EMIGRANT BANK v. NICOLAOU (2021)

DECISION & ORDER

In an action to foreclose a mortgage, the defendant Sotiris Nicolaou appeals from an order of the Supreme Court, Nassau County (Thomas A. Adams, J.), entered January 24, 2020.  The order denied that defendant's motion for injunctive relief and, in effect, to set aside a foreclosure sale and any subsequent conveyances of the subject property.

ORDERED that the order is affirmed, with costs.

Many of the underlying facts are set forth in this Court's decisions and orders on related appeals in this matter (Emigrant Bank v. Nicolaou, ––– A.D.3d ––––, ––– N.Y.S.3d ––––, 2021 WL 4763025 [Appellate Division Docket No. 2017–12673;  decided herewith];  Emigrant Bank v. Nicolaou, ––– A.D.3d ––––, ––– N.Y.S.3d ––––, 2021 WL 4763065 [Appellate Division Docket No. 2018–08907;  decided herewith]).  Following the issuance of an order and judgment of foreclosure and sale in this action, a foreclosure sale of the subject property was conducted.  There being no bids, the property reverted to the plaintiff for a nominal bid of $100 (see Polish Natl. Alliance of Brooklyn v. White Eagle Hall Co., 98 A.D.2d 400, 407, 470 N.Y.S.2d 642).  The plaintiff assigned its bid to its subsidiary Retained Realty, Inc., and a referee's deed was issued on January 27, 2019.  On November 22, 2019, Retained Realty, Inc., transferred the property to Nassau Land Developers, LLC.

The defendant Sotiris Nicolaou (hereinafter the defendant) thereafter moved for injunctive relief and, in effect, to set aside the foreclosure sale and any subsequent conveyances of the subject property based on fraud, collusion, or misconduct.  The Supreme Court denied the motion.  The defendant appeals, and we affirm.

A court may exercise its inherent equitable power to set aside a foreclosure sale where there is evidence of fraud, collusion, mistake, or misconduct (see Concept 9, LLC v. 614 Realty, LLC, 189 A.D.3d 992, 993, 133 N.Y.S.3d 901;  Liberty Dabar Assoc. v. Mohammed, 183 A.D.3d 880, 882, 124 N.Y.S.3d 708;  Nationstar Mtge., LLC v. Brignol, 181 A.D.3d 881, 882, 119 N.Y.S.3d 882).  “In order to provide a basis for setting aside a sale, the evidence of fraud, collusion, mistake, or misconduct must cast suspicion on the fairness of the sale” (Nationstar Mtge., LLC v. Brignol, 181 A.D.3d at 882, 119 N.Y.S.3d 882;  see T11 Funding v. Traynelis, 166 A.D.3d 927, 928, 85 N.Y.S.3d 882;  Northern Blvd Corona, LLC v. Northern Blvd Prop., LLC, 157 A.D.3d 895, 896, 69 N.Y.S.3d 866).  “[U]nsubstantiated claims are insufficient to establish the existence of fraud, collusion, mistake, or misconduct” (Clinton Hill Holding 1, LLC v. Kathy & Tania, Inc., 142 A.D.3d 631, 632–633, 36 N.Y.S.3d 732;  see Concept 9, LLC v. 614 Realty, LLC, 189 A.D.3d at 993, 133 N.Y.S.3d 901).

Here, the defendant failed to submit sufficient evidence of fraud, collusion, mistake or misconduct in support of his motion to establish his entitlement to the relief requested.  Accordingly, the Supreme Court properly denied the motion.

MASTRO, J.P., MILLER, CONNOLLY and BRATHWAITE NELSON, JJ., concur.