US Laws, Codes, Statutes & Cases

 
    §  11-409  Severance  and  trial of issues where answer is interposed;
  installment agreements authorized after action commenced. a. If  a  duly
  verified  answer  is  served upon the corporation counsel not later than
  twenty days after the last date for redemption, the answering  defendant
  shall  have  the right to a severance of the action, as to any parcel in
  which the  defendant  has  pleaded  an  interest,  upon  written  demand
  therefor filed with or made a part of his or her answer.
    b.  When such answer is interposed, the court shall summarily hear and
  determine the issues raised by the complaint  and  answer  in  the  same
  manner  as  it  hears  and  determines  other  actions, except as herein
  otherwise provided. Proof  that  the  taxes  which  made  said  property
  subject  to  foreclosure  hereunder together with interest and penalties
  thereon, were paid before filing of the list of delinquent taxes or that
  the property was not subject to tax shall constitute a complete defense.
    c. No counterclaim may be asserted  in  an  answer  interposed  in  an
  action  brought  pursuant  to  this  chapter.  Where  a  counterclaim is
  asserted in an in rem answer the city may disregard that portion of  the
  answer   and  shall  suffer  no  legal  penalty  or  impediment  in  the
  prosecution of its in rem action for its failure  to  reply  or  respond
  thereto.  Where  an  answer  contains  only  a counterclaim and no other
  defenses the city may proceed to judgment  of  foreclosure  against  the
  property affected without the need for moving against the answer.
    d. When a verified answer alleges a substantial equity over the city's
  lien for taxes, the defendant may demand additional time in which to pay
  the  taxes  and interest or to have the property sold with all taxes and
  interest to be paid out of the proceeds of such sale. Upon such demand a
  defendant shall have the right to an extension of time for such  purpose
  not  in  excess  of six months from the last day to interpose an answer.
  Where a mortgagee or lienor who has interposed such answer  commences  a
  proceeding  to foreclose his or her mortgage or lien and it appears that
  with due diligence such proceeding cannot be concluded in time to  allow
  the  payment  of  taxes within the aforesaid six month period, the court
  may, on application before the end of said six month  period,  authorize
  an  additional  period during which such proceeding may be concluded and
  the taxes, together with interest and penalties, paid.
    e. Where an answer of the type described  in  subdivision  d  of  this
  section  is interposed and taxes are paid within the period set forth in
  such  subdivision  d,  the  commissioner  of  finance  shall   issue   a
  certificate  of  withdrawal as to the property on which such payment has
  been made pursuant to the provisions of section 11-413 of this  chapter.
  When  taxes are not paid within the period set forth in such subdivision
  d, it shall be deemed that there was no equity over the city's tax liens
  and the answer shall be deemed to be without merit.  The  city  in  that
  event  may  proceed  to  judgment  of  foreclosure against such property
  without moving against the answer.
    f. All answers interposed in an action hereunder  and  all  affidavits
  and  other papers pertaining to any litigation involving such answers or
  to any proceeding brought pursuant to this chapter involving  less  than
  an  entire  action  shall  bear  a  caption containing the in rem action
  number of the city's tax foreclosure  proceeding,  the  borough  or  the
  section  of a tax map or portion of a section of a tax map affected, and
  if the action covers less than all  parcels  in  an  entire  borough  or
  section  of  a  tax  map  or  portion  of  a  section  of a tax map, the
  particular class or classes, and the  serial,  section,  block  and  lot
  numbers of the parcel or parcels in issue.
    g.  The  corporation  counsel, when submitting an in rem judgment roll
  pursuant to the provisions of this chapter, may request a  severance  as
  to  any parcel on which an in rem answer or litigation is pending, or as

  to which, before the  preparation  of  said  in  rem  judgment  roll  is
  commenced,  an  agreement  was  duly  made,  executed and filed with the
  commissioner of  finance  for  the  payment  of  the  delinquent  taxes,
  assessments  or  other  legal  charges  and  interest  and  penalties in
  installments as provided in subdivision c  of  section  11-405  of  this
  chapter  and  there  has  been no default in such agreement as to either
  quarterly installments or current  taxes,  assessments  or  other  legal
  charges.  Where such an agreement is entered into subsequent to the last
  date for redemption specified in subdivision a of section 11-407 of this
  chapter, there shall be paid to the commissioner of finance at the  time
  the aforesaid agreement is executed an amount equal to the penalty which
  would  have  been  payable under subdivision c of section 11-407 of this
  chapter had the person executing the agreement made  a  late  redemption
  payment.  Such  amount  shall be in addition to any installment payments
  required to be made under  the  agreement  and  shall  not  be  credited
  against  any  such  installment payments. Where a default occurs in such
  agreement  as  to  either  quarterly  installments  or  current   taxes,
  assessments  or  other  legal  charges,  all  payments  made  under  the
  agreement shall be forfeited and the city shall be entitled  to  acquire
  the  parcel  as to which the default occurred. Where such default occurs
  before the submission of the judgment roll, the parcels as to which such
  default occurs shall be included in said judgment roll among the parcels
  to be acquired by the city. Where such default  has  occurred  as  to  a
  parcel  severed  pursuant  to  this subdivision, the corporation counsel
  shall cause to be entered a supplemental judgment of foreclosure  as  to
  such  parcel  immediately on notification by the commissioner of finance
  of such default. Where such installment agreement is paid  in  full  the
  commissioner  of  finance shall discontinue the in rem action from which
  said parcel was severed by issuing a certificate  of  withdrawal  as  to
  said  parcel  pursuant  to  the  provisions  of  section  11-413 of this
  chapter.
