Real Estate Litigation

March 15, 2011

What is Title Insurance and Why is it Such a Hot Topic in New York?

Almost universally as a house closing or refinance closing approaches, I am asked why the itemized cost for “title insurance” is so high. Sometimes, clients even tell me that they do not have to pay for “title insurance” because they are putting more than twenty percent down, but have confused Private Mortgage Insurance (PMI) with “title insurance.” So, what is title insurance and why do you need it?

To begin with, PMI is insurance designed to protect lenders against losses should the borrower default, and is required by lenders for virtually all borrowers who put less than twenty percent (20%) down. It has nothing to do with who owns or has “title” to the property, and who insures that no one is going to claim against it.

Title insurance is a contract where an insurer guarantees a lender or a home owner that there are no known claims or defects in title caused by past events such as mortgages, liens, or possession of property by another person not the owner. Title insurance companies search public records to develop and document the chain of title and to detect known claims (defects) in the title. For example, the title search may identify an old home equity loan that is still outstanding or that a contracting firm filed a mechanics lien against the owner years before. If they missed those defects, then the title insurance company would pay to have them fixed, even if it meant litigation.

March 13, 2011

Home Improvement Protections Exist in New York, Use Them.

by Peter Klose

Do you hire a doctor or a lawyer without checking their licenses, their pedigree, and their referrals? So, why is it that when it comes to investing in their greatest asset (the home), so many people become victims of dishonest contractors who demand large advance payments for projects, and then fail to complete the work fully or competently. What are your rights.

In Rockland County, there are several resources designed to protect us from unscrupulous home improvement contractors. The first, Rockland County Code, Section 286, empowers the Office of Consumer Protection to license and regulate nearly all home improvement contractors and transactions. [Rockland County Law can be found at http://www.ecode360.com/?custId=RO1021, Chapter 286].

The comprehensive law covers everything from licensing individual contractors; (286-7) the contents of home improvement contracts (286-12); the prohibited acts (286-10); the penalties for not complying with the law (286-21); and the powers of the Board. While the nuances of such law are complex, the goal is to provide minimum standards to avoid the main problems that homeowners have with contractors.

February 14, 2011

When is a “sign” not a Sign in the Village of Rhinebeck, New York?

by Peter Klose

[Dutchess County, New York]. When is a television monitor a “sign,” under Rhinebeck Zoning Enforcement Regulations. That is a battle being waged between our client and the Village of Rhinebeck, New York. Since this is a pending matter, we will permit the Poughkeepsie Journal newspaper account to speak for itself.

Bottom Line– The First Amendment of the US Constitution is a powerful tool, supported by the New York State Constitution which provides even broader protection to freedom of speech.

Judge for Yourself

December 6, 2010

Recent Case–Can Parking on a Public Street be a Nuisance in New York?

by Peter Klose

In what should be an interesting trial in Rockland County, New York, the Second Department, (appellate court) recently sent a

January 11, 2010

Tools to Grieve your Taxes Exist– the Government Provides Them in Dutchess County, New York.

by Peter Klose

Real Property Taxes are at the front of everyone’s mind these days because property values in New York have declined so dramatically. Did you know that the tools to grieve your taxes are often right at your finger tips.

For example, in Dutchess County, the Real Property Tax Service Agency’s Parcel Access system provides tax assessment information for your parcel and your neighbor’s parcel, including development plans, property tax estimates and other information supplied by local municipal governments. Updated twice a year to coincide with the submission of Tentative Assessment Rolls every May and every July of each year, the Parcel Access allows Search Tools by type of property, name of debtor, and by map.

The website’s main objective is to function as a tool for real estate buyers and sellers to have access to and view assessment information. If a seller disagrees with a listed assessment, however, value the home owner may “grieve” those taxes by seeking a review first by the assessor and then by a formal review with the Board of Assessment Review.

January 7, 2010

Adverse possession, Walling decision, and its application in the 1st, 2nd, 3rd Departments.

by Peter Klose

As a result of recent Court of Appeals and Statutory Changes in New York, litigation and law suits relating to adverse possession are wending their way through trial and appellate courts throughout the state.

Adverse possession is a method of gaining title to property. Although not the favored means to procure land, a person may acquire title to land by adverse possession if she holds the property in a manner that conflicts with the rights of the true owner for a period of time.

There are five elements that establish a claim of adverse possession. Possession must be 1) hostile and under claim of right, 2) actual, 3) open and notorious, 4) exclusive, and 5) continue for the specified period as determined by jurisdiction. Adverse possession is generally a question of fact to be decided by a court. Recent decisions in New York have included:

December 22, 2009

New York’s Seizure of Private Land for Public Good?

by Peter Klose

Last month, the New York Court of Appeals ruled that the state of New York may legally seize private land for private developers use. In the 6-1 decision, the court allowed the seizure of a 22-acre plot located in downtown Brooklyn – effectively allowing the Atlantic Yards Project to proceed – reasoning it would allow for improvements on the “blighted conditions” of the property. The recent ruling falls in line with the 2005 decision by the Supreme Court in Kelo v. City of New London that similarly allowed a corporation to seize private homes and businesses to build a research campus.

