Faison v. Lewis

Citation25 N.Y.3d 220,32 N.E.3d 400,2015 N.Y. Slip Op. 04026,10 N.Y.S.3d 185
Decision Date12 May 2015
Docket NumberNo. 46,46
PartiesDorothy M. FAISON, as Administratrix of the Estate of Percy Lee Gogins, Jr., Deceased, Appellant, v. Tonya LEWIS, also known as Tonya Taylor and Another, et al., Defendants, and Bank of America, N.A., Respondent.
CourtNew York Court of Appeals Court of Appeals

Gordon & Haffner, LLP, Harrison (David Gordon and Steven R. Haffner of counsel), for appellant.

Liezl Irene Pangilinan, Fidelity National Law Group, New York City, for respondent.

OPINION OF THE COURT

RIVERA

, J.

The legal question raised in this appeal is whether plaintiff Dorothy Faison is time-barred under CPLR 213(8)

from seeking to set aside and cancel, as null and void, defendant Bank of America's mortgage interest in real property conveyed on the authority of a forged deed. Under our prior case law it is well-settled that a forged deed is void ab initio, meaning a legal ity at its inception. As such, any encumbrance upon real property based on a forged deed is and void. Therefore, the statute of limitations set forth in CPLR 213(8) does not foreclose plaintiff's claim against defendant. As the Appellate Division affirmed the dismissal of plaintiff's claims as time-barred, we now reverse.

I.

Plaintiff is the daughter and administrator of the estate of her father, Percy Lee Gogins, Jr. Gogins and his sister, defendant Dorothy Lewis (Lewis), inherited from their mother, as tenants in common, a three-family house in Brooklyn. A few years after the mother's death, in May 2000, Lewis conveyed by quitclaim deed her half-interest in the property to her daughter Tonya Lewis (Tonya). In February 2001, Tonya recorded a deed claiming to correct the prior deed from Lewis. This corrected deed, dated December 14, 2000, allegedly conveyed Gogins's half-interest in the real property to Tonya. Thus, if the corrected deed were valid, it would convey to Tonya a fee interest in the property. Gogins passed away in March 2001.

In September 2002, plaintiff filed an action on behalf of Gogins's estate against Lewis and Tonya, claiming the corrected deed was void because her father's signature was a forgery. In April 2003, Supreme Court dismissed the complaint on the ground that plaintiff lacked capacity to sue because she was not the estate's administrator. At the time, Gogins's widow was the administrator.

In December 2009, Tonya borrowed $269,332 from defendant Bank of America (BOA), which she secured with the mortgage, granted in favor of defendant Mortgage Electronic Registration Systems, Inc. (MERS). Several months later, in July 2010, Surrogate's Court appointed plaintiff administrator of Gogins's estate. In her supporting affidavit explaining her delay in seeking appointment, plaintiff asserted that her mother's lawyer led her to believe that he had secured a judgment in favor of the estate, when in fact the lawyer, now disbarred, had failed to take action on her mother's behalf.

The month following her appointment, in August 2010, plaintiff filed the underlying action against Lewis, Tonya, BOA and MERS to declare the deed and mortgage null and void based on the alleged forgery. Thereafter, BOA moved to dismiss the complaint under CPLR 3211(a)(5)

as untimely under CPLR 213(8), and plaintiff cross-moved to dismiss the statute of limitations affirmative defense asserted in the BOA and MERS joint answer. Supreme Court granted the motion to dismiss the complaint in its entirety as time-barred, and denied plaintiff's cross motion as moot.

The Appellate Division modified the order, denying the motion to dismiss as against the individual defendants and MERS,

on procedural grounds, leaving the action pending against those defendants (Faison v. Lewis, 106 A.D.3d 1047, 966 N.Y.S.2d 198 [2d Dept.2013]

). On the merits, the Appellate Division concluded, in reliance on Second Department precedent, that plaintiff's forgery-based claim against defendant BOA was subject to the six-year statute of limitations for fraud claims set forth in CPLR 213(8) (

id. at 1048, 966 N.Y.S.2d 198 ). We granted plaintiff leave to appeal against defendant BOA (22 N.Y.3d 1193, 985 N.Y.S.2d 481, 8 N.E.3d 859 [2014] ).1

II.

As a preliminary matter, because this is an appeal from a dismissal under CPLR 3211(a)(5)

, [w]e accept the facts as alleged in the complaint as true, accord plaintiff[ ] the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory” (Leon v. Martinez, 84 N.Y.2d 83, 87–88, 614 N.Y.S.2d 972, 638 N.E.2d 511 [1994] [citations omitted] ). Accordingly, for purposes of this appeal, we must assume that the deed is forged.2

Plaintiff contends that a forged deed has long been treated as void ab initio, entirely without effect from inception. Therefore, the CPLR 213(8)

statute of limitations does not apply to her claims to vacate and declare the deed and defendant BOA's mortgage-based interest in the property a legal nullity. We agree.

