Bill Text: NY A01136 | 2023-2024 | General Assembly | Introduced

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Bill Title: Relates to the rights of parties involved in foreclosure actions; relates to the effect of discontinuance of actions based upon certain instruments related to real property.

Spectrum: Partisan Bill (Democrat 17-0)

Status: (Introduced) 2024-01-03 - referred to judiciary [A01136 Detail]

Download: New_York-2023-A01136-Introduced.html

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                STATE OF NEW YORK
        ________________________________________________________________________

                                          1136

                               2023-2024 Regular Sessions

                   IN ASSEMBLY

                                    January 13, 2023
                                       ___________

        Introduced by M. of A. WALKER, ANDERSON, BURGOS, CARROLL, DAVILA, DILAN,
          EICHENSTEIN,  EPSTEIN,  FALL,  GALLAGHER,  HUNTER,  PAULIN,  RAJKUMAR,
          REYES, RIVERA, D. ROSENTHAL, VANEL, WEPRIN -- read once  and  referred
          to the Committee on Judiciary

        AN  ACT  to  amend  the civil practice law and rules, in relation to the
          rights of parties involved in foreclosure actions

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:

     1    Section  1. Section 203 of the civil practice law and rules is amended
     2  by adding a new subdivision (i) to read as follows:
     3    (i) Clarification. Once a cause of action upon an instrument described
     4  under subdivision four of section two hundred thirteen of  this  article
     5  has accrued, no party may unilaterally waive, postpone, cancel, or reset
     6  the  accrual  thereof, or otherwise effectuate a unilateral extension of
     7  the limitations period prescribed by law to interpose the claim,  unless
     8  expressly permitted by law.
     9    §  2.  Section  206  of the civil practice law and rules is amended by
    10  adding a new subdivision (e) to read as follows:
    11    (e) Based on standardized mortgage instruments.  In an action to fore-
    12  close upon any uniform or model mortgage instrument  securing real prop-
    13  erty or any interest therein, as adopted by the federal  national  mort-
    14  gage  association  (Fannie  Mae), federal home loan mortgage corporation
    15  (Freddie Mac), or U.S.  Department  of  Housing  and  Urban  Development
    16  (HUD),  the time within which the action must be commenced and the claim
    17  interposed shall be computed from the time the right to demand immediate
    18  payment in full of all sums so secured thereby may be  exercised.    For
    19  purposes  of this subdivision only, there shall be a rebuttable presump-
    20  tion that all substantive conditions precedent to accrual of a cause  of
    21  action to foreclose upon any such mortgage instrument, if any, have been
    22  satisfied.  The  presumption  may  be  rebutted  by clear and convincing
    23  evidence. Nothing contained herein shall give rise  to  the  presumption

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD04666-01-3
        A. 1136                             2

     1  that  any  event  of default under the mortgage instrument has occurred,
     2  except for purposes of computation of the time within which  the  action
     3  must be commenced and the claim interposed.
     4    § 3. Subdivision (d) of rule 3217 of the civil practice law and rules,
     5  as  added  by section 29 of part J of chapter 62 of the laws of 2003, is
     6  amended to read as follows:
     7    (d) Effect of discontinuance of actions based upon certain instruments
     8  related to real property.  Unless effectuated in strict accordance  with
     9  the  applicable  provisions  of  article  seventeen of the general obli-
    10  gations  law,  the  discontinuance  of  an  action  upon  an  instrument
    11  described under subdivision four of section two hundred thirteen of this
    12  chapter, by any means, shall not, in form or effect:
    13    1.  act as a waiver, postponement, cancellation, resetting, or tolling
    14  of accrual of the cause of action;
    15    2. extend the limitations period prescribed by law  to  interpose  the
    16  claim; or
    17    3. automatically revoke or nullify an election of remedies made in any
    18  complaint.
    19    (e)  All  notices, stipulations, or certificates pursuant to this rule
    20  shall be filed with the county clerk by the defendant.
    21    § 4. This act shall take effect immediately; provided, however:
    22    a. for causes of action pursuant to subdivision (e) of section 206  of
    23  the  civil  practice  law and rules as added by section two of this act,
    24  having accrued prior to, and would be time barred immediately upon,  the
    25  effective  date  of this act, suits thereupon shall be commenced and the
    26  claims interposed within one year after this act  shall  have  become  a
    27  law; and
    28    b.  for causes of action pursuant to subdivision (e) of section 206 of
    29  the civil practice law and rules as added by section two  of  this  act,
    30  having accrued prior to the effective date of such section and for which
    31  less  than  one  year remains upon the applicable limitations period for
    32  the commencement of an action or proceeding thereupon, such suits  shall
    33  be  commenced  and  the claims interposed within one year after this act
    34  shall have become a law.