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HERE THE PURPORTED TRANSFER BY DEED OF AN INTEREST IN REAL PROPERTY TO A LIMITED LIABILTY COMPANY WAS NULL AND VOID FROM THE OUTSET BECAUSE THE LLC DID NOT EXIST WHEN THE DEED WAS EXECUTED; THEREFORE THE STATUTE OF LIMITATIONS FOR REFORMATION OF THE DEED NEVER STARTED RUNNING; PLAINTIFF WAS ENTITLED TO A DECLARATORY JUDGMENT THAT THE TRANSFER TO THE LLC WAS NULL AND VOID (SECOND DEPT).

The Second Department, reversing (modifying) Supreme Court, determined the action seeking a declaratory judgment that a deed is null and void should not have been dismissed as time-barred. The deed was void from the outset because the limited liability company listed as a property owner did not not exist at the time the deed was executed. Because the deed was void (re; the LLC) at the time of execution, the statute of limitations for a reformation of the deed never started running:

“‘A cause of action seeking reformation of an instrument on the ground of mistake is governed by the six-year statute of limitations pursuant to CPLR 213(6), which begins to run on the date the mistake was made'” … . Here, however, the deed, insofar as it purported to convey an interest in the property from Gold to the LLC, was void at its inception, since it is undisputed that the LLC did not exist at the time the deed was executed … . Since “a statute of limitations cannot validate what is void at its inception,” the statute of limitations cannot act as a bar to the cause of action for a judgment declaring the LLC’s purported interest in the property null and void … . J​PMorgan Chase Bank, N.A. v Katz, 2026 NY Slip Op 00359, Second Dept 1-28-26

Practice Point: A statute of limitations cannot be used to validate a purported transfer of property that was void at its inception. Here the statute of limitations for a judgment declaring a purported transfer of property by deed to an LLC which did not exist when the deed was executed should not have been invoked to bar reformation of the deed.​

 

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THE STATUTE OF LIMITATIONS FOR DECLARATORY JUDGMENTS DEPENDS ON THE UNDERLYING THEORY, FRAUD IN THIS CASE; AN AGREEMENT TO ASSIGN OR OBTAIN A MORTGAGE IS A CONTRACT INVOLVING AN INTEREST IN REAL PROPERTY AND IS SUBJECT TO THE STATUTE-OF-FRAUDS WRITING-REQUIREMENT (SECOND DEPT).

The Second Department, reversing (modifying) Supreme Court, determined that certain causes of action in this dispute over ownership of real property should have been dismissed as time-barred or as violative of the statute of frauds:

“Actions for declaratory judgments are not ascribed a certain limitations period. The nature of the relief sought in a declaratory judgment action dictates the applicable limitations period” … . The statute of limitations for an action based upon fraud generally is six years from the date the cause of action accrued (see CPLR 213[8]). … [T]he first and second causes of action were untimely, as the amended complaint alleged that [defendant’s] fraud in obtaining those interests occurred more than six years before the commencement of this action … .

… Causes of action to impose a constructive trust upon real property and to recover damages for unjust enrichment are governed by a six-year statute of limitations, which begins to accrue at the time of the wrongful act giving rise to the duty of restitution … . … [Defendant’s] alleged fraudulent acquisition of ownership interests … occurred more than six years before the commencement of this action.

… The statute of frauds requires any contract transferring or creating an interest in real property to be in writing (see General Obligations Law § 5-703[1] …). Here, [the] … complaint alleged [defendants] breached their agreements to assign or obtain a mortgage in favor of the plaintiffs. A mortgage constitutes an interest in real property, and the agreements to transfer or obtain mortgages in favor of the plaintiffs, therefore, were required to be in writing. Hersko v Hersko, 2026 NY Slip Op 00120, Second Dept 1-14-26

Practice Point: The statute of limitations for a declaratory judgment is that which applies to the underlying theory. Here the six-year statute for fraud applied.​

Practice Point: An agreement to assign or obtain a mortgage is subject to the statute-of-frauds because a mortgage constitutes an interest in real property.

