Case ID: ad_1/html/0411-01.html
Source: Caselaw Access Project
Author: {"author": "Rumsey, J.:", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Mary Finn, Appellant, v. James J. Lally and Others, Respondents.
    - Mortgagees in possession — redemption by the owner of the equity of redemption — grantees by deed from the mortgagee are assignees of the mortgage — Statute of Limitations — adverse possession ■— Champerty Act, what title is not adverse —final judgment on the facts by the appellate court—1 R. S. 739, §§ 143, 147— Code of Civil Procedure, §§ 379, 1033.
    In an action brought April 7, 1894, to redeem certain premises from the lien of a mortgage, it appeared that in 1853 a person named Weeks owned the premises; that he sold them to a person named Stewart, who gave back a mortgage for the purchase money; that in 1869 Weeks commenced an action to foreclose the mortgage in which Stewart, who was the only defendant, was served by publication under an order made by a county judge; that this order was wholly void, and that the court acquired no jurisdiction of Stewart in the action; that the premises were sold and bought by Weeks upon the foreclosure sale and that the sheriff conveyed them to Weeks, who did not take possession, but in 1871 conveyed them to a person named Delaney, who did not take possession, but in August, 1874, conveyed the northerly half of the northerly half to a person named Barnecott, who on August 6, 1874, commenced to occupy and to erect a dwelling upon them and subsequently conveyed them to the defendant. Conneff; that subsequently, in 1884, Delaney conveyed the southerly half of the northerly half to the defendant Lally, who took possession shortly after the time when he received his deed. The plaintiff claimed to have acquired title to the whole of the premises by mesne conveyances from Stewart.
    
      Held, that the plaintiff was entitled to redeem;
    
      That the foreclosure effected no change in the relation which originally existed between Weeks and Stewart; that the grantees of Weeks took only his right and became in effect assignees of the mortgage, and stood, with relation to Stewart, in the attitude of mortgagees in possession;
    That there was no adverse possession which could run against the right to redeem before Barnecott commenced to occupy and build on the 6th day of August, 1874, and as this action was begun on the 7th day of April, 1894, it was not barred by the Statute of Limitations;
    That the action was not barred by the Champerty Act, under which it was necessary that a title be disclosed adverse to the title of the grantor in the deed which was assailed, as the titles of the respective parties to this action were not hostile to each other;
    That while, in a proper case, the court had power to grant to the plaintiff the judgment which the facts warranted, it would not exercise that power in a case where it appeared that part of the premises had been sold and an accounting as to the rents and profits would be necessary, and an apportionment of the expenses necessarily incurred by the owners of the premises for taxes and other expenditures must be made, and where questions arose which must be settled upon facts not before the appellate court.
    Appeal by the plaintiff, Mary Finn, from a judgment of the Supreme Court in favor of the defendants, entered in the office of the cleric of the county of New York on the 1st day of August, 1895, upon the decision of the court rendered after a trial at the New York Special Term dismissing the plaintiff’s complaint upon the merits.
    
      Charles IS. Sentell and Fordham Morris, for the appellant.
    
      Theo. H. Friend and James R. Manrvin, for the respondents.
   Rumsey, J.:

The action was brought to redeem certain premises from the lien of a mortgage. It appears that in 1852 one Weeks was the owner of the premises which are the subject of the action, and that he sold them to Stewart, who gave him in return a purchase-money mortgage. No interest having been paid upon the mortgage, in 1869 Weeks commenced an action to foreclose it, making Stewart alone a defendant. The service of the summons was made by publication, upon an order granted by the county judge of Westchester county, in which county, at that time, the premises were situated. It is claimed by the qtlaintiff that this order was wholly void, and that the court acquired no jurisdiction of Stewart

