Harris v. Thompson

• Court: New York Supreme Court — Appellate Division
• Writing for the Court: PETER B. SKELOS
• Citation: Harris v. Thompson, 2014 NY Slip Op 3487, 117 A.D.3d 791, 985 N.Y.S.2d 713 (N.Y. App. Div. 2014)
• Decision Date: 14 May 2014
• Parties: Mary HARRIS, plaintiff-respondent, v. Sylvia THOMPSON, defendant-respondent, AmTrust Bank, appellant, et al., defendants.

117 A.D.3d 791

985 N.Y.S.2d 713

2014 N.Y. Slip Op. 03487

Mary HARRIS, plaintiff-respondent,

v. Sylvia THOMPSON, defendant-respondent,AmTrust Bank, appellant, et al., defendants.

Supreme Court, Appellate Division, Second Department, New York.

May 14, 2014.

Solomon & Siris, P.C., Garden City, N.Y. (Bill Tsevis of counsel), for appellant.

Dianne O. Woodburn, Rego Park, N.Y. (Robert J. Seewald and Donna Dougherty of counsel), for plaintiff-respondent.

PETER B. SKELOS, J.P., SANDRA L. SGROI, JEFFREY A. COHEN, and HECTOR D. LASALLE, JJ.

In an action, inter alia, pursuant to RPAPL article 15 to quiet title to real property, the defendant AmTrust Bank appeals from an order of the Supreme Court, Queens County (Sampson, J.), entered August 14, 2012, which denied its motion for summary judgment on its first and second counterclaims or on its third and fourth counterclaims.

ORDERED that the order is modified, on the law, by deleting the provision thereof denying that branch of the appellant's motion which was for summary judgment on its third counterclaim imposing an equitable lien in its favor against the subject premises, and substituting therefor a provision granting that branch of the motion to the extent of awarding summary judgment to the appellant imposing an equitable lien against the subject premises in its favor in the aggregate amount it paid to satisfy two prior mortgages on the subject premises that the plaintiff had given to Emigrant Mortgage Company, Inc.; as so modified, the order is affirmed, without costs or disbursements.

In 1970, the plaintiff acquired certain real property (hereinafter the subject property), located in Jamaica, Queens. In October 2005, the property was encumbered by two mortgages that the plaintiff had given to Emigrant Mortgage Company, Inc. (hereinafter Emigrant), securing loans in the amounts of $172,200 and $11,262, respectively (hereinafter the Emigrant mortgages). On October 31, 2005, the plaintiff conveyed the property to the defendant Jason Leslie. Leslie financed his purchase with two loans of $252,800 and $47,250 from the defendant AmTrust Bank, formerly known as Ohio Savings Bank (hereinafter AmTrust), each secured by a mortgage on the property (hereinafter together the Leslie mortgages). According to the settlement statement from the October 31, 2005, closing, proceeds of the Leslie loans totaling $190,817.39 were allocated to satisfy the Emigrant mortgages. Satisfactions of mortgage with respect to the Emigrant mortgages were issued by Emigrant on November 13, 2005, and December 11, 2005, respectively, and recorded on January 23, 2006. On October 30, 2006, Leslie conveyed the property to the defendant Sylvia Thompson, who financed the purchase with a loan of $375,000 from AmTrust, secured by a mortgage on the subject property (hereinafter the Thompson mortgage). According to the settlement statement from the October 30, 2006, closing, proceeds totaling $305,373.03 were allocated to satisfy the Leslie mortgages. After Thompson defaulted on her monthly payments, AmTrust commenced a related action to foreclose the Thompson mortgage and, on January 7, 2008, AmTrust obtained a judgment of foreclosure and sale. The plaintiff alleges that she was the owner of the subject property, and that she had no reason to believe otherwise until she received a letter notifying her of AmTrust's judgment.

Thereafter, the plaintiff commenced this action, inter alia, pursuant to RPAPL article 15 to quiet title, seeking, among other things, a judgment declaring that the Leslie and Thompson deeds and mortgages are void, and that she was the sole owner of the property. The complaint alleged that Leslie, Thompson, the defendant mortgage broker Sylvia Banks, and the defendant attorney Robin Gray acted together to fraudulently procure the plaintiff's deed to Leslie by misrepresenting that the plaintiff was simply refinancing her mortgages, when, in fact, she was conveying the property to Leslie.

In its answer, AmTrust asserted various counterclaims. In its first counterclaim, AmTrust sought the imposition of an equitablelien on the subject property in the amount of the proceeds of the Thompson mortgage that were allocated to satisfy the remaining balance on the Leslie mortgages and other liens on the property. In its second counterclaim, AmTrust alleged that, in the event that the plaintiff were ultimately successful in this action, it was entitled to a money judgment against the plaintiff in the principal...