OPINION OF THE COURT
STEPHEN G. CRANE, J.
Nationwide Associates Inc. (Nationwide) and Barry Richter cross-move to compel plaintiff to deliver an assignment of the note and mortgage and cause of action for foreclosure on tender of all sums legally due and owing to plaintiff.
Prior Proceedings and Events
This action was commenced on March 2, 1998. It demanded judgment of foreclosure and alleged that the principal sum due on the mortgage as of January 1, 1998 was $211,283.95. The complaint asked for that sum with interest as stated in the mortgage together with fire insurance premiums, taxes, assessments, water rates, interest or liens or other charges affecting the mortgaged premises. It sought judgment against Barry Richter and Daniel Perla for any deficiency based on their guaranty. And, it asked for the costs and expenses of the action and of the sale. The defendants either defaulted or waived service of papers.
On August 4, 1998 the court granted plaintiff's motion to appoint a Referee to compute the sums due to plaintiff on the mortgage. The court appointed Ravi Batra, Esq., to "take proof as to any payments which have been made, and to compute the amount due on the mortgaged premises to Plaintiff."
On August 18, 1998, plaintiff assigned the mortgage to CLM in consideration of $210,000 plus foreclosure attorney's fees. The assignment included the "bond or note or obligation described in said mortgage, and the moneys due and to grow due thereon with the [sic] interest." In a separate document, plaintiff assigned to CLM the promissory note and guaranty thereof by Barry Richter and Daniel Perla executed on January 24, 1992.
Mr. Batra rendered his Referee's report of computations dated March 12, 1999. In it he reported that there was due
Guarantor Richter on April 30 notified plaintiff's attorney that he was "ready, willing and able to pay all sums due and owing to the mortgagee in consideration for an assignment of the mortgage, note and cause of action."
This court, by the Decision dated May 11, 1999, granted on default plaintiff's motion (sequence No. 003) "to amend the caption to reflect the substition [sic] of CLM Properties, Inc. as plaintiff, to confirm the Report of the Referee to Compute * * * and for Judgment of Foreclosure and Sale." The Decision directed a settle order. This is the Decision that the motion at bar asks to modify.
Swiftly following this Decision, CLM assigned the mortgage to MS for "One Hundred Dollars and other good and valuable
In conformity with the Decision counsel for MS submitted and later withdrew a proposed "Order & Judgment of Foreclosure & Sale." Its first decretal paragraph provided for confirmation and ratification in all respects of the report of Ravi Batra, Esq. The second paragraph declared that plaintiff was entitled to $255,827.27 plus interest from February 16, 1999.
The last event of note before MS brought on the motion at bar was the misguided effort of MS to return to the Referee, without a court order, to amend his report. The Referee rendered an amended report dated July 26, 1999. In it he reports that the amount due to plaintiff through July 15, 1999 is $306,331.91. This consists of the same principal of $211,283.93
The law applicable to this motion and the cross motion of Richter and Nationwide takes us through principles of assignment, law of the case, judicial estoppel, refereeships to compute, rights of redemption and equitable termination of accruing interest.
Law of Assignment
It is familiar learning that an assignee stands in the shoes of the assignor. MS, therefore, is in no better position than was CLM. Indeed, MS is subject to all the equities and burdens that attached to CLM and Fourth Federal Savings Bank.
Law of the Case and Judicial Estoppel
Where an issue has been resolved on the merits earlier in the litigation, this resolution becomes the law of the case. (Locilento v Coleman Catholic High School, 134 A.D.2d 39, 43 [3d Dept 1987]; cf., Mulder v Donaldson, Lufkin & Jenrette, 224 A.D.2d 125, 131 [1st Dept 1996].) The law of the case doctrine also applies to motions. Matter of Dondi v Jones (40 N.Y.2d 8, 15 ) states: "It is fundamental that, in the absence of a statutory exception * * * and in order to prevent vexatious and repeated applications on the same point, a motion once fully heard and decided cannot be revived again or renewed unless with leave of the court or Judge who denied it or if made upon presentation of new facts which have occurred since the denial of the previous motion." (See also, 28 NY Jur 2d, Courts and Judges, § 236.)
Lest there be any hesitation, on the ground that it was granted on default, about the applicability of the doctrine of the law of the case attaching to CLM's motion for judgment of foreclosure and sale upon the original Referee's report and calculations, the law is also settled that a decision on default is deemed a decision on the merits. (Cf., Rubeo v National Grange Mut. Ins. Co., 93 N.Y.2d 750; 175 E. 74th Corp. v Hartford Acc. & Indem. Co., 51 N.Y.2d 585, 590, n 1  ["That the dismissal was after default does not alter this rule of direct estoppel"]; Bray v Cox, 38 N.Y.2d 350, 355  ["Thus, we hold the dismissal of an appeal for want of prosecution to be on the merits of all claims which could have been litigated had the appeal been timely"]; Christian v Hashmet Mgt. Corp., 189 A.D.2d 597 [1st Dept 1993]; 28 NY Jur 2d, Courts and Judges, § 252; 10 Weinstein-Korn-Miller, NY Civ Prac ¶¶ 5011.12, 5011.30.)