by service by publication under it. It is unnecessary to examine particularly the grounds of this claim, as it is conceded by both parties, and there is no doubt that the affidavit upon which the order to publish was made, did not give the county judge jurisdiction, and for that reason the proceedings, as against Stewart, were entirely void. The judgment, therefore, was entirely without force, so far as he was concerned, and the purchase by Weeks, who bought in the premises upon the foreclosure sale and took a deed from the sheriff, affected no change in the relation between himself and Stewart. So far as they were concerned Stewart was still the mortgagor and Weeks was still the mortgagee, and their rights and liabilities were precisely the same as though no action had been brought and no judgment of foreclosure had been entered. Weeks did not take possession of the premises, but the matter stood in precisely the same situation as it has been after the .foreclosure sale until the year 1871, at which time Weeks made a conveyance of the premises to one Delaney. That deed operated under the statute to pass to Delaney only the interest which Weeks had in the premises at the time the deed was made, and no more. (1 R. S. 739, § 143.) The effect of the transfer to Delaney was to make him simply the assignee of the mortgage. (Townshend v. Thomson, 139 N. Y. 152, 161.) Delaney did not take possession, but in August, 1874, he conveyed to Barnecott the northerly half of the northerly half of the property. Barnecott conveyed to the defendant Conness the same portion of the premises. Later Delaney conveyed to the defendant Tally the southerly half of the northerly half of the premises. This conveyance was made in 1884. Barnecott took possession of the portion of the premises conveyed to him on the 6th day of August, 1874, and Tally took possession of his portion of the premises shortly after the execution of his deed in 1884. Tally and Gonness took from their grantors only the interest which the grantors had to give, and they became, therefore, assignees of the mortgage so far as Delaney was an assignee of it from Weeks. After they had taken possession of the premises under the conveyances from Delaney they stood with relation to the original mortgagor in the attitude of mortgagees in possession. (Townshend v. Thomson, supra.)

The plaintiff claims to have taken title to the whole of the premises by mesne conveyances from Stewart. These conveyances it is unnecessary to recapitulate, as it is not disputed that if they conveyed anything they conveyed the interest which Stewart had. Stewart’s equity of redemption never having been foreclosed he still owned it, and the deeds to the plaintiff conveyed the equity of redemption and vested her with the title to the property precisely as Stewart had it. If the deeds under which the plaintiff claims were valid, which will be considered later, she undoubtedly, as the owner of the equity of redemption, had the right to redeem from the mortgage, unless that right has been barred by the Statute of Limitations. As against that right, the Statute of Limitations does not begin to run until the mortgagee has entered into possession, and the action is not barred until the mortgagee or those claiming under him have ■ continuously maintained an adverse possession of the mortgaged premises for twenty years after a breach of the condition of the mortgage. (Code Civ. Proc. § 379.)

This action was begun, as it appears, on the 7th day of April, 1894. The first question presented is whether the action was barred hy the Statute of Limitations. The facts bearing upon that question are chiefly made to appear by the evidence of the defendant •and they are not at all in dispute. It seems that Weeks, who was the original owner of the farm from which this lot of land was ■carved, laid it out into lots, in 1852, and that after it was laid out it lay open and vacant and unoccupied for many years. So far as ¡appears, Stewart did not take possession of it under his deed nor •occupy it. Neither did Weeks do so after he had obtained the sheriff’s deed upon the foreclosure. Delaney, who took the title to ■.the premises from Weeks, testified that at the time he took it the premises were vacant and unimproved, and continued to be so up do the time of the conveyances by him to Barnecott on August 6, 1874. Barnecott testified that he examined the property before he "bought it; that there were no fences upon it; that it was entirely vacant and unimproved and wild, and had not been cultivated in a number of years; that he took his deed on August 6, 1874, and that immediately afterward he commenced the erection of a dwelling upon the lot conveyed by it. This evidence was given by the witnesses sworn on behalf of the defendant.

The witnesses sworn on behalf of the plaintiff testified substantially that from 1852 down to 1874 the premises stood open and vacant; that no crops were grown upon it; that it was not fenced, and that it was entirely unoccupied. It is quite clear from this testimony that there was no adverse possession of these premises by virtue of which the Statute of Limitations could run against the right to redeem before August 6, 1874. The law says that for the purpose of constituting an adverse possession by a person claiming a title founded upon a written instrument, which is this case, land is deemed to have been possessed and occupied where it has been usually cultivated or improved, or where it has been protected by a substantial inclosure. (Code Civ. Proc. § 370.) Neither of these conditions existed in this case, and for that reason the claim that the cause of action is barred by the Statute of Limitations is not well founded.