 

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GENERALLY THE DEATH OF A PARTY TO AN ACTION DIVESTS THE COURT OF JURISDICTION AND REQUIRES A STAY OF THE PROCEEDINGS; HERE IN THIS FORECLOSURE ACTION HUSBAND AND WIFE OWNED THE PROPERTY AS TENANTS BY THE ENTIRETY; THE PROPERTY THEREFORE REMAINED WHOLLY OWNED BY WIFE UPON HUSBAND’S DEATH; BECAUSE PLAINTIFF WAS NOT SEEKING A DEFICIENCY JUDGMENT AGAINST HUSBAND’S ESTATE, A STAY OF THE PROCEEDINGS WAS NOT REQUIRED (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the death of one of the parties in this foreclosure action did not require a stay of the proceedings. The defendant wife held the property with her husband as tenants by the entirety. When the husband died, the wife remained as the owner of the entire property. The plaintiff mortgage company, by moving to delete the husband’s name for the caption, elected not to seek a deficiency judgment against the decedent’s estate. Therefore the action should not have been stayed:

“‘Generally, the death of a party divests a court of jurisdiction to act, and automatically stays proceedings in the action pending the substitution of a personal representative for the decedent'” … . However, “where a party’s demise does not affect the merits of the case, there is no need for strict adherence to the requirement that the proceedings be stayed pending substitution” … . “[A] mortgagor who has made an absolute conveyance of all his [or her] interest in the mortgaged premises . . . is not a necessary party to foreclosure, unless a deficiency judgment is sought” … .

… [T]he plaintiff established that, upon the decedent’s death, Janice, “as a tenant by the entirety with her husband, remained seized of the entire ownership interest in the subject property” … . Moreover, by moving to amend the caption to delete the name of the decedent and, in effect, to discontinue the action insofar as asserted against him, the plaintiff, in effect, elected not to seek a deficiency judgment against the decedent’s estate … .

By virtue of the absolute conveyance of the property from the decedent to Janice, and the plaintiff’s waiver of its right to seek a deficiency judgment against the decedent or his estate, “strict adherence to the requirement that the proceedings be stayed pending substitution was not necessary” … . Citimortgage, Inc. v Fimbel, 2025 NY Slip Op 06600, Second Dept 11-26-25

Practice Point: Here in this foreclosure action against husband and wife as tenants by the entirety, the husband’s death did not require a stay of the proceedings because the wife continued to hold the entire ownership interest in the property and plaintiff was not seeking a deficiency judgment against the estate of the husband.

 

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IN THIS EJECTMENT ACTION, DEFENDANT-TENANT’S “FAILURE TO STATE A CAUSE OF ACTION,” “WAIVER,” “CONSTRUCTIVE EVICTION,” “BREACH OF COVENANT OF QUIET ENJOYMENT,” “IMPROPER NOTICE OF DEFAULT,” AND “TRESPASS” AFFIRMATIVE DEFENSES SHOULD NOT HAVE BEEN DISMISSED; CRITERIA EXPLAINED (SECOND DEPT).

The Second Department, reversing (modifying) Supreme Court, determined several affirmative defenses in this ejectment action should not have been dismissed. Plaintiff landlord sought to eject defendant tenant from a parking lot for nonpayment of rent. Defendant alleged, and plaintiff acknowledged, plaintiff had rented certain parking spaces to a third party. The Second Department held: (1) no motion lies to dismiss a “failure to state a cause of action” defense because plaintiff cannot test the sufficiency of its own claim; (2) the “waiver” defense should not have been dismissed despite the “nonwaiver” provision in the lease; (3) the constructive eviction and breach of covenant of quiet enjoyment defenses were supported by plaintiff’s renting spaces to a third party; (4) the ‘improper notice of default” defense was supported by the plaintiff’s failure to provide the notice called for by the lease; and (5) the “trespass” defense was supported by the rental of spaces to a third party:

CPLR 3211(b) provides that “[a] party may move for judgment dismissing one or more defenses, on the ground that a defense is not stated or has no merit.” “When moving to dismiss, the plaintiff bears the burden of demonstrating that the affirmative defenses ‘are without merit as a matter of law because they either do not apply under the factual circumstances of [the] case, or fail to state a defense'” … . “‘On a motion pursuant to CPLR 3211(b), the court should apply the same standard it applies to a motion to dismiss pursuant to CPLR 3211(a)(7), and the factual assertions of the defense will be accepted as true'” … . “‘Moreover, if there is any doubt as to the availability of a defense, it should not be dismissed'” … . Diversified Bldg. Co., LLC v Nader Enters., LLC, 2025 NY Slip Op 06047, Second Dept 11-5-25

Practice Point: Consult this decision for insight into the criteria for dismissal of an affirmative defense and the elements of “waiver,” “constructive eviction,” “breach of covenant of quiet enjoyment,” “Improper notice of default,” and “trespass” affirmative defenses as alleged by defendant-tenant in this ejectment action brough by plaintiff-landlord.

 

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THE INSTALLATION OF MOTION-ACTIVATED SECURITY LIGHTS WHICH SHINE INTO A NEIGHBOR’S PROPERTY CAN CONSTITUTE A PRIVATE NUISANCE (FOURTH DEPT).

The Fourth Department, reversing (modifying) Supreme Court, determined the nuisance cause of action, based upon defendants’ installation of flood lights, should not have been dismissed:

“To establish a claim of private nuisance, a plaintiff must show: ‘an interference (1) substantial in nature, (2) intentional in origin, (3) unreasonable in character, (4) with [the plaintiff’s] property right to use and enjoy land, (5) caused by another’s conduct in acting or failure to act’ ” … . The interference “must not be fanciful, slight or theoretical, but certain and substantial, and must interfere with the physical comfort of the ordinarily reasonable person” … .

… [T]he amended complaint alleged that a nuisance arose from, among other things, flood lights in defendants’ backyard that shined light onto plaintiff’s property at night. According to plaintiff, the lights constituted a “substantial, intentional and unreasonable interference” with his property rights. In support of that part of their motion seeking summary judgment, defendants acknowledged that they installed motion-activated security lights in their backyard but contended in a conclusory fashion that the lights do not “amount to nuisance to a reasonable person.” Defendants did not identify where on their property the lights are stationed, nor did they dispute that they shined light onto plaintiff’s property. Thus, defendants failed to establish as a matter of law that the lights did not constitute a nuisance. Marrano v Dusza, 2025 NY Slip Op 05592, Fourth Dept 10-10-25

Practice Point: Lights which shine into a neighbor’s property can constitute a private nuisance.

 

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PLAINTIFF, WHO HAD PURCHASED 75% OF REAL PROPERTY FROM THE HEIRS OF THE ORIGINAL OWNER, SOUGHT PARTITION AND SALE; DEFENDANT, WHOSE MOTHER HAD PURCHASED THE PROPERTY, OWNED THE REMAINING 25%; UNDER THE UNIFORM PARTITION OF HEIRS PROPERTY ACT (UPHPA), PLAINTIFF WAS REQUIRED TO NEGOTIATE A SETTLEMENT IN GOOD FAITH, BUT DID NOT (SECOND DEPT).

The Second Department, in a full-fledged opinion by Justice Wan, determined that plaintiff, who had purchased 75% of a piece of real property from the heirs of the original owner, did not negotiate in good faith in seeking a judgment directing the partition and sale of the property. The Uniform Partition of Heirs Property Act (UPHPA) (RPAPL 993) applies to this situation, where defendant, an heir of the original owner, holds the remaining 25% of the property. The UPHPA required that plaintiff negotiate a sale price for its share of the property and/or a purchase price for defendant’s share of the property in good faith. Both Supreme Court and the Second Department determined plaintiff did not negotiate in good faith and therefore was not entitled to the partition and sale:

Pursuant to RPAPL 993, property that qualifies as “heirs property” within the meaning of RPAPL 993(2)(e) is subject to the mandates of the UPHPA, which supersedes the general partition statutes, including RPAPL 901 … .