    h. A party who has interposed an answer as to any parcel  included  in
  an  in rem tax foreclosure action, or any other party interested in such
  parcel, shall have the right, at any time prior to the final disposition
  of a motion to strike said answer, to pay  all  taxes,  assessments  and
  other  legal  charges  and  interest  owing on said parcel. An answering
  party who makes such payment shall not be required to pay  any  penalty.
  Where  such  payment  is made by other than an answering party after the
  expiration of the period of redemption,  there  shall  be  paid  to  the
  commissioner  of  finance  an  additional  amount  equal  to the penalty
  payable under subdivision c of section 11-407 of this chapter. Where all
  delinquent taxes, assessments and  other  legal  charges  together  with
  lawful  interest  thereon  and  penalties, where required, are paid, the
  commissioner of finance shall issue a certificate of  withdrawal  as  to
  said  parcel  pursuant  to  the  provisions  of  section  11-413 of this
  chapter. Said parties may also pay such  taxes,  assessments  and  other
  legal  charges  and  interest  by  an  installment agreement. Where such
  agreement is requested before the preparation of the  aforesaid  in  rem
  judgment  roll  is  commenced,  the  terms  of  said  agreement shall be
  consistent with the provisions of subdivision g or i  of  this  section,
  whichever  is  applicable.  Where  such  agreement  is  requested  after
  judgment of foreclosure has been entered in the in rem action  in  which
  the  aforesaid  answer  was  interposed,  said agreement shall require a
  first installment of fifty percent of all taxes, assessments  and  other
  legal  charges  and  interest  owing  on  said parcel, a penalty of five
  percent of all such taxes,  assessments  and  other  legal  charges  and
  interest,  which  penalty  may  not exceed one thousand dollars, and the
  payment of the balance  of  such  taxes,  assessments  and  other  legal

  charges  and interest in four equal quarterly installments together with
  all current taxes, assessments  and  other  legal  charges  that  accrue
  during such period. The request of an answering party for an installment
  agreement  shall  constitute  a  withdrawal  of  such party's answer. An
  installment agreement requested by an interested party  other  than  the
  answering  party shall require the consent of said answering party which
  shall also constitute a withdrawal of such party's answer. The severance
  provided for in this section shall be continued during the term  of  all
  installment  agreements  entered into pursuant to the provisions of this
  subdivision. Where a  default  has  occurred  as  to  a  parcel  severed
  pursuant  to this subdivision, the corporation counsel shall cause to be
  entered a  supplemental  judgment  of  foreclosure  as  to  such  parcel
  immediately  on  notification  by  the  commissioner  of finance of such
  default.  Where  such  installment  agreement  is  paid  in  full,   the
  commissioner  of  finance shall discontinue the in rem action from which
  said parcel was severed by issuing a certificate  of  withdrawal  as  to
  said  parcel  pursuant  to  the  provisions  of  section  11-413 of this
  chapter.
    i. (1) Notwithstanding subdivision g of this section, this subdivision
  shall apply with respect to installment agreements  made,  executed  and
  filed  with  the  commissioner  of finance on or after the date on which
  this subdivision takes effect. An installment agreement pursuant to this
  subdivision may be made,  executed  and  filed  with  such  commissioner
  during  the period beginning on the date on which an action is commenced
  as provided in subdivision d of section  11-405  of  this  chapter  with
  respect  to  the parcel that is the subject of such agreement and ending
  on the date on which such commissioner is  advised  by  the  corporation
  counsel  that  the preparation of the judgment of foreclosure in such in
  rem action has been commenced. Notwithstanding anything to the contrary,
  and except to the extent provided in paragraph two of this  subdivision,
  the provisions of paragraphs one through six of subdivision c of section
  11-405  of  this  chapter  shall  not apply to any installment agreement
  requested on or after the date on which this  subdivision  takes  effect
  and  on or after the date on which an action is commenced as provided in
  subdivision d of such section 11-405 with respect to the parcel that  is
  the subject of such requested agreement.
