Case Name: Lewis L. Fawcett, as Receiver of Louis Edelmuth, Appellant, v. The City of New York, Respondent, Impleaded with Paulina Goldman and Others
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1906-04-06
Citations: 112 A.D. 155
Docket Number: 
Parties: Lewis L. Fawcett, as Receiver of Louis Edelmuth, Appellant, v. The City of New York, Respondent, Impleaded with Paulina Goldman and Others.
Judges: 
Reporter: Appellate Division Reports
Volume: 112
Pages: 155–159

Head Matter:
Lewis L. Fawcett, as Receiver of Louis Edelmuth, Appellant, v. The City of New York, Respondent, Impleaded with Paulina Goldman and Others.
First Department,
April 6, 1906.
Supplementary proceedings — time of appointment of receiver immaterial if proceedings were instituted within ten years — action by receiver to recover award made on condemnation of lands — demurrer to answer sustained —judgment debtor not necessary party.
If proceedings supplementary to execution are begun within ten years of the return of execution, as allowed by statute (Code Civ. Proc. § 2435), the date of the subsequent appointment of a receiver therein is immaterial.
Hence* when in an action by such receiver to recover an award, made-on the condemnation of lands in which the j udgment debtor is alleged to {have had an interest, the. answer alleges that the order appointing the receiver was made more than ten years after docket of judgment, it fails to state a defense; as it does not show that the supplementary proceeding itself was not instituted within the time allowed.
When a receiver in supplementary proceedings is appointed before an award is made for lands taken by eminent .domain, the judgment debtor ceases to have any interest in the lands, áñd the award vests'in the receiver. As such award is personal property, the ten-year limitation as to lien of judgments upon real . estate has no application. '
It is no defense in such action, to allege that, the judgment'debtor has not been made a party. Moreover, if there were a defect of parties it appeared upon the face of the.complaint, and the objection must he taken by .demurrer or it is waived.
Appeal by the plaintiff, Lewis L. Fawcett, as receiver, etc., from an interlocutory judgment of the Supreme Court, entered in the office of the clerk of the county of New York-on the-8th day of June, 1905, overruling " the plaintiff’s demurrer to. the separate defenses contained, in the answer’of the .defendant, the City of New York.- ’ r . . . ’ ■
Henry R. Ham, for the appellant.
Theodore Connoly, for the respondent.

Opinion:
McLaughlin, J.:
The plaintiff, in "proceedings, supplementary to -execution, was appointed receiver of the property of one Edelmuth, and as such broughjt this action to determine the title tó, and recovér Edelmutli's interest in, an award made to unknown owners for land taken by the city of New York for street purposes.
The complaint alleged, in substance, that on December 24,. 1897, Edelmuth was the" owner of an undivided one-sixth part. of. the land taken; that on that day title vested in the city of New York, for which an award of $336' was made to unknown owners; that on February 3, 1904, the,plaintiff in-proceedings instituted for that piirposewas appointed-receiver of Edelmuth's property; that he ga^e the bond required, entered upon and has since, been discharging the duties of his office* The complaint'also alleges a demand for and refusal of payment by the city. The city, among other defenses, interposed the following
" III. And for a further and separate defense the defendant, The City of Few York, upon information 'and belief, alleges that the plaintiff is not now and was not at the time of the commencement of this action entitled to claim, sue for or recover any part, parcel or portion of the award herein sued upon, in that the plaintiff as by his com plaint alleged claims to have been appointed such receiver in supplementary proceedings on the third day of February, 1904, and in'thafc on examination of the docket of judgments, in the office of the Clerk of the County of Few York, it appears that the judgment upon which these proceedings are founded was entered on the seventh day of August, 1891, in City Court of the City of Few York and duly docketed in said County Clerk's office on the eighth day of August, 1891; a period more than ten years prior to entry of the alleged order appointing this plaintiff receiver therein.
" IV. And for a further and separate answer and defense the defendant, The City of Few Yoi'k, alleges that there is a defect of parties defendant in that one Louis Edelmuth, the person of whom as aforesaid the plaintiff herein claims to be receiver in supplementary proceedings, has' not been made a party plaintiff or defendant herein, and that the aforesaid Louis Edelmuth is a necessary party to the action."
To each of these defenses the plaintiff demurred upon the ground that it was insufficient in law upon the face thereof. The demurrer Was overruled and the receiver has appealed.
