Case ID: ny-super-ct_47/html/0441-01.html
Source: Caselaw Access Project
Author: {"author": "By the Court.—Truax, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

BENJAMIN WRIGHT, Receiver, Etc., Respondent, v. ELBERT NOSTRAND, et al., Appellants.
    Supplementary Proceedings.
    1. Receiver, order appointing.
    
    
      (a) Piling and recording under the code of procedure.
    1. Should be filed and recorded in the office of the clerk of the county where the judgment debtor resides, and in order to vest the receiver with real estate of the judgment debtor, in the office of the clerk of the county where such real estate is situate (§ 298). It is not necessary to record it in a register's office.
    
    (6) Jurisdiction to make.
    1. When and by whom to be shown.
    
    In an action brought by a receiver appointed by a judge's order against third persons, he must prove every fact necessary to confer jurisdiction.
    2. Matters necessary to confer.
    
    1. A money judgment.
    2. An execution issued on a money judgment and returned unsatisfied.
    1. What is not such an execution. One which, in reciting the judgment, leaves the amount, and date of docket, blank, is not.
    3. An order supplementary to execution.
    1. Non-production of, when not accounted for. Not by the testimony of the clerk of the court that he cannot upon search find it in his office. Such evidence does not authorize secondary proof.
    4. That the proceedings supplementary were instituted or carried on by the owner of the judgment.
    1. When such fact does not appear.
    It does not, when a corporation obtained a judgment, and thereafter it was dissolved by judicial action, and a receiver of all its property, &c., was appointed, and there is no evidence that the supplementary proceedings were instituted by the receiver; but on the contrary in the proceedings the corporation appeared to be the owner of the judgment, and the proceedings were carried on as if it had a legal existence.
    5. That the proceedings, from their institution up to the time of the appointment of the receiver, were kept alive by regular adjournments, and that proper notice of the application for a receiver was given.
    Before Sedgwick, Ch. J., Freedman and Tritax, JJ.
    
      Decided June 13, 1881.
    
      This is an action brought by the plaintiff, as receiver of Elbert Nostrand, one of the defendants, to set aside certain conveyances made by said Elbert Nostrand to the defendant, John R. Cypert, and by said Cypert and wife to the defendant, Mary A. Nostrand, the wife of the defendant, Elbert Nostrand, on the ground that such conveyances were made in fraud of the creditors of said Elbert Nostrand, and without any consideration having been paid therefor by said Cypert or by said Mary A. Nostrand. Said conveyances were made on February 12, 1874. The judgments in which the plaintiff was appointed receiver were recovered as follows : One in favor of J. E. Arnold, in this court on March 2, 1874 ; one in favor of the Loaners’ Bank, in this court on January 19, 1876, and one in favor of Conrad Poppenhusen and others, in the court of common pleas, on December 26, 1874. The actions in which these judgments were obtained were commenced prior to said 12th day of February, 1874, except the Poppenhusen action. This action, however, was brought on a promissory note made by said Elbert Nostrand on January 15, 1874. Execution was issued to the sheriff of the city and county of New York, the county in which said Elbert Nostrand then resided, on the Arnold judgment on March 4, 1874, and returned unsatisfied, and such proceedings were thereafter had that on July 25, 1877, the plaintiff in this action was appointed receiver of all the debts, property, equitable interests, rights and things in action of the said Elbert Nostrand. The plaintiff, as such receiver, duly filed his bond, and the order appointing him receiver was duly filed in the office of the clerk of the city and county of New York on January 18, 1878, and before the commencement of this action. Said order was not recorded in the office of the register of the city and county of New York.
    Execution was issued on the Poppenhusen judgment, and such proceedings were had that on February 12, 1878, an order was made by said court of common pleas extending the appointment of said receiver to the Poppenhusen judgment. This order was filed in the office of the clerk of the city and county of New York on the same day, but never was recorded or registered in said register’s office.
    Execution was also issued on the Loaners’ Bank judgment, and such proceedings were thereafter had that on January 21, 1878, an order was made by this court extending the appointment of said receiver to said last-mentioned judgment. This order was recorded .in said county clerk’s office on January 31, 1878. It never has been recorded or registered or filed in the office of said register.
    The execution issued on the Arnold judgment contained a number of defects. It recited that the judgment was obtained in the superior court, without specifying what superior court, for the sum of - dollars, and that judgment was docketed on March —, 1874. It commanded the sheriff to return said execution to the clerk of the city and county of New York. It' was witnessed by “Egbert Speir,” one of the justices of this court. It was indorsed with a direc- ' tion to return said execution within sixty days to ‘ ‘ the Culver & Bertrand, plff. attys.”
    The execution, however, did state the amount due thereon, did direct the sheriff to levy and collect that amount, and was returned to the office of the clerk of this court.
    The execution issued on the judgment in favor of the Loaners’ Bank was made returnable to the clerk of the city and county of New York.
    The execution issued on the Poppenhusen judgment recited that the judgment was obtained “in the court of common pleas,” and was made returnable to the clerk of the city and county of New York.
    
