Bonnett v. Brown — 36 N.Y. St. Rep. 320

Majority

p. 320

William H. Bonnett, Ex’r, App’lt, v. Eugenia V. Brown et al., Resp’ts.

(Supreme Court, General Term, Second Department,

Filed February 9, 1891.)

Headnote

1. Foreclosure—Re-sale.

While mere inadequacy of price is not a sufficient reason for a re-sale, if such inadequacy is coupled with any fraud or surprise, it will have great weight on an application for a re-sale.

2. Same.

Plaintiffs’ attorney had been attorney for Mrs. Brown, and told her husband that he could represent her and her children, and that there would be no deficiency judgment entered. There was only one bidder, and an adjournment was refused, and the property was bid in for plaintiff, leaving a deficiency of $7,000, the judgment for which was entered and assigned. Feld, a proper case for a resale.

Appeal by plaintiff and Alfred E. Marling, the assignee of a deficiency judgment, from an order granting a re-sale on conditions.

Jacob Halstead, for app’lts; Carlisle Norwood, Jr., for guardian ad litem, resp’t.

The plaintiff by virtue of a decree in foreclosure sold the mortgaged premises in November, 1889. The premises were situated in Mamaroneck, Westchester county. The decree was based on two mortgages given by Mary E. Yanderburgh and her husband to the executor of Peter Bonnett. Mary E. "Vanderburgh, before the sale, had died and had devised a life estate in the premises to her daughter, Eugenia Y. Brown, with remainder to her children. The property consisted of two parcels, which were sold at the foreclosure sale for $18,000 upon the plaintiff’s bid. An appeal was made to obtain a re-sale. That application was discontinued. Some different method appears to have been suggested to these parties. The plaintiff assigned his bid to Mrs. Iselin, and she was to purchase other adjoining land of Mrs. Brown. This arrangement was never carried out. Mrs. Brown then offered to pay the claim of the plaintiff, and this she failed to do.

In February, 1890, the referee gave the deed to the plaintiff. The premises were within a few days conveyed to Caroline E. Wilmarth for the sum of $18,000. This left a deficiency judgment of over $7,000. This deficiency judgment has been assigned to Alfred E. Marley. The present motion was- made in July, 1890, and in view of the fact that the remaindermen are two , infant children, no suggestion of laches should prevail. The motion papers were properly served on the attorney for the plaintiff in the foreclosure action. Pitt v. Davison, 37 N. Y., 235 .

The resale was properly granted. The property brought an inadequate price, and while mere inadequacy of price is not a sufficient reason for a resale, if such inadequacy be coupled with any fraud or surprise it will have great weight on an application for a resale. Howell v. Mills, 53 N. Y., 322 .

The papers show that the plaintiff’s attorney in the foreclosure had been the attorney for Mrs. Brown. That he told her that the

p. 321

first bid would be enough to pay the mortgage debt. He assured Mrs. Brown’s husband that he could represent Mrs. Brown and her children, as their interests were identical. There was apparently but one bidder present and an adjournment was refused. The owner of the deficiency judgment bid in the property for the plaintiff. The plaintiff’s attorney told Mr. Brown, plaintiff’s husband, that there would be no deficiency judgment entered. The plaintiff’s attorney did make an arrangement to have a $25,500 bid made at once, but he says that Mr. and Mrs. Brown dissuaded him from so doing as there would be no higher bidders; that “if the bidding was started at $25,500 there would not be another bid.” The statement of Mr. and Mrs. Brown is not really contradicted, for if the arrangement or understanding was that the bid should equal the claim the result should have been reached by the plaintiff’s attorney whether he commenced low or high in the amount of his biddings. Justice can only be reached by a resale and the conditions are sufficient to protect the holders of the mortgage claim from injury. The purchaser at a judicial sale also buys subject to the right of the court to set it aside for good cause.

The order should therefore be affirmed, with costs.

Pratt, J., concurs; Dykmajst, J., not sitting.