New York: Notice of Appeal May Work as a Cloud on Title

see http://www.newyorklawjournal.com/home/id=1202732820636/Appellate-Decision-Unwinds-Foreclosure-Purchase?mcode=1202615326010&curindex=2&slreturn=20150623125150

It’s procedure, stupid! That is the message coming out of several courts who are subjecting foreclosure actions to increasing scrutiny. They apparently are noticing that the facts are not as assumed in most cases and that the true facts are being papered over with instruments that appear facially valid. Now the long standing rule that a person who takes title with knowledge of litigation might not get title after all. In New York, title was unwound. The conclusions of the authors is what I said years ago. There is no way that continuing litigation would allow for any title to be marketable. That is especially true where the allegation is that the sale was wrongful, fraudulent etc. But it is also true where there are other issues that affect title. Title is clouded as long as there is litigation — at least in this case in New York State.

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