| Manufacturers & Traders Trust Co. v Foy |
| 2007 NY Slip Op 06840 [43 AD3d 1005] |
| September 18, 2007 |
| Appellate Division, Second Department |
| Manufacturers & Traders Trust Company,Respondent, v Lawrence B. Foy et al., Appellants, et al., Defendants. MohammedKezadri et al., Nonparty Respondents. |
—[*1] Rosicki, Rosicki & Associates, P.C., Plainview, N.Y. (Edward Rugino of counsel), forrespondent. Sanford Solny, New York, N.Y., for nonparty respondents.
In an action to foreclose a mortgage, the defendants Lawrence B. Foy and Jeirlynn Foyappeal from an order of the Supreme Court, Kings County (Dabiri, J.), dated January 27, 2006,which, in effect, denied the defendant Jeirlynn Foy's motion to vacate a foreclosure sale and staytransfer of the deed, and authorized the referee to transfer the deed to the subject property.
Ordered that the appeal by the defendant Lawrence B. Foy is dismissed, as that defendant isnot aggrieved by the order appealed from (see CPLR 5511); and it is further,
Ordered that the order is affirmed, with one bill of costs payable to the respondents appearingseparately and filing separate briefs.
After the defendants Lawrence B. Foy and Jeirlynn Foy defaulted on their mortgage inDecember 1999 the plaintiff commenced this foreclosure action. Between March 2000 andJanuary 2004, Lawrence B. Foy filed three Chapter 13 bankruptcy petitions, and Jeirlynn Foyfiled two Chapter 13 bankruptcy petitions, all of which were ultimately dismissed. AfterLawrence B. Foy filed his third Chapter 13 petition, the plaintiff moved in that proceeding forrelief from the automatic bankruptcy stay, and a determination that "any future filings by thedebtor and/or [the] co-mortgag[or] and any person or occupant with an interest in the premiseswithin one hundred eighty (180) days from the entry of the order lifting the automatic stay, shallnot operate as an automatic stay against movant, except upon separate, proper application to thecourt." Neither Lawrence B. [*2]Foy nor Jeirlynn Foy opposedthe motion, and it was granted by the United States Bankruptcy Court for the Eastern District ofNew York in an order dated April 21, 2004.
A foreclosure sale was subsequently conducted on September 16, 2004 and closing wasscheduled to take place on March 4, 2005. However, prior to the transfer of title to the successfulbidders, Jeirlynn Foy moved to vacate the foreclosure sale and stay transfer of the deed upon theground that she had filed a third Chapter 13 bankruptcy petition on September 14, 2004 resultingin an automatic stay of the foreclosure action. In opposition to the motion, the plaintiff and thebidders pointed out that pursuant to the Bankruptcy Court order dated April 21, 2004, any filingsby either Lawrence B. Foy or Jeirlynn Foy within 180 days of its entry would not operate as anautomatic stay against the plaintiff. Although the Supreme Court initially held Jeirlynn Foy'smotion in abeyance pending receipt of proof that the plaintiff had served her with a copy of theBankruptcy Court order, it subsequently denied her motion, concluding that there was norequirement that she be served with the Bankruptcy Court order pursuant to the Federal Rules ofBankruptcy Procedure.
The Supreme Court properly denied Jeirlynn Foy's motion to vacate the foreclosure sale.Although the United States Bankruptcy Code provides for an automatic stay of all nonbankruptcyactions and proceedings effective immediately upon filing of a bankruptcy petition (see11 USC § 362 [a]; Carr vMcGriff, 8 AD3d 420, 422 [2004]), a bankruptcy court has jurisdiction to terminate,annul, or modify the automatic stay (id.). Here, the Bankruptcy Court's order dated April21, 2004, afforded the plaintiff relief from the automatic stay which became effective uponLawrence B. Foy's third bankruptcy filing, and provided that any future filings by him orco-mortgagor Jeirlynn Foy, within 180 days of entry of the order, would not operate as anautomatic stay against the plaintiff, except upon separate and proper application to theBankruptcy Court. Since the bankruptcy petition filed by Jeirlynn Foy on September 14, 2004was filed within 180 days of the entry of the Bankruptcy Court order, and it is undisputed that shedid not apply to the Bankruptcy Court for a stay barring the plaintiff from proceeding in thisaction, the foreclosure sale conducted on September 16, 2004, was valid. Moreover, the plaintiffwas not required to serve the Bankruptcy Court order upon the plaintiff in order to give it effect(see Fed Rules Bankr Proc rule 9022).
Furthermore, under the circumstances of this case, the Supreme Court properly considered aletter submitted by the plaintiff's attorney in response to its initial order holding the motion inabeyance. Copies of the letter were sent to the attorney representing Jeirlynn Foy, the attorneyrepresenting the bidders, and the referee, and Jeirlynn Foy had an ample opportunity to respondto it. Mastro, J.P., Covello, McCarthy and Dickerson, JJ., concur.