Court Orders Nunc Pro Tunc Indexing
of Delinquent Mortgage
In a recent case, the Supreme Court of Nassau County ordered the Nassau County Clerk to “re-index” a mortgage being foreclosed “nunc pro tunc to December 9, 2005.” General Elec. Capital Corp. v Ocean Mar. Inc., et al. 2011 NY Slip Op 33154(U) (Sup. Ct. Nassau Cty., November 28, 2011).
The mortgage accurately described the property, but it was erroneously indexed against only one of three affected tax lots. The mortgagor and guarantor defendants argued that, due to the the defective indexing “this proceeding is defective by its terms and should be dismissed because it does not describe the property subject to the mortgage in proper terms.” In support of this position, counsel for the defendants submitted his own affidavit asserting that “it is the position of the County Clerk that, ‘[i]n order to foreclose all 3 lots...a new mortgage would have to be prepared and filed and a new 255 Affidavit would have to be prepared and filed concerning the payment of the mortgage recording tax.’” The affidavit goes on to state that "[a]n alternative procedure suggested by the County Clerk's Office would involve a court order ordering the prior mortgage recording be amended to include all 3 lots." (emphasis added).
The Court analyzes the facts, prior proceedings and applicable law. It concludes that the indexing error does not affect the Plaintiff's right to a judgment of foreclosure and sale. Despite this holding, the Court “directs that the records of the County Clerk be amended to reflect that the Mortgage is indexed against the appropriate lots” and issues an order to the County Clerk to do so.
It appears that the only subordinate lienor involved in the action was the “New York State Corporation Tax Processing Unit” which had previously defaulted. It seems unlikely that the nunc pro tunc order would have issued if an intervening interest would have been compromised. See Gletzer v. Harris, 12 NY 3d 468 (2009). It is interesting that alleged, unsupported assertions of the County Clerk, delivered in the form of a “hearsay affidavit,” appeared to influence the Court. While improper indexing might well prevent the foreclosure of subsequent bona fide purchasers, it presents no bar to foreclosing the mortgagor’s interest.