Robert B. Gitlin for plaintiff and third-party plaintiff.
Saperston & Day (Bruce S. Zeftel of counsel), for Bank of New York,
Darweesh, Callen, Lewis & Von Dohlen (Joseph N. Darweesh of counsel), for Richard E. Wolpert and another, third-party defendants.
Raymond E. Cornelius, J.
On February 16, 1995, a warranty deed, dated February 10, 1995, was filed in Liber 8578 of Deeds at page 409 of the Monroe County Clerk's office, whereby certain property in the City of Rochester, known as 115-119 Lydia Street, was conveyed to Richard A. Ranalletta (emphasis added). On December 13, 1995, this record owner executed a promissory note, made payable to Richard E. Wolpert and Carol Soefing, in the amount of $50,032, which was to be payable within a one-year period or upon sale of the property at 115-119 Lydia Street, whichever event occurred first. In order to secure this indebtedness, a mortgage, dated December 4, 1995, was executed and recorded on December 8, 1995, in Liber 12781 of Mortgages at page 57. However, this document named the mortgagor as Richard A. Ranaletta (emphasis added).
On April 10, 1996, Richard A. Ranalletta granted two mortgages to FHB Funding Corp., each to secure an indebtedness in the amount of $55,300. One mortgage was recorded in the Monroe County Clerk's office on April 17, 1996, in Liber 12915 of Mortgages at page 57, for premises at 115 Lydia Street, and the other mortgage was also recorded on April 17, 1996, in the Monroe County Clerk's office, in Liber 12915 of Mortgages at page 166, for property located at 119 Lydia Street. Public Abstract Company had conducted a title search prior to acceptance of the mortgages and the making of the loans by FHB Funding Corp. This search failed to disclose the mortgage granted to Richard E. Wolpert and Carol Soefing by Richard A. Ranaletta, and there is no evidence to suggest actual knowledge of this lien on the part of FHB Funding Corp.
On September 22, 1998, a foreclosure action (index No. 98-10026) was commenced by Richard E. Wolpert and Carol Soefing by filing of a summons and complaint. This action was based upon the claim that there had been a default in payment on the underlying promissory note. In addition to the defendant Richard A. Ranalletta, the summons and complaint named the Bank of New York, as trustee under the Pooling and Service Agreement dated as of May 31, 1996 Series 1996-B (Bank of New York), which had become an assignee of the mortgage previously granted to FHB Funding Corp.
Following commencement of the foreclosure action, Joseph Coco allegedly purchased the interests of Richard E. Wolpert and Carol Soefing, in both the mortgage and existing cause of action, for the amount of $42,744. An assignment of mortgage, dated December 28, 1998, was recorded the same date in the Monroe County Clerk's office. Thereafter, Joseph Coco became the named plaintiff in the foreclosure action, and on January 4, 1999, counsel, on his behalf, made an ex parte application for an order of reference to compute the amount owed on the mortgage. Another Supreme Court Justice issued an order of reference on January 5, 1999, but before a report could be submitted to the court, counsel was contacted by an attorney, on behalf of the defendant Bank of New York. Although this defendant had failed to interpose an answer to the summons and complaint in the foreclosure action, an agreement was reached whereby an answer would be accepted on behalf of the plaintiff. Accordingly, there is no merit to plaintiff's position that the Bank of New York should be estopped from asserting any affirmative defense or counterclaim.
The answer of the defendant Bank of New York contains an affirmative defense and counterclaim, asserting lack of actual or constructive notice of the mortgage granted to Richard E. Wolpert and Carol Soefing, and a claim that the mortgage, granted to FHB Funding Corp., should be declared a superior lien. The Bank of New York has now made a motion for summary judgment, requesting dismissal of the complaint, and in accordance with the declaratory judgment action contained in the counterclaim, an order declaring the mortgage, now held by the Bank of New York, to be superior to the mortgage, subject of the foreclosure action. A cross motion for summary judgment has been submitted, on behalf of Joseph Coco, requesting a judgment against the defendant Bank of New York.
In addition to the foregoing, an action was commenced by Joseph Coco, identified as third-party plaintiff, against Richard E. Wolpert and Carol Soefing, identified as third-party defendants, under the same index number as the foreclosure action. This action seeks rescission of the agreement between these parties, which had resulted in assignment of the mortgage, based upon a claim of mutual mistake of fact. A motion for summary judgment has also been made on behalf of Joseph Coco, in this action, in the event that the ...