      The defendants objected to the admission of those executions on the trial, on the grounds above specified. The defendants also objected to the admission of the orders appointing and continuing plaintiff receiver, on the ground that owing to the above defects a proper foundation had not been laid, and that it did not appear that any notice of the motion for the appointment of a receiver had been given to the judgment debtor. The order appointing a receiver in the Arnold action was also objected to, on the ground that no proper foundation had been laid for its admission, by proof of supplementary proceedings first instituted in that action. These objections were overruled, and the defendants duly excepted.
    Judgment passed for plaintiff, from which the defendants appealed to the general term.
    
      Thomas & Wilder, attorneys, and E. P. Wilder, of counsel, for appellants, on the questions considered by the court, urged :
    I. It was error to'admit in evidence the order appointing plaintiff receiver. Mo proper foundation was laid for it by the introduction of the order in supplementary proceedings on which it was or should have been based. Plaintiff’s attorney, Betts, afterwards tried to supply this defect by testifying that the order and examination of the judgment debtor had been handed up to a judge of this court, since which time he, Betts, had never seen them, but he admitted he had caused no search to be made for them among that judge’s papers. It is submitted that this laid no foundation for secondary evidence, much less for dispensing with evidence altogether (see Josuez v. Connor, 7 Daly, 448). This was the order of a judge in a special statutory proceeding instituted before a judge, and not before the court. The order carries on its face no presumptions as to jurisdiction or regularity (Old Code, § 298). Every fact necessary to the order must be proved (Coope v. Bowles, 28 How. Pr. 10; Sackett v. Newton, 10 Id. 561; De Comean v. People, 7 Robt. 498, 501; Dubois v. Cassidy, 8 N. Y. Weekly Dig. 132). And such jurisdiction may be attacked or inquired of collaterally anywhere (Kamp v. Kamp, 59 N. Y. 212).
    II. The order was further objected to, as there was no proof of notice to the judgment debtor of the applk cation for it. The “notice” required by law is a legal notice, given in conformity with the rules relating to other motions. “Notices shall be in writing” (Code of Pro. § 408). Here none whatever was given. The testimony of Betts, at the most, amounts only to this: that he verbally notified Reeve, at the close of the examination of Nostrand, that he would then and there apply for a receiver. Reeve was not a practicing attorney, and had not been for many years. He was not the attorney for Nostrand in that action, and was present with him only as his friend. Besides, he contradicts Betts flatly. As to the insufficiency of such a notice, see Vandeburgh v. Gaylord, 7 N. Y. Weekly Dig. 136; Kemp v. Harding, 4 How. Pr. 178 ; Dorr v. Noxson, 5 Id. 29 ; Barker v. Johnson, 4 Abb. Pr. 435 ; Todd v. Crook, 4 Sandf. 694, 695.
    III. The order appointing plaintiff receiver confers upon Mm no title or capacity to bring this action, because not recorded in the office of the register of New York city and county. In Rockwell v. Merwin (45 N. Y. 166, 168, affirming as correct; the view taken by Mo-. nell, J., in 8 Abb. Pr. N. S. 330, 334), the distinction between the office of county clerk and of the register in the city and county of New York was not taken. The decision is emphatic only upon the necessity of filing and recording. The language of the Code is of course general, and applies to all the counties of the State, except such as are affected by special statutes creating the office of register. This distinction is now insisted on by virtue of chapter 86 of the Laws of 1813.
    IV. The judgment creditor’s remedy at law was not exhausted before resorting to this action. This, for the following reasons : No valid execution was issued on the judgment in favor of J. E. Arnold against Elbert Nostrand, under which the plaintiff was first appointed. The subsequent appointments under the judgments of the Loaners’ Bank and Poppenhusen were mere extensions of the first appointment, and depend for their validity on that, (a) It does not state the amount of the judgment. This is essential (Code of Pro. § 289). (5) It does not state the court in which the judgment was recovered. It speaks of “superior court,” but whether of Buffalo or some other city does not appear (Code of Pro. § 289). If issued out of the wrong court it is utterly void (See Clark v. Miller, 18 Barb. 269). (o) It does not state when the judgment was docketed (Code of Pro. § 289). (d) If is not returnable “to the clerk with whom the judgment is filed.” On its face it is returnable to the clerk of the city and county of New York, and on its back, to the plaintiff’s attorney in that action (Code of Pro. § 290). (e) It is not tested in the name of any judge of this court, but of one “Egbert Speir,” not known to be a judge of any court (See Clarke v. Miller, 18 Barb. 269).
    V. The “ extension” of the appointment of the plaintiff as receiver, under and for the benefit of the j udgment recovered by the Loaners’ Bank is clearly a nullity. It appears that the Loaners’ Bank, at the time these supplementary proceedings were instituted, had ceased to be a corporation, and its property (including, of course, this judgment, for no previous assignment of it to anybody appears in evidence) had passed into the hands of one Wintringham, as receiver. The affidavit on which these proceedings were based was made by a former attorney of the Loaners’ Bank, whose authority, of course, must have terminated with the existence of the corporation, his client (See Amore v. Lamothe, 7 N. Y. Weekly Dig. 212). No authority is shown to have proceeded from Wintringham, the receiver ; no allusion to' him is made in the proceedings; and no notice appears to have been given to him of any motion for the “extension” of plaintiff’s appointment for his benefit; he is not made a party to this action, nor was his request or permission obtained before bringing it.
    
