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N.Y. Real Property Law Journal a Publication of the Real Property Law Section of the New York State Bar Association

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N.Y. Real Property Law Journal a Publication of the Real Property Law Section of the New York State Bar Association NYSBA SUMMER 2008 | VOL. 36 | NO. 3 N.Y. Real Property Law Journal A publication of the Real Property Law Section of the New York State Bar Association SPECIAL EDITION: SELECTED TOPICS IN MEDICAL ETHICS AND BIOETHICS SPPECIALECIAL ISSSUESUE: THHEE LAAWYERWYER AASS TIITLETLE INNSURANCESURANCE AGGENTENT RealPropSum08.indd 1 7/21/2008 2:31:29 PM Your key to professional success… A wealth of practical resources at www.nysba.org • Downloadable Forms organized into common The N.Y. Real Property Law practice areas Journal is also available online! • Comprehensive practice management tools • Forums/listserves for Sections and Committees • More than 800 Ethics Opinions • NYSBA Reports – the substantive work of the Association • Legislative information with timely news feeds • Online career services for job seekers and employers • Free access to several case law libraries – exclusively for members Go to www.nysba.org/RealPropertyJournal The practical tools you need. to access: The resources you demand. • Past Issues (1998-present) of the N.Y. Real Available right now. Property Law Journal* Our members deserve nothing less. • N.Y. Real Property Law Journal Searchable Index (1998-present) • Searchable articles from the N.Y. Real Property Law Journal that include links to cites and statutes. This service is provided by Loislaw and is an exclusive Section member benefi t* *You must be a Real Property Law Section member and logged in to access. Need password assistance? Visit our Web site at www.nysba.org/pwhelp. For questions or log-in help, call (518) 463-3200. For more information on these and many other resources go to www.nysba.org RealPropSum08.indd 2 7/21/2008 2:32:20 PM Table of Contents A Message from the Outgoing Chair .................................................................................4 (Karl B. Holtzschue) A Message from the Incoming Chair..................................................................................4 (Peter V. Coffey) THE LAWYER AS TITLE INSURANCE AGENT Introduction .......................................................................................................................5 (Peter V. Coffey) The History of Title Insurance ........................................................................................6 (Gerard G. Antetomaso) Ancillary Attorney Compensation from Title Services ...............................................8 (George Haggerty) The Real Estate Lawyer and the Title Insurance Policy Ethics Status Report ........13 (Steven Wechsler) COSAC Proposes to Make it Consentable for an Attorney to Refer a Client to the Lawyer’s Title Abstract Company.....................................................................19 (Karl B. Holtzschue) Single Room Occupancy Law in New York City ............................................................21 (Marti Weithman and Gerald Lebovits) On Expanding the Concept of Brownfields Restoration ...............................................26 (Jeffrey Kleeger) Revised § 216 Lets Corporations with Unlimited Non-Member Income Be “Cooperative Housing Corporations” .........................................................................35 (Joel E. Miller) BERGMAN ON MORTGAGE FORECLOSURES: More on Service of Process Woes..................................................................................43 (Bruce J. Bergman) Guide to Hudson River Sights from the Train ................................................................44 (Karl B. Holtzschue) NYSBA N.Y. Real Property Law Journal | Summer 2008 | Vol. 36 | No. 3 3 RealPropSum08.indd 3 7/21/2008 2:32:22 PM Message from the A Message from the Outgoing Chair Incoming Chair It’s been a busy year and, as of I just attended an appellate prac- this writing, less than a month to go tice seminar put on by the New York in my term. I want to thank my fel- State Bar Association at which all 13 low offi cers, Peter Coffey, Joel Sachs Justices of the Appellate Division, and Anne Reynolds Copps and Third Department appeared. One fellow RPLS Executive Committee point they made was this—that as members for all their help and sup- soon as you stand up in front of the port. They are an outstanding group court, introduce yourself. Well, who of real estate lawyers and devote a am I to challenge the entire bench of great number of hours and effort to Karl B. Holtzschue the Third Department of the Appel- Peter V. Coffey carry out the work of our Section. late Division? As you will see below, responding My name is Peter V. Coffey and I am a member of to and proposing legislation has been a major focus this a six-person law fi rm in Schenectady, New York—I am year. Following are some of the highlights of the year: married and have been for forty (40) years and we are the 1. Adverse Possession Bill Proposed. A9156/S5364A parents of six children (boys) and one grandchild. (Sen. Little) was an attempt to reverse the outcome in First