    (2)  An  agreement  entered  into  pursuant  to this subdivision shall
  provide for  the  payment  in  installments  of  the  delinquent  taxes,
  assessments  and  other  legal  charges,  and the interest and penalties
  thereon, due and owing as  of  the  date  on  which  such  agreement  is
  requested.  Unless an eligible owner or other interested person requests
  an agreement pursuant to the  provisions  of  paragraph  three  of  this
  subdivision,  the terms of such agreement with respect to a parcel shall
  be the same as the terms that would be applicable to such  parcel  under
  paragraph  four,  five  or  six, as the case may be, of subdivision c of
  section 11-405 of  this  chapter,  except  that,  for  purposes  of  the
  agreement   pursuant   to  this  paragraph,  the  amount  of  the  first
  installment shall be equal to: (i) fifteen percent of the  total  amount
  due  in  the  case  of  a  parcel described in such paragraph four; (ii)
  twenty percent of the total amount due in the case of a parcel described
  in such paragraph five; and  (iii)  twenty-five  percent  of  the  total
  amount due in the case of a parcel described in such paragraph six.
    (3)  Instead  of  an  agreement  pursuant  to  paragraph  two  of this
  subdivision, an eligible owner or other interested party may request  an
  agreement pursuant to the following provisions:
    (i)  With  respect  to  a  parcel that is owned by a company organized
  pursuant to article XI of the state private housing finance law with the
  consent and approval of  the  department  of  housing  preservation  and

  development,   such   agreement   shall   provide  for  the  payment  in
  installments of  the  delinquent  taxes,  assessments  and  other  legal
  charges, and the interest and penalties thereon, due and owing as of the
  date on which such agreement is requested. The first installment thereof
  shall  be  paid  upon  the  filing of the installment agreement with the
  commissioner of finance and shall be in an amount at least equal to,  at
  the applicant's election, either thirty-five percent or fifty percent of
  the  total  amount  of such delinquent taxes, assessments or other legal
  charges  and  the  interest  and  penalties   thereon.   The   remaining
  installments,  which  shall be three times the number of unpaid quarters
  of real estate taxes or the equivalent thereof, but which  shall  in  no
  event  exceed  thirty-two  in  number, shall be payable quarterly on the
  first days of July, October, January and April, together  with  interest
  at the rate or rates determined as provided in subparagraph (iv) of this
  paragraph.  For the purposes of calculating the number of such remaining
  installments, unpaid real estate taxes that are due and payable on other
  than a quarterly basis shall be deemed to  be  payable  on  a  quarterly
  basis.
    (ii)  With  respect  to  a  parcel,  other  than a parcel described in
  subparagraph (i) of this  paragraph,  that  is  a  residential  building
  containing   not   more  than  five  residential  units,  a  residential
  condominium unit or a residential building held in a cooperative form of
  ownership, such agreement shall provide for the payment in  installments
  of  the  delinquent  taxes, assessments and other legal charges, and the
  interest and penalties thereon, due and owing as of the  date  on  which
  such agreement is requested. The first installment thereof shall be paid
  upon  the  filing  of the installment agreement with the commissioner of
  finance and shall be in an amount at least equal to, at the  applicant's
  election,  either  twenty-five  percent  or  fifty  percent of the total
  amount of such delinquent taxes, assessments or other legal charges  and
  the  interest  and  penalties thereon. The remaining installments, which
  shall be three times the number of unpaid quarters of real estate  taxes
  or  the equivalent thereof, but which shall in no event exceed twenty in
  number, shall be payable quarterly on the first days of  July,  October,
  January and April together with interest at the rate or rates determined
  as  provided in subparagraph (iv) of this paragraph. For the purposes of
  calculating the number  of  such  remaining  installments,  unpaid  real
  estate  taxes  that  are due and payable on other than a quarterly basis
  shall be deemed to be payable on a quarterly basis.
