The plaintiff is seeking to vacate the sale of its foreclosed property and retain the successful bidder's down payment because of his failure to close title within the obligatory time frame. The successful bidder claims that he has not forfeited the bid or his deposit, arguing that a legally definitive time for closing title was not established and he is now ready willing and able to close title and should be permitted to do so.

The plaintiff-mortgagor foreclosed on a Brooklyn property on September 5, 2006 obtaining a Judgment of Foreclosure and Sale which controls these foreclosure proceedings. The sale was conducted on October 26, 2006. The Judgment mandated inter alia that the closing of title take place "within forty five days after such sale unless otherwise stipulated by all parties . . . . [and recited that] [a]ny delay or adjournment of the closing date beyond forty five days may be stipulated among the parties, with the Referee's consent, up to ninety days from the date of sale but any adjournment beyond ninety days may be set only with approval of this Court." Additionally, the Judgment of Foreclosure and Sale directed the referee to "transfer title only to the successful bidder at the auction."

The Terms of Sale scheduled the closing of title "no later than November 23, 2006." The plaintiff contacted Mr. Siunykalimi on November 10th and on November 16th whereupon he informed the plaintiff that he expected title to "be in on the week of November 20, 2006." However, apparently Mr. Siunykalimi made no further contact with the plaintiff and on [*2]December 4, 2006, plaintiff sent him a letter giving him an additional ten days from the date of the letter to close on the property saying that "In the event that the closing does not take place on or before December 14, 2006, we will seek to forfeit your deposit and vacate the sale of this property.

The successful bidder has declared that he is now ready to close as the title exceptions have been cleared and he annexes a copy of what purports to be a certified check for the presumed balance due. Notably, the maker of this check is not the successful bidder, but another individual.

In these statements it becomes apparent that there are two obligations imposed by the Judgment of Foreclosure and Sale that have been overlooked by the bidder. The first was the bidder's obligation to seek the approval of this Court for any adjournment that would delay the closing more than ninety days past the sale date. The second is the bidder's seeming disregard for the judicial directive that the referee transfer title only to the successful bidder at the auction. The successful bidder explains that certain title objections prevented him from closing sooner, but does not explain why he did not communicate these difficulties to the plaintiff. More significantly he does not indicate why he, in contrast to the plaintiff who timely brought the delay to this Court's attention, did not communicate with the Court and seek its approval for a closing that would be conducted more than ninety days after the sale. Further, there is no explanation as to how the successful bidder is going to close title with a check certified in another individual's name, unless he had planned to "flip the bid" and effect an immediate transfer of title at closing which is prohibited by the terms of the Judgment of Foreclosure and Sale.

However, the plaintiff does not seek to hold the bidder in default on these grounds. Instead, the plaintiff' turns to the language of the Terms of Sale which provides for a closing "no later than November 23, 2006 and further recites that "[t]ime is of the essence with respect to the closing date as to the purchaser only." There are two difficulties with this line of reasoning. First and foremost, this argument overlooks a far more critical omission by the bidder which involves his blatant disregard of an order of this Court which directed him to seek the Court's permission for an adjournment beyond ninety days. Second, the plaintiff cannot and did not create a "time of the essence" closing with the language it used in the Terms of Sale since "no later than" and "on or before" terms do not create a "time of the essence" closing date. Kevan v. Modesta, 292 AD2d 348(2d Dept. 2002);O'Connell v. Clear Holding Co., 126 AD2d 530(2d Dept. 1987).

This Court finds that both sides have contributed to the delays in this proceeding and both sides owe this Court an explanation by way of a showing of good cause for their dilatory conduct in violation of its order. The plaintiff did not properly schedule a time of the essence closing" within forty five days of the sale and then promptly move for relief when the bidder did not close. As a result, although ultimately, the plaintiff's motion was made just within the ninety day period specified in the Judgment, a protracted delay was incurred before the motion made its way to the calendar a delay that extended far beyond the ninety day period provided in the Judgment. The successful bidder did not seek Court intervention within the ninety day period but instead complacently sat back and waited for a motion to vacate the sale. This Court is very disturbed by these omissions which have created unnecessary delay in these proceedings.

Delays in the foreclosure context inevitably leave viable properties in a virtually [*3]ownerless limbo state and create the potential for a landscape filled with vacant, decaying edifices, which could well invite further foreclosures and decreasing property values. After the exposure of the sub-prime mortgage collapse, we can no longer have any doubt about the impact of foreclosure proceedings upon the larger landscape.

Accordingly, the motion is granted to the extent that this Court will conduct a hearing on the question of whether there is good cause for the parties' dilatory conduct in abrogation of the directives of the Judgment of Foreclosure and Sale. If good cause is not shown, remedies may include vacating the bid and suspending the accrual of interest. The parties are directed to appear in the Courthouse, 360 Adams Street, Brooklyn, New York, room 441 on Friday May 4, 2007 at 11:00 a.m. prepared to commence this hearing.

This constitutes the decision and order of the Court.

J.S.C.