New York A 11257: Relates to the scope of quasi-judicial immunity of referees in mortgage foreclosure actions

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A11257 Summary:

BILL NOA11257 

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SAME ASNo Same As

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SPONSORWalker

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COSPNSR

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MLTSPNSR

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Add §1354-a, amd §1355, RPAP L; amd R4311, CPLR

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Clarifies and codifies the limits of quasi-judicial immunity applicable to referees appointed in mortgage foreclosure actions; ensures accountability for misconduct and ultra vires acts.

Go to top A11257 Actions:

BILL NOA11257 

&nbsp

05/04/2026referred to judiciary

Go to topA11257 Committee&nbspVotes:

Go to topA11257 Floor&nbspVotes:

There are no Assembly votes for this bill in this legislative session.

Go to topA11257 Text:

 STATE OF NEW YORK
 ________________________________________________________________________

 11257

 IN ASSEMBLY

 May 4, 2026
 ___________

 Introduced by M. of A. WALKER -- read once and referred to the Committee
 on Judiciary

 AN ACT to amend the real property actions and proceedings law, in
 relation to the scope of quasi-judicial immunity of referees in mort-
 gage foreclosure actions

 The People of the State of New York, represented in Senate and Assem-
 bly, do enact as follows:

 1 Section 1. Legislative findings and intent. The legislature hereby
 2 finds that referees appointed in mortgage foreclosure actions pursuant
 3 to article thirteen of the real property actions and proceedings law and
 4 article forty-three of the civil practice law and rules perform func-
 5 tions that are limited in scope and subject to strict judicial super-
 6 vision.
 7 The legislature further finds that New York courts, including the
 8 appellate division, second department, apply a functional analysis in
 9 determining whether quasi-judicial immunity applies, limiting such immu-
 10 nity to acts that are discretionary in nature and integrally related to
 11 the judicial process, and withholding such immunity for ministerial
 12 acts, acts in excess of authority, or acts undertaken in bad faith or in
 13 the clear absence of jurisdiction.
 14 It is the intent of the legislature to codify and clarify these prin-
 15 ciples as applied to foreclosure referees, and to ensure accountability
 16 where such referees engage in misconduct or exceed the authority
 17 conferred by statute or court order.
 18 Court-appointed foreclosure referees have been computing judgment
 19 debts with unlawful interest - compound interest, interest during the
 20 motion determination period, unauthorized default rates - for years.
 21 Those inflated computations suppress surplus funds that legally belong
 22 to borrowers, subordinate lienholders, and creditors. In addition, fore-
 23 closure referees fail to report surplus monies to the Court and the
 24 former owner, and fail to deposit the surplus monies into Court as
 25 required by law. In none of the cases has there been anyone held
 26 accountable, despite the widespread and public account of this abuse of
 27 power or discretion.

 EXPLANATION--Matter in italics (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD15723-01-6

 A. 11257 2

 1 Referees claim quasi-judicial immunity, even though New York State law
 2 directs otherwise. The amendments in this bill also seek to codify the
 3 rule being proposed by the New York State Office of Justice Initiatives
 4 that referees "do not have judicial immunity and would not be repres-
 5 ented by the Attorney General if sued". This legislation expressly
 6 abrogates judicial and quasi-judicial immunity for specific enumerated
 7 categories of misconduct, including conversion of surplus funds, failure
 8 to deposit surplus funds into court, and failure to file the report of
 9 sale as to surplus funds.
 10 This act addresses any unlawful computation or unauthorized distrib-
 11 ution of surplus monies by a referee is per se misconduct; authorizes
 12 vacatur of the foreclosure sale where the misconduct materially affected
 13 the open bid or upset price, the calculation of the amounts due to the
 14 mortgagee or plaintiff or its attorneys, or the calculation or deposit
 15 or distribution of surplus monies, and is in keeping with the federal
 16 and state law that surplus monies from any auction is protected property
 17 of the former owner.
 18 § 2. The real property actions and proceedings law is amended by
 19 adding a new section 1354-a to read as follows:
 20