New York Real Estate Lawyer Blog

Attorneys in New York are keenly aware of the new representations, but do consumers know how seriously the New York State Legislature is taking the mortgage foreclosure crisis?

The Office of Court Administration sets forth the Proposed Language and Provides consumers with the following warning:

N.B.: During and after August 2010, numerous and widespread insufficiencies in foreclosure filings in various courts around the nation were reported by major mortgage lenders and other authorities. These insufficiencies include: failure of plaintiffs and their counsel to review documents and files to establish standing and other foreclosure requisites; filing of notarized affidavits which falsely attest to such review and to other critical facts in the foreclosure process; and “robosignature” of documents by parties and counsel. The wrongful filing and prosecution of foreclosure proceedings which are discovered to suffer from these defects may be cause for disciplinary and other sanctions upon participating counsel.

Simultaneously, the Govenor has agreed to permit homeowners the opportunity to seek attorneys fees. Generally, unless a contract provides or a statute states that counsel fees are available, such fees are not recoverable in New York. To encourage homeowners to vigorously protect their rights, New York has now enacted, Real Property Law §282, which retroactively inserts a statutory provision permitting attorneys fees in where homeowners successfully prevail in defeating their mortgage agreements. Although it goes into effect 60 days after its signing, it applies to all mortgages in effect on or after Oct. 20 and all proceedings begun on or after that date.

Although it is early, such a law may encourage attorneys to volunteer their services to homeowners facing foreclosure, many of them who cannot afford to hire their own lawyers. Homeowners may also benefit by gaining leverage to negotiate concessions from lenders seeking to avoid the potential costs of litigation.

One thing is for sure-- New York's not-for-profits and mortgage counselors (flooded with these cases) may start gaining traction for their defenses.

We will see.

Did you know that if a landlord includes a provision in the lease that awards fees to the landlord in a summary eviction proceeding, the tenant may also be entitled (as a matter of statutory law) to seek attorney's fees?

Real Property Law § 234 provides:

Whenever a lease of residential property shall provide that in any action or summary proceeding the landlord may recover attorneys' fees and/or expenses incurred as the result of the failure of the tenant to perform any covenant or agreement contained in such lease ... there shall be implied in such lease a covenant by the landlord to pay the tenant the reasonable attorneys' fees and/or expenses incurred by the tenant as the result of the failure of the landlord to perform any covenant or agreement on its part to be performed under the lease or in the successful defense of any action or summary proceeding commenced by the landlord against the tenant arising out of the lease.

Bottom Line-- Review your lease. If your landlord puts a fees provision in the lease, and you have a problem, you may be entitled to recover your fees too.