. The homeowner then moved to vacate that order. On May 9, 2022, the court (S. Betsy Heckman Torres, J.) denied vacatur. The homeowner appealed.

On August 14, 2024, the Appellate Division, Second Department, reversed. It granted the homeowner’s motion to vacate the 2018 order and held that the branches of the bank’s motion — for summary judgment, to strike the answer, and for an order of reference — should have been denied. In other words, the bank failed to establish its entitlement to foreclosure summary judgment with admissible proof. You can read the full Second Department decision on Justia.

The 2021 procedural setup vs. the 2024 win

This was not the homeowner’s first trip to the Appellate Division. An earlier decision, HSBC Bank USA, N.A. v Pacifico, 194 A.D.3d 1029 (2021), addressed an appeal that, in part, sought reargument. The court applied a settled rule: no appeal lies from the denial of a motion for leave to reargue, so that branch of the appeal was dismissed. Critically, the part of the motion seeking to vacate the 2018 order remained pending and undecided at that stage — it had not yet been resolved on the merits.

That distinction matters. A motion to reargue and a motion to vacate are different tools, and the dismissal of the reargument appeal in 2021 did not end the homeowner’s effort to undo the order. When the trial court later denied the vacatur branch in 2022, that denial was reviewable — and that is the order the Second Department reversed in 2024. The lesson is procedural patience: the path from a 2018 unopposed order to a 2024 reversal ran through the right motion, preserved and pursued to the right court.

The burden of proof in a New York foreclosure

In New York, a foreclosure is a court case in which the lender carries the burden of proof. To obtain summary judgment, the plaintiff generally has to establish three things with admissible evidence:

• the mortgage — the security interest in the property;
• the note — the borrower’s written promise to repay the debt; and
• the borrower’s default in payment.

When the borrower places standing in issue — as Pacifico did by pleading it as an affirmative defense — the plaintiff also has to prove standing as part of its prima facie case. In New York, that means showing it was the holder or assignee of the note at the time it commenced the action, established through a written assignment or the physical delivery of the note endorsed in blank or specially to the plaintiff. The right to foreclose follows the note, so possession of the note (and the ability to prove it) is central.

Each of those elements has to rest on evidence the court can actually consider. That is where this case turned.

Why a servicer affidavit without the records fails

To prove note possession and default, the bank relied on affidavits from two vice presidents of its loan servicer, Ocwen Loan Servicing — Catherine Ubinas, who submitted an affidavit of possession, and Pamela Ballard. Their affidavits described business records, including a claim that the note had been possessed on October 26, 2011, and described the borrower’s default.

The Second Department held those affidavits were inadmissible hearsay, for two connected reasons:

That is the principle in the court’s own words: it is the business record itself, not the foundational affidavit, that serves as proof. An affidavit can lay the foundation that lets a record be admitted, but it does not replace the record. Where the affiant cannot show personal knowledge of how the records are kept, and the records are not in front of the court, the affidavit is just an out-of-court assertion — hearsay — and it cannot carry the lender’s burden. Because the bank’s proof of note possession, standing, and default rested on those affidavits, the motion failed.

The procedural angle: vacatur and late opposition

There is a second layer to the decision that matters to homeowners whose opposition was rejected or who were defaulted. The 2018 order had been granted as unopposed after the homeowner’s papers were treated as untimely. The Second Department addressed the standards for vacating that order under CPLR 5015(a), together with a court’s discretion under CPLR 2004 and CPLR 2214(c) to accept late opposition papers.

In exercising that discretion, courts weigh factors such as the length of the delay, whether there is prejudice to the other side, and whether the late opposition is potentially meritorious. Here, the equities favored hearing the opposition — a minimal delay, no real prejudice to the bank, and opposition that was potentially meritorious because the bank’s own proof was deficient. That is how a case that looked finished in 2018 was reopened and ultimately reversed in 2024.

What it means for Long Island homeowners

The practical takeaways from Pacifico are straightforward, and they apply well beyond this one file:

• A bank’s affidavit is not automatically proof. If the affiant cannot show personal knowledge of the record-keeping practices, or the underlying records are not attached, the affidavit can be inadmissible hearsay.
• Standing has to be proven when you raise it. Pleading lack of standing forces the plaintiff to show it held or was assigned the note when it sued — with admissible evidence, not conclusions.
• An unopposed order is not always the end. A motion to vacate, supported by a showing under CPLR 5015(a) and the discretion to accept late opposition, can reopen a case — and a denial of that motion can be appealed.
• The right motion matters. Reargument and vacatur are different; pursuing the correct one preserved the homeowner’s path to the Appellate Division.

This is the same discipline behind the firm’s broader Long Island foreclosure defense practice: read the lender’s proof the way an appellate lawyer reads a record, and hold the bank to admissible evidence on every element.

Related foreclosure-defense topics

The proof problems in Pacifico connect to the issues that decide most New York foreclosure cases:

• Standing & chain of title — who held the note when the case was filed, and how the chain breaks.
• RPAPL 1304 notice defense — the 90-day notice the lender must send and prove it mailed.
• Stop a foreclosure sale or eviction — emergency options when a date is already scheduled.
• Long Island foreclosure defense overview — how the proof-focused approach fits together.