| Wells Fargo, N.A. v Savinetti |
| 2014 NY Slip Op 02428 [116 AD3d 765] |
| April 9, 2014 |
| Appellate Division, Second Department |
| Wells Fargo, N.A., Respondent, v Maria Savinetti,Respondent, and Shafer Zysman et al., Appellants, et al.,Defendants. |
—[*1] Rosicki, Rosicki & Associates, P.C. (Solomon & Siris, P.C., Garden City, N.Y. [BillTsevis], of counsel), for plaintiff-respondent. Mark Abrams, New York, N.Y., for defendant-respondent.
In an action, inter alia, to foreclose a mortgage and for a judgment declaring that acertain mortgage is a first lien against the subject property, the defendants Shafer Zysmanand Hal Mevorah appeal from an order of the Supreme Court, Queens County(McDonald, J.), entered May 21, 2012, which denied their motion for summary judgment(a) dismissing the amended complaint insofar as asserted against them, (b) declaring thatthey have a first lien on a parcel of real property owned by the defendant Maria Savinettilocated in Queens County and designated on the tax map of the City of New York asblock 14173, lot 56, and (c) on their second cross claim against the defendant MariaSavinetti to recover on a mortgage note.
Ordered that the order is affirmed, with one bill of costs.
In 2005, the defendant Maria Savinetti, the owner of the subject property, designatedblock 14173, lots 56 and 57, obtained a mortgage loan from Argent Mortgage Company,LLC, the plaintiff's assignor, which was recorded on June 27, 2005. The mortgagedocuments indicated that the mortgage only encumbered lot 57. In May 2006, Savinettiobtained a $300,000 loan from the defendants Shafer Zysman and Hal Mevorah(hereinafter together the moving defendants), secured by a mortgage on the subjectproperty encumbering lots 56 and 57. That mortgage was recorded on June 20, 2006. InOctober 2007, the plaintiff commenced this action to foreclose its mortgage, and in itsamended complaint, inter alia, sought to reform the mortgage to encumber both lot 56and lot 57 on the ground of mutual mistake and to declare its mortgage superior as toboth lots. The moving defendants moved for summary judgment (a) dismissing theamended complaint insofar as asserted against them, (b) declaring that they have a firstlien on lot 56, and (c) on their second cross claim against Savinetti to recover on theirmortgage note.[*2]
The Supreme Court properly denied that branchof the moving defendants' motion which was for summary judgment on their secondcross claim against Savinetti to recover on their mortgage note. The moving defendantsestablished their prima facie entitlement to judgment as a matter of law by submittingevidence of the existence of the note, executed by Savinetti, and proof of her default (see New York Commercial Bank vJ. Realty F Rockaway, Ltd., 108 AD3d 756 [2013]; European Am. Bank vSyosset Autorama, 204 AD2d 266 [1994]). In opposition, however, Savinetti raiseda triable issue of fact as to whether the moving defendants' loan to her constituted ahigh-cost home loan within the meaning of Banking Law § 6-l (1) (g), andwhether the loan conformed to the statutory requirements of such a loan (seeBanking Law § 6-l [2] [b], [k], [l] [i], [ii]; [2-a] [a]).
The Supreme Court also properly denied those branches of the moving defendants'motion which were for summary judgment dismissing the amended complaint insofar asasserted against them, and declaring that they have a first lien on that portion ofSavinetti's property designated as block 14173, lot 56. "Under New York's RecordingAct (Real Property Law § 291), a mortgage loses its priority to a subsequentmortgage where the subsequent mortgagee is a good-faith lender for value, and recordsits mortgage first without actual or constructive knowledge of the prior mortgage" (Washington Mut. Bank, FA v PeakHealth Club, Inc., 48 AD3d 793, 797 [2008]; see 2 Lisa Ct. Corp. v Licalzi,89 AD3d 721, 722 [2011]; Lend-Mor Mtge. Bankers Corp. v Nicholas, 69 AD3d 680[2010]). "[A] mortgagee is under a duty to make an inquiry where it is aware of facts thatwould lead a reasonable, prudent lender to make inquiries of the circumstances of thetransaction at issue" (MortgageElec. Registration Sys., Inc. v Rambaran, 97 AD3d 802, 804 [2012] [internalquotation marks omitted]). Here, the moving defendants demonstrated, prima facie, thatthey have a first lien with respect to lot 56 by submitting evidence that they were goodfaith lenders for value protected by Real Property Law § 291 (see generallyAlvarez v Prospect Hosp., 68 NY2d 320, 324 [1986]). However, in opposition, theplaintiff's submissions, including a title report obtained by the moving defendants inconnection with their mortgage loan to Savinetti, raised a triable issue of fact as towhether the moving defendants had a duty to inquire about whether the mortgagepreviously entered into between the plaintiff's assignor and Savinetti was intended toencumber the entirety of Savinetti's property, not merely that portion designated as block14173, lot 57 (see Real Property Law § 291; Booth v Ameriquest Mtge.Co., 63 AD3d 769, 769 [2009]; see also 89 Pine Hollow Rd. Realty Corp. v American TaxFund, 96 AD3d 995, 998 [2012]).
Savinetti's and the plaintiff's remaining contentions are either without merit or notproperly before this Court. Rivera, J.P., Lott, Roman and Cohen, JJ., concur.