I am of the opinion that the demurrer should have been sustained. As to the third defense, the contention of the learned corporation counsel is that inasmuch as the judgment, under which the proceeding was instituted which resulted in plaintiff's appointment, was recovered more than ten years prior to the time of "his appointment, the order appointing him was either void or else of no effect under the decision of Importers & Traders' National Bank v. Quackenbush (143 N. Y. 567), but that case is not in point, nor do I think it has any application." That was an appeal from an order' vacating a stay of proceedings and denying a motion by' the appellant to set aside an execution issued upon a judgment and order for the examination of the judgment debtor in proceedings supplementary to execution. There, the judgment was recovered in 1879 and the execution upon it was issued, in 1894, which, was returned unsatisfied and thereupon an order was obtained requiring the defendant to appear and answer in supplementary proceedings, and it was simply held that a motion to vacate the order was improperly denied; that under section' 1251 of the Code of Civil Procedure the lien of the judgment upon defendánt's real estate ceased after ten years and the execution was ineffective to reach, all of .the - debtor's property; that'the. judgment creditor's legal remedy had hot been exhausted* inasmuch as no steps had been taken to re-establish the lien oh the real estate, and for that reason the proceeding was improperly instituted. It also appeared that a prior execution had been issued upon the judgment immediately after its rendition, which was returned unsatisfied and it was held that the right to maintain supplementary proceedings accrued upon the return of that execution and was barred after the lapse of ten years, in the absence of some proceeding to revive it, to which the debtor was a party.
Here, the only allegation in the third defense is that the order appointing the receiver was made more than ten years after the, docketing of the judgment. The judgment was docketed August 7, 1891. The receiver was appointed February 3,1904. The appointment of the receiver is, of course, a step in the proceedings supplementary to execution and he may be appointed at any time in the course of a properly'instituted proceeding'. (Code Civ. Prop. § 2464.) If the proceeding itself is instituted within the required time, then the date of the appointment is entirely immaterial, and for aught that appears, the proceeding which resulted in the appointment of this plaintiff may have been instituted (and in the absence of an allegation to the contrary such must be presumed) within the time prescribed by statute. The only limitation within which such proceeding may be instituted is contained in section '2435 of the Cbde of Civil Procedure, which is, " At any time within ten years after the return* wholly or. partly unsatisfied, of an execution." The ten years does not begin to run with the docketing of the judgment, but with the return of the execution. As already indicated, there is no allegation that the proceeding was not instituted within ten years after the return of the execution, and, therefore, the validity of the appointment itself is not questioned by this defense, The receiver was appointed before the award was made, and under section 2468 of the Code of Civil Procedure, title to the award, when made, immediately vested in him. The moment that the title to the land vested in the city, .that moment the judgment debtor ceased to have any interest.in the land as the award made took its place. (Ballou v. Ballou, 78 N. Y. 325 ; King v. Mayor, 102 id. 171.) The award being personal property the ten years' limitation as to liens upon real estate has no application. (Treacy v. Ellis, 45 App. Div. 492; Van Loan v. City of New York, 105 id. 572.)
As to the fourth defense. The judgment debtor is not a necessary party. The title to the award in so far as he had any interest therein vested in the receiver and the only interest that the judgment debtor thereafter had was the right to an accounting in the event of a surplus after the payment of the judgment. (Matter of Wilds, 6 Abb. N. C. 307; Goddard v. Stiles, 90 N. Y. 199 ; Bostwick v. Menck, 40 id. 383.)
And in addition to this, if there were a defect of parties, then the city should have demurred. It appeared upon the face of the complaint if the -fact were important that the judgment debtor should have been made a party to the aetion, and the omission to join him as a party should have been raised by demurrer. Hot having been thus raised, it was waived. (Code Civ. Proc. § 488, 499; De Puy v. Strong, 37 N. Y. 372; Straus v. Tradesmen's Nat. Bank, 36 Hun, 451.)
The judgment appealed from, therefore, must be reversed, with costs, and the demurrer sustained, wi(h costs, with leave to the city to serve an amended answer on payment of the costs in this court and in the court below.
O'Brien, P. J., Patterson, Laughlin and Houghton, JJ., concurred.
Judgment reversed, with costs, and demurrer sustained, with costs, with leave to the city to amend on- payment of costs in this court and in the court below. Order filed.