National Park Bank v. Salomon — 23 N.Y. St. Rep. 566

Majority

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The National Park Bank of New York, App’lt, v. Emanuel Salomon et al., Resp’ts. Gustave Salomon and Solomon Salomon v. The Same.

(Supreme Court, General Term, First Department,

Filed May 24, 1889.)

Headnote

1. Judgment—By confession—Statement in—Power of supreme court to amend—Code Civil Pro., § 1274.

The power of the supreme court to amend a confession of judgment, on motion, may be exercised, notwithstanding that the effect of such amendment may be to deprive subsequent judgment creditors of rights which, would otherwise be theirs

2. Same—Execution on part of a judgment—Second execution for full amount.

A judgment, by confession, was entered for an amount partly due and partly to become due, and an execution issued thereon for the amount then actually due. Thereafter, and without an amendment of the statement upon which the judgment was based, the parties thereto met and agreed that all the indebtedness mentioned therein should become and be deemed presently due. Thereupon, the first execution was withdrawn and a second execution for the full- amount issued. Held, that, as the statement remained unchanged, there was no warrant for issuing an execution on any part of the claim, except that which the statement showed to be due at the time it was made.

3. Same—When judgment creditor may attack an execution—Code Civil Pro., § 1277.

Whexe an execution has been issued upon a confessed judgment, for a sum greater than appears to be then actually due, by the statement upon

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which the judgment is based, it is competent for a subsequent execution creditor to attack the execution by motion for invalidity, so far as it directs the sheriff to collect anything in excess of the sum presently due on the prior judgment.

Appeal by the Natidnal Park Bank of New York, from a special term order, denying a motion to set aside a judgment confessed by the defendants above named, to the plaintiffs in the second of the above entitled actions, and also to set aside the execution issued on such confessed judgment, except as to a part thereof.

Francis G. Barlow, for app'lt; B. F. Einstein, for resp’ts.

The supreme court possesses power to amend a confession of judgment on motion. Union Bank v. Bush, 36 N. Y., 631 , 635. This power may be exercised, notwithstanding that the effect of such amendment may be to deprive subsequent judgment creditors of rights which would otherwise be theirs. Mitchell v. Van Buren, 27 N.Y., 300 . In thus amending a confession of judgment, the court merely gives the creditor the judgment which the debtor intended to give him at the time of executing the confession. In the present case, a reference was ordered to take proof of such facts as were relevant to the motion of the appellants; and upon the reference, the counsel for the National Park Bank consented that the referee might report to the court “that the indebtedness, and the items thereof mentioned in the confession of judgment, were fairly and honestly due from the defendants who confessed the judgment to the plaintiffs in the confession of judgment.” Hence, even if the appellants are right in their view that the statement prescribed by section 1274 of the Code, as the basis for a judgment by confession, was defective in this instance, the court, at special term, could properly have permitted an amendment such as was allowed in Mitchell v. Van Buren (supra), by the addition of a further verified statement; and we think it may fairly be assumed, from the manner in which the case was dealt with below, that the court did exercise the discretionary power which it possessed in that regard by allowing the statement to be amended, although this does not expressly appear. In view of the admission already quoted to the effect that the indebtedness mentioned in the confession of judgment was fairly and honestly due, it was perfectly proper to treat the case as though a suitable amendment had been made, if such amendment was necessary.

We are, therefore, of the opinion that the motion was rightly denied so far as it sought to set aside.the confessed judgment. As to that portion of the application, however, which was directed against the execution, except as to the part thereof which represented an amount actually due at the time such execution was issued, we have reached a different conclusion.

p. 568

The judgment was confessed on the 23d day of January, 1888, for a total sum of $19,790.84, exclusive of costs and disbursements, and the statement upon which it was based showed that the only portion of this indebtedness then actually due was $550. On the same day, the plaintiffs in the said confessed judgment caused an execution to be-issued thereon, endorsed by their attorney with a direction to the sheriff to levy and collect $566.50, being the amount then actually due on the judgment, together with costs and disbursements. This execution was in the form prescribed by section 1277 of the Code. Two days later, however, it was withdrawn, and another execution was issued on the confessed judgment, directing the sheriff to collect the whole amount mentioned therein, to wit, $19,790.84. To this execution the National Park Bank, as a subsequent-execution creditor, objects on the ground that it is not warranted by section 1277 of the Code of Civil Procedure. There is no doubt that it was issued in disregard of the provisions of that section. The respondents argue that the appellants have no standing to question the execution on this account, but we think they are entitled to do so for the reasons set forth in the case of Jaffray v. Saussman, decided by this court at the present term.

The respondents further insist that the whole amount of the confessed judgment had in fact become due on the 25th day of January, 1888, when the second execution was-issued.

It appears that after the judgment was confessed and , entered, and without any amendment of the statement-upon which it was based, the parties thereto met. and agreed that all the indebtedness mentioned therein should become and be deemed presently due. This subsequent agreement, however, could have no effect upon the judgment so far as it concerned third parties, or upon the form of execution which it was proper to issue thereon. Under the statute the execution must follow the judgment, and could properly direct the sheriff only to collect such amount as the statement upon which the judgment was founded showed to be actually due.

So long as the statement remained unchanged there was no warrant for issuing execution for any part of the claim except that which the statement showed to be due at the time it was made. So far as this part of the case is concerned, there is no question of amendment, because the parties to the confessed judgment have not sought to* amend -it in any way. They are insisting upon the validity of an execution which is founded not upon a judgment, but upon an agreement or arrangement entered into between them subsequent to the judgment, and not in any

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manner of record. Such an agreement is unavailing so far as the rights of third parties are concerned.

The order appealed from should be reversed so far as it denies the motion to set aside the execution on the confessed judgment, and said execution should be set aside as to all of the amount mentioned therein, except $566.50.

Van Brunt, Ch. J., and Daniels, J., concur.