| Wells Fargo Bank Minn., N.A. v Garrasi |
| 2011 NY Slip Op 00331 [80 AD3d 1061] |
| January 20, 2011 |
| Appellate Division, Third Department |
| Wells Fargo Bank Minnesota, National Association, asTrustee under the Pooling and Servicing Agreement Dated September 1, 1999, Home EquityLoan Asset Backed Certificate Series 1999-3, Appellant, v Robert Garrasi,Respondent. |
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Stein, J. Appeal from an order of the Supreme Court (Connolly, J.), entered April 27, 2010 inAlbany County, which, among other things, granted summary judgment to defendant on hiscounterclaim.
In April 1999, a husband and wife executed two mortgage notes, one in the amount of$51,750 and the second in the amount of $13,800. The mortgage securing the $13,800 note wasfiled first and the mortgage securing the $51,750 note was filed immediately thereafter.Ultimately, Provident Bank became the holder of the $51,750 note and mortgage. Providentcommenced foreclosure proceedings in 2002 without naming as a party or otherwise notifyingthe holder of the $13,800 mortgage. In 2004, Provident's mortgage was foreclosed upon and thesubject property was [*2]sold at public auction pursuant to ajudgment of foreclosure and sale. Plaintiff was assigned the bid by Provident at auction andthereafter purchased the property and received a referee's deed. Subsequently, the $13,800mortgage was assigned to defendant.
Plaintiff commenced this action requesting, among other things, a judgment declaring that itsmortgage had first priority over defendant's mortgage and demanding that defendant eitherredeem the property or commence an action for foreclosure. Defendant interposed a counterclaimrequesting, among other things, a judgment dismissing the complaint and recovery of the amountdue on the $13,800 note and mortgage. Both parties then moved for summary judgment, eachasserting that their mortgage had priority over the other. Supreme Court denied both motions,determining that the mortgages were of equal priority. Defendant subsequently moved again forsummary judgment on different grounds and that motion was also denied. Eventually, defendantmoved to amend his answer to assert various affirmative defenses. Plaintiff cross-moved forequitable relief, requesting that Supreme Court direct defendant to execute a discharge of the$13,800 mortgage so that the property could be sold and the proceeds distributed to the parties intheir proportionate shares. Supreme Court denied defendant's motion and plaintiff's cross motion.However, Supreme Court determined that, inasmuch as plaintiff's cross motion essentially soughta judgment disposing of the case, it was akin to a motion for summary judgment. The court,therefore, searched the record, granted judgment to defendant and directed plaintiff to sell theproperty and to pay defendant's mortgage first in its entirety from the proceeds. Plaintiff nowappeals and we affirm.
Plaintiff argues that Supreme Court erred when it granted judgment to defendant sua spontewithout giving notice to plaintiff that it was considering such relief. Although a court may notgenerally grant summary judgment sua sponte in the absence of a motion pursuant to CPLR 3212(see Ressis v Mactye, 98 AD2d 836, 837 [1983]; see generally Vinder v ShowbranLeasing & Mgt., 298 AD2d 325, 326 [2002]), in certain circumstances, a court may grantsuch relief, even if it is not demanded, so long as there is no substantial prejudice to the adverseparty (see Berle v Buckley, 57AD3d 1276, 1277 [2008]; Ressis v Mactye, 98 AD2d at 837). In such cases, we haverequired that the court give notice to the parties that summary judgment is being considered as aremedy, so that they may develop evidence and offer proof in support of or in opposition to themotion (see Berle v Buckley, 57 AD3d at 1277; Barrett v Watkins, 52 AD3d 1000, 1003 [2008]; Ressis vMactye, 98 AD2d at 837).
Here, Supreme Court determined that defendant was entitled to judgment in his favorbecause, even if the parties' mortgages were initially contemporaneous and of equal priority (asthat court concluded in determining the parties' prior summary judgment motions), plaintiff'smortgage was satisfied when it purchased the subject property at the foreclosure sale, leavingonly defendant's mortgage remaining. Indeed, it is well settled that plaintiff's mortgage wasextinguished when it purchased the subject property at the foreclosure sale (see WhitestoneSav. & Loan Assn. v Allstate Ins. Co., 28 NY2d 332, 336 [1971]). In the instant matter,defendant arguably raised this legal principle in his answer to the complaint and the parties havealready had the opportunity to lay bare their proof in the context of the prior summary judgmentmotions. In that regard, Supreme Court could have reached the same result that plaintiff nowchallenges when it determined such motions. In addition, defendant argued, in response toplaintiff's current cross motion, that his mortgage should be paid in full and he articulated, as abasis for his position, the extinguishment of plaintiff's mortgage in his reply affidavit and at oralargument on the motions. At no time did plaintiff request an opportunity to submit [*3]additional proof in opposition. Even on appeal, plaintiff has failedto indicate what additional proof it would have submitted to Supreme Court had it been placedon notice that the court was considering its motion as one for summary judgment. In fact, asrelevant here, the parties agree that no questions of fact remain. Under these particularcircumstances, we cannot discern any purpose that would have been served by giving plaintiffnotice of Supreme Court's intent and there is no evidence that plaintiff has been substantiallyprejudiced by its determination (compare Ressis v Mactye, 98 AD2d at 837).Accordingly, we decline to disturb it.
Plaintiff's remaining contentions have been considered and found to be unavailing.
Cardona, P.J., Mercure, Malone Jr. and Garry, JJ., concur. Ordered that the order is affirmed,with costs.