N.Y. Tax Law § 259: Trust mortgages

§ 259. Trust mortgages. In the case of mortgages made by corporations

in trust to secure payment of bonds or obligations issued or to be

issued thereafter, if the total amount of principal indebtedness which

under any contingency may be advanced or accrued or which may become

secured by any such mortgage which is subject to this article has not

been advanced or accrue thereon or become secured thereby before such

mortgage is recorded, it may contain at the end thereof a statement of

the amount which at the time of the execution and delivery thereof has

been advanced or accrued thereon, or which is then secured by such

mortgage; thereupon the tax payable on the recording of the mortgage

shall be computed on the basis of the amount so stated to have been so

advanced or accrued thereon or which is stated to be secured thereby.

Such statement shall thereafter at all times be binding upon and

conclusive against the mortgagee, the holders of any bonds or

obligations secured by such mortgage and all persons claiming through

the mortgagee any interest in the mortgage or in the mortgaged premises.

Whenever a further amount is to be advanced under the original mortgage,

or shall accrue thereon or become secured thereby, the corporation

making such mortgage shall pay the tax on such amount at or before the

time when such amount is to be advanced, accrues or becomes secured and

shall, at the time of paying such tax, file in the office of the

recording officer where such mortgage has been or is first recorded and

with the tax commission a statement, verified by the secretary,

treasurer or other proper officer, of said corporation of the amount of

principal indebtedness to be so advanced, accruing or becoming secured,

and the certification of any bond or bonds by the trust mortgagee shall

be deemed an advance under this article. Such additional tax shall be

paid to the recording officer where such mortgage has been or is first

recorded and a receipt therefor shall be endorsed upon the mortgage and

payment therefor shall be noted in the margin of the record of such

mortgage and if requested a duplicate receipt for such payment shall

also be given to the party paying such tax and the note of such payment

or additional payment or such receipt shall have the same force and

effect as the record of receipt of the tax which under this article is

payable at or before the recording of the mortgage. If such additional

tax is not paid as required by this section, the trust mortgagee shall

not certify any bond or other obligation issued on account thereof. The

corporation making such mortgage or the owner of the property which

secures the mortgage debt shall annually within thirty days after July

first, and until it shall appear by such statement that the maximum

amount of principal indebtedness secured by such mortgage has been

advanced, has accrued or become secured and the tax thereon paid, file

in the office of the tax commission and the recording officer where such

mortgage has been or is first recorded a statement, verified by the

secretary, treasurer or other proper officer of said corporation,

showing:

1. The name of the mortgagor and the mortgagee;

2. The date of the mortgage and the county where first recorded;

3. The maximum amount of principal debt or obligation which under any

contingency may be secured by such mortgage;

4. The amount advanced on such mortgage during the year ending June

thirtieth preceding, with the date and amount of each advancement;

5. In the case of a mortgage recorded prior to July first, nineteen

hundred and six, the first annual statement filed under this section as

hereby amended, shall state the total amount advanced prior to July

first, nineteen hundred and six, and the date and the amount of each

subsequent advancement to the end of the period covered by the

statement.

A failure to file any statement required by this section within the

specified time shall subject the corporation or other person required to

file such statement to a penalty of not less than one dollar nor more

than one hundred dollars for each one thousand dollars of the maximum

amount of principal indebtedness which is or under any contingency may

become secured by the mortgage, which penalty in the aggregate shall not

exceed the sum of five thousand dollars, recoverable by the

attorney-general in an action brought in the name of the people of the

state of New York.