Section 756-A - Stay of action or proceeding when a party's claim to title is in dispute1.(a) A federal, state or local government agency may move for a stay of any proceeding to recover possession of or quiet title to real property relating to a residential dwelling unit or property, based on a pending good faith investigation into the theft or fraud in the title to, or the financing of, the premises that is the subject of any proceeding. Upon the agency's showing of the pendency of a good faith investigation, the court shall issue a stay of the proceeding, including staying execution of a warrant of eviction or enforcement of a judgment so long as the investigation is ongoing.(b) Every six months, the court shall schedule a status conference with the government agency and any other parties to the action to review any stay and to determine if the investigation is still continuing in good faith and shall continue the stay of the proceeding until the government investigation is closed. If it should deem necessary, a court may review any supporting documents filed by the government agency in camera and to be filed under seal if deemed necessary by the government agency.2. The court shall stay all proceedings to recover possession of or quiet title to real property relating to a residential dwelling unit or property, where a charging instrument is filed against a party to such proceeding for deed theft, larceny, offering a false instrument for filing, criminal possession of stolen property or any other law asserting theft or fraud in obtaining title to property and said charging instrument relates to the premises that are the subject of such proceeding. The stay shall remain in effect until resolution of such criminal action.3. The court shall stay all proceedings to recover possession of or quiet title to real property relating to a residential dwelling unit or property, where a federal, state or local government agency has commenced a civil action or proceeding relating to the theft or fraud in the title to, or the financing of, the premises that are the subject of such proceeding.4. The court shall stay all proceedings under section seven hundred eleven or seven hundred thirteen of this article for ninety days to allow a party to file a complaint in the appropriate forum when the court makes a determination that there is a bona fide dispute between parties purporting to own the property that is the subject of the proceeding. (a) A rebuttable presumption that a bona fide dispute to title exists shall be created when the party disputing petitioner's title, owns or owned the property that is the subject of the court proceeding during the last three years, or is a person interested in the property, as defined by section one hundred three of the surrogate's court procedure act.(b) A party may seek an additional stay of the proceeding beyond the initial ninety day stay by the court if they were unable to file a complaint or seek a stay from another forum. In extending the stay, the court shall consider, without limitation, the totality of the circumstances including steps the parties have taken to resolve the dispute, the harm to the parties of a further stay, and the ability of the parties to advocate for themselves or retain counsel.(c) This section shall not apply to any proceeding commenced pursuant to subdivision ten of section seven hundred thirteen of this article.5. Nothing in this section shall diminish the court's own discretion to further stay a proceeding in the interests of justice.6. Nothing in this section shall limit a party from seeking relief, including a stay of a proceeding under this article, in another court.7. For purposes of this section, a proceeding to recover possession of or quiet title to real property shall include any proceeding under section seven hundred eleven or seven hundred thirteen of this article, an ejectment action or a writ of assistance pursuant to section two hundred twenty-one of this chapter, a foreclosure action, an action to enforce a mortgage note, or any other action affecting title to or encumbrance upon real property, or any other judicial or administrative proceeding to recover possession of or quiet title to real property.8. For purposes of this section, a party shall include:(a) a corporation, limited liability company, partnership or other entity where a charging instrument has been filed against an individual who has a financial or controlling interest in the entity that holds title to the property; or(b) where a charging instrument has been filed against a seller of the property, including an individual or corporation, limited liability company, partnership or other entity, or where a charging instrument has been filed against an individual who has a financial or controlling interest in the entity that sold the property.N.Y. Real Prop. Acts. Law § 756-A
Added by New York Laws 2023, ch. 630,Sec. 1, eff. 12/14/2023.