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Home > Underwriting > Title News > Twenty Volume Eleven

SERIES: Twenty VOLUME: Eleven DATED: November, 2005

~ REAL PROPERTY LAW AMENDMENT PENALIZES MORTGAGEES WHO FAIL TO FILE MORTGAGE SATISFACTIONS ~

Chapter 467 of the New York Session Laws of 2005 has amended Real Property Law Section 275 to create substantial financial penalties for any mortgagee which makes five (5) or more mortgage loans in any calendar year and fails to prepare and present for recording a certificate of discharge or mortgage satisfaction within thirty (30) days of the mortgagee's receipt of payment of the full amount of principal and interest due on a mortgage. This amended statute, which is applicable to mortgage payoffs received by mortgagees on or after November 7, 2005, creates three (3) increasing levels of financial penalty in connection with a mortgagee's failure to record a mortgage satisfaction within a reasonable period of time after its receipt of payoff funds. The failure by a mortgagee to prepare and present for recording a certificate of discharge or satisfaction of mortgage within thirty (30) days of the mortgagee's receipt of the full amount of principal and interest due on a mortgage ". . . shall result in the mortgagee being liable to the mortgagor in the amount of $500.00." Failure by a mortgagee to prepare and present for a recording a certificate of discharge or mortgage satisfaction within sixty (60) days of the mortgagee's receipt of the full amount of principal and interest due on a mortgage ". . . shall result in the mortgagee being liable to the mortgagor in the amount $1,000." Failure by a mortgagee to prepare and present for a recording a certificate of discharge or mortgage satisfaction within ninety (90) days of the mortgagee's receipt of the full amount of principal and interest due on a mortgage ". . . shall result in the mortgagee being liable to the mortgagor in the amount of $1,500.". The term "mortgagee" does not include a person, partnership, association, corporation or other entity which makes less than five (5) mortgage loans in any calendar year. The provisions of this section also do not apply to any mortgage granted to or made by the State of New York, or any agency or instrumentality thereof or any political subdivision of the state or any agency or instrumentality thereof.

Hopefully the creation of these financial penalties will eliminate the substantial delays now encountered by mortgagors in connection with the prompt recordation of satisfactions for paid mortgages.

~ CIVIL PENALTY CREATED FOR DESTRUCTION OR REMOVAL OF SURVEY BOUNDARY MARKERS ~

A recently enacted amendment of Education Law Section 7209, which contains special provisions applicable to the professions of engineering and land surveying, has established a civil fine in an amount up to $500.00 which may be levied against "any person who knowingly damages, destroys, disturbs, removes, resets, or replaces any boundary marker placed on any tract of land by a licensed land surveyor..."

Newly enacted paragraph "9" of Education Law Section 7209 specifically provides as follows:

"9. a. Any person who knowingly damages, destroys, disturbs, removes, resets, or replaces any boundary marker placed on any tract of land by a licensed land surveyor, or by any person at the direction of a licensed land surveyor, for the purpose of designating any point, course or line in the boundary of such tract of land in which he or she has no legal interest, shall be punished by a civil fine of not more than five hundred dollars and shall be liable for the cost of reestablishment of said boundary marker.

b. Notwithstanding the provisions of paragraph a of this subdivision, a licensed land surveyor licensed under section seventy-two hundred three of this article or a person acting at the direction of any such licensed land surveyor, may remove an existing marker if substandard in nature in order to place an upgraded marker in the same location and shall note the same on the map of survey."

~ SUCCESSIVE NOTICES OF PENDENCY NOW PERMITTED BY STATUTE ~

Chapter 387 of the New York Session Laws of 2005 has amended the Civil Practice Law and Rules to add a new Section 6516 which specifically allows for the filing of successive notices of pendency in the both mortgage foreclosure and tax foreclosure actions where a previously filed notice of pendency has expired under CPLR Section 6512 (i.e. service of summons within 30 days after filing) or Section 6513 (i.e. 3 year duration from date of filing). This statutory amendment clarifies contradictory case law decisions in mortgage foreclosures. New Section 6516 only applies to mortgage or tax foreclosure actions and does not apply to non-judicial RPAPL Section 1403 Non-Judicial Foreclosure Proceedings or the foreclosure of mechanic's liens.

The text of new Section 6516 is as follows:

"§ 6516. Successive notice of pendency

(a) In a foreclosure action, a successive notice of pendency may be filed to comply with section thirteen hundred thirty-one of the real property actions and proceedings law, notwithstanding that a previously filed notice of pendency in such action or in a previous foreclosure action has expired pursuant to section 6513 of this article or has become ineffective because service of a summons had not been completed within the time limited by section 6512 of this article, whether or not such expiration or such ineffectiveness has been determined by the court. This subdivision is inapplicable to an action to foreclose a mechanic's lien, notwithstanding section forty-three of the lien law.

(b) For the purposes of this article, the term 'foreclosure action' shall mean any action or proceeding in which the provisions of section thirteen hundred thirty-one of the real property actions and proceedings law are applicable or in which a similar requirement is imposed by law.

(c) Except as provided in subdivision (a) of this section, a notice of pendency may not be filed in any action in which a previously filed notice of pendency affecting the same property had been canceled or vacated or had expired or become ineffective.

(d) Nothing contained in this section shall be construed as making the requirements of section thirteen hundred thirty-one of the real property actions and proceedings law applicable to a proceeding to foreclose a tax lien in which a list of delinquent taxes has been filed pursuant to subdivision seven of section eleven hundred twenty-two of the real property tax law or any comparable law, or as precluding the filing of a successive list of delinquent taxes in such a proceeding."


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