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Religious Corporation Law May Bar Action to Foreclose on Promissory Note, Daniel Perla Assoc., LP v Cathedral Church of St. Lucy

Posted in Breach of Promissory Note, Justice Driscoll, Timothy, Nassau, Summary Judgment in lieu of Complaint

In a March 21, 2011 decision by Justice Driscoll the Court denied plaintiff’s motion for summary judgment in lieu of complaint and granted defendant’s cross motion to transfer the litigation from Nassau County to Kings County. The action arose out of a mortgage and promissory note encumbering church property. The church failed to make payments. Plaintiff (and his assignors) previously brought an action in Kings County to foreclose on the loan. That litigation was dismissed because the church failed to obtain court approval prior to encumbering its property, as required by the Religious Corporations Law. 

Plaintiff brought another action in Nassau County and sought summary judgment in lieu of complaint, arguing that this action arose from the “note” and not the “mortgage” so the action was not barred by the Religious Corporations Law. Defendant moved to dismiss or in the alternative to have the action transferred to Kings County before the judge who dismissed the prior action based on the Religious Corporations Law. The Court granted defendants motion to transfer venue and provided that the Kings County justice would rule on the other motions.

Daniel Perla Assoc., LP v Cathedral Church of St. Lucy, Sup Ct, Nassau County, March 21, 2011, Driscoll, J., Index No. 016453.