Following the commencement of a partition action involving “heirs property,” RPAPL 993(5)(a) mandates that the matter shall proceed to a settlement conference, “for the purpose of holding settlement discussions, pertaining to the relative rights and obligations of the parties with respect to the subject property” … . …

RPAPL 993(5)(e) further requires that “[b]oth the plaintiff[ ] and defendant[ ] shall negotiate in good faith [during the UPHPA mandated settlement conferences] to reach a mutually agreeable resolution.” * * *

​… [A]s the defendant contends, the equitable factors set forth in RPAPL 993(9)(a) strongly favored her position that she was primarily interested in reaching an agreement that would allow her to maintain her ownership interest in the property. … [T]he defendant’s mother had purchased the property in 1970, approximately 50 years before the plaintiff acquired its interest in the property and commenced this action. … [T]he defendant had grown up in the property, her children had grown up there, and her son still lived there … . Additionally, the plaintiff, who is not a relative of either person from whom it purchased its 75% interest in the property …, allegedly purchased that interest for $136,000. Despite purchasing its interest in the property for approximately one quarter of the appraised value of that interest of $521,250, the plaintiff made a final offer to sell its interest in the property for $500,000, which would afford the plaintiff a significant profit … . Laurelton Estates, LLC v Prince, 2025 NY Slip Op 05226, Second Dept 10-1-25

Practice Point: Consult this opinion for insight into what the “good-faith-settlement-negotiation” requirements in the Uniform Partition of Heirs Property Act (UPHPA) are. The requirements were not met here. ​

 

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THE JUDGMENT OF FORECLOSURE AND SALE WAS REVERSED ON APPEAL; THE DEFENDANT IN THE FORECLOSURE ACTION DID NOT SEEK A STAY PENDING APPEAL; THE FACT THAT THE NOTICE OF PENDENCY, FILED BY THE BANK AT THE OUTSET OF THE FORECLOSURE PROCEEDINGS, WAS STILL IN EFFECT AT THE TIME OF THE FORECLOSURE SALE DID NOT AFFECT THE TRANSFER OF TITLE TO A GOOD FAITH PURCHASER AT THE FORECLOSURE SALE (SECOND DEPT).

The Second Department, reversing Supreme Court, in a full-fledged opinion by Justice Brathwaite Nelson, determined the defendant in the foreclosure action, Yesmin, upon reversal of the judgment of foreclosure and sale on appeal, was not entitled to cancel and discharge the referee’s deed transferring title to a good faith purchaser of the foreclosed property. It is significant here that the defendant in the foreclosure action did not seek a stay pending appeal. The notice of pendency, filed by the bank in the foreclosure action, which was still in effect at the time of the foreclosure sale, did not affect the title acquired by the good faith purchaser:

This appeal raises the question of what effect an extant notice of pendency has on the title to real property acquired by a third party from a judicial foreclosure sale when the judgment of foreclosure and sale is reversed on the appeal of a defendant to the foreclosure action. For the reasons that follow, we hold that a notice of pendency that was unexpired at the time of the foreclosure sale has no effect on the title acquired by a good faith purchaser for value from a sale conducted pursuant to the judgment of foreclosure and sale. * * *

Once a judgment is entered, the need to obtain a stay pending appeal in order to protect the right to restitution of the property is shared equally by a defendant or a plaintiff against whom the judgment is entered. Where a judgment has been entered against a plaintiff, “the plaintiff’s right to impair the marketability of the property during the pendency of an appeal [is conditioned] upon the issuance of a discretionary CPLR 5519(c) stay” … . Thus, regardless of whether the judgment is issued in favor of a defendant or the plaintiff, once a judgment is entered, a stay is necessary to protect the property, and in the absence of a stay, the winning party is free to transfer the property as it sees fit. * * *

