79 N.Y. 146 | NY | 1879
Lead Opinion
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *148
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *149 The order of the General Term reversed the order confirming the report of the referee and directed that the case be referred to the referee to report as to priority of liens.
This is not a final order, and inasmuch as, upon the report of the referee as to this priority of the liens, the court at Special Term may hold that the moneys be retained to await the determination of a suit to be brought to test the right *151 of the parties to the moneys, we think the order is not appealable to this court.
The appeal must, therefore, be dismissed, with costs.
All concur.
Addendum
A subsequent motion was made for re-argument, resulting as follows: In granting the order dismissing the appeal in this case, the court overlooked the fact that the order appealed from imposed costs of the appeal upon the appellant (the respondent there) absolutely and not conditionally, and in this respect was a final determination from which an appeal could lawfully be taken. The motion for a re-argument must, therefore, be granted, and the order dismissing the appeal vacated. In this aspect of the case, the questions presented for review upon the appeal are open for consideration.
We think that the referee, by virtue of the order to ascertain and report the liens and their priorities in reference to the surplus moneys, had authority to inquire as to the validity of the conveyances under which Mrs. Snedeker claimed and of the mortgage of herself and husband to Clayton. The object of the reference was to ascertain to whom the surplus moneys belonged; and this opens a door to an inquiry as to the character of all liens which may be presented. No reason exists why the fraudulent character of conveyances cannot be tested in these proceedings, as well as that of all other liens. One of the objects and purposes of a foreclosure suit is the distribution of the fund arising upon a sale. (Livingston v. Mildrum,
The power of the court to settle questions of this character is also, we think, fully sustained by the decisions. In Halstead
v. Halstead (
The claim that the Clayton mortgage must be sustained, even although the other conveyances are declared fraudulent and void, is not well founded. Clayton had full knowledge of the alleged fraud; knew that a suit had been brought to set aside the deeds on account of the fraud; and, in fact, the mortgage was given to him to secure the payment of his charges for defending the title of Mrs. Snedeker. It is also an answer to this position that the sheriff's certificate of the sale to Carman had been filed and recorded in the county *153 clerk's office, long prior to the mortgage; and he had notice not only that the mortgagor's title was fraudulent, but also of the appellant's claim to the property by virtue of the sheriff's sale: (2 R.S., 370, § 43.)
As to the right of Carman to sell and acquire a title under his judgment, it is well settled that where a debtor has made a fraudulent conveyance of his real estate, a subsequent judgment creditor may proceed to sell under his execution, and the purchaser will have the right to impeach the conveyance, in an action at law to recover the premises: (Chautauqua Co. Bank v.Risley 19 N.Y., 369-375.) He may, but he is not bound to file a creditor's bill to set aside the conveyance: (See also Erickson v. Quinn, 15 Abb. [N.S.], 168.
The case of Lamont v. Cheshire (
We have carefully considered all the questions presented and the suggestions made by the respondent's counsel and are of the opinion that the referee was right, and that the General Term erred in reversing the decision of the Special Term.
The order of the General Term must, therefore, be reversed and that of the Special Term affirmed, with costs of both parties upon the appeal, to be paid out of the fund.
All concur.
Ordered accordingly. *154