      H. D. Betts, attorney, and of counsel, for respondent, on the questions considered by the court, urged :
    I. The defendants objected on the trial to the court’s receiving the execution. ■ on the Arnold judgment in evidence, and claim that proceedings supplemental could not be founded on its return unsatisfied. 1st. Because the amount of the judgment was not stated ; 2nd. Because the court was not stated to be the superior court of the city of New York but only the superior court; Sd. Because it did not state the day on which the judgment was docketed in the county clerk’s office ; 4th. Because it directed the sheriff to return it to the clerk of the county of New York. The execution did state the amount due upon the judgment. It did state that the judgment was recovered in the “superior court.” It did state the month and the year in which the judgment was docketed in the county clerk’s office. It was not necessary to direct the sheriff where to return it, and such direction was.mere surplusage (Code of Pro. § 280). The law made it the duty of the sheriff to return the execution to the clerk of this court, and it appears that he did so return it. The sheriff received the execution and executed it, and the plaintiff’s remedy at law was thereby exhausted, and he had a right to proceed in equity. Besides, the execution was valid and the irregularities complained of are at any time amendable nunc pro tunc (Kennedy v. Thorpe, 3 Abb. Pr. N. S. 131; Fake v. Edgerton, 5 Duer, 681; Cutler v. Rathbone, 1 Hill, 204; Peck v. Tiffany, 2 N. Y. 451; James v. Gurley, 48 Id. 163). Like objection to the executions issued on the Poppenhusen judgment was taken because it directed the sheriff to return it to the clerk of the city and county of New York, and the execution issued on the judgment of the Loaners’ Bank for that reason, and because it describes the judgment roll as being filed in the county clerk’s office instead of the office of the tilerk of the court of common pleas. It appears that both of these executions were executed by the sheriff, and by him returned to the proper office, and that the judgment roll in the case of the Loaners’ Bank was filed in the office of the clerk of the court of common pleas ; the irregularities complained of were clearly amendable under the authorities above cited. Besides, all these objections were waived by the appearance of the judgment debtor and his examination without objection in proceedings supplemental to execution (Hobart v. Frost, 5 Duer, 672 ; Union Bank of Troy v. Sargent, 35 How. Pr. 87). And in general, in a statutory proceeding, a party against whom it is taken may waive any particular requirement of the statute intended exclusively for his benefit (Bull v. Trustees of Village of Lockport, 3 N. Y. 197; Williams v. Potts, 2 Barb. 316; Phyfe v. Eimer, 45 N. Y. 102; Wright v. Alden, 3 How. Pr. 213; Whitehead v. Pecare, 9 Id. 35 ; Platt v. Platt, 2 Sup’m. Ct. [T. & C.] 26; Church v. Kidd, 3 Hun, 254; James v. Gurley, supra). All these objections go only to the regularity of the appointment of the receiver, as this action could have been maintained by the judgment creditors, even if no execution had been issued upon the judgment and returned unsatisfied (Baldwin v. Ryan, 3 Sup'm. Ct. [T. & C.] 251; Crippen v. Hudson, 13 N. Y. 161).