    (iii) With respect to any parcel  of  class  one  or  class  two  real
  property,  other  than a parcel described in subparagraph (i) or (ii) of
  this  paragraph,  such  agreement  shall  provide  for  the  payment  in
  installments  of  the  delinquent  taxes,  assessments  and  other legal
  charges, and the interest and penalties thereon, due and owing as of the
  date on which such agreement is requested. The first installment thereof
  shall be paid upon the filing of  the  installment  agreement  with  the
  commissioner  of finance and shall be in an amount at least equal to, at
  the applicant's election, either thirty-five percent or fifty percent of
  the total amount of such delinquent taxes, assessments  or  other  legal
  charges   and   the   interest  and  penalties  thereon.  The  remaining
  installments, which shall be twice the number of unpaid quarters of real
  estate taxes or the equivalent thereof, but  which  shall  in  no  event
  exceed twenty in number, shall be payable quarterly on the first days of
  July,  October, January and April, together with interest at the rate or
  rates determined as provided in subparagraph (iv) of this paragraph. For
  the purposes of calculating the number of such  remaining  installments,
  unpaid  real  estate  taxes  that  are  due  and payable on other than a
  quarterly basis shall be deemed to be payable on a quarterly basis.

    (iv) (A)  Notwithstanding  any  higher  rate  of  interest  prescribed
  pursuant  to  applicable  law,  and  unless  a lower rate of interest is
  applicable to a delinquent amount owing on a parcel that is the  subject
  of  an  agreement  pursuant  to  this  paragraph,  the  interest payable
  together  with the remaining installments due under such agreement shall
  be:
    (I) with respect to an agreement for which a  twenty-five  percent  or
  thirty-five percent down payment was made, calculated at a rate equal to
  the sum of (a) the rate prescribed for the applicable period pursuant to
  paragraph (i) of subdivision e of section 11-224.1 of this title and (b)
  one-half of the difference between such rate and the rate prescribed for
  such  period  pursuant  to  paragraph  (ii)  of subdivision e of section
  11-224.1 of this title; or
    (II) with respect to an agreement  for  which  a  fifty  percent  down
  payment  was made, calculated at a rate equal to the rate prescribed for
  the applicable period pursuant to paragraph  (i)  of  subdivision  e  of
  section 11-224.1 of this title.
    (B)  If  a  default  occurs in any agreement executed pursuant to this
  paragraph  as  to  either  quarterly  installments  or  current   taxes,
  assessments  or  other  legal  charges, the rates of interest determined
  under this subparagraph shall thereupon cease to be applicable  and  the
  commissioner  of  finance  shall  thereafter charge, collect and receive
  interest in the manner and at the rates otherwise prescribed pursuant to
  law.
    (4) The corporation counsel, when submitting an in rem  judgment  roll
  pursuant  to  the provisions of this chapter, may request a severance as
  to any parcel as to  which,  before  the  preparation  of  said  in  rem
  judgment  roll  is  commenced,  an agreement was duly made, executed and
  filed with the commissioner of finance for the payment of all delinquent
  taxes, assessments and other legal charges and interest and penalties in
  installments as provided in this subdivision,  and  there  has  been  no
  default in such agreement as to either quarterly installments or current
  taxes,  assessments  or  other legal charges. Where such an agreement is
  entered into subsequent to the last date  for  redemption  specified  in
  subdivision  a of section 11-407 of this chapter, there shall be paid to
  the commissioner of finance at the time such agreements are executed  an
  amount  equal  to  the  penalty  that  would  have  been  payable  under
  subdivision c of section 11-407 of this chapter had the person executing
  the agreement made a late redemption payment. Such amount  shall  be  in
  addition  to  any  installment  payments  required  to be made under the
  agreement and  shall  not  be  credited  against  any  such  installment
  payments.  Where  a  default  occurs  in  such  agreement  as  to either
  quarterly installments or current  taxes,  assessments  or  other  legal
  charges,  all  payments  made under the agreement shall be forfeited and
  the city shall be entitled to obtain a  judgment  hereunder  as  to  the
  parcel  as  to  which  the default occurred. Where such default occurred
  before the submission of the judgment roll, the parcels as to which such
  default occurs shall be  included  in  said  judgment  roll  amount  the
  parcels  to  be  acquired  by  the  city or by a third party. Where such
  default  has  occurred  as  to  a  parcel  severed  pursuant   to   this
  subdivision,  the  corporation  counsel  shall  cause  to  be  entered a
  supplemental judgment of foreclosure as to such  parcel  immediately  on
  notification  by the commissioner of finance of such default. Where such
  installment agreement is paid in full, the commissioner of finance shall
  discontinue the in rem action from which  such  parcel  was  severed  by
  issuing  a  certificate  of withdrawal as to such parcel pursuant to the
  provisions of section 11-413 of this chapter.