Summary
This Appellate Division, Second Department decision addresses an appeal by an intervenor in a mortgage foreclosure action seeking to set aside a foreclosure sale and recover its bid deposit. The court affirmed the lower court's orders, holding that the intervenor failed to demonstrate that the condominium association's post-judgment common charges rendered title unmarketable or that any fraud or misconduct warranted setting aside the sale. Additionally, the court dismissed the appeal from the denial of a cross-motion for leave to reargue, as no appeal lies from such an order, and awarded costs to the plaintiff.
Topics
Practice areas
Questions Presented
- Whether a purchaser at a foreclosure sale is entitled to a good, marketable title.
- Whether the foreclosure sale should be set aside and the bid deposit returned to the intervenor.
Holdings
- A purchaser at a foreclosure sale is entitled to a good, marketable title; marketable title is a title free from reasonable doubt, but not from every doubt.
- The foreclosure sale was not set aside and the bid deposit was not returned because Kami failed to demonstrate that the title was unmarketable or that any fraud, mistake, or misconduct occurred.
Key quotations
“As a general rule, a purchaser at a foreclosure sale is entitled to a good, marketable title.” (65 AD3d at 1116)
“A marketable title is "a title free from reasonable doubt, but not from every doubt".” (82 NY2d at 571)
Factual background
The plaintiff obtained a foreclosure judgment on March 29, 2018 and a foreclosure sale was held on Dec. 18, 2018, where Kami Holding Corp. was the winning bidder and tendered a $40,000 deposit. Kami failed to close the purchase. Kami later moved to set aside the sale, claiming that condominium association charges incurred after the judgment rendered the title unmarketable.
Procedural history
The plaintiff obtained a judgment of foreclosure and sale of a condominium unit. Kami Holding Corp. was the successful bidder at the foreclosure sale, tendered a $40,000 deposit, but failed to close. Kami moved to intervene and set aside the sale, alleging unmarketable title due to post‑judgment common charges. The Supreme Court denied those portions of Kami's motion, later deeming Kami in default and ordering release of the deposit to the plaintiff. Kami appealed the decisions.