N.Y. Real Property Actions & Proceedings Law § 963: Payment of proceeds out of court where there are liens

§ 963. Payment of proceeds out of court where there are liens. 1.

Where the proceeds of a sale are paid into court, in a case specified in

section 962, the party may apply to the court for an order directing

that the money, or such part as he claims, be paid to him, and the court

shall make such an order as justice requires. The party shall by

affidavit show the amount actually due on each incumbrance, and the name

and residence of the owner of the incumbrance, as far as they are known

or can be ascertained with due diligence, and showing service of a

notice of the application on each owner of an incumbrance. Service of

the notice within the state shall be personal, or by leaving it at the

owner's residence with some person of suitable age and discretion, at

least fourteen days previous to the application. Service without the

state, if personal, shall be made at least twenty days previous to the

application. If the owner of the incumbrance resides without the state,

and the place of his abode cannot be ascertained with reasonable

diligence, notice may be served on him by publishing it in such

newspaper or newspapers as the court may direct, once in each week for

the four weeks immediately preceding the application.

2. When the whole amount of the unsatisfied liens upon an undivided

share has been ascertained, the court shall order the portion of the

money so paid into court on account of that share to be distributed

among the creditors having the liens, according to the priority of each

of them. Where the incumbrancer is not a party to the action, the clerk

or other officer by whom a lien is paid off shall procure satisfaction

to be acknowledged or proved, as required by law, and shall cause the

incumbrance to be duly satisfied or cancelled of record. The expense of

so doing shall be paid out of the portion of the money in court

belonging to the party by whom the incumbrance was payable.