    II. The plaintiff, as receiver, succeeds to all the rights of the judgment creditors, represented by him Bostwick v. Menck, 40 N. Y. 383; Barker v. Torrence, 31 Id. 331).
    III. It is claimed by the appellant that the plaintiff could not recover as the representative of the owners of the judgment of the Loaners’ Bank against Nostrand— because at the time the. supplementary proceedings were instituted which resulted in the extension of the plaintiff’s receivership to that - action, the Loaners’ Bank had become insolvent and its assets passed into the hands of a receiver, one Wintringham—and because it does not affirmatively appear that those proceedings were authorized by Wintringham. These proceedings were properly instituted in the action, in the name of the original plaintiffs, they are regular on their face, and the presumption is that they were duly authorized, especially is this so in view of the fact that this action was brought at the request of Wintringham. In any event, to have constituted a defense the burden was on the defendants to show affirmatively that these proceedings were not authorized by him. It was sufficient for the plaintiff to show that he was regularly appointed receiver in the several actions which he represents—but it appears that this action is brought for the real parties in interest and by their request. The order of the court directing the receiver to bring this action is conclusive upon this question.
    IV. The defendants asked the court to dismiss the complaint, because the orders appointing the plaintiff receiver were not filed and recorded in the office of the register of the city and county of New York, claiming that by virtue of the provisions of the act of April 9, 1813, creating the office of register, &c., the orders should be filed and recorded in that office instead of the office oí the clerk of the city and county of New York. The old code (§ 298), which was in force at the time these orders were made, required the orders to be filed and recorded in the office of the clerk of the county in which the judgment roll was filed, upon which proceedings were taken. This was done, and this is all that is required (Rockwell v. Merwin, 45 N. Y. 166 168). The argument of the defense is that the-act of 1813 took from the legislature the power to subsequently direct the filing and recording of a paper in. the office of the clerk of the city and county of New York, and is an absurdity on its face. There is nothing in the act of 1813 inconsistent with the provisions of section 298 of the Code of Procedure, and if there is, the former is repealed by the latter. Besides, the-provisions of section 298 of the old code are for the-protection of third parties, and not for the benefit of the judgment debtor. He has actual notice of the appointment of the receiver, and the constructive notice required by the statute might well be disregarded as to him. It is a well settled principle of law that when a party has actual notice, it is immaterial whether a constructive notice required by a statute is given or not.
   By the Court.—Truax, J.

