In a November 28, 2011 decision by Justice Driscoll, the court granted plaintiff lender’s motion for judgment of foreclosure and sale and an order of reference. In 2005, the lender, GE Capital Corp., loaned $1 million to defendant, a marina located in Freeport, NY. The loan was secured by a mortgage on three properties. In addition, the individual defendants each signed a commercial guaranty. The Note required defendants to pay all real estate taxes associated with the property, and contained an acceleration clause in the event of default by the borrower.
Defendants failed to pay the 2009 and 2010 real estate taxes, and ultimately the lender accelerated the payments due under the Note which, by the time of acceleration, amounted to $988,736.
On the motion, the defendants did not contest the signing of the Note or that the they intended to mortgage the three lots, but rather that the mortgage recording was defective because of improper indexing by the office of the County Clerk. As such, foreclosure should be denied.
In granting the judgment of foreclosure, the court held that the lender established a prima facie right to entitlement to a judgment of foreclosure. Such right, held the court, is not defeated by an indexing error by the County Clerk. Accordingly, the court directed entry of judgment of foreclosure, and directed the County Clerk to amend the records to re-index the mortgage as it was intended.
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General Electric Capital Corp. v. Ocean Marine Inc., Sup Ct, Nassau County, Nov. 28, 2011, Driscoll J, Index No. 002278/2011.