Beebe v. Richmond Light, Heat & Power Co.

Majority

p. 187

Albert O. Beebe, Respondent, v. Richmond Light, Heat and Power Company, Defendant. Electric Power Company of Staten Island and Erastus Wiman, Appellants; Austin B. Fletcher, Appellant.

Headnote

Mortgage foreclosure — a purchaser of the mortgaged premises after a judgment in foreclosure, cannot intervene — remedy where there is a sale of personal property under, not covered by, the judgment — a defeated, party who has not appealed to the Appellate Division cannot appeal from, its judgment to the Court of Appeals.

Upon an application by Austin B. Fletcher to intervene and be made a party defendant in an action for the foreclosure of a mortgage given by the Electric Power Company of Staten Island, it appeared that Fletcher was the owner by assignment of unsecured claims against the mortgagor, and that in February, 1896, he had acquired by purchase at a sale, made by the receiver of the Electric Power Company, all its property, both real and personal; judgment was entered in the foreclosure action in November, 1895, and was affirmed, on an appeal, by the Appellate Division in April, 1896, on the argument before which appellate court Fletcher filed a brief.

Held, that as Fletcher had acquired his title subsequent to the rendition of the judgment in foreclosure, which established the rights of the parties and to which judgment his title was subject, the court would not now, after theaffirmance of the judgment, permit him to intervene and renew the contest;

That the fact, if established, that the Electric Power Company had been dissolved ' by the court before the judgment of foreclosure was rendered afforded no ground for granting the application to intervene, for the reason that, if such was the fact, he might bring an action in ejectment to recover the property, as where the owner of the equity of redemption is not a party to a decree in foreclosure, the decree of foreclosure is void and the purchaser does not, become even a mortgagee in possession;

That the question whether, under the foreclosure judgment, providing that only chattels or personal property acquired before the date of the execution of the mortgage should be sold, the referee had sold chattels acquired since the execution of the mortgage could not be settled by opening the judgment; that in such case Fletcher’s remedy would be by replevin or by suit as for a. conversion;

p. 188

Where the receiver of a corporation, which has given a mortgage, had notice of the entry of a decree foreclosing the mortgage, "but took no appeal from such decree to the Appellate Division, he cannot be allowed subsequently to appeal to the Court of Appeals from an order which affirmed the judgment of the Special Term.

Appeal by the petitioner, Austin B. Fletcher, from an order of the Supreme Court, made at the Kings County Special Term and entered in the office of the clerk of the county of Richmond on the 21st day of May, 1896, denying his application to intervene in the above-entitled action and be made a party thereto.

Appeal by the Electric Power Company of Staten Island and another from an order of the Supreme Court, made at the Kings County Special Term and entered in the office of the clerk of the ■county of Richmond on the 21st day of May, 1896, denying their application to direct the receiver of the Electric Power Company of Staten Island to appeal to the Court of Appeals from an order of affirmance of the Appellate Division of the Supreme Court of a judgment of foreclosure in the above-entitled action.

Austin B. Fletcher, in person, and William P. S. Melvin, for the petitioner, appellant.

George A. Black, for the respondent.

The first appeal is from an order of the Special Term denying the application of the appellant Fletcher to intervene in this action and to be made, a party defendant thereto. The affidavit of Mr. Fletcher shows that he is the owner, by assignment, of unsecured claims against the Electric Power Company of Staten Island, the owner of the equity of redemption. It further shows that on February 14, 1896, he acquired, by purchase at a receiver’s sale, all the • property, real and personal, of said company. Judgment was entered in this action, which is for the foreclosure of a mortgage, on the 13th day of November, 1895.

We think the application was properly denied. Had the appellant acquired title to the mortgaged property pending the action, he, doubtless, would have had the right to intervene. But his title accrued subsequent to the rendition of the judgment which estab

p. 189

lisked the rights of the parties, and his title was subject to the lien of that judgment. In a case of fraud a judgment operating injuriously to the appellant’s rights would doubtless be opened and the appellant allowed to intervene and defend, but this action was defended vigorously and in good faith by the Electric Power Company. From the judgment rendered against it an appeal was taken to this division of the court and the appeal argued, the present appellant being on the defendant’s brief. We affirmed the judgment on the 7th of April, 1896, and the application of the appellant Avas not made until after our decision. To suffer the appellant to now intervene would be to permit the Avhole matter to be again litigated. If such practice is to be permitted it Avould be possible, by successive transfers of the property, to prolong indefinitely any action of foreclosure.

The appellant claims that the judgment is irregular because prior to its rendition the Electric Power Company had been dissolved by a decree of the court. If this be so, then the appellant can bring his action in ejectment to recover the property, for it is settled hy authority that where the owner of the equity of redemption is not a party to a decree in foreclosure the foreclosure is void and the purchaser does not become eAren a mortgagee in possession. (Howell v. Leavitt, 95 N. Y. 617 .)

The appellant further claims that while the judgment provided that only chattels or personal property acquired before the date of the execution of the mortgage should be sold under the decree, the referee has sold chattels acquired since that time. This question cannot be determined by opening the judgment or making the defendant a party to the action. The action by the referee has in no wise prejudiced the appellant’s rights. If the referee has sold property not covered by the terms of the judgment, the appellant may recover the same by replevin or sue in trover for their conversion.

The order appealed from should be affirmed, Avitk ten dollars costs and disbursements.

A second appeal is from an order denying an application to direct Albert B. Boardman, as receiver of the Electric PoAver Company, to appeal to the Court of Appeals from the order of affirmance of the decree in foreclosure made by this division of the court in

p. 190

April, 1896. It appears by the affidavits that notice of the decree was served on the receiver and that he took no appeal therefrom to this division of the court. The time for appeal by him has now lapsed. As he did not appeal to this division of the court, he, of course, cannot now appeal from the order of affirmance to the Court of Appeals.

The order apjiealed from should be affirmed, with ten dollars ■costs and disbursements.

All concurred, except Pratt, J., not sitting.

Orders affirmed, with ten dollars costs and disbursements on each ■appeal.

Cases cited

Howell v. Leavitt 95 N. Y. 617 N.Y. 1884-04-29 p. 189