256 A.D. 724 | N.Y. App. Div. | 1939
Lead Opinion
The defendants have appealed from three orders denying their motions to dismiss the complaints of the plaintiffs for failure to state facts sufficient to constitute a cause of action. The complaints are similar and may be summarized as actions brought by the obligees upon bonds secured by mortgages on real estate executed by the defendants’ testator some years before his death. In each action the amount sought to be recovered is the interest due and owing at the death of the obligor. The complaints contain no allegation as to the contents of the will nor is there any allegation that the defendants’ testator was the owner
The orders should be affirmed, with one bill of ten dollars costs and disbursements, with leave to appellants to answer within ten days from the entry of the order hereon.
Carswell and Johnston, JJ., concur; Taylor, J., concurs in result, being of opinion that if the allegations of each complaint are taken at their face value, a right of recovery of mortgage interest accruing in testator’s lifetime exists as matter of law; Hagarty, J., dissents and votes to reverse the orders and grant the motions, with opinion.
Dissenting Opinion
(dissenting). As the appeals raise common questions, it is necessary to consider but one complaint. In the action of Walter Ives, as trustee under the last will and testament of Elizabeth T. Watson, deceased, it is alleged that Frederick C. Kemple died a resident of Westchester county on the 21st day of May, 1938, leaving a will which has been admitted to probate. About ten years prior to his death he executed and delivered to the New Rochelle Trust Company his bond in the sum of $10,000, which was the amount the trust company then loaned him, and at the same time executed and delivered to it a mortgage upon certain real property located in the city of New Rochelle to secure the said bond, which instruments plaintiff holds upon assignment by the trust company. Defaults in the semi-annual payment of interest from January, 1936, to July, 1938, are set forth in the total amount of $1,493.88. Thus, this was interest which had accrued, practically in its entirety, at the time of the death of Kemple.
Appellants urge that this action may not be maintained -against the personal representatives of the mortgagor’s estate, but that-plaintiff is relegated to his action for foreclosure of the lien of the
The death of the obligor, therefore, restricts the remedy which may be pursued by the obligee. During the lifetime of the obligor the obligee may elect to sue for judgment on the bond alone and might even seek judgment for accrued interest despite the moratorium laws (Johnson v. Meyer, 268 N. Y. 701; Rochester Trust & Safe Deposit Co. v. Hatch, 273 id. 507) without subjecting himself thereby to a defense of splitting a cause of action. (Union Trust Co. of Rochester y. Kaplan, 249 App. Div. 280.) But when death occurs and the statutes with respect to descent and distribution are brought into operation, the requirement that a creditor fashion his remedy in accordance therewith is no more than an application of the equitable doctrine of marshaling of assets, and it cannot be said that by adhering to the procedure the creditor forfeits any legal right. Both the land and the general assets are aváilable to him, and he is merely obliged to look to the land in the first instance.
The foregoing views have been expressed upon the assumption that the mortgaged properties were owned by the testator at the time of his death. If, however, the contrary was the fact and the properties had been conveyed by the decedent during his lifetime, in which respect the complaints are silent, the result would be the same. By virtue of a conveyance, the land would serve as the primary fund for the satisfaction of the debt and the mortgagor who had so conveyed would occupy a position akin to that of a surety. (National Savings Bank of Albany v. Fermac Corp., 241 App. Div. 204; affd. without opinion, 266 N. Y. 443; Osborne v. Heyward, 40 App. Div. 78; Comstock v. Drohan, 71 N. Y. 9.)
In the event of a conveyance by the decedent during his lifetime, with warranty and for the whole purchase price despite the mortgage (La Grave v. Hellinger, 144 App. Div. 397; affd., 205 N. Y. 577), or a provision in the decedent’s will charging the accrued interest to the estate or of any other unusual contingency, the facts pertaining thereto should be affirmatively alleged in the complaints, as they would constitute the bases for the causes of action.
For the foregoing reasons, the orders denying motions of the appellants to dismiss the complaints for insufficiency should be reversed on the law, and the motions granted.
Orders affirmed, with one bill of ten dollars costs and disbursements, with leave to appellants to answer within ten days from the entry of the order hereon.