Two Options to Recover on Note and Mortgage; One in Law (Note); One in Equity (Foreclosure)

In finding that CPLR 5236(b) did not apply in the case, the Second Department described the two options a mortgagee has with respect to recovery based on a note and mortgage:

CPLR 5236(b) provides, in relevant part, that “[r]eal property mortgaged shall not be sold pursuant to an execution issued upon a judgment recovered for all or part of the mortgage debt.” Typically, a mortgagee has the choice of “two remedies: one at law in a suit on the debt as evidenced by the note, the other in equity to foreclose the mortgage” …. A mortgagee who elects to proceed on the note becomes “subject to the statutory restrictions which direct that when a judgment is recovered for all or part of the mortgage debt, the execution shall direct that no part of the mortgage[d] property shall be levied upon or sold thereunder” (Goddard v Johnson, 96 Misc 2d 230, 231). Matter of Ivy Hill Commodities Corp v Beekharry, 2013 NY Slip Op 03483, 2nd Dept, 5-15-13