• Charles H. Wallshein


Strict compliance is a term used in law that refers to one hundred percent adherence to the dictates of a particular statute. Substantial compliance is a relaxed standard that defines a more relaxed requirement.

As a procedural matter case law states that a defendant may raise noncompliance with §1303 and §1304 at any time[1] and that the notices must be delivered for all home loans as defined by statute.[2]

To date, the majority of the decisions concerning RPAPL sections 1303 and 1304 discuss the manner of service and delivery of each respective notice. The §1303 Notice must be served with the summons and complaint. The §1304 Notice must be made by registered or certified mail and also by first-class mail to the last known address of the borrower, and if different, to the residence that is the subject of the mortgage. Such notice shall be sent by the lender, assignee or mortgage loan servicer in a separate envelope from any other mailing or notice. Notice is considered given as of the date it is mailed. RPAPL §1304(2).

Courts have taken foreclosure plaintiffs to task to prove that the mailing was one hundred percent compliant with the statute. Of all four appellate divisions, the Second Department has the majority of decisions on the issue. The two main decisions concerning “strict compliance” are Aurora v. Weisblum, and First National Bank of Chicago v. Silver.[3] In each case plaintiff was denied summary judgment and summary judgment was granted to defendants and the complaints were dismissed. In Weisblum, the husband admitted but he wife denied receiving the 90 Day Notice. At summary judgment the lower Court held that Aurora’s failure to serve her with the notice was “not fatal” since the Weisblums both participated in “the mandatory settlement conference” (see CPLR 3408), and no prejudice to the Weisblums had been identified. Aurora responded that the Weisblums, in attending the settlement conference, had waived any failure of Aurora to comply with a condition precedent in not serving the RPAPL 1304 notice on Patti Weisblum. On re-argument, the Court adhered to its original position and the appeal was taken. The Second Department reversed and stated: Thus, we now make clear what is implicit in Silver, namely, that proper service of the RPAPL 1304 notice containing the statutorily-mandated content is a condition precedent to the commencement of the foreclosure action. The plaintiff's failure to show strict compliance requires dismissal.

The Court in Weisblum, for the first time, used the term “content”. The Court went further to explain its reasoning that requires plaintiffs to adhere to statutorily-mandated content. The Court referred to its decision in Silver one year prior. In Silver the Court recognized that RPAPL §1303 grew out of the Home Equity Theft Prevention Act [HEPTA, enacted 2007], and that the notice requirement in the statute requires a specific method of delivery, in a specific printed form and containing specific text. The Silver Court interpreted nothing in the statute that would allow anything less than strict compliance acceptable and that the remedy for failure to adhere to strict compliance was dismissal of the action. Weisblum expanded the Court’s reasoning in Silver to §1304.

A recent string of trial court dismissals and appellate level decisions indicate that non-compliance with content and form will warrant dismissal. Therefore, special attention should be paid to non-compliant content and form. In this I refer to content as the actual text, and form meaning the layout of the document.

The analysis of content is relatively simple to comprehend. The RPAPL contains the mandatory textual requirements in effect on the date the notice was mailed or served. The practitioner may simply compare the text in the statute to the text in the notice that was actually mailed or served. Many of you will be surprised to discover how many glaring deviations from required content were utilized by the loan servicers when the notices were created. I am not referring to minor deviations. Some loan servicers apparently believed that RPAPL §1303 & 1304 were not strict compliance statutes at all, but rather popular suggestions. These loan servicers believed that as long as the notices were somewhere in the ballpark the notices would pass judicial review. Surprise! See Tuthill Finance v. Candlin, 129 A.D.3d 599 (3rd Dept. 2015).

The most glaring deficiency is where the type size is non-compliant. There is actually a statute that defines type size. General Construction law §62 defines type size. Most of us simply set our word processing program on a font such as “times” or “Calibri” then choose a font size and just type away. However, font size is not type size. All fonts have different type sizes irrespective of how the author sets his or her font size. “Calibri 12” is not the same type size as “Helvetica 12”. Type size is calculated per GCL §62, in millimeters, as .45 x .351 x the lower-case letter (in millimeters) exclusive of ascenders and descenders. [I really need to get a life]. To measure an Upper-case letter one will need to purchase a “typesetter’s tool” or “e-scale ruler”. You will have to buy one on-line, as they are not sold at Staples. Believe me. I know, I looked. I bought a clear millimeter ruler and I have measured numerous RPAPL 1303 & 1304 notices’ lettering. Many of the §1303 notices have headings in 16-point type rather than the required 20 point. Likewise, many §1304 notices have text that measures considerably less than the 2.2 millimeters for 14-point type required by the statute. Type size and font size are two different concepts.[4] Be aware that the margin size of the notice is important when reviewing for type size. Now that Plaintiffs are aware of this deficiency some are purposefully enlarging the entire page for exhibiting to disguise the error.

Another common error made by loan servicers is where additional notices are mailed together with the §1304 Notice in the same envelope. This is in direct violation of the statute and is grounds for dismissal. I suggest that if the practitioner ask the client if they still have the 90-day notice that was mailed. Very often the 90-day notice is not annexed to the complaint as an exhibit.

Last, is what I believe to be the most material and egregious error. In a vast majority of the 90 day notices the amount stated by the lender that is necessary to reinstate the loan is wrong. I am not implying that these reinstatement dollar amounts are in error by just a few dollars. The reinstatement dollar amounts are often in error by at least two or three full payments.

It seems that whomever read §1304 at the servicer’s end does not know how to count days or months. A plain reading of the statute requires that the lender provide a sum certain to reinstate by a date certain within a 90-day window from the date of the mailing of the notice. I believe that one of the most vital aspects of the notice is the amount required to reinstate. It is apparent to me that most Plaintiffs believe otherwise. From the sheer number of non-compliant 90 Day Notices I see I cannot help but believe that Plaintiffs think that accuracy of the Notice’s factual content is irrelevant. It seems as if the only thing that matters to them is that some notice is mailed irrespective of the accuracy of the content.

There are many loan servicers that provide less than 30 days to reinstate. As of the date of this article I do not know of any case law that addresses this issue on point. Nevertheless, I believe that a lender should provide at least 30 days to reinstate/cure in the 90 day notice as this is the minimum time allowed under New York Law as reflected in paragraph 22 of the standard Fannie/Freddie mortgage contract. I strongly suggest that careful attention be paid and that the practitioner conduct a thorough review of the content and form of both the §1303 and §1304 Notices. I have reviewed hundreds of these notices and I have found that many Plaintiffs have acted with wanton disregard for the law in the drafting and delivery of said strict compliance notices.

[1] U.S. Bank National Association v. Carey, 137 A.D.3d 894 (2d Dept., 2016).

[2] Bank of New York Mellon v. Alberto Aquino, Index No.: 7736/2010 (trial Court Queens) reversed and modified by Bank of New York Mellon v. Aquino, 131 A.D.3d 1186 (2d Dep’t 2015).

[3] Aurora Loan Services, LLC v. Weisblum, 85 A.D.3d 95 (2d Dep’t 2011); First Natl. Bank of Chicago v. Silver, 73 A.D.3d 162, (2d Dep’t 2010)

[4] The Worldwide Web Consortium (WWC) established the standard measurement for desktop publishing font sizes. The DTP point (desktop publishing point) is the de facto standard. The DTP point is defined as 1⁄72 of an international inch (about 0.353 mm) and, as with earlier American point sizes, is considered to be 1⁄12 of a pica.

7 views0 comments