100 A.D.2d 613 | N.Y. App. Div. | 1984
In a foreclosure action, the Department of Housing Preservation and Development appeals, as limited by its brief, from so much of an order of the Supreme Court, Kings County (Kartell, J.), dated April 19, 1982, as granted the motion of receiver John Brown to enjoin it from proceeding in the Civil Court of the City of New York against the receiver for failing to supply heat and hot water at the subject premises. H Order reversed, insofar as appealed from, without costs or disbursements, and motion denied without prejudice to renewal if, within 30 days after service upon the Department of Housing Preservation and Development of a copy of the order to be made hereon, with notice of entry, the latter fails to move in the appointing court for permission to proceed in the Civil Court of the City of New York. H In April, 1981, John Brown was appointed by the Supreme Court, Kings County, as receiver with respect to properties located at 1575, 1581 and 1589 President Street, Brooklyn, pending a mortgage foreclosure action. In November of the same year, the Department of Housing Preservation and Development (hereinafter HPD) commenced proceedings in the Civil Court of the City of New York against Triz Realty Corp., the owner of the properties, and Nachum J. Nodell, the registered managing agent, because of certain alleged building violations. HPD apparently then learned that John Brown had been appointed receiver. By order to show cause, dated January 18, 1982, HPD brought a proceeding in the same court against John Brown, seeking an order directing Brown to provide heat and hot water to the apartment building located at 1575 President Street. By notice of motion dated January 21,1982, HPD moved, in the proceedings against Triz Realty Corp. and Nachum J. Nodell, inter alia, to add John Brown as a party and to fine him $500 “for failure to register as owner or managing agent”. H Thereafter, John Brown moved, by order to show cause, to enjoin HPD “from conducting a proceeding in the Civil Court, County of Kings, seeking an order whereby heat and hot water is to be supplied at the premises”. He argued that the proceeding was improper because he had not been sued “in his capacity as a receiver * * * nor did they obtain leave to sue from the Supreme Court before proceeding”. HPD cross-moved for, among other things, an order allowing it to intervene in the foreclosure action. It argued that Brown was correctly named in the proceeding as “owner” of the subject premises, since the legal definition of that term includes “receiver”. It further argued that permission to sue Brown was not needed from the appointing court, since “he is being sued to compel compliance with housing code standards”. I Special Term accepted the receiver’s contention that permission was needed from the appointing court, and enjoined HPD “from commencing or prosecuting any proceeding in the Civil Court of the City of New York, for heat and hot water at premises 1575, 1581 and 1589 President Street, Brooklyn, New York”. The court also denied HPD’s cross motion. As limited by its brief, HPD appeals from that portion of the order which granted the receiver’s motion. H It is true that generally a receiver may not sue or be sued without the express permission of the court that appointed him (Kilarjian v Kilarjian, 32 AD2d 542). This rule “was devised in order to protect the receiver and the estate against the harassment and expense of possibly unnecessary litigation and to preserve the estate in the hands of the receiver for the benefit of all creditors equally” (Copeland v Salomon, 56 NY2d 222, 228). Focusing on this rationale, we conclude that an action or proceeding to enforce a housing code comes within the rule. A suit which seeks correction of housing violations affects the res insofar as the costs of litigation, the expense of remedying any violations, and the payment of any penalties would presumably have to be