107 Misc. 140 | N.Y. Sup. Ct. | 1919
The petitioner, a judgment creditor of the defendant Bay View Heights Land Company, moves in two actions, known as action No. 1 and action No. 2, brought by the Thomas F. Martin Realty Company against the Bay View Heights Land Company to foreclose mortgages. Action No. 1 was brought to foreclose a mortgage which at the time of the commencement of this action had been reduced by payment to $26,500. Action No. 2 was brought to foreclose a mortgage for $2,385. The petitioner seeks a resale of the premises, the subject matter of action No. 1, and to vacate the judgment and set aside the sale had thereunder and for leave to come in and to defend action No. 2. The premises foreclosed in action No. 1 were sold on August 15, 1918, for $500, and the premises foreclosed in action No. 2 were sold on June 21, 1918, for $1,000. The plaintiff in the foreclosure actions was the purchaser. The petitioner alleges here that the land sold in action No. 1 for $500 was worth at the time of the sale upwards of $38,000, and
I am satisfied that the petitioner has shown enough upon this application to warrant the court in ordering a resale of the premises foreclosed in action No. 1 and in vacating the judgment in action No. 2 and permitting the petitioner to come in and defend that action. There is no question but that the petitioner has a standing in this court for the purpose of this motion. Goodell v. Harrington, 76 N. Y. 547; Matter of Fuller v. Brown, 35 Hun, 162. It is apparent, therefore, that the petitioner is entitled to relief not only because it appears that in both actions the sales were for sums grossly inadequate, but also because it appears that there is a substantial defense to the mortgage sought to be foreclosed in action No. 2. Those who bought lots from the purchaser at the foreclosure sale had no notice of this application. They acted in good faith, relying on the judgment of this court, and have paid the amount of the purchase price. The court has power in granting an application of this kind to preserve the rights of those who purchased in good faith, without knowledge of any irregularity. Matter of Fuller v. Brown, 35 Hun, 162; Hale v. Clauson, 60 N. Y. 339; Weeks v. Weeks, 106 id. 629.
The motion will therefore be granted to the following extent: In action No. 1 a resale of the premises, except the lots sold by the purchaser at foreclosure, will be ordered. In action No. 2 the judgment will be vacated in all respects except as to the lots which were sold by the purchaser at foreclosure to the parties who have no notice of this proceeding, and, as to those lots, the judgment and sale by the referee will be confirmed. The summons and complaint in action No. 2 will be amended by adding the name of the petitioner as a party defendant, and leave is granted to him to
Ordered accordingly.