Since [the good faith purchaser of the foreclosed property] established that it is “a purchaser in good faith and for value” whose title would be affected by restitution of Yesmin’s property rights lost by the judgment of foreclosure and sale, Yesmin may not seek restitution by canceling the referee’s deed and, instead, is limited to monetary relief against the plaintiff to the foreclosure action (CPLR 5523 …). Yesmin v Aliobaba, LLC, 2025 NY Slip Op 02964, Second Dept 5-14-25

Practice Point: If the defendant in a foreclosure action which is appealed does not seek a stay pending appeal, the reversal on appeal does not affect title transferred to a good faith purchaser at the foreclosure sale.

 

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BECAUSE THE INITIAL USE OF THE ROADWAY WAS PERMISSIVE, AND THERE WAS NO HOSTILE USE FOR THE REQUIRED TEN YEARS, THE CRITERIA FOR A PRESCRIPTIVE EASEMENT WERE NOT MET; HOWEVER BECAUSE THE INITIAL USE WAS PERMISSIVE AND CONTINUED FOR 50 YEARS, THE CRITERIA FOR AN EASEMENT BY ESTOPPEL WERE MET (THIRD DEPT).

The Third Department, reversing Supreme Court, determined that plaintiffs did not have a prescriptive easement over defendants’ properties, but did have an easement by estoppel. Because there was an agreement among the original owners of the three adjacent camps to construct, maintain and use a roadway providing vehicular access to all three camps, and because there had been no hostile use of the roadway for ten years, the requirements for a prescriptive easement were not met. However plaintiffs were entitled to an easement by estoppel. The court noted that the Statute of Frauds does not apply to an easement by estoppel:

[Re; a prescriptive easement] … [B]ecause plaintiffs’ predecessors’ use of the extension was permissive, the element of hostility was negated … . Therefore, no adverse use could have arisen until there was the assertion of a hostile right … , which, at the earliest, occurred in 2018. We are presented with a permissive use that did not ripen into a prescriptive one for the time required … .

Yet, these same facts establish plaintiffs’ entitlement to an easement by estoppel … . “An easement by estoppel may arise when, among other things, a party reasonably relies upon a servient landowner’s representation that an easement exists” … . The uncontested existence of the agreement between the parties’ predecessors for the construction and use of the extension, together with the time and expense of not only the initial construction but, also, the continued 50-year maintenance thereof, demonstrates that plaintiffs “undertook . . . action[s] to their detriment in reasonable reliance upon a representation that they held an easement” … . Sardino v Scholet Family Irrevocable Trust, 2025 NY Slip Op 02828, Third Dept 5-8-25

Practice Point: Consult this decision for clear illustrations of the criteria for a prescriptive easement and an easement by estoppel.

 

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TENANT WAS PRECLUDED FROM ASSERTING A CLAIM FOR BREACH OF THE COVENANT OF QUIET ENJOYMENT BECAUSE THE TENANT HAD ALREADY STOPPED PAYING RENT WHEN IT VACATED THE PREMISES (FIRST DEPT).

The First Department, reversing Supreme Court, determined the tenant’s claim for breach of the covenant of quiet enjoyment was precluded because the tenant was in default (failure to pay rent) at the time the tenant vacated the premises:

Under … the lease between the landlord and defendant tenant … , the tenant was entitled to “peaceabl[y] and quietly enjoy the premises,” which were in the basement of the landlord’s building, as long as it performed its obligations under the lease, which included the obligation to pay rent. Under … the lease, the tenant waived the provisions of Real Property Law § 227. The premises were shut down in March 2020 under Executive Order 202.7 (9 NYCRR 8.202.7) in response to COVID. At that time, the tenant stopped paying rent. * * *

