State of New York

Supreme Court, Appellate Division

Third Judicial Department

Decided and Entered: December 8, 2016 522775 

________________________________

RUSSELL E. COOPER,

Appellant,

v

JAMES E. PULLAR et al.,

Defendants, MEMORANDUM AND ORDER

and

FIRST NIAGARA BANK, N.A.,

Formerly Known as FIRST 

NIAGARA BANK, as Successor 

by Merger to HUDSON RIVER 

BANK AND TRUST,

Respondent.

________________________________

Calendar Date: October 17, 2016

Before: Egan Jr., J.P., Rose, Clark, Mulvey and Aarons, JJ.

__________

Englert, Coffey, McHugh & Fantauzzi, LLP, Schenectady

(Peter V. Coffey of counsel), for appellant.

Schiller, Knapp, Lefkowitz & Hertzel, LLP, Latham (Gary A.

Lefkowitz of counsel), for respondent.

__________

Aarons, J.

Appeal from an order of the Supreme Court (Elliott III,

J.), entered June 26, 2015 in Rensselaer County, which, among

other things, granted a cross motion by defendant First Niagara

Bank, N.A. for summary judgment dismissing the complaint against

it.
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In 1999, plaintiff and his wife entered into a lease with

defendants James E. Pullar and Doris E. Pullar to rent a

residential property located in the City of Troy, Rensselaer

County. This lease, which contained an option-to-buy provision,

was not recorded. In 2003, the Pullars sold the subject property

to defendant Samuel Barr, who obtained a loan from defendant

First Niagara Bank, N.A. (hereinafter defendant) secured by a

mortgage on the property. The mortgage was recorded in 2003. 

Notwithstanding this sale, plaintiff and his wife remained

tenants of the property, continued to occupy the house and made

rental payments to Barr.

After Barr failed to make payments due under the loan,

defendant commenced an action in 2011 to foreclose on the subject

property. While plaintiff and his wife were originally named as

defendants in the foreclosure action as "John Doe#1-#50" and

"Mary Roe#1-#50," respectively, they were served with process and

eventually the caption was amended to include their names in

place of the fictitious names. Plaintiff and his wife neither

appeared nor answered in the foreclosure action and a judgment of

foreclosure and sale was granted. Plaintiff subsequently

commenced this action seeking, among other things, to declare

defendant's mortgage on the subject property null and void. 

Following joinder of issue, plaintiff moved and defendant crossmoved for summary judgment. Supreme Court, among other things,

granted defendant's cross motion. Plaintiff now appeals. 

Even if we agreed with plaintiff that res judicata and

collateral estoppel were inapplicable, because defendant was

entitled to protection of New York's recording statutes, we

conclude that Supreme Court properly granted summary judgment in

defendant's favor. It is undisputed that plaintiff's lease with

the Pullars was not recorded. It is also undisputed that

defendant's mortgage with Barr was validly recorded. This appeal

therefore centers on whether defendant had a duty to further

inquire about plaintiff's claimed interest in the property. 

In asserting that defendant was required to make a further

inquiry, plaintiff relies on his possession of the property. 

Indeed, actual possession of real estate generally gives notice

to all of the world of the existence of a right that a person in
-3- 522775 

possession may establish (see Wardell v Older, 70 AD2d 1008, 1009

[1979]). But, "[t]he possession that will be equivalent to

actual notice must be inconsistent with the title of the apparent

owner by the record" (Fekishazy v Thomson, 204 AD2d 959, 962

[1994] [internal quotation marks and citation omitted], appeal

dismissed 84 NY2d 844 [1994], lv denied 84 NY2d 812 [1995]; see

Ward v Ward, 52 AD3d 919, 921 [2008]; Berger v Polizzotto, 148

AD2d 651, 652 [1989], lv denied 74 NY2d 612 [1989]). Here,

plaintiff's mere possession and occupancy of the property with

his family did not give defendant notice of any conflicting

interest that plaintiff had in the property. In other words,

plaintiff's occupancy was wholly consistent with his rights as a

tenant under the lease given that he continued to live at the

property and paid monthly rent (see 10 Cardinal Lane, LLC v

N.K.T. Land Acquisitions, Inc., 117 AD3d 1133, 1134-1135 [2014];

Stracham v Bresnick, 76 AD3d 1009, 1011 [2010]; Tompkins County

Trust Co. v Talandis, 261 AD2d 808, 810-811 [1999], lv dismissed

93 NY2d 1041 [1999]; compare Mortgage Elec. Registration Sys.,

Inc. v Pagan, 119 AD3d 749, 753 [2014]). Under these

circumstances, no basis exists to void defendant's mortgage and,

thus, we find that Supreme Court properly granted defendant's

cross motion for summary judgment.

Egan Jr., J.P., Rose, Clark and Mulvey, JJ., concur.

ORDERED that the order is affirmed, with costs.

ENTER:

Robert D. Mayberger

Clerk of the Court