The New York court’s ruling has raised arguments from opponents that ownership rights amount to being worthless if a government deems private land for the ‘public good.’ The Atlantic Yards Project, headed by Forest City Ratner Cos., seeks to develop office towers, apartments, and most notably an $900 million arena for the NBA’s New Jersey Nets. The only dissenter on the court’s bench stated, “It might be possible to debate whether a sport stadium open to the public is a ‘public use’ in the traditional sense, but the renting of commercial and residential space by a private developer clearly is not.” The New York Court of Appeals, however, ultimately ruled that the definition of ‘blight’ is a matter for the legislature, not the courts, to change.

November 25, 2009

Recent Highlights in the Neighbor Wars-Adverse Possession

by Peter Klose

This blog has identified recent legislation in the State of New York discussing adverse possession. Adverse possession is a method of gaining title to property based upon use of the property (not written). Although not a favored means to procure land, depending upon the facts a person may acquire title to land by adverse possession if she holds the property in a manner that conflicts with the rights of the true owner for a period of time.

There are five elements that establish a claim of adverse possession in New York. Possession must be 1) hostile and under claim of right, 2) actual, 3) open and notorious, 4) exclusive, and 5) continue for the specified period as determined by jurisdiction. Adverse possession is generally a question of fact to be decided by a court. Since the enactment of the statute and recent decisions by the Court of Appeals in New York, it is important to consider what judicial department you might be located.

For example, in the First Department, in the case entitled Eller Media Co. v. Bruckner Outdoor Signs, the plaintiffs constructed a billboard on a disputed parcel and surrounded that billboard with a chain-link fence. The defendants appealed the trial court’s summary judgment in favor of the plaintiffs arguing that the disputed parcel was held by a city for a public purpose. The court disagreed and determined that the plaintiffs or claimants had not only satisfied the elements of adverse possession because its use was hostile, open and notorious, exclusive, and continuous for more than the ten year statutory period, but that the parcel was not held for a public purpose and therefore not immune to the plaintiff’s adverse possession claim.

At Klose & Associates, we handle real estate litigation including adverse possession claims in the first department. You should always contact a specialized New York real estate litigation attorney if you have concerns about adverse possession.
Continue reading

November 11, 2009

Mortgages – Fraud Watch for Homeowners in New York!

by Peter Klose

You hear the old adage– “if its too good to be true . . . . ” Homeowners in New York and elsewhere should be on the look out for the newest form of fraud on the rise–“house theft.” Under various permutations of the fraud, con men and thieves conspire to to take ‘ownership’ of a home through various scams and false documents. In one version, the group acquires a house then ‘sells’ it to their associates, who obtain a loan from unsuspecting banks. The fictitious ‘seller,’ gets paid the loan proceeds, and then shares the sale proceeds with the fraudulent ‘buyer.’

The FBI estimates that from 2007 to the 2008, the reported cases of house theft have jumped 36% to an estimated 64,000 incidents. House theft, also known as title theft, most frequently occurs in larger urban areas particularly in cities with many vacant properties such as Detroit and Miami.

In reaction, several new online services offer free help to protect homeowners from house theft. Among its free services, www.ePropertyWatch.com provides informal house appraisals, monitors public real estate documents, and alerts homeowners to possible criminal activity. ePropertyWatch will also provide information on recent sales and foreclosures in the user’s neighborhood and observe long-term changes in the median sale prices relative to a ZIP code.

August 21, 2009

Don’t put your head in the sand when you get sued for Foreclosure in New York.

by Peter Klose

Have you been sued for foreclosure in New York State, are you ignoring the certified mail or the papers taped to your door. Well, that’s not the best response to a foreclosure action, where they want to take your home away. Increasingly, as this mortgage foreclosure debacle ripens, courts, litigants, and attorneys are learning that foreclosure is not always the slam dunk, lock the door, win/win case that it might have been when there were fewer foreclosures. Stand up for yourself, ask an attorney about your rights, read the papers and and fight back if the facts warrant. See my prior New York State Real Estate Lawyer Blog Entry.

In past decades, bankers gave millions of mortgages to entice new homeowners to leverage their dreams, and then repackaged that leverage (loans) to sell to investors, taking their cut, nary a worry for the borrowers or the lenders. As a result of the frenzied repackaging of such loans, it turns out that many of these banks and lenders lost papers, misplaced paperwork, forged signatures, and inaccurately dated documents, creating a messy jumble of paperwork, and making it sometimes impossible to decide who owns the right to commence the foreclosure, which bank owns which mortgage. This is where you might have a chance.

As the wave of the foreclosure crisis deepens, courts are increasingly challenged because homeowners rarely show up to court to fight the process, rarely have the money to hire competent lawyers to sort out the problems. So, increasingly, judges end up examining the banks’ papers, and ruling on the affidavits before them.