The tenant is precluded from asserting a claim for breach of the covenant of quiet enjoyment because it was already in default of its obligation to pay rent at the time it vacated the leased premises. The law is clear that, in order for a tenant to assert a claim for breach of the covenant of quiet enjoyment, the tenant must have performed all obligations which are a condition precedent to its right to insist upon the covenant … . When a tenant vacates the premises after defaulting on its obligation to pay rent, it is deprived of its right to insist upon the performance of the covenant of quiet enjoyment … . By the express terms of the lease, the tenant was obligated to pay rent while remaining in possession of the premises as a condition precedent to receiving the benefit of quiet enjoyment of the premises. Since the tenant remained in possession of the premises without paying rent, the tenant has failed to satisfy the condition precedent in the lease and is thereby precluded from claiming a breach of the covenant of quiet enjoyment … . 558 Seventh Ave. Corp. v E&B Barbers Inc., 2025 NY Slip Op 02546, Frist Dept 4-29-25

Practice Point: Here, under the terms of the lease, payment of rent was a condition precedent for the benefit of quiet enjoyment of the premises. Therefore the tenant, who had stopped paying rent at the time the premises were vacated, could not make a claim for breach of the covenant of quiet enjoyment.

 

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UNBEKNOWNST TO ALL DURING THE 1992 SURROGATE’S COURT PROCEEDING, THE DECEDENT’S BROTHER WAS STILL ALIVE; DECEDENT’S NEPHEW TOOK POSSESSION OF DECEDENT’S PROPERTY, A THREE-STORY BUILDING, IN 1993; THE NEPHEW FIRST BECAME AWARE OF DECEDENT’S BROTHER’S INTEREST IN THE PROPERTY IN 2019; THE COURT OF APPEALS DETERMINED THE NEPHEW ACQUIRED THE PROPERTY BY ADVERSE POSSESSION (CT APP).

The Court of Appeals, in a full-fledged opinion by Judge Wilson, over a dissenting opinion, determined respondent (Mr. Golobe), who “inherited” the building after his aunt (Dorothy) died, was entitled to the building through adverse possession after it became known that Dorothy’s brother, Yale, was still alive. During the Surrogate’s Court proceeding a family friend testified that Yale  predeceased Dorothy by six or seven years:

Mr. Golobe. Mr. Golobe took possession of the Premises in October 1992 and has maintained possession since then. He has negotiated leases, collected and retained rent, paid property taxes, executed a construction mortgage, and made substantial renovations to the Premises. Those renovations include a complete structural support overhaul, an interior gut renovation, the replacement of the front entrance and door, the replacement of the second and third floor windows, and the replacement of the roof.

Yale actually died the year after Dorothy, in 1993. His estate passed to his wife Helen, then to Helen’s sister Beatrice, then to Beatrice’s husband Emil Kraus. Upon Mr. Kraus’s death, his estate passed to the Trust, the defendant-appellant in this case. * * *

The question—whether a cotenant may adversely possess property when neither cotenant is aware of the existence of the co-tenancy—is an issue of first impression in New York. We hold that a cotenant may obtain full ownership of jointly owned property even when neither party is aware of the other cotenant’s interest. Mr. Golobe did so.

“To establish a claim of adverse possession, the occupation of the property must be (1) hostile and under a claim of right (i.e., a reasonable basis for the belief that the subject property belongs to a particular party), (2) actual, (3) open and notorious, (4) exclusive, and (5) continuous for the statutory period (at least 10 years)” … . The parties agree that Mr. Golobe actually, exclusively and continuously occupied the Premises for over 20 years, beginning in October 1992. We must determine whether Mr. Golobe’s possession was hostile, under a claim of right, and open and notorious. It was all three. Golobe v Mielnicki, 2025 NY Slip Op 01670, CtApp 3-20-25

Practice Point: In a matter of first impression, the Court of Appeals determined a cotenant may adversely possess property even when neither cotenant is aware of the existence of the co-tenancy.

 

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