The following documents were read in connection with the motion of the defendant Board of Managers of the Village of Mount Kisco Condominium Association:

Notice of motion, affirmation, exhibits1-8

Plaintiff's affirmation in opposition, exhibits9-12

Reply affirmation13

On or about May 24, 2010, the plaintiff commenced this action to foreclose on a residential condominium unit owned by the defendants James L. Brooks II, Juanita Brooks, and Maria Osorio (hereinafter the defendant homeowners). In addition to these defendants, the complaint named, among others, the defendant Board of Managers of the Village of Mount Kisco Condominium Association (hereinafter the Board) as a lien holder whose interest was subordinate to the mortgage. [*2]On February 7, 2011, the Board filed a "Notice of Appearance and Waiver in Foreclosure," in which it waived notice of all proceedings with the exception of the referee's report, judgment of foreclosure and sale, notice of sale, and notice of any proceedings to obtain surplus monies. Although the action was filed in 2010, little, if any, progress has been made in moving the case forward.^[FN1]

The Board now moves (1) pursuant to CPLR 3025 for leave to withdraw its notice of appearance, (2) for leave to file an answer asserting counterclaims and cross claims, (3) compelling the plaintiff to pay the accrued common charges on the condominium unit and, if it is the successful bidder at the foreclosure sale, to pay the common charges on the unit from that point forward, and (4) for the costs of bringing this motion. The proposed amended answer seeks to assert a counterclaim against the plaintiff to recover the unpaid common charges that have accrued on the subject unit during the pendency of this action, alleging that the charges accrued due to the plaintiff's delay in prosecuting the action. The Board also seeks to assert a cross claim against the defendant homeowners for unpaid common charges in the sum of $40,973.51 (which figure includes the sum of $19,083.79 that was apparently already reduced to a judgment against the defendant homeowners in a separate action).

In opposition, the plaintiff claims that its delay in moving the case forward was due to the collapse of the law firm of Steven J. Baum, P.C., its prior counsel. The plaintiff argues that the Board intentionally defaulted by not answering, and it cannot seek to cure that default now by seeking leave to interpose a late answer. The plaintiff contends that Board's motion is defective in that the plaintiff has not submitted and affidavit of merit, or offered an excuse for its intentional default.

In reply, the Board contends, among other things, that it did not intentionally default and has not in fact defaulted at all, since it timely filed a notice of appearance.

The Board's motion is denied in its entirety.

With respect to the branches of the Board's motion which seek leave to withdraw its notice of appearance and file its proposed answer, "[a]pplications for leave to amend pleadings should be freely granted except when the delay in seeking leave to amend would directly cause undue prejudice or surprise to the opposing party, or when the proposed amendment is palpably insufficient or patently devoid of merit" (Gomez v State of New York, 106 AD3d 870 [2d Dept 2013]). "The sufficiency or underlying merit of the proposed amendment is to be examined no further" (id., citing Lucido v Mancuso, 49 AD3d 220, 221, 227 [2d Dept 2008]). Here, the Board's proposed counterclaim which seeks to recover damages from the plaintiff for delaying in prosecuting this action is clearly an attempt to reduce its request for sanctions to a cause of action. However, since "New York does not recognize a separate cause of action to impose sanctions" (Greco v [*3]Christoffersen, 70 AD3d 769, 771 [2d Dept 2010]), the proposed counterclaim is patently devoid of merit. Further, allowing the Board to assert the proposed cross claim for damages against the defendant homeowners will only serve to delay and complicate this action. Moreover, some of the damages the Board seeks to recover have already been reduced to a judgment and, therefore, litigating whether the defendant homeowners are liable for that sum would be duplicative. While leave to amend a pleading is ordinarily freely given, the Court finds, in its discretion, that the Board's claims against the defendant homeowners for common charges would be better litigated in a separate plenary action. Accordingly, leave to withdraw the notice of appearance and serve the proposed answer is denied.

The branch of the motion which seeks to compel the plaintiff to pay the common charges on the subject unit is denied, as the Board has failed to establish its entitlement to that relief. Specifically, the Board has not identified any basis, either in statute, common law, or contract, under which a junior lien holder can recover damages from a senior lien holder for not enforcing its rights more promptly. Indeed, although an inordinate delay attributable to a foreclosing plaintiff may result in the loss of interest or penalties due under the terms of the borrower's loan (see CPLR 5001 [a]; Deutsche Bank Trust Co., Ams. v Stathakis, 90 AD3d 983, 984 [2d Dept 2011]), nothing compels a mortgage holder to sue for foreclosure at all (see 1-2 Bergman on New York Mortgage Foreclosures § 2.20 [4] ["a mortgage holder is not obligated to foreclose its mortgage. If it does foreclose, no pace of the action is mandated, although protracted delay can have monetary consequences" such as the loss of interest (emphasis added)]).^[FN2] Thus, while the Board might argue at some point in this action that the plaintiff's delay should result in the loss of mounting interest on its loan (which strategy might, if successful, theoretically result in a surplus upon the foreclosure sale from which the Board and other junior interest holders would be entitled), the proposed remedy of requiring the plaintiff to pay the defendant homeowners' accruing common charges to the Board as damages would, in effect, improperly subordinate the plaintiff's mortgage to the Board's lien. Such a result is incompatible with the very notion that one interest in real property can have priority over another.

Finally, the branch of the motion which seeks to recover the costs of bringing the instant motion as sanctions pursuant to 22 NYCRR 130-1.1 is denied.

Accordingly, it is hereby,

ORDERED that the motion of the defendant Board of Managers of the Village of Mount Kisco Condominium Association is denied; and it is further

ORDERED that all other relief requested and not decided herein is denied.

This constitutes the decision and order of the Court.

June 13, 2014

Attorneys for the plaintiff

187 East Main Street

Huntington, NY 11743

By fax: 631-935-1223

Law Offices of Timothy A. Green

Attorney for the Board

81 Main Street, Suite 205

White Plains, NY 10601

By fax: 914-683-7900

James L. Brooks, II

25-404 Barker Street

Mt. Kisco, NY 10549

By mail

Juanita Brooks

25-404 Barker Street

Mt. Kisco, NY 10549

By mail

Maria Osorio

25-404 Barker Street

Mt. Kisco, NY 10549

By mail

Mt. Kisco Housing Authority

200 Carpenter Ave.

Mount Kisco, NY 10549

By mail