Adam Leitman Bailey, P.C. was retained by a lender to foreclose a business purpose loan. After successfully prosecuting the foreclosure action and obtaining a judgment of foreclosure and sale, the property was scheduled for auction. On the eve of the foreclosure sale, the borrower filed an Order to Show Cause, with a request for a temporary restraining order, on the grounds that the borrower had entered into a contract of sale for the subject property.

Adam Leitman Bailey, P.C. is fully familiar with this stall tactic and therefore was able to jump into action right away. Upon receipt of the Order to Show Cause, Adam Leitman Bailey, P.C. immediately filed a letter with the Court, citing to RPAPL § 1341(2), which specifically provides that a stay of a foreclosure sale is only appropriate if a borrower pays the amounts due and owing under the subject loan into Court.

In this case, Adam Leitman Bailey, P.C. pointed out to the Court that not only did the borrower not pay the amounts due and owing pursuant to the judgment of foreclosure and sale into Court, but also mislead the Court by claiming that proof of funds for the purchase and sale were annexed as an exhibit to its moving papers. However, the purported proof of funds exhibit was a precommitment letter for a mortgage dated several months earlier, and clearly the financing was not approved, since no actual commitment letter was annexed.

Adam Leitman Bailey, P.C. further reminded the Court that the borrower had not made a payment to its lender in many years, yet has been in control of and benefitting from the mortgaged premises, while the lender paid all of the carrying costs, including taxes and insurance. Since the borrower failed to present any grounds, as a matter of law, to stay the upcoming auction and misled the Court in its papers, Adam Leitman Bailey, P.C.’s letter requesting that the Court should decline to sign the Borrower’s Order to Show Cause in its entirety, and to permit its client to proceed with the scheduled foreclosure sale of the subject property without a stay, was accepted and followed by the Court.

The Court agreed and declined to grant the borrower a stay of the foreclosure sale by refusing to sign the Order to Show Cause.

Adam Leitman Bailey, P.C.’s foreclosure expertise allowed it to generate a quick response to this baseless request and achieve a favorable result for its client.

Jackie Halpern Weinstein and Courtney J. Lerias of the Foreclosure Litigation Group at Adam Leitman Bailey, P.C. successfully prevented this borrower from delaying the client from exercising its rights.