Roosevelt Hospital v. Dowley — 57 How. Pr. 489

Majority

p. 489

SUPREME COURT.

The Roosevelt Hospital agt. Patrick Dowley and others.

Headnote

Lien of purchaser at tax sale —Parties to action for the foreclosure of a mortgage.

A purchaser at a tax sale, and to whom a lease is made of premises subject to a mortgage, secures thereby a lien, which entitles him to priority over the mortgage, for the consideration paid at the tax sale, with the interest allowed by law.

Such person is a proper party to an action for the foreclosure of the mort- . gage, and the judgment should provide for the payment out of the proceeds of the sale, of his prior lien.

Special Term, October, 1878.

Action to foreclose a mortgage.

Lewis L. Delafield,, for plaintiff.

Anderson Price, for defendant Williams.

Francis T. Oarrettson, guardian ad litem.

The defendant, Williams, is a proper party to this action.

The effect of his purchase at the tax sale, subsequent to the mortgage, and the lease to him thereupon, was to create a lien in his favor, which entitled him to priority over the mortgage, to the extent of his lien. There is no question of adverse title in Williams, involved.

In his answer he does not set up an adverse claim by title paramount. He says he has an interest in, or lien upon, the mortgaged premises. That his lien is a lien paramount to the mortgage sought to be forelosed. In thus defining his attitude it is conceded that he speaks truly. Having failed to serve the notice required by the Laws of 1871 (chap. 381, vol. 1, p. 747, secs. 13-16) he has acquired no title to the mortgaged premises.

p. 490

But he has a valid prior claim for the consideration paid at the tax sale, with forty-two per cent interest to he added thereto. That is the extent of his claim and lien.

Prior incumbrancers — and the claim of the defendant, Williams, is of that nature — are proper parties to an action for the foreclosure of a mortgage (Harris agt. Beach, 3 John. Chy., 459 ; Holcomb agt. Holcomb, 2 Barb., 20 ; Walsh agt. Rutgers F. Ins. Co., 13 Abbott, 33, 38, 39; Brown agt. Volkening, 64 N. Y., 76 ; Moller agt. Muller, 12 Hun, 674 ).

The propriety of this defendant being made a party is shown by Becker agt. Howard ( 66 N. Y., 5 ).

There must be judgment of foreclosure, but the defendant, Williams, must be paid first out of the proceeds arising on the sale, the amount of his lien, above recognized and established.