JP Morgan Chase Bank v. Kalpakis , 937 N.Y.2d 105 ( 2012 )

The subject property was owned by George Kalpakis until his death in 1995. According to the affidavit of Lythia A. Rousseas, George Kalpakis died intestate, and his only heirs were his four children: Lythia A. Rousseas, Barbara Kalpakis, Mark Kalpakis, and James Kalpakis. Pursuant to a deed dated March 12, 2003, the subject property was purportedly transferred from George Kalpakis, who was then deceased, to Bette Kalpakis, James Kalpakis’s wife. In 2007 Bette Kalpakis executed a mortgage on the property in favor of the plaintiffs predecessor.

In April 2010 the plaintiff commenced this action to foreclose the mortgage. In December 2010 Lythia A. Rousseas, Barbara Kalpakis, and Mark Kalpakis (hereinafter collectively the movants) moved, inter alia, pursuant to CPLR 1012 (a) (3) for leave to intervene in the action. The movants asserted that the deed dated March 12, 2003, was a forgery, and that they did not discover the fraud until 2009.

The Supreme Court properly granted that branch of the movants’ motion which was pursuant to CPLR 1012 (a) (3) for leave to intervene in the action, as the movants established that they may have an ownership interest in the property that is the subject of the foreclosure proceeding (see US Bank N.A. v Gestetner, 74 AD3d 1538, 1541 [2010]; Greenpoint Sav. Bank v McMann Enters., 214 AD2d 647, 647-648 [1995]). Contrary to the plaintiffs contention, it did not establish that the movants’ claim to invalidate the deed dated March 12, 2003, was barred by the statute of limitations. The movants’ claim was asserted within two years of discovery of the fraud (see Piedra v Vanover, 174 AD2d 191, 196 [1992]), and the plaintiff did not establish, as a matter of law, that the fraud could have been discovered earlier with reasonable diligence (see CPLR 213 [8]; Sargiss v Magarelli, 12 NY3d 527, 532 [2009]; Citicorp Trust Bank, FSB v Makkas, 67 AD3d 950, 953 [2009]). Skelos, J.P, Hall, Austin and Miller, JJ., concur. [Prior Case History: 30 Misc 3d 1236(A), 2011 NY Slip Op 50374(U).]