Also playing a role in resolving the motion and cross motion at bar is the concept of judicial estoppel or, more precisely, estoppel against inconsistent positions. Judicial estoppel is
This is not to say, however, that no estoppel can result from inconsistent sworn statements made in the course of the same proceeding. (57 NY Jur 2d, op. cit., § 53.) As this court recognized in City of New York v Show World (178 Misc.2d 812, 823, n 4 [Sup Ct, NY County 1998]), such inconsistency can support an estoppel. (Inter-Power of N. Y. v Niagara Mohawk Power Corp., 208 A.D.2d 1073, 1075 [3d Dept 1994] ["(T)he doctrine of judicial estoppel * * * `prevent(s) a party from inequitably adopting a position directly contrary to or inconsistent with an earlier assumed position in the same proceeding or a prior proceeding'"], citing Shepardson v Town of Schodack, 195 A.D.2d 630, 632 [3d Dept 1993], affd 83 N.Y.2d 894 .)
Referees to Compute
RPAPL 1321 authorizes the court to direct a Referee to compute the amount due the plaintiff in an action to foreclose a mortgage. A Referee has no power beyond the order of reference. (Feder Corp. v Bozkurtian, 48 A.D.2d 701 [2d Dept 1975].) The court has the power to bypass the Referee's appointment and retain the authority itself to perform all the decision-making including the computation of the amount due. This is rarely done except in New York County where it reserves to itself the function to fix legal fees when they are requested. (2 Bergman, New York Mortgage Foreclosures § 27.01 .)
Right of Redemption, Accrual of Interest and Attorney's Fees
A mortgagor may tender payment of the balance due on the mortgage as long as it is unconditional. If the mortgagee wrongfully refuses to accept the tender, additional interest may be forfeited. (1 Bergman, op. cit., § 4.08.) The court has discretion to determine whether interest is recoverable. (Sloane v Gape, 216 A.D.2d 285, 286 [2d Dept 1995], lv dismissed 87 N.Y.2d 968
Finally, where a mortgage provides for legal costs or reasonable attorney's fees, it will be enforced. (2 Bergman, op. cit., § 26.01.) But, there must be an express provision for payment of attorney's fees in the mortgage. (Ibid.) A provision solely in the note will not accomplish the mortgagee's objective. "A provision in the note for the payment of legal fees simply does not create an obligation to pay counsel fees incurred in an action to foreclose on the mortgage secured by that note." (2 Bergman, op. cit., §§ 26.01, 26.01 , citing Lipton v Specter, 96 A.D.2d 549 [2d Dept 1983], lv denied 61 N.Y.2d 608 .)
Application to Motion and Cross Motion
MS, the assignee, wants this court to confirm the amended Referee's report. The Referee was without jurisdiction to render that report. His original report had already been confirmed and was the basis for granting CLM's motion for judgment of foreclosure and sale "in the usual form." CLM proclaimed the validity of the figures reported by the Referee. It also conceded the credit of $2,995.58.
MS as assignee steps into the shoes of CLM. CLM could only "correct" the alleged errors it induced in the Referee's original report by moving this court to reconsider its decision granting plaintiff's motion for judgment and to recommit the computation to the Referee. Of course, this would require a showing of new facts or, at the very least, an explanation of why the errors were not discovered before the report was submitted in support of the motion for judgment of foreclosure and sale. (Foley v Roche, 68 A.D.2d 558, 568 [1st Dept 1979].)
Since MS has not moved for renewal or reconsideration, nor complied with the requisites of such a motion, its application to confirm the amended Referee's report is blocked by the law of the case and by estoppel. Its assignor has saluted the correctness of Mr. Batra's original computation. CLM obtained a favorable decision on its motion for judgment based on that computation.
Even were the court to reach the merits of the amended Referee's report, the plaintiff would not prevail. First, the interest calculation for the month of January 1998 is inflated by
The court does not agree with the defendants that the default rate of interest cannot apply to the balloon payment, but only applies to the installments. The balloon payment itself is an installment, albeit the final installment under the note.
The defendants also claim that MS is not entitled to attorney's fees at all. It is true that CLM never asked for them. It is also accurate to observe that the mortgage is silent as to legal fees. However, the note makes provision for them. This is not good enough. They cannot be recovered in this foreclosure action. (Lipton v Specter, supra.) Moreover, the $3,000 for Mr. Kaufman's services includes time spent posttender, and much of these services were duplicative of prior counsel's efforts or were squandered on the misguided effort to obtain an amended Referee's report. They would, if applied for, be denied for the added reason of plaintiff's lack of showing that they were reasonable and necessary.
In view of the foregoing, Richter and Nationwide may tender in accordance with the figures previously confirmed in the original Referee's report.
This all means that plaintiff's motion to confirm the amended Referee's report and to modify the Decision dated May 11, 1999 is denied, save only for a change of caption to reflect the substitution of MS. This also means that the cross motion is granted on condition that Richter or Nationwide or both