Co-ops and Condominiums

In a quiet title action by purchaser of a condominium unit who sought a determination that its interest was not encumbered by a mortgage executed by a former owner, purchaser appealed from Supreme Court's grant of summary judgment to mortgagee. The Appellate Division reversed, holding that mortgagee had failed to establish that its interest was superior to the lien on which the condominium association had foreclosed.

Gary and Deborah Parks bought the subject condominium in 1990. They financed the purchase with two mortgages, a first mortgage for $226,400 in favor of Home Saving and a second mortgage for $40,000 in favor of their seller, Scappaticci. In 1994, Scappaticci died. The following year, Gary executed a quitclaim deed to Deborah, who then executed a mortgage in favor of GMAC's predecessor for $273,000. Two years later, Deborah executed a mortgage in favor of JP Morgan for $75,000, subject only to the GMAC mortgage. In 2012, GMAC brought an action to foreclose its mortgage. Three years later, the condominium association filed a lien for unpaid common charges, and then brought a foreclosure action. Great Homes purchased the unit by referee's deed as a result of the foreclosure sale and then brought this action to establish that its interest was not encumbered by the GMAC mortgage. Supreme Court granted summary judgment to GMAC, and Great Homes appealed.