You are here: / / ONCE PLAINTIFF RELEASED THE MORTGAGE UPON PAYMENT OF LESS THAN THE VALUE...
,

ONCE PLAINTIFF RELEASED THE MORTGAGE UPON PAYMENT OF LESS THAN THE VALUE OF THE NOTE, PLAINTIFF COULD PROCEED AGAINST THE NOTE AND GUARANTY BY AMENDING THE FORECLOSURE COMPLAINT.

The Second Department, reversing Supreme Court, determined, once plaintiff agreed to release a mortgage in return for sale proceeds which were less than the value of the note, plaintiff could then commence a proceeding on the note and the guaranty. The court further held that the action on the note and guaranty could be accomplished by amending the original foreclosure complaint:

“RPAPL 1301(3) . . . prohibits a party from commencing an action at law to recover any part of the mortgage debt while the foreclosure proceeding is pending or has not reached final judgment, without leave of the court in which the foreclosure action was brought'” … . Conversely, “where a foreclosure action is no longer pending and did not result in a judgment in the plaintiff's favor, the plaintiff is not precluded from commencing a separate action' without leave of the court” … .

Here, since, pursuant to the parties' stipulation, the plaintiff agreed to accept the net proceeds of the sale in exchange for releasing the property from the mortgage and there was no judgment in the plaintiff's favor, the plaintiff was not precluded from seeking to recover on the note and guaranty by RPAPL 1301(3), “a statute which must be strictly construed” … .

Furthermore, there is no reason the plaintiff could not seek such relief by seeking leave to amend its complaint, rather than by commencing a new action … . TD Bank, N.A. v 250 Jackson Ave., LLC, 2016 NY Slip Op 01828, 2nd Dept 3-16-16

FORECLOSURE (PLAINTIFF COULD PROCEED AGAINST NOTE AND GUARANTY AFTER RELEASING MORTGAGE)/NOTE (FORECLOSURE, PLAINTIFF COULD PROCEED AGAINST NOTE AND GUARANTY AFTER RELEASING MORTGAGE)/MORTGAGES (FORECLOSURE, PLAINTIFF COULD PROCEED AGAINST NOTE AND GUARANTY AFTER RELEASING MORTGAGE)/DEBTOR-CREDITOR  (FORECLOSURE, PLAINTIFF COULD PROCEED AGAINST NOTE AND GUARANTY AFTER RELEASING MORTGAGE)/CIVIL PROCEDURE (AMENDING COMPLAINT, AFTER RELEASING MORTGAGE, PLAINTIFF COULD PROCEED AGAINST THE NOTE AND GUARANTEE BY AMENDING THE ORIGINAL FORECLOSURE COMPLAINT)

You might also like
DEFENDANT, AT THE PLEA PROCEEDINGS, WAS NOT INFORMED OF THE PERIOD OF POSTRELEASE SUPERVISION TO BE IMPOSED OR THE MAXIMUM WHICH COULD BE IMPOSED; GUILTY PLEA VACATED (SECOND DEPT).
Vehicle Owner’s Uncontradicted Deposition Testimony Not Enough to Overcome Presumption Vehicle Driven with Owner’s Consent
QUESTIONS OF FACT WHETHER DEFENDANT BUS DRIVER WAS NEGLIGENT; PLAINTIFF’S HAND WAS CAUGHT IN THE CLOSED DOOR OF THE BUS (SECOND DEPT).
PLAINTIFF’S FORECLOSURE ACTION SHOULD NOT HAVE BEEN DISMISSED, SUA SPONTE, AS ABANDONED PURSUANT TO 22 NYCRR 202.48; THE 60-DAY TIME LIMIT ONLY APPLIES TO THE DIRECTION TO SUBMIT A JUDGMENT “ON NOTICE” (SECOND DEPT).
In Opposing a Motion to Dismiss for Failure to Timely File a Note of Issue, No Need to Show Potentially Meritorious Cause of Action Where Defendant Contributed to the Delay
Writ of Coram Nobis Granted—Ineffective Assistance of Appellate Counsel
MOTION FOR LEAVE TO AMEND NOTICE OF CLAIM TO INDICATE PLAINTIFF WAS RIDING A BICYCLE AT THE TIME OF THE ACCIDENT PROPERLY GRANTED.
SUMMARY JUDGMENT SHOULD NOT HAVE BEEN AWARDED TO PLAINTIFF IN THIS SIDEWALK SLIP AND FALL CASE ON A THEORY RAISED IN REPLY PAPERS, CITY DEFENDANTS DID NOT DEMONSTRATE THEY HAD NO NOTICE OF THE CONDITION OR DID NOT CREATE THE CONDITION, EVIDENCE SUBMITTED BY THE CITY DEFENDANTS IN REPLY PAPERS COULD NOT BE CONSIDERED (SECOND DEPT).

Categories

Sign Up for the Mailing List to Be Notified When the Site Is Updated.

  • This field is for validation purposes and should be left unchanged.

Copyright © 2026 New York Appellate Digest, Inc.
Site by CurlyHost | Privacy Policy

SUA SPONTE DISMISSAL FOR LACK OF STANDING REVERSED, LACK OF STANDING DEFENSE... ATTORNEYS’ FEES NOT AVAILABLE TO INSURED WHO BRINGS AFFIRMATIVE ACTION...