But the defendants insist that even if the action is not barred by the statute the deeds under which the plaintiff claims were void under the Champerty Act, and for that reason she acquired no title to the equity of redemption and cannot maintain this suit. The law under which this claim is made is found in the Revised Statutes. It was passed originally to provide against a state of affairs which does not exist in these times, and for that reason it is not often invoked. It provides that every grant of land shall be absolutely void if at the time of the delivery thereof such lands shall be in the actual possession of a person claiming under a title adverse to that of the grantor. (1 R. S. 739, § 147.) The wording of the statute is significant, and it must not be confused with the statute which prescribes what shall constitute an adverse possession to set the Statute of Limitations running. The possession, which is sufficient under the Statute of Limitations, is possession under a claim of title. When that claim is set up it is not necessary that the pleader should show that he is in under any specific title, but it is sufficient if he proves that he claims to hold the premises adversely to the right that he is contesting. The material matter where the Statute of Limitations is in question is the possession, and whether that possession has been taken under a claim of right hostile to the adverse party, without regard to what the particular claim is. The important matter, however, under the Champerty Act, is the title, and not the particular possession. To avoid a deed the claim under the Champerty Act must be under a title. Nothing can satisfy the language of that act but the existence of some specific title under which the party claims. That title must be disclosed so that the court may see that it is adverse to the title of the grantor in the deed which is assailed, and unless that fact is made to appear, the deed is valid. (Crary v. Goodman, 22 N. Y. 170; Dawley v. Brown, 76 id. 390; Smith v. Faulkner, 48 Hun, 186.) In the case at bar both parties claim under the title of Stewart, Weeks and his grantees claiming to have derived it hy foreclosure of the mortgage which Stewart gave, and the plaintiff and her grantees claiming the title by virtue of mesne conveyances from Stewart of the equity of redemption. These titles are not, therefore, hostile, the one to the other, within the meaning of this act. Each goes back to a common grantor and seeks to establish its validity by showing a descent from him in right line. For this reason it cannot be said that the plaintiff’s deed is void, but she acquired by her conveyance an equity of redemption and the same right to redeem the premises from this mortgage which Stewart had. The judgment, therefore, must be reversed.

We are asked to enter judgment for the plaintiff pursuant to section 1022 of the Code of Civil Procedure. While the power of the court to do this in a proper case cannot be denied, this, as we think, is not one of those cases. It appears that the defendants are in possession, claiming to own the northerly half of these premises. To that half the plaintiff has still her title, but she has disposed of the title to the southerly half, which is owned by her grantee. To enable her to redeem she must pay the whole mortgage debt. (Jones on Mortgages, § 1072.) She is entitled to an account of the rents and profits, and she must be charged with the expenses necessarily incurred by the owners of the premises by way of taxes and such other expenses as were necessary to protect the premises. Just how far these rents and profits shall be applied upon the mortgage, to what extent the necessary expenses shall be charged against them, and how far those expenses must be apportioned between the different owners of the property, are things which probably must be considered by the court before an interlocutory judgment is entered in this action. The facts necessary to pass upon those questions have not been presented here, and have not been argued before us. For that reason we deem it advisable simply to reverse this judgment and send the case back for a new trial, where there can be presented to the court all the facts necessary to enable it to lay down the principles upon which an account should be taken, if, upon the evidence presented upon that trial, it shall appear that the plaintiff is entitled to the relief demanded in the complaint.

Judgment reversed, new trial ordered, with costs to the appellant to abide the event.

Van Brunt, P. J., Barrett, "Williams and Ingraham, JJ., concurred.

Judgment reversed and new trial ordered, with costs to appellant to abide event.