28 N.Y.S. 1086 | N.Y. Sup. Ct. | 1894
A sale under a judgment of foreclosure in the above-entitled action on a mortgage on real estate, of which the defendant had the legal title, subject to the mortgage, was perfected on the 18th of April, 1893, leaving a surplus of $893.76, which was deposited in the county treasury. The mortgage on which this foreclosure was had was dated March 31, 1890, and recorded May 5 of the same year. The premises covered by the mortgage were conveyed to the defendant April 1, 1891. August 10, 1891, the Posts, as partners, filed a mechanic’s lien against the premises sold on such foreclosure sale, for labor and material, for $804.85. September 18, 1891, Conklin filed a notice of mechanic’s lien, claiming $600.60. October 16, 1891, Hill filed notice of a mechanic’s lien on the premises, claiming $380.40. December 14, 1891, Johnson filed notice of mechanic’s lien on the premises, claiming $140.08. On the 19th of November, 1891,. the Royal Food Company executed and delivered to William Onderdonk, to secure the payment of $15,000 and interest one year from date, a mortgage on these premises, which was recorded on the 23d day of November, 1891. The mortgagee, Onderdonk, assigned this mortgage on the 9th of September, 1892, which assignment was acknowledged on the 15th of that month, to Thomas E. Ferrier, who, by a declaration in trust, in writing, dated October 24, 1892, acknowledged that said bond and mortgage was assigned to him in trust for the Catskill National Bank, to secure all notes, checks, and demands due or to become due the bank from the Royal Food Company. At that time, and ever since, the Royal Food Company has owed said bank about $2,000 in notes, which were part due at the time of the distribution of this surplus. An action in the supreme court was prosecuted by Herbert K. Hill on the lien filed by him, wherein all the other lienors, the defendant in this action, and Onderdonk were made parties defendants. None of these de
The only'question which seems to be in controversy on this appeal is as to whether the proof before the referee in these proceedings auiliorized the allowance of the claims of any of the lienors except that of Hill. It is insisted by the learned counsel for the appellant that, as none of the defendants in the action brought by Hill for the foreclosure of his lien appeared or answered therein, there was no such adjudication of their respective claims as would authorize the referee upon these proceedings, upon the mere presentment of the record in that case, to allow them as liens upon this surplus. Section 17 of chapter 342 of the Laws of 1885 makes it the duty of all persons seeking to foreclose a lien to make all other lienors, either senior or junior, parties defendants, and provides that all persons, firms, corporations, and associations who have filed notices of liens under this act shall, by answer in such action, set forth the same; and the court in which such action is brought may settle and determine the equities of all parties thereto, and decide the extent, justice, and priority of the claims of all parties to the action, and upon
This action by Hill to foreclose his lien was prosecuted in a court of general jurisdiction, which had, by the service of the process and the pleadings and liens before it, acquired jurisdiction of the persons of all these parties and of the subject-matter of that action. Mc-Callister v. Case (Com. Pl. N. Y.) 5 N. Y. Supp. 918. In that action, as we have seen, all the liens, both of the plaintiffs and defendants, could be foreclosed. Onderdonk, whose interest is now represented by Ferrier, as trustee, who brings this appeal, was a party to that action upon the record. No appeal was taken from that judgment. The decree in the action by Hill assumes to dispose of the rights and equities of all the lienors who were parties thereto. But it is urged that, if the general jurisdiction of the court be conceded, and that it acquired jurisdiction of the parties and subject-matter in this case, still it had no power of its own to adjudicate upon the rights of parties not submitting their right to it; and that, as these de-, fendants failed to answer as required by section 17 of the statute, supra, its voluntary adjudication of their rights was inoperative and void. It is not quite clear what purpose the answer under section 17 was intended to serve. That it was a proper step in the proceeding is quite apparent, but there is nothing in the statute which divests the court of jurisdiction, which it has regularly acquired, by the defendant’s failure to answer. Doubtless, if the plaintiff had stated in his complaint the liens of the defendants improperly, that defect could have been corrected by answer; but, as the defendants were before the court, and had the opportunity to answer, and failed to do so, and judgment went against them, or was entered in a manner that their rights were prejudiced, the judgment, until set aside or reversed, would be conclusive upon them. They could not attack it collaterally. Any of the parties to the Hill action might have answered, contesting any of the liens as set out in the bill of complaint,
“The validity or regularity of a provision in a judgment of foreclosure, not raised by a party to the suit by answer, appeal, or motion, cannot be raised collaterally when the court rendering the judgment had general jurisdiction of the parties and the subject-matter of the action.”
This judgment in the Hill case was an action of foreclosure, conducted in the ordinary manner of an action of foreclosure, and the rules applicable to judgments in foreclosure of mortgage seem to be applicable to judgments of this character. We think, therefore, that the referee was right in holding that the rights of the lienors were fixed by the judgment in the action by Hill, and that his report was properly confirmed by the order of the special term. Order of special term affirmed, with costs and printing disbursements. All concur.