§ 756-a. Stay of action or proceeding when a party's claim to title is
in dispute. 1. (a) A federal, state or local government agency may move
for a stay of any proceeding to recover possession of or quiet title to
real property relating to a residential dwelling unit or property, based
on a pending good faith investigation into the theft or fraud in the
title to, or the financing of, the premises that is the subject of any
proceeding. Upon the agency's showing of the pendency of a good faith
investigation, the court shall issue a stay of the proceeding, including
staying execution of a warrant of eviction or enforcement of a judgment
so long as the investigation is ongoing.

(b) Every six months, the court shall schedule a status conference
with the government agency and any other parties to the action to review
any stay and to determine if the investigation is still continuing in
good faith and shall continue the stay of the proceeding until the
government investigation is closed. If it should deem necessary, a court
may review any supporting documents filed by the government agency in
camera and to be filed under seal if deemed necessary by the government
agency.

2. The court shall stay all proceedings to recover possession of or
quiet title to real property relating to a residential dwelling unit or
property, where a charging instrument is filed against a party to such
proceeding for deed theft, larceny, offering a false instrument for
filing, criminal possession of stolen property or any other law
asserting theft or fraud in obtaining title to property and said
charging instrument relates to the premises that are the subject of such
proceeding. The stay shall remain in effect until resolution of such
criminal action.

3. The court shall stay all proceedings to recover possession of or
quiet title to real property relating to a residential dwelling unit or
property, where a federal, state or local government agency has
commenced a civil action or proceeding relating to the theft or fraud in
the title to, or the financing of, the premises that are the subject of
such proceeding.

4. The court shall stay all proceedings under section seven hundred
eleven or seven hundred thirteen of this article for ninety days to
allow a party to file a complaint in the appropriate forum when the
court makes a determination that there is a bona fide dispute between
parties purporting to own the property that is the subject of the
proceeding.

(a) A rebuttable presumption that a bona fide dispute to title exists
shall be created when the party disputing petitioner's title, owns or
owned the property that is the subject of the court proceeding during
the last three years, or is a person interested in the property, as
defined by section one hundred three of the surrogate's court procedure
act.

(b) A party may seek an additional stay of the proceeding beyond the
initial ninety day stay by the court if they were unable to file a
complaint or seek a stay from another forum. In extending the stay, the
court shall consider, without limitation, the totality of the
circumstances including steps the parties have taken to resolve the
dispute, the harm to the parties of a further stay, and the ability of
the parties to advocate for themselves or retain counsel.

(c) This section shall not apply to any proceeding commenced pursuant
to subdivision ten of section seven hundred thirteen of this article.

5. Nothing in this section shall diminish the court's own discretion
to further stay a proceeding in the interests of justice.

6. Nothing in this section shall limit a party from seeking relief,
including a stay of a proceeding under this article, in another court.

7. For purposes of this section, a proceeding to recover possession of
or quiet title to real property shall include any proceeding under
section seven hundred eleven or seven hundred thirteen of this article,
an ejectment action or a writ of assistance pursuant to section two
hundred twenty-one of this chapter, a foreclosure action, an action to
enforce a mortgage note, or any other action affecting title to or
encumbrance upon real property, or any other judicial or administrative
proceeding to recover possession of or quiet title to real property.

8. For purposes of this section, a party shall include:

(a) a corporation, limited liability company, partnership or other
entity where a charging instrument has been filed against an individual
who has a financial or controlling interest in the entity that holds
title to the property; or

(b) where a charging instrument has been filed against a seller of the
property, including an individual or corporation, limited liability
company, partnership or other entity, or where a charging instrument has
been filed against an individual who has a financial or controlling
interest in the entity that sold the property.