of all, the thank yous. Great thanks and warm Walling v. Przybylo, 7 N.Y.3d 228 (2006), by providing praise go to Karl Holtzschue, who has chaired the Section that a title claim based on adverse possession could for the past year. His initiative regarding legislation is not succeed if the claimant had knowledge of the one of the better accomplishments I have seen in the Real true ownership. Our Section opposed the bill (RPLS Property Law Section. Legislation Memorandum #13) because it contained ambiguities and raised important issues, and the Thanks also to Joel Sachs, Second Vice-Chair, who Governor vetoed the bill. Our Task Force on Adverse has planned a great outing in Hershey, PA—as in choco- Possession studied the law and recommended a late and great things for children to do. Thanks to Anne better alternative to help ensure that homeowners Copps, our Secretary (if you have an enemy make him or are on notice of adverse possession, to eliminate her Secretary). The new year which begins June 1st has claims based on minor encroachments and lawn Joel as First Vice-Chair, Anne as Second Vice-Chair and mowing and to generally clarify the RPAPL provi- Ed Baer as Secretary (who doesn’t like him?). Ed was the sions, though not reversing the result in Walling. The former Budget Offi cer—a new position for the Section and RPLS Executive Committee approved the bill and we something we very much needed. He will be replaced in obtained approval from the NYSBA Executive Com- that capacity by Spencer Compton. mittee. It was introduced on April 29 as a courtesy by Senator Little as S7915, who also reintroduced her If you are a member of the Executive Committee old bill as S7917. We met with her on April 29 and or have been otherwise substantially involved with the she still insisted on denying adverse possession to Section, you understand what is going on. This message possessors with knowledge of true ownership, ask- is addressed to the rest of you. The goal of this year is to ing that we come up with a compromise to achieve bring as many of you as possible into active involvement both her goals and ours. We met with her again on in the Section—to bring you the benefi t of in-person inter- May 14 to argue for our bill. action with some of the best real estate practitioners in the state—and the nation in many instances. 2. Title Agents and Service Charges Bill. The Section successfully negotiated an exclusion from the con- Let me tell of a couple of examples of recent activity trolled business prohibition for attorney title agents to show you what I am talking about. Karl Holtzschue and examining counsel in the title agents registration has established a great initiative as I mentioned before in bill (A1743/S877) and consequently supported the that we have become actively involved with the legisla- bill. Our Title and Transfer Committee has drafted a ture. This has resulted in our visiting and conferring with bill to require disclosure of service charges to con- several legislators every year. Because of this involvement sumers in connection with title insurance that would and our actively monitoring legislation affecting our area, separately identify (1) payments to third parties and we focused on the Property Condition Disclosure Act. (2) service charges. The bill was approved by our As initially passed by the legislature, the Act would have (continued on page 49) (continued on page 50) 4 NYSBA N.Y. Real Property Law Journal | Summer 2008 | Vol. 36 | No. 3 RealPropSum08.indd 4 7/21/2008 2:32:22 PM THE LAWYER AS TITLE INSURANCE AGENT Introduction By Peter V. Coffey A core act of any real estate attor- to reconsider N.Y. State 595, which presentation itself is the result of an ney is the rendering of a title opinion. resulted in Opinion 621 stating, “at intense effort by the group for several The concept is simple, its service the request of the Real Property Law months prior to the presentation of complex. In the normal residential Section of the New York State Bar the issue. I chaired the panel. real estate closing today confl ict is Association (upon which 1986 report There was much discussion at the at the heart of the complexity. For we relied heavily in fashioning N.Y. presentation and a lively and (as they whom is the attorney rendering a State 595 [1988]), our committee has say) heated debate. It is my position title opinion? If it’s for only one party reconsidered N.Y. State 595 1988.” that DR 1-106 overrides the previ- to the transaction, then we have a However, this opinion did not change ous ethics opinions regarding this simple concept. But once parties are the conclusion that had been reached issue, holding there is a nonconsent- added to the representation, confl icts earlier. The issue continued to fer- able confl ict. The Ethics Committee and complexity compound. And all ment and there followed a series of takes the position these confl icts are the while we as real estate attorneys ethics opinions issued by the New nonconsentable, that is, even if in- must keep in mind one of the essen- York State Bar Association Committee formed of every aspect of the confl ict, tials of our profession—subordinate on Professional Ethics.
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