In re the Trusteeship under a Certain Indenture of Mortgage Made

99 N.Y.S. 925 | N.Y. App. Div. | 1906

McLaughlin, J.

The appellant, a domestic corporation, executed and delivered to one Morris, as trustee, a mortgage to secure the payment of certain bonds. Morris accepted the trust and continued to act until Rovember 8, 1905, when he resigned, and thereupon the respondent Bostwick, alleging he was the owner of the outstanding bonds, was, upon his own application, appointed substituted trustee. The corporation appealed from so much of the order as appointed Bostwick trustee. The order was reversed and the matter remitted to the Special Term, with instruction to' appoint some disinterested person in place of Bostwick. (Matter of Radam Microbe Killer Co., 110 App. Div. 329.) Subsequently Bostwick applied, pursuant to the order of reversal, by an order to show cause, for the appointment of a disinterested person. On the return of the order the corporation did not appear and" the motion was granted. The parties subsequently agreed upon a Mr. Hagaiy and he wras on February 23, 1906, appointed substituted trustee on motion of Bostwick’s attor, neys, by the entry of an order to that, effect, which also contained the following recitals : “ And that Walter W. Bostwick is the owner of all the outstanding bonds (issued) under said indenture of mortgage or trust agreement and that the ¥m. Radam Microbe Killer Company has defaulted in the payment of interest on said bonds due and payable on July 1st, 1905 ; ” and “ within said time that Walter W. -Bostwick execute, acknowledge and deliver to the said new trustee a bill of sale, transfer and assignment of all the property transferred to him by the original trustee Joseph A. Morris, and standing in his name as such trustee.” The corporation moved to resettle the order by striking out the recitals. The motion was denied and it appeals from the order, and also from so much of the order of February 23, 1906, as contained the recitals.

I am of the opinion that the appeal, in so far as it is taken from the order of February 23, 1906, should be dismissed. The recitals were improperly inserted ip the order, but the corporation is not in a position — inasmuch as it made default in appearing on the return of the order to show cause — to raise the question by an appeal from that order. It could only do so by a motion to resettle the order. It made such motion, which was denied, and the appeal from that order I think is well taken. There is a dispute between the ci rporation and Bostwiclc as to the validity of the bonds or his interest in them, and there ought not to be anything in the order which could be construed as a determination or adjudication of this question. Tire recitals which the corporation asked to have stricken out might be so considered, and for that reason they have no place in the order. Besides, the notice given was simply for the appointment of a disinterested person as trustee instead of Bostwick. Where the default of a- party has been taken under a notice of motion served upon him the moving jiarty is entitled to no greater relief than that asked for in his notice. (Smith v. Fleischman, 17 App. Div. 532 ; Boston National Bank v. Armour, 50 Hun, 177.) There was nothing in the notice which in any way apprised the corporation that an application would be made to have such recitals inserted in the order. It had a right to rely upon the notice, if it did not appear that any greater relief would be granted than that asked for.

It follows, therefore, that the appeal, so far as taken from the order of February 23, 1906, should be dismissed, with ten dollars costs, and the order appealed from, denying a motion to resettle that order by striking out the recitals above quoted, should be reversed, with ten dollars costs and disbursements, and motion granted, with ten dollars costs.

O’Brien, P. J., Ingraham, .Clarke and Houghton, JJ., concurred.

Appeal, so far as taken from order of February 23, 1906, dismissed, with ten dollars costs. Order of April 23,1906,.reversed, with ten' dollars costs and disbursements, and motion granted, with ten dollars costs. Order filed.