46 N.Y.S. 486 | N.Y. App. Div. | 1897
On the day of salé under the first inortgage from which the- surplus arose, the time for redemption by Woolsey had not expired, nor ' had the time for the second mortgagee, Cotterill, to redeem.arrived. ■ The effect of the sale was to transfer the title to a stranger, and to suspend the rights and remedies of the second mortgagee-and of the
By the 64th court rule it is provided that “ on filing the report of the sale any party to the suit, or any person who had a lien on the mortgaged premises at the time of the sale,” may file his notice of claim to the surplus. This was deposited on August 26, 1895, and was thus placed in the custody of the court, because deposited to the credit of the action and subject to the court’s power to determine all claims to the fund. Inasmuch as the rule fixes the lien as of the time of the sale under the mortgage foreclosure, the amount of the lien is thus to be determined as of that time. From the dates it will be seen that the surplus was deposited with the chamberlain before the time for Woolsey to redeem from the sheriff’s sale had expired, and prior to the time when the second mortgagee had the right to redeem. It ■ is true that the Cotterill second mortgage was subsequent to the lien of the Schecker judgment, and if it were not for the foreclosure of the first mortgage, which effected a change in the title to the property, the subsequent deed by the sheriff would have related back, as provided by section 1440 of the Code of Civil Procedure, to the time when the judgment became a lien on the property, and would have taken precedence of the second mortgage. By section 1440 it is provided : “ But if the property is not redeemed, and a deed is executed in pursuance of the sale, the grantee in the deed is deemed to have been vested with the legal estate from the time of the sale.” As stated, however, at the date of the sale, the time of Woolsey, the then owner of the equity, to redeem from the sale on execution had not expired, nor had the time arrived when the second mortgagee could redeem, because under the statute the latter’s right only accrued one year from date of sale, and continúes from the expiration of the year, three months. (Code Civ. Proc. §§ 1449, 1450.) When such time to redeem arrived, however, the property had passed from Woolsey by virtue of the sale under the first mortgage,
It is suggested that while the statutory method of redemption was gone there could have been an equitable redemption by paying the amount, of the bid. But as the holder of the sheriff’s certificate had a claim to the surplus at the time it was deposited to the extent of what he had bid, and could have it paid out of such surplus with interest, there is no good reason suggested why it was necessary, in order to prevent such holder from getting any greater rights as against Cotterill, that thé latter should pay him the amount and thus go through the form.of what the appellant suggests would; be an- equitable redemption. While the surplus 'arising out of foreclosure is regarded in, some aspects as realty, it was ..not" the: exact equivalent of" the property sold in the sense that the parties: were obliged to move, either the holder of the sheriff’s certificate "to obtain the deed of the property or the second mortgagee to tender the amount of the bid, m pursuance of the law as to a statutory. redemption, because at the date of the sale their rights were then fixed and their remedies in other directions suspended, and they were relegated to an enforcement of their then lien for their respective -claims against the surplus. It being both just and equitable that their rights should; be thus fixed as of the date of sale, they should be adjusted accordingly.
How, at -the date of sale, the holder of the sheriff’s certificate had a. claim against such surplus to the amount that had been paid upon the sheriff’s sale, and upon the pajunent of that amount or permit-... ting it to be taken from the ¡surplus, thé holder of ¡such certificate receives just what he would have'been entitled to from the owner of the equity of redemption or- from the second mortgagee if the property had not been'sold and' either had been at liberty to pursue-the statutory-method of redemption. Having thus, obtained his just due, there is no' reason why, to the disadvantage of the mortgagee, he should get more; or why the second mortgagee, in order •to get the benefit of the same rule of having his rights fixed as of the date of. sale and in order to preserve them, should be obliged- to go. through the form of redeeming, property which was no longer the subject of redemption. . It is unnecessary to elaborate the reason
Our conclusion, therefore, is that the order appealed from should be affirmed,- with costs and disbursements.
"Van Brunt, P. J., Williams, Patterson and Ingraham, JJ., concurred.
Order affirmed, with ten dollars costs and disbursements.