Opinion
No. 102394–09.
2010-07-22
MASON TENDERS DISTRICT COUNCIL WELFARE FUND, Pensions Fund, Annuity Fund, Training Fund, New York State Laborers–Employers Cooperation and Education Trust Fund, New York Laborers' Health and Safety Trust Fund and Building Contractors Association Industry Advancement Program and John J. Virga, in his fiduciary capacity as Director, and Steve Hammond, as Trustee of the Mason Tenders District Council of Greater New York, Plaintiffs, v. DIAMOND CONSTRUCTION & MAINTENANCE INC. and Joseph Gonzalez, Defendants.
PHILIP G. MINARDO, J.
Non-party Deutsche Bank National Trust Company, as Trustee, in Trust for the Registered Holders of Argent Securities Inc., Asset–Backed Pass–Through Certificate Series 2003–W8 (hereinafter referred to as “Deutsche Bank”), moves pursuant to CPLR § 5015(a)(4), to modify or vacate the renewal judgment entered by this Court in this action dated January 11, 2010.
Plaintiffs MASON TENDERS DISTRICT COUNCIL WELFARE FUND, PENSION FUND, ANNUITY FUND, TRAINING FUND, NEW YORK STATE LABORERS–EMPLOYERS COOPERATION AND EDUCATION TRUST FUND, NEW YORK LABORERS' HEALTH AND SAFETY TRUST FUND AND BUILDING CONTRACTORS ASSOCIATION INDUSTRY ADVANCEMENT PROGRAM and JOHN J. VIRGA, in his fiduciary capacity as Director, and STEVE HAMMOND as Trustee of the MASON TENDERS DISTRICT COUNCIL OF GREATER NEW YORK (hereinafter, “MASON TENDERS”) commenced this action, seeking renewal of its judgment entered against the defendants DIAMOND CONSTRUCTION and MAINTENANCE INC. and JOSEPH GONZALEZ. Plaintiff MASON TENDERS had docketed a judgment against the defendants on or about October 19, 1999 with the County Clerk, Richmond County, NY, which was entered on June 30, 1998 in the amount of $869,504.86. In 2009, the plaintiffs MASON TENDERS initiated the instant renewal action to extend their lien for an additional ten (10) years. This Court granted plaintiff's application extending their judgment lien nunc pro tunc from June 30, 2008 for ten (10) additional years.
Before plaintiffs MASON TENDERS commenced this renewal action, Deutsche Bank had brought a foreclosure action against the defendant in an action entitled Deutsche Bank v. JOSEPH GONZALEZ, and MASON TENDERS, under Index No.101489–08. The facts of the foreclosure action are as follows; Argent Mortgage Company, LLC obtained a mortgage from defendants Joseph and Jennifer Gonzalez for $499,900.00 on or about September 24, 2003 which was recorded on January 27, 2004 and assigned to Deutsche Bank National Trust Company on or about March 31, 2008. This $499,900.00 mortgage was used to satisfy the balance of the Staten Island Savings Bank's prior mortgage, which was recorded prior to MASON TENDERS' judgment lien. A title insurance policy was obtained by Argent Mortgage Company, LLC through Old Republic Title Insurance Company which retained Richmond Abstract Corp. to act as its agent. A judgment and lien search was made against defendant JOSEPH GONZALEZ which revealed six judgments. Deutsche Bank contended it was determined that the judgments against JOSEPH GONZALEZ were not against this particular defendant JOSEPH GONZALEZ, but that was an error, in that one of said judgments was obtained by MASON TENDERS in the amount of $869,504.086 against this defendant JOSEPH GONZALEZ. Deutsche Bank moved for a judgment of foreclosure and sale of the property and a declaration that its mortgage has priority over defendant MASON TENDERS judgment. It was Deutsche Bank's contention that MASON TENDERS judgment on the subject property expired ten (10) years after it was docketed, i.e. on June 30, 2008 and said lien had not been renewed.
