Inc., 98 AD2d 400 [2d Dept, 1983] and Empire Savings Bank v. The Tower
Co., 54 AD2d 574 [2d Dept, 1976].
The respondent, as the sole tenant, is a necessary party to the foreclosure proceeding
(see 78 NY Jur. 2d Mortgages §588). As a necessary party who was not named in
the foreclosure proceeding, the respondent's rights were "unaffected by the judgment and sale,
and the foreclosure sale may be considered void as to the omitted party ." 6820 Ridge
Realty, L.L.C. v. Goldman, 263 AD2d 22, 26 [2d Dept, 1999] (see Si
Bank & Trust v. Sheriff of the City of New York, 300 AD2d 667, [2d Dept, 2000]).
Thus, a tenant or occupant who was not named as a party in the foreclosure action retains his or
her possessory rights and a right of redemption. Id.; and Davis v.
Cole, 193 Misc 2d 380 [SCt NY, 2002].
As stated in Finkelstein and Ferrara, Landlord and Tenant Practice in New York § 2:76:
Lease Subject to Foreclosure-Typically, the possessory interests of a rent paying tenant who
was not made party to a foreclosure action will not be affected by a judgment of foreclosure- the
purchaser will take title subject to any rights or interest which the tenant may establish. When a
tenancy is not expressly extinguished by the foreclosure judgment, the subsequent purchaser
generally is not entitled to actual possession until the tenancy's termination.
The lease would be extinguished if the lease contained a subordination clause but only if the
tenant were duly named and served as a party defendant (Finkelstein and Ferrara, Landlord and
Tenant Practice in New York § 2:77). The lease does not have a subordination clause but
even if it contained one, the foreclosure action would have no effect on the tenant's lease because