§ 410-K — Supervision

§ 410-k. Supervision. 1. The commissioner may from time to time\nmake, alter, amend and repeal rules and regulations for the supervision,\nexamination, regulation and audit of an eligible borrower and for\ncarrying into effect this title, and each eligible borrower shall submit\nan annual report of its operations to the commissioner and the agency\nwho may examine and audit the books and records of the eligible borrower\nat any time.\n 2. The commissioner and the department shall have power to act for\nand in behalf of the agency in servicing the project mortgage loans of\nthe agency, and to perform such functions and services in connection\nwith the making, servicing and collection of such loans as shall be\nrequested by the agency.\n 3. (a) The commissioner and the department may, with respect to any\nproject of which the agency has acquired the fee or otherwise, enter\ninto an agreement with said agency subject to the approval of the\ndirector of the budget, for the department, as provided in paragraph (b)\nhereof, to operate the said project in a manner consistent with the\npurposes of this title. In such event, the commissioner, on behalf of\nthe department, shall have the power to use any available funds to pay\nall operating expenses and to comply with all the terms and provisions\nof the mortgage, as though the mortgage had not been foreclosed, and to\ncomply with the provisions of this title.\n (b) Subject to the provisions of the agreement with said agency, the\ncommissioner may contract with any person, firm or corporation which he\ndeems qualified to operate and manage such project and to perform such\nduties and functions as he may deem necessary.\n 4. Whenever the commissioner shall be of the opinion that an eligible\nborrower is failing or omitting, or is about to fail or omit to do\nanything required of it by law or by order of the commissioner and is\ndoing or is about to do anything, or permitting anything, or is about to\npermit anything to be done, contrary to or in violation of law or of any\norder of the commissioner, or which is improvident or prejudicial to the\ninterest of the public, the lienholders, the shareholders, or the\noccupants, the commissioner may, in addition to such other remedies as\nmay be available, commence an action or proceeding in the supreme court\nof the state of New York in the name of the commissioner, for the\npurpose of having such violations or threatened violations stopped and\nprevented, and in such action or proceeding, the court may appoint a\ntemporary or permanent receiver or both. Such action or proceeding\nshall be commenced by a petition to the supreme court, alleging the\nviolation complained of and praying for appropriate relief. It shall\nthereupon be the duty of the court to specify the time, not exceeding\ntwenty days after service of a copy of the petition, within which the\neligible borrowers complained of must answer the petition. In case of\nany default or after answer the court shall immediately inquire into the\nfacts and circumstances in such manner as the court shall direct in the\ninterest of substantial justice without other or formal pleading. Such\nother persons or corporations as it shall seem to the court necessary or\nproper to join as parties in order to make its order or judgment\neffective, may be joined as parties. The final judgment in any such\naction or proceeding shall either dismiss the action or proceeding or\ndirect that an order or an injunction, or both, issue, or provide for\nthe appointment of a receiver as prayed for in the petition, or grant\nsuch other relief as the court may deem appropriate.\n