114 N.J. Eq. 551 | N.J. Ct. of Ch. | 1933
On July 9th, 1932, the defendant, Gatti Paper Stock Corporation, was adjudged insolvent pursuant to provisions of the Corporation act (2 Comp. Stat. 1910 p. 1595 et seq.) and Richard A. Callahan, the respondent herein, was appointed receiver therefor. Part of defendant's property which came to the possession of said receiver were lands and premises situate in Hoboken, New Jersey, upon which the petitioner herein held mortgage liens aggregating $105,000. Part of said mortgaged premises were used by the defendant (and by the respondent after he was appointed receiver for said defendant) in the conduct of the business in which the defendant was engaged, and part thereof was occupied by a tenant who *553
paid $500 a month rent. Said rent was payable on the first day of each month. Because of default in payments due under said mortgages the petitioner applied to the court for leave to institute a suit for the foreclosure of said mortgages and to make the respondent a party defendant thereto. An order granting such leave was entered October 31st, 1932. On November 14th, 1932, the petitioner filed its mortgage foreclosure bill and simultaneously therewith applied to the court for the appointment of a receiver for the collection of rents of the mortgaged premises pendente lite. The respondent, as receiver of the insolvent corporation, questioned the validity of said mortgages, and the court caused an investigation to be made thereof, and as a result of such investigation on December 17th, 1932, made an order appointing the respondent receiver for the collection of rents of said mortgaged premises pending the foreclosure proceeding. As receiver of the insolvent corporation the respondent collected rents in the aggregate sum of $2,500 prior to his aforesaid appointment as rent receiver. The mortgaged premises were bid in by the petitioner for a nominal sum at the sheriff's mortgage foreclosure sale, with the result that the petitioner had a considerable claim for deficiency under its decree. Thereafter, in lieu of a proceeding by respondent as receiver of the insolvent corporation-mortgagor to have the court determine a fair value of the mortgaged premises as of the date of the sheriff's sale to be applied against the deficiency under petitioner's decree (Federal Title and Mortgage Guaranty Co. v.Lowenstein,
I will advise an order denying the relief sought by the petitioner herein, discharging the order to show cause, and dismissing the petition.