Greenpoint Mtge. Funding, Inc. v United States of Am. Acting Through IRS
Annotate this CaseDecided on November 13, 2007
Supreme Court, Suffolk County
Greenpoint Mortgage Funding, Inc., its Successors and Assigns, Plaintiff,
against
United States of America Acting Through IRS, Defendant.
7778-2007
STEVEN J. BAUM, P.C.
Attorney for Plaintiff
P.O. Box 1291
Buffalo, New York 14240-1291
Sandra L. Sgroi, J.
ORDERED that the motion of the Plaintiff Greenpoint Savings Bank for a
judgment foreclosing a right of redemption as against the United States is denied with leave to
renew in accordance with this decision.
A judgment of foreclosure and sale was entered in the Suffolk County Clerk's office
on July 10, 2006 in a foreclosure action affecting the property involved in this action for strict
foreclosure on or about April 14, 2005(Index No.8999/2005). The United States of America was
not named as a party in that 2005 foreclosure action as a result of an error of the company that
performed the foreclosure search to determine necessary parties. Therefore the lien of the IRS
remains a cloud on the title of the property. It is unclear from these papers if Greenpoint
Mortgage Funding, Inc. (hereinafter "Greenpoint") presently holds title to the property and
therefore, the Court cannot determine if Greenpoint is the proper party to commence this action
for strict foreclosure of the property. This, however, is not the only issue that requires denial of
the relief requested by the Plaintiff.
This year, Greenpoint commenced an action in strict foreclosure against the only
Defendant herein, the United States of America acting through IRS, seeking a judgment barring
and foreclosing the United States from enforcing its Internal Revenue Service lien on the
property. According to the Plaintiff, the United States defaulted in appearing in this action and
this entitles it to an ex parte judgment. However, the Court must determine if it has jurisdiction
of the Defendant.
It is well-settled that, under the doctrine of sovereign immunity, the United States
cannot be sued without its consent(see, Hudson County Board of Chosen Freeholders v.
Morales [78-2 USTC P 9634], 581 F.2d 379, 382 ,3rd Cir. 1979). Unless there has
been a waiver of sovereign immunity, the action against the United States may not go forward
(see, Kroll v. Franklin Nat. Bank, 1983 WL 1644, 52 A.F.T.R.2d 83-5737, 83-2
USTC P 9562, S.D.Ohio Jun 02, 1983)
Unless the United States government consents to be sued in an action to discharge a
tax lien, sovereign immunity is a bar to any action commenced against it in the Courts of the
United States (see, United States v. Shaw, 309 U.S. 495, 500-505). The
limitations and conditions imposed by Congress in waiving immunity must be strictly observed
by the Courts and no exceptions will be implied in determining if there has been a waiver of
immunity (see, Soriano v. United States, 352 U.S. 270, 77 S. Ct. 269, 1 L. Ed. 2d 306; United States v. Sherwood, 312 U.S. 584, 61 S. Ct. 767, [*2]85 L. Ed. 1058). If there is no express, statutory waiver of
immunity, this Court lacks jurisdiction to entertain an action brought against the United States
(see, United States v. Sherwood, supra; Minnesota v. United
States, 305 U.S. 382, 59 S. Ct. 292, 83 L. Ed. 235).
The Plaintiff has not addressed this issue in its papers. A review of the applicable
statutes leads this Court to the conclusion that the applicable statutory waiver of sovereign
immunity in this case is 28 U. S. C. § 2410(a). This section of the United
States Code provides:
(a) Under the conditions prescribed in this section and section 1444 of this title for
the protection of the United States, the United States may be named a party in any civil action or
suit in any district court, or in any State court having jurisdiction of the subject matter -
(1) to quiet title to,
(2) to foreclose a mortgage or other lien upon,
(3) to partition,
(4) to condemn, or
(5) of interpleader or in the nature of interpleader with respect to real or personal property on
which the United States has or claims a mortgage or other lien.(USCA
2410)
In Falik v. United States ([65-1
USTC P 9295], 343 F.2d 38, 42 ,2d Cir. 1965, Friendly, J.), Judge Friendly analyzed
USCA 2410(a) as follows:
[T]he prime purpose of § 2410(a) as enacted in 1931 . . . was to permit
joinder when the lien of the United States was junior to that being foreclosed; in such cases the
validity of the Government lien would generally be irrelevant. When the suit was brought by a
junior lienor, the statute concededly permitted inquiry into the validity of the lien itself, as
distinct from the underlying assessment, through attacks on procedural irregularity . . . on liens
filed against property of a person other than the one against whom the tax had been assessed, on
Government liens asserted to be prior but contended not to be, and on liens which had in fact
been eliminated but not discharged of record. . . .(Falik v. United States,
supra, 343 F. 2d at 41-42).
The Court further notes it may
be proper to commence this suit in Federal District Court pursuant to 28 USCA §
1340. That statute, which gives the District Court "original jurisdiction of any civil
action arising under any Act of Congress providing for internal revenue," has been held to apply
to suits properly brought pursuant to 28 USCA § 2410.
In First Nat. Bank of East Islip v. Crest Affiliates, Inc., (1974 WL
593, 34 A.F.T.R.2d 74-5300, 74-2 USTC P 9508, E.D.NY Jun 04, 1974), United States District
Court Judge Travia stated:
Title 28 U. S. C. § 2410(a) was not intended to permit a taxpayer to question
the [*3]merits of an assessment or to enjoin the enforcement of a
tax lien. See Broadwell v. United States [64-2 USTC P 9768], 234 F. Supp. 17
(E. D. N. C. 1964), aff'd [65-1 USTC P 9310] 343 F.2d 470 (4th Cir. 1965);
Falik v. United States [65-1 USTC P 9295], 343 F.2d 38 (2d Cir. 1965);
Seff v. Machiz [65-2 USTC P 9691], 246 F. Supp. 823 (D. Md. 1965). In such a
situation, the old adage of "pay first and litigate later" still applies. Flora v. United
States [60-1 USTC P 9347], 362 U.S. 145 (1960). However, where a nondelinquent
taxpayer, not a party to the tax claim, asserts that a tax lien has been improperly imposed upon
his real property, he may test the validity of the lien in a state court having jurisdiction of one of
the five real estate actions enumerated in § 2410(a). Cf. Pipola v. Chicco
[60-1 USTC P 15,276], 274 F.2d 909, 914 (2d Cir. 1960); see also Petition of
Sills [53-2 USTC P 9581], 115 F. Supp. 239 (E. D. NY
1953).
In Integrity Trust Co. v. United States,
(D.C.N.J. 1933, 3 F.Supp. 577), it was held that consent to be sued in a strict foreclosure
proceeding had not been given by the United States, since the United States Code sections
waiving sovereign immunity contemplated a judicial sale (see also, Borough of
Kenilworth v. Corwine, 96 F.Supp. 68-citing Integrity Trust Co. v. United
States with approval; Federal Procedure, Lawyers Edition, §
48:1465, Foreclosure action culminating in judicial sale, 2007; Am. Jur. 2d Federal Tax
Enforcement § 1086, Foreclosure action culminating in judicial sale ,2007). In
the two treatises cited above, Federal Procedure, Lawyers Edition and
Am. Jur. 2d Federal Tax Enforcement, it is stated unequivocally that the United
States has not waived sovereign immunity in strict foreclosure actions.
Under these conditions, unless the Plaintiff shows the Court authority permitting the
relief sought herein, the Court cannot grant the relief requested by the Plaintiff, Greenpoint
Mortgage Funding, Inc., in its action for strict foreclosure.
Dated:________________________SANDRA L. SGROI, J. S. C.
Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.