| Solar Line, Universal Great Bhd., Inc. v Prado |
| 2012 NY Slip Op 07982 [100 AD3d 862] |
| November 21, 2012 |
| Appellate Division, Second Department |
| Solar Line, Universal Great Brotherhood, Inc.,Respondent, v Valdemar Prado et al., Defendants, and Accredited Home Lenders, Inc.,Appellant. |
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In an action, inter alia, for a judgment declaring that a deed and a mortgage are void, thedefendant Accredited Home Lenders, Inc., appeals, as limited by its brief, from (1) so much of anorder of the Supreme Court, Kings County (Knipel, J.), dated April 20, 2010, as granted thatbranch of the plaintiff's motion which was, in effect, for summary judgment declaring that thedeed is void, and (2) so much of an order of the same court dated October 18, 2010, as deniedthat branch of its motion which was for leave to reargue its opposition to that branch of theplaintiff's motion and, in effect, denied that branch of its motion which was, in effect, forsummary judgment declaring that its mortgage is not void.
Ordered that the order dated April 20, 2010, is affirmed insofar as appealed from, withoutcosts or disbursements; and it is further,
Ordered that the appeal from so much of the order dated October 18, 2010, as denied thatbranch of the appellant's motion which was for leave to reargue is dismissed, without costs ordisbursements, as no appeal lies from an order denying reargument; and it is further,
Ordered that the order dated October 18, 2010, is affirmed insofar as reviewed, without costsor disbursements.
The defendant Accredited Home Lenders, Inc. (hereinafter AHL), contends that the SupremeCourt erred in granting that branch of the plaintiff's motion which was, in effect, for summaryjudgment declaring that a deed executed by the defendant Valdemar Prado conveying to himselfcertain real property owned by the plaintiff, a not-for-profit corporation, is void. The plaintiffestablished that the deed is void on the ground that Prado did not obtain court approval for thetransfer and, thus, the transfer violated Not-For-Profit Corporation Law §§ 510 and511, which require Supreme Court approval for the disposition of all or substantially all of theassets of a not-for-profit corporation. Contrary to AHL's contention, the plaintiff showed that it isa duly registered not-for-profit corporation and that the transferred property constitutes all orsubstantially all of the plaintiff's assets. In opposition, no triable issues of fact were raised.[*2]
AHL further contends that the Supreme Court erred indetermining that its mortgage, which was based on the void deed, is also void. This contention iswithout merit. "If documents purportedly conveying a property interest are void, they conveynothing, and a subsequent bona fide purchaser or bona fide encumbrancer for value receivesnothing" (First Natl. Bank of Nev. vWilliams, 74 AD3d 740, 742 [2010], citing Marden v Dorthy, 160 NY 39, 48[1899]; see GMAC Mtge. Corp. vChan, 56 AD3d 521, 522 [2008]; Yin Wu v Wu, 288 AD2d 104, 105 [2001];Kraker v Roll, 100 AD2d 424, 430-431 [1984]; see also Ameriquest Mtge. Co. v Gaffney, 41 AD3d 750, 751[2007] ["one consequence of a void deed would be that (a subsequent transferee) cannot claimthe protected status of bona fide purchaser because nothing would have been conveyed to it"]).AHL contends that it was a subsequent good faith encumbrancer for value and, thus, protectedunder Real Property Law § 266. However, a bona fide encumbrancer is only protectedwhen the challenged conveyance is voidable, not when it is void (see Anderson v Blood,152 NY 285 [1897]; Yin Wu v Wu, 288 AD2d at 105; Kraker v Roll, 100 AD2d424 [1984]). Here, the Supreme Court determined that the deed is void. Thus, the interests ofsubsequent bona fide purchasers or encumbrancers for value are not protected under RealProperty Law § 266.
AHL also contends that the Supreme Court erred in determining that the deed is void,inasmuch as the deed is capable of ratification. In this regard, AHL correctly points out thatReligious Corporations Law § 12 provides an exception to the statutory requirement ofobtaining leave of the court by permitting the court to confirm a conveyance after the sale hasbeen made and the conveyance executed and delivered (see Religious Corporations Law§ 12 [9]; Church of God of Prospect Plaza v Fourth Church of Christ, Scientist, ofBrooklyn, 54 NY2d 742 [1981]; Matter of Yancey [New Chapel Baptist Church],307 NY 858 [1954]). However, that statute does not apply here since the plaintiff is not areligious corporation (see Cuomo v Daniels, 25 Misc 3d 1226[A], 2009 NY Slip Op52304[U] [2009]; see also Rose Ocko Found. v Lebovits, 259 AD2d 685, 688 [1999]).Skelos, J.P., Balkin, Leventhal and Sgroi, JJ., concur.