- Court
- New York Supreme Court, Appellate Division, Second Department
- Case
- BAC Home Loan Servicing, LP v. MacPherson
- Date
- May 27, 2026
- Slip Op. No.
- 2026 NY Slip Op 03285
Background
The plaintiff commenced this mortgage foreclosure action in December 2007 against, among others, defendant Donald MacPherson regarding property in Southampton. During the course of the lengthy foreclosure proceedings, the plaintiff moved pursuant to CPLR 3025(b) for leave to amend the complaint to add Creative Forms, Inc. as a defendant. Creative Forms, which had acquired an interest in the subject property after the commencement of the foreclosure action, opposed the amendment. The Supreme Court, Suffolk County, granted the plaintiff’s motion for leave to amend. Creative Forms appealed.
Holding
The Appellate Division affirmed the orders granting leave to amend. The Court applied the liberal standard of CPLR 3025(b), which provides that leave to amend should be freely given absent prejudice or surprise. The Court found that the plaintiff demonstrated a valid basis for adding Creative Forms as a defendant, as it had acquired an interest in the mortgaged property that made it a necessary party to the foreclosure action. Creative Forms failed to demonstrate prejudice from the amendment, and the proposed amendment was not palpably insufficient or devoid of merit. The Court noted that the addition of parties who acquire interests in foreclosed property during the pendency of the action is a common and proper use of the amendment mechanism.
Takeaways
In mortgage foreclosure actions, a plaintiff may amend the complaint to add parties who acquire interests in the mortgaged property during the pendency of the litigation. The liberal amendment standard of CPLR 3025(b) applies, and such amendments are routinely granted absent demonstrated prejudice. Entities that acquire interests in property subject to pending foreclosure actions should anticipate being added as defendants and should monitor the foreclosure proceedings to protect their interests.
Why It Matters
This decision is relevant for foreclosure practitioners and real estate investors who acquire interests in properties subject to pending foreclosure actions. The ruling confirms that foreclosure plaintiffs can add new parties who acquire interests during the litigation, ensuring that the foreclosure judgment will be binding on all interested parties. Investors purchasing interests in distressed properties should conduct title searches to identify pending foreclosure actions and should understand that their interests may be subject to the foreclosure if they are added as defendants and the action proceeds to judgment.