In Marden v. Dorthy, this Court held that a forged deed was void at its inception, finding it to be a “spurious or fabricated paper” (160 N.Y. 39, 53, 54 N.E. 726 [1899]

), a forgery characterized by “the fraudulent making of a writing to the prejudice of another's rights” (id. ). As Marden noted, a forged deed lacks the voluntariness of conveyance (see id. at 54, 54 N.E. 726

). Therefore, it holds a unique position in the law; a legal ity at its creation is never entitled to legal effect because [v]oid things are as no things” (id. at 56, 54 N.E. 726 ).

A forged deed that contains a fraudulent signature is distinguished from a deed where the signature and authority for conveyance are acquired by fraudulent means. In such latter cases, the deed is voidable. The difference in the nature of the two justifies this different legal status. A deed containing

the title holder's actual signature reflects “the assent of the will to the use of the paper or the transfer,” although it is assent “induced by fraud, mistake or misplaced confidence” (Marden, 160 N.Y. at 50, 54 N.E. 726

; see also

Rosen v. Rosen, 243 A.D.2d 618, 619, 663 N.Y.S.2d 228 [2d Dept.1997] ; 26A C.J.S., Deeds § 153 [“where the grantor knowingly executes the very instrument intended, but is induced to do so by some fraud in the treaty or by some fraudulent representation or pretense, the deed is merely voidable”] ). Unlike a forged deed, which is void initially, a voidable deed, “until set aside, ... has the effect of transferring the title to the fraudulent grantee, and ... being thus clothed with all the evidences of good title, may incumber the property to a party who becomes a purchaser in good faith” (Marden, 160 N.Y. at 50, 54 N.E. 726 ).

A forged deed, however, cannot convey good title, and [i]t is legally impossible for any one [sic] to become a bona fide purchaser of real estate, or a purchaser at all, from one who never had any title, and that is this case (id. at 56, 54 N.E. 726

[emphasis omitted]; see also

Yin Wu v. Wu, 288 A.D.2d 104, 105, 733 N.Y.S.2d 45 [1st Dept.2001] [“A forged deed is void and conveys no title”]; 2–15 Warren's Weed, New York Real Property § 15.01 [“A purchaser who takes title through a forged deed cannot be a bona fide purchaser, even if the purchaser did not have knowledge of the forgery”] ). New York's rule reflects a general well-established principle of real property law (see e.g.

Harding v. Ja Laur Corp., 20 Md.App. 209, 214, 315 A.2d 132, 135 [1974] [“A forged deed ... is void ab initio”]; Scott D. Erler, D.D.S. Profit Sharing Plan v. Creative Fin. & Invs., L.L.C., 349 Mont. 207, 214, 203 P.3d 744, 750 [2009] [“forged conveyances are void ab initio and do not transfer title” (emphasis omitted) ]; Brock v. Yale Mtge. Corp., 287 Ga. 849, 852, 700 S.E.2d 583, 586 [2010] [we have also long recognized that a forged deed is a nullity and vests no title in a grantee”]; Akins v. Vermast, 150 Or.App. 236, 241 n. 7, 945 P.2d 640, 643 n. 7 [1997] [“If fraud is ‘in factum,’ such as a forged deed or a situation analogous to forgery, the deed is void ab initio and will not support subsequent title in any person” (emphasis omitted) ]; First Natl. Bank in Albuquerque v. Enriquez, 96 N.M. 714, 716, 634 P.2d 1266, 1268 [1981] [“a forged deed is a void deed and transfers no interest”]; Williams v. Warren, 214 Ark. 506, 511, 216 S.W.2d 879, 881 [1949] [“No one can claim that an estate in land should be divested by forgery”] ).

It is similarly true that no property shall be encumbered, including by a mortgagee, in reliance on a forged deed (see

Marden , 160 N.Y. at 51, 54 N.E. 726

; see also

Cruz v. Cruz, 37 A.D.3d 754, 754, 832 N.Y.S.2d 217 [2d Dept.2007] [“A deed based on forgery or obtained by false pretenses is void ab initio, and a mortgage based on such a deed is likewise invalid”]; Jiles v. Archer, 116 A.D.3d 664, 666, 983 N.Y.S.2d 283 [2d Dept.2014] [“If a document purportedly conveying a property interest is void, it conveys nothing, and a subsequent bona fide purchaser or bona fide encumbrancer for value receives nothing”]; 2–15 Warren's Weed, New York Real Property § 15.09 [“If the conveyance is void, the purchaser or encumbrancer will not enjoy any of the rights of a bona fide purchaser”]; 43A N.Y. Jur. 2d, Deeds § 218

[“a forged deed is null and void, and conveys nothing, and a purchaser or mortgagee from the grantee, even for value and without notice of the forgery, will not be protected”] ).

Moreover, New York's recording statute (Real Property Law § 291

) does not apply to a forged deed (see

Albany County Sav. Bank v. McCarty, 149 N.Y. 71, 74, 43 N.E. 427 [1896] ; Grosch v. Kessler, 231 App.Div. 870, 870, 246 N.Y.S. 851 [2d Dept.1930] ). Neither can recording a forged deed transform it into a document with legal authority to establish a valid property interest, for it “does not change the legal rights of any one [sic] (Marden, 160 N.Y. at 56, 54 N.E. 726 ). “The fact that a false and fabricated writing of this character is...

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