It was at this time that the plaintiff MASON TENDERS moved for a renewal of its judgment for another ten year period. The Court granted plaintiff's renewal judgment in the amount of $869,504.86 nunc pro tunc from June, 30, 2008 in an order dated January 11, 2010. However, in this renewal action MASON TENDERS did not name Deutsche Bank as a party defendant. Deutsche Bank contends that it did not have notice that such nunc pro tunc relief had been awarded by the Court until it was included in a footnote in the Decision and Order concerning the foreclosure action dated January 29, 2010 and entered on February 17, 2010 (Index No.101489–08). Deutsche Bank contends that this retroactive relief should not have been awarded by the Court in view of the absence of any such specific request by MASON TENDERS to do so, and in the absence of Deutsche Bank as a party defendant. Deutsche Bank further contends that by renewing MASON TENDERS judgment nunc pro tunc from June 30, 2008, the Court has adversely affected the rights of Deutsche Bank by effectively subordinating its mortgage lien to the renewal judgment without Deutsche Bank being given the opportunity to be heard and depriving Deutsche Back of its property rights without due process of law. Thus, Deutsche Bank requests this Court to modify the renewal judgment by deleting the words nunc pro tunc from June 30, 2008, or alternatively, vacate the renewal judgment in its entirety. Plaintiff MASON TENDERS opposes Deutsche Bank's motion, claiming that the Court did not lack jurisdiction over the renewal action because Deutsche Bank was not a necessary party to the action and the judgment would not have been any different had Deutsche Bank been a party to the action. Alternatively, plaintiff MASON TENDERS contends that even if Deutsche Bank had been a necessary party that would not have deprived the Court of jurisdiction over the action.
New York courts have considered a non-party necessary when their property rights will be adversely and inequitably affected. (Tecler v. Lake George Park Commission, 261 A.D.2d 690 [3d Dep't 1999] ). The Court of Appeals has determined that it is “the general policy of the Civil Practice Law and Rules to limit the scope of indispensable parties to those cases and only those cases where the determination of the court will adversely affect the rights of nonparties.” ( In the Matter of Castaways Motel v. C.V.R. Schuyler, as Commissioner of General Services of the State of New York, 24 N.Y.2d 120;247 N.E.2d 124 [1969] ). The Court in In the Matter of Castaways Motel reasoned that even though the Power Authority's interest may have been affected by the action, it was not inequitably affected, and concluded that the Power Authority was not a necessary party to the action. ( Id.)
Because a lien on real property is only effective for ten (10) years and a money judgment is viable for 20 years, the Legislature enacted CPLR § 5014 to allow a judgment creditor to apply for a renewal of the judgment lien. (Gletzer v. Harris, 12 NY3d 468[2009] ). New York courts have determined that the legislature's intent was that the renewal lien does not stand apart from, but it is a continuation of, the original lien. (In re Buchardt, 114 B .R. 362, 364 [N.D.NY 1990] ). Thus, the lien resulting from an action on the judgment pursuant to CPLR § 5014 was not intended to create, and does not create, on the part of the creditor any new property rights in the judgment debtor's property. ( Id. at 365).
In the instant action, Deutsche Bank's interest in the defendant JOSEPH GONZALEZ's property was in no way affected by the renewal action proceeding without Deutsche Bank being present. The renewal of the property lien is a continuation of the original lien that was already in place at the time Deutsche Bank's predecessor granted the defendant a mortgage. Plaintiff MASON TENDERS' judgment maintained priority over Deutsche Bank's mortgage because the mortgage assumed by Deutsche Bank was obtained and recorded with full notice and knowledge MASON TENDERS prior recorded lien. In fact, this Court concluded in the foreclosure action brought by Deutsche Bank that whether or not MASON TENDERS' renewal judgment is granted nunc pro tunc relief, is of no effect on its priority standing. Therefore, the inclusion of nunc pro tunc in the renewal does not inequitably affect Deutsche Bank, and as such they are not a necessary party.
While the New York Court of Appeals has previously determined that the court should not automatically give retroactive effect to a renewal judgment, it is still permitted. ( see Gletzer, 12 NY3d at 474. In Gletzer, the Court refused to allow the renewal lien nunc pro tunc treatment because additional lenders relying on the public record acquired rights in the property during the lien gap period. ( Id.). However, in the instant case Deutsche Bank's predecessor did not grant the defendant JOSEPH GONZALEZ a mortgage during the gap between the expiration and renewal of the lien, rather the Deutsche Bank mortgage was given during MASON TENDERS first ten (10) year lien period (approximately 4 years post filing of the lien), and thus MASON TENDERS' judgment and lien has priority over Deutsche Bank's mortgage. Therefore, the concerns expressed by the court in Gletzer are not involved in this case in that Deutsche Bank's mortgage was not recorded during the gap. It was within the Court's discretion to grant the renewal lien nunc pro tunc, and since Deutsche Bank was not a necessary party to the action their absence does not necessitate the modification of the Order.
Accordingly, it is
ORDERED that Deutsche Bank's motion to modify/vacate this Court's prior order granting a renewal judgment nunc pro tunc dated January 11, 2010 is denied.
This shall constitute the decision and order of the Court.