MATTER OF 200 E. 64TH ST. CORP. v. Manley

New York Court of Appeals

MATTER OF 200 E. 64TH ST. CORP. v. Manley

337 N.E.2d 133, 37 N.Y.2d 744, 374 N.Y.S.2d 621, 1975 N.Y. LEXIS 2108

CourtNew York Court of Appeals

DecidedJuly 2, 1975

StatusPublished

Cited by7 cases

This text of 337 N.E.2d 133 (MATTER OF 200 E. 64TH ST. CORP. v. Manley) is published on Counsel Stack Legal Research, covering New York Court of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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MATTER OF 200 E. 64TH ST. CORP. v. Manley, 337 N.E.2d 133, 37 N.Y.2d 744, 374 N.Y.S.2d 621, 1975 N.Y. LEXIS 2108 (N.Y. 1975).

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Opinion

Memorandum. We agree with the reasoning of Mr. Justice Staley in his dissenting opinion at the Appellate Division that the construction mortgage was extinguished through merger when it was acquired by John Hancock Mutual Life Insurance Company, the then owner of the leasehold. As the consolidation agreement does not qualify as a supplemental mortgage under section 255 of the Tax Law, for the reasons therein stated, a recording tax was subsequently due and owing upon the filing of said agreement (Tax Law, § 250).

We disagree, however, with the determination that the appraisal value of the property should be used in the computa *747 tion of the taxes due. The amount of the principal debt or obligation is to be used as the basis for computation of the recording tax (Tax Law, § 253), unless that amount "is not determinable from the terms of the mortgage” in which case "the value of the property covered by the mortgage” is to be used (Tax Law, § 256). Here, although the consolidation agreement provided for additional payments, the amount of which would not be ascertainable at the time of recording, such payments are nothing more than additional interest and, therefore, do not make indeterminable or uncertain the amount of the principal indebtedness, which remains at $5,500,000.

The order of the Appellate Division should be modified by remitting the matter to the Appellate Division with directions to remand to the State Tax Commission for computation of the recording tax in the full amount of the indebtedness of $5,500,000, evidenced by the consolidation agreement recorded June 30, 1970, without costs.

Chief Judge Breitel and Judges Jasen, Gabrielli, Jones, Wachtler, Fuchsberg and Cooke concur.

Order modified, without costs, and the matter remitted to the Appellate Division, Third Department, for further proceedings in accordance with the memorandum herein and, as so modified, affirmed.

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Memorandum. We agree with the reasoning of Mr. Justice Staley in his dissenting opinion at the Appellate Division that the construction mortgage was extinguished through merger when it was acquired by John Hancock Mutual Life Insurance Company, the then owner of the leasehold. As the consolidation agreement does not qualify as a supplemental mortgage under section 255 of the Tax Law, for the reasons therein stated, a recording tax was subsequently due and owing upon the filing of said agreement (Tax Law, § 250).

We disagree, however, with the determination that the appraisal value of the property should be used in the computa *747 tion of the taxes due. The amount of the principal debt or obligation is to be used as the basis for computation of the recording tax (Tax Law, § 253), unless that amount "is not determinable from the terms of the mortgage” in which case "the value of the property covered by the mortgage” is to be used (Tax Law, § 256). Here, although the consolidation agreement provided for additional payments, the amount of which would not be ascertainable at the time of recording, such payments are nothing more than additional interest and, therefore, do not make indeterminable or uncertain the amount of the principal indebtedness, which remains at $5,500,000.

The order of the Appellate Division should be modified by remitting the matter to the Appellate Division with directions to remand to the State Tax Commission for computation of the recording tax in the full amount of the indebtedness of $5,500,000, evidenced by the consolidation agreement recorded June 30, 1970, without costs.

Chief Judge Breitel and Judges Jasen, Gabrielli, Jones, Wachtler, Fuchsberg and Cooke concur.

Order modified, without costs, and the matter remitted to the Appellate Division, Third Department, for further proceedings in accordance with the memorandum herein and, as so modified, affirmed.

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337 N.E.2d 133, 37 N.Y.2d 744, 374 N.Y.S.2d 621, 1975 N.Y. LEXIS 2108, Counsel Stack Legal Research, https://law.counselstack.com/opinion/matter-of-200-e-64th-st-corp-v-manley-ny-1975.

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