Case ID: ny-st-rep_49/html/0300-01.html
Source: Caselaw Access Project
Author: {"author": "Putnam, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Elsie S. Morrison, Ex’rx, Resp’t., v. Thomas H. B. Crane, et al., App’lts.
    
      (Supreme Court, General Term, Third Department,
    
    
      Filed November 22, 1892.)
    
    Reference—Compulsory.
    This action was brought upon an alleged agreement of assignees for creditors on a sale of real estate to pay a certain mortgage thereon, and to recover of the preferred creditors a sufficient amount to pay the same. The assignees denied making such agreement. Held, that a reference could not he compelled, as the examination of a long account was not involved; the real issue being as to whether such agreement was made. If plaintiff should recover on such issue, a reference might afterwards be ordered to take proof as to the portion of the recovery which each defendant should pay.
    Appeal by the defendants from an order referring the action to a referee to hear, try and determine. The defendants opposed a reference.
    The action was originally brought by one Alexander C. Morrison, to whom Fales assigned the cause of action, and is now prosecuted by Morrison’s executrix.
    The facts set forth in the complaint are briefly these: Clark & Kline in 1883 became insolvent and made a general assignment for the benefit of their creditors to Hinman & Crane. At the time of the assignment the assignors owned two parcels of real estate, one known as the “Globe mill property,” the other as the “Brewery property.” The former was encumbered to the amount of about $50,000, and the latter was mortgaged to Morris to secure him against liabilities to the amount of $6,000. In 1884 the assignees agreed to sell to Fales the two parcels of real estate for $35,000, subject to all encumbrances, except that said assignees agreed to pay said Morris mortgage out of said $35,000. A deed of said two parcels was thereupon made and delivered by said assignees to Fales, containing the clause “ subject to existing liens and encumbrances thereon,” and the $35,000 purchase price paid. The assignees failed to pay the Morris mortgage, and Fales was subsequently compelled by foreclosure proceedings to pay the same. The assignees proceeded to pay said $35,000 to the preferred creditors under the assignment, and now have no funds in their hands.
    The plaintiff has requested the assignees to bring an action to recover from the preferred creditors a sufficient amount of the money paid them under'their preferences to reimburse him, and the assignees have omitted to do so. The plaintiff seeks in this action to recover from the preferred creditors a sum sufficient to reimburse him for his payment of the Morris mortgage. The issue in the case is whether the assignees upon the sale to Fales agreed to pay the Morris mortgage out of the purchase price.
    
      C. S. Nisbet, for app’lts; E. F. Bullard, for resp’t.
   Putnam, J.

The real issue in this caséis whether the assignees of “Clark & Kline” agreed, on the sale to plaintiff’s assignor of the real estate described in the complaint, to pay out of the purchase money the “ Morris ” mortgage, which was a lien thereon and which plaintiff’s assignor was afterwards compelled to pay.

It is quite clear that the action does not involve the examination of a long account within the meaning of § 1013 of the Code of Civil Procedure. If the plaintiff should succeed on the only real issue in the case, i. e., as to the agreement of the assignees of “ Clark & Kline ” to pay said mortgage, on which issue defendant is entitled to a trial by jury, a reference might be afterwards ordered, if desired, to take proof as to the portion of plaintiff’s recovery that- each defendant should pay. Drexel et al. v. Pease et al., 41 St. Rep., 236 ; Thayer v. McNaughlon, 117 N. Y., 111; 26 St. Rep., 843; Camp v. Ingersoll, 86 N. Y., 433.

The order should be reversed, with costs and printing, and the motion for a reference denied, with costs.

Mayham, P. J., and Herrick, J., concur.