R&E Delivers Update on CoA FAPA Holdings

On November 25, 2025, the New York Court of Appeals issued a pair of long awaited decisions regarding the retroactive effect and constitutionality of the controversial Foreclosure Abuse Prevention Act (“FAPA”) – Article 13 LLC v Lasalle National Bank Association (“Article 13”) and Van Dyke v U.S. Bank, National Association (“Van Dyke”). FAPA was signed into law by the Governor on December 31, 2022 and was aimed, in large part, to prevent lenders from restarting the six-year statute of limitations clock on previously dismissed residential mortgage foreclosure actions and filing endless foreclosure actions against homeowners on the same debt.

In the Court of Appeals’ two decisions, the Court confirmed that FAPA applies retroactively to foreclosure actions where a final judgment of foreclosure and sale has not been enforced, and rejected all constitutional challenges to the statute.

The Court of Appeals’ key holdings in Article 13 and Van Dyke include:

• FAPA applies retroactively — The Court held that the legislature “expressly stated” that FAPA applies to “all actions” in which a final judgment of foreclosure and sale has not been enforced, meaning that FAPA governs pending and previously filed matters unless a final judgment has already been enforced. The term “enforced” in foreclosure matters means when the “hammer” hits down at auction.

• FAPA is constitutional when applied retroactively — the Court expressly struck down the lender’s constitutional challenges to FAPA, holding that FAPA neither violates the substantive or procedural due process clause nor the contracts clause.

• FAPA’s estoppel rule prevails — the Court upheld FAPA’s language preventing parties from deaccelerating a previously accelerated loan to avoid the statute of limitations unless the earlier case was dismissed based on an “expressed judicial determination” that the acceleration was invalid.

If you have any questions about foreclosure law or other legal matters pertaining to distressed real estate, please feel free to contact your trusted R&E attorney or Christopher A. Gorman or John P. Muldoon, who authored the above end of year update.