214 A.D. 99 | N.Y. App. Div. | 1925
Lead Opinion
A bond for $750,000, together with a real estate mortgage securing the same, was executed on December 6, 1923, by the relator, then known as the Masro Realty Corporation, and delivered to the Winson Mortgage Company. The mortgage was recorded on December 28,1923, and a recording tax of $3,750, calculated at the statutory rate of fifty cents for every $100, was duly paid. On March 6, 1924, the relator’s name was changed. On March 19, 1924, the mortgagee executed and delivered to the Equitable Trust Company of New York an assignment of the bond and mortgage so given. On the same day the relator executed and delivered to the Equitable Trust Company an additional bond for $250,000, together with a mortgage upon the identical real estate previously mortgaged. The Equitable Trust Company and the relator, on the same day, executed an agreement consolidating the two bonds and mortgages. After these instruments had been executed and delivered to the Equitable Trust Company, that company advanced to the relator the additional sum of $250,000. The $250,000 mortgage and the consolidation agreement were thereafter recorded upon the payment under protest of $5,000 tax. The State Tax Commission has determined that the consolidation agreement was a mortgage and that a recording tax of $5,000 was payable by the relator for the recording thereof. With this conclusion we are in accord. The consolidation agreement was accompanied by a bond of $1,000,000. It provided for the elimination of the prior bond of $750,000 and the bond for $250,000. It also imposed upon the real property, described in the other instruments, a mortgage lien to secure the payment of the bond for $1,000,000. Clearly, therefore, it constituted a mortgage. It was not a supplemental mortgage under section 255 of the Tax Law (as amd. by Laws of, 1916, chap. 323), since it was not given “ for the purpose of correcting or perfecting any
The determination, so far as it determines that a tax of $1,250 was due and payable, should be annulled, and otherwise in all things confirmed.
All concur, except Van Kirk, J., dissenting with an opinion, in which McCann, J., concurs.
Dissenting Opinion
The relator complains of the collection of the recording tax on the $250,000 mortgage. This tax is upon the mortgage, not upon any indebtedness whose payment is secured by the mortgage. The indebtedness recited in the mortgage is the measure of the tax. The tax is payable when the mortgage is recorded; its payment is a condition precedent to the recording. This mortgage was recorded; the tax was then legally due. The mortgage was a live, valid instrument when recorded. The execution and recording of the consolidation mortgage or agreement, however, soon after the $250,000 mortgage was recorded, cannot render illegal the tax
McCann, J., concurs.
Determination of the State Tax Commission, so far as it determines that a mortgage tax of $1,250 became due and payable upon the recording of the mortgage for $250,000, is annulled, and in all other respects confirmed.