In re the General Assignment for the Benefit of Creditors of Oakdale Woods, Inc., 24 Misc. 2d 141

In re the General Assignment for the Benefit of Creditors of Oakdale Woods, Inc.

24 Misc. 2d 141 | N.Y. Sup. Ct. | 1960

Bernard S. Meyer, J.

The assignees for benefit of creditors by this motion seek to stay a foreclosure sale now scheduled for June 10,1960, and to have an order entered authorizing sale by the assignees free of the various liens and incumbrances to which the properties are subject. With respect to secured creditors subdivision 8 of section 15 of the Debtor and Creditor Law authorizes the court “ To allow secured creditors such sum only as to the court seems to be owing over and above the value of their securities.” The value of assets other than obligations for the payment of money which constitute the security is determined under section 34 of the Debtor and Creditor Law “ By creditor’s sale” (emphasis supplied). The latter term “ includes any sale effected by the secured creditor by judicial *142process or otherwise under the terms of his contract or the applicable law for the purpose of realizing upon his security.” (Debtor and Creditor Law, § 30, subd. [e].) Only where valuation under section 34 is impracticable or would cause undue delay, may the court order a sale “ which, when completed and approved by the court, shall pass to the purchaser good title, free and clear of all liens of the secured creditor, such liens to be transferred to the proceeds of sale.” (Debtor and Creditor Law, § 35, subd. [3].) Neither such condition exists here; the court is, therefore, without authority to make the order requested. (Matter of Geoghan [N. Y. Credit Men’s Adjustment Bureau], 200 Misc. 945; see Saligman v. Ginsburg, 102 N. Y. 8. 2d 142.)

The motion is denied with respect to all properties subject to liens of secured creditors. The court cannot determine from the papers submitted whether any of the properties referred to in the moving papers are free of such liens. If so,' an order will be entered providing for the sale by the assignees of such parcels alone. The order to be entered hereon shall be settled on notice and, if the assignees seek an order authorizing sale of any parcel, shall be accompanied by a supplemental affidavit specifying which parcels the assignees contend are free of such lien. Proceed accordingly.