Computershare Trust Company N.A. v. 907 Associates LLC

Background

Computershare Trust Company N.A., acting as trustee through its special servicer, sued 907 Associates LLC, Gjek Gjonlekaj, and other defendants to foreclose on a mortgage securing a $4 million loan on property at 907 East 221st Street in the Bronx, New York. The opinion identifies 907 Associates LLC as the borrower and Gjek Gjonlekaj as the guarantor.

The borrower obtained the loan in May 2019. It allegedly defaulted in September 2024 by failing to make required monthly payments. The property later became subject to mechanic’s liens, and the borrower did not cure the defaults after receiving an April 30, 2025 notice of default and acceleration. That notice revoked the borrower’s permission to collect rents and accelerated the amounts due. The borrower also did not send rent payments to Computershare and failed to pay certain property taxes, requiring Computershare to advance at least part of the taxes owed.

Computershare filed the foreclosure action on June 13, 2025, and moved on July 2, 2025, to appoint a receiver during the litigation. At an August 15 conference, the parties agreed there was no dispute about the foundational facts described in the opinion. The dispute was whether a receiver should be appointed. Both sides declined an evidentiary hearing offered by the court.

Legal standard

The court stated that federal law governs appointment of a receiver in a diversity action. A receiver is an extraordinary remedy used cautiously when necessary to protect a plaintiff’s interests in property. Relevant considerations include whether the defendant engaged in fraud, whether the property faces imminent loss or decline in value, whether ordinary legal remedies are inadequate, whether the harms favor appointment, and whether the plaintiff is likely to succeed and face irreparable injury.

Ordinarily, the plaintiff must make an adequate showing that a receiver is necessary. But when a mortgage agreement includes the borrower’s consent to a receiver, the burden shifts to the defendants to explain why one should not be appointed. The court found that this mortgage provision stated that, after a default, the lender had a strict right to have a receiver appointed to take possession of the property and collect rents. The court interpreted that language as the borrower’s consent, so the defendants had the burden of opposing appointment. Defense counsel conceded that burden at the conference.

Court’s analysis

The court found that Computershare had made an initial showing supporting a receiver and that the defendants had not met their burden. Because the loan was nonrecourse, the court said Computershare’s only available remedy was foreclosure. The court also found that Computershare had shown a high likelihood of success in the foreclosure action because the parties did not dispute that the borrower had defaulted.

The court identified a danger that the property’s value could decline because rents were being squandered and taxes were not being paid. The borrower attributed the defaults to misconduct by its former property manager and said it was working to make the property profitable and repay its debts. The court found that the borrower offered no evidence showing that those improvements were likely or that appointment of a receiver would harm the borrower more than failure to appoint one would harm Computershare.

The defendants did not object to Orazio Crisalli’s qualifications. The court therefore granted Computershare’s motion to appoint Crisalli, of Syracuse Realty Group, LLC, as receiver for the property.

Disposition

Judge Margaret M. Garnett granted Plaintiff’s Motion to Appoint Orazio Crisalli of Syracuse Realty Group, LLC, as receiver for the Property. The opinion addresses the receivership request; it does not state that the court entered a final foreclosure judgment.