Ulster Savings Bank v. Bash

—In an action to foreclose a mortgage, defendant Yigal A. Bash appeals from an order of the Supreme Court, Dutchess County (Burchell, J.), dated January 7, 1985, which denied his motion for an order setting aside a foreclosure sale and for related relief.

Order reversed, with costs, motion granted, and matter remitted to the Supreme Court, Dutchess County, for further proceedings.

At a mortgage foreclosure sale, appellant, the highest bid*501der, attempted to make his down payment with a combination of cash and two out-of-State bank checks made out to the Referee. The Referee informed appellant that this form of payment did not comply with the terms of sale which called for cash or certified checks. Appellant then asked the Referee to sign the checks so that he could cash them. She refused to do so, even though she could have indorsed them "without recourse” (see, UCC 3-414). Thereupon, the Referee reopened the bidding and accepted a bid $10,000 lower than appellant’s and allowed this second bidder an opportunity to convert his bank check, made payable to himself, to cash for the down payment.

The Referee’s actions, although not fraudulent, cast an aura of unfairness over the conduct of the sale and, therefore, we exercise our discretion to set it aside (see, United States v Thwaites Place Assoc., 548 F Supp 94, affd 722 F2d 729). Gibbons, J. P., Brown, Niehoff and Fiber, JJ., concur.