UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NEW YORK
September 23, 1986
FRANK J. ESPOSITO, Plaintiff,
FEDERAL DEPOSIT INSURANCE CORPORATION, et al., Defendants
The opinion of the court was delivered by: GLASSER
MEMORANDUM AND ORDER
GLASSER, United States District Judge:
In a Memorandum and Order dated May 20, 1986, this Court granted defendant's motion to require plaintiff to post a bond in order to avoid cancellation of a notice of pendency that plaintiff had filed with respect to defendant's property.
This Court directed the parties to confer with respect to the amount of the bond. Because the parties have failed to agree on this issue, it will now be decided by the Court.
The purpose of the bond required to be posted by plaintiff is to indemnify defendant against any damages he may sustain if the notice of pendency is not cancelled. Chain Locations of America, Inc. v. T.I.M.E. - DC, Inc., 99 A.D.2d 111, 472 N.Y.S.2d 462, 464 (3rd Dept. 1984). Plaintiff, claiming that the value of the land at issue has increased substantially in the past two years and predicting that the market will continue to rise, argues that defendant will not be damaged by the continuation of the notice of pendency. Thus, he suggests that no bond or one for a minimal amount should be required. This suggestion, as defendant points out, ignores the fact that as long as the notice of pendency prevents defendant from selling the property, it is required to pay the costs of maintaining the property and to pay real estate taxes, and it is deprived of the use of money it would have received as proceeds from the ale. On the basis of these potential damages, the Court holds that plaintiff should be required to post a bond in the amount of $200,000.
In a typical case, the party seeking to have the notice of pendency cancelled should be required to post a bond sufficient to satisfy whatever monetary damages it might be obligated to pay if it is ultimately unsuccessful at trial. In the case, as the Court stated in its earlier decision, see id. at n. 3, because defendant is a governmental entity, it will not be required to post any bond. However, the Court has determined that a fair amount for that bond would also have been $200,000.
Plaintiff is directed to post a bond in the amount of $200,000 within ten (10) days from the date of this order. If no bond is posted, the defendant may submit an appropriate order cancelling the notice of pendency.
Dated: Brooklyn, New York
September 23rd, 1986
I. LEO GLASSER, United States District Judge