The motion to dismiss the complaint because the order appointing plaintiff' receiver had not been filed or recorded in the office of' the register of the city and county of New York, was-rightly denied. Chapter 86 of the Laws of 1813 simply directs that any papers therein mentioned, that are-thereafter directed by the legislature to be recorded or registered without specifying the place where they* should be recorded or registered, shall be recorded an d. registered in the office of the register of the city and county of New York, but when any subsequent law specifies the place in which papers shall.be regist*red or recorded, such papers must be registered or recorded in the place so specified. This construction of the act of 1813 makes section 298 of the Code of Procedure consistent with that act. But if the act of 1813 and section 298 of the Code are inconsistent, the former must be considered to have been repealed or superseded by the latter, which is the later expression of the will, of the legislature (People ex rel. Kingsland v. Palmer, 52 N. Y. 83; People ex rel. Navarro v. Van Nort, 64 Barb. 205).

The alleged execution issued on the Arnold judgment contains as many defects as it is possible to put into an execution. It says a judgment was rendered for-dollars and was docketed on the-day of March. It directed the sheriff to collect $604.95, which was the amount of the judgment. There were also a few other mistakes in it, but the one first mentioned is the only one that will be considered. I am of the opinion that this execution gave the sheriff no power to make a levy. If the judgment was rendered for-dollars, the sum of $604.95 could not be due thereon,, and the sheriff had no right to collect that sum. Section 289 of the Code of Procedure, which was in force at the time the execution was issued, directed that “an execution must intelligibly refer to the judgment, stating the court, the county where the judgment roll or transcript is filed, the names of the parties and the amount of the judgment.” Under this provision and similar provisions in other States, it has been held that the execution must exactly follow the judgment and be warranted by it (Reese v. Burt, 39 Ga. 565 ; Highton v. Handlin, 27 Ark. 20 ; Wilson v. Renter, 29 Iowa, 176 ; Jennings v. Pray, 8 Yerg. 85; Kniel v. Graves, 72 Penn. 11, 104; Baur v. Crisman, 29 Mo. 293 ; Farnham v. Hildreth, 32 Barb. 277; Tanner v. Grant, 10 Bush, 362 ; Cutler v. Wadsworth, 7 Conn. 6; Clark v. Miller, 18 Barb. 269). The general term of this court, in Heilner v. Walsh (ante, p. 269), held that, although an execution was not subscribed, either, by the party issuing it, or by his attorney, yet, having on it an indorsement which was subscribed by the attorney, such an indorsement was equivalent to a subscription, and therefore the execution was not void. Heilner v. Walsh also holds that mere defects in the form of an execution might be disregarded, or might be cured by amendment. I am of the opinion that the omission of the amount of the judgment is not a mere defect in the form of the execution, that the court should amend four or five years after the issuing of the execution, although it would have amended the execution on motion made at the proper time. The order appointing plaintiff receiver in the Arnold action should not have been received in evidence. The order was the order of a judge and not of the court, and every fact necessary to sustain the order must be proved. . It carries on its face no presumption of jurisdiction or of regularity. A material fact to give the judge jurisdiction to make the order was the issuing of an order supplementary to the execution. Such an order was not produced. Nor was its non-production accounted for by the testimony offered. There is no law requiring such an order to be filed with the clerk. It is a judge’s order, and the testimony that the clerk said he could not find the order in his office, did not authorize secondary proof of the order (Coope v. Bowles, 42 Barb. 87; De Comeau v. People, 7 Robt. 498, arid cases there cited). Before a judge has jurisdiction to make an order supplementary to the execution there must be a money judgment and an execution must have been issued on that judgment and returned unsatisfied. If a judge has made an order supplementary to the execution, when it is made to appear that no execution has been issued, the order should be vacated or further proceedings under the order should be stopped. The judgment in favor of the Loaners’ Bank was obtained January 19, 1876. On May 3, 1876, a receiver of all and singular the property, assets, choses in action and estate of every description of said Loaners’ Bank was appointed. The corporation on the appointment of the receiver no longer had any legal existence (McCulloch v. Norwood, 58 N. Y. 562). There is no evidence that these proceedings supplementary to the execution were instituted by the receiver of the bank. In those proceedings the Loaners’ Bank appeared to be the owner of the judgment, and the proceedings were carried on as though the bank had a legal existence. Proceedings supplementary to the execution must be carried on in the name of the owner of the judgment (Amery v. Lamothe, 7 Weekly Dig. 212). The supplementary proceedings in the Poppenhusen action were begun on April 9, 1875. The order was made February 12, 1878. It does not appear that the proceedings were kept alive until that day, nor does it appear that any notice of the application for the appointment of a receiver was given to'the defendant or to his attorney. Jurisdiction was lost by the failure to continue the proceedings by regular adjournments (Squire v. Young, 1 Bosw. 690 ; Carter v. Clarke, 7 Robt. 490).

The judgment is reversed and new trial ordered, with costs to the appellant to abide the event.

Sedgwick, Ch. J., and Freedman, J., concurred.