N.Y. Real Property Tax Law § 1197: Claims for surplus

§ 1197. Claims for surplus. 1. Any person who had any right, title,

interest, claim, lien or equity of redemption in or upon a parcel

immediately prior to the issuance of the judgment of foreclosure may

file a claim with the court having jurisdiction for a share of any

surplus resulting from the sale of such property. Such claims shall be

administered and adjudicated, and such surplus shall be distributed, in

the same manner as in an action to foreclose a mortgage pursuant to

article thirteen of the real property actions and proceedings law,

subject to the provisions of this section.

2. (a) Where the property was sold by a public sale, the amount paid

for the property shall be accepted as the full value of the property. No

party may maintain a claim for surplus or any other claim or action

against the tax district on the basis that the amount paid for the

property did not fairly represent the property's value.

(b) Where the property was sold by other than a public sale, a

claimant may make a motion, upon notice to the enforcing officer, for

the surplus to be recalculated on the basis that the property's full

value on the date of the sale was substantially higher than the value

used to measure the surplus pursuant to subparagraph (ii) of paragraph

(a) of subdivision one of section eleven hundred ninety-six of this

title. If the court or its referee finds that a preponderance of the

evidence supports the claimant's position, the court may direct the

enforcing officer to recalculate the surplus based upon the property's

value as determined by the court or referee. The court may further

direct the enforcing officer to pay the difference into court to be

distributed as required by this section.

3. Where the court has appointed a referee to preside over the

proceedings pursuant to subdivision two of section thirteen hundred

sixty-one of the real property actions and proceedings law, it shall not

be necessary for such referee to make a report of such proceedings; nor

shall it be necessary for the court to confirm by order or otherwise

such proceedings.

4. In the case of residential property, if at the time of the

confirmation of the report of sale, no former homeowner has filed a

claim for surplus, and there are surplus proceeds that remain to be

distributed, the proceeding shall remain open for at least three years

from the confirmation of the report of sale, or for such longer period

as the court may direct. If a former homeowner should file a claim for

surplus during such period, the court shall proceed as if it had been

timely filed.

5. At the conclusion of such proceedings, any surplus funds that have

not been claimed shall be deemed abandoned but shall be paid to the tax

district, not to the state comptroller, and shall be used by the tax

district to reduce its tax levy.

6. To the extent the provisions of article thirteen of the real

property actions and proceedings law are inconsistent with the

provisions of this article, the provisions of this article shall govern.