In Gramatan Home Invs. Corp. v. Lopez (46 NY2d 481, 386 NE2d 1328, 414 NYS2d 308 (1979), the defendant homeowners purchased vinyl siding for their home and financed the cost by entering into a retail installment contract backed by a mortgage on the home. The note and bond were assigned to the plaintiff shortly after they were executed. Approximately two years later, the New York State Attorney General commenced a consumer-fraud action against the plaintiff's assignor and obtained a judgment which declared the contract between the assignor and the homeowner void. The assignee then sued for payment, and the defendant homeowner moved for dismissal under the theory of collateral estoppel. The Court of Appeals analyzed the doctrine of collateral estoppel and its purpose, as well as the broader doctrine of res judicata. The Court's analysis first addressed the issue of privity and found that although there is no requirement that collateral estoppel be confined to those named in the previous action, there must nevertheless be privity between those two parties. The Court then found that there must be "privity" in an assignor-assignee relationship inasmuch as such relationship "denotes a mutually successive relationship of the same rights to the same property" (id. at 486). The Gramatan Court acknowledged that an assignor-assignee relationship is effectively a mutually successive relationship but found that the "crucial inquiry focuses upon the juncture at which the relationship between the party to the first action and the person claimed to be his or her privy is established. In the assignor-assignee relationship, privity must have arisen after the event out of which the estoppel arises. Hence, an assignee is deemed to be in privity with the assignor where the action against the assignor is commenced before there has been an assignment" (id. at 486-487). The reasoning for this determination is set forth in the very next sentence, "In that situation, at the time the assignee succeeded to the rights of the assignor ... the assignee is charged with notice that his rights to the assignment are subject to a competing claim" (id. at 487).