Case Name: Leon Pizer, Appellant, v. George W. Herzig and Others, Respondents
Court: New York Supreme Court, Appellate Division
Jurisdiction: New York
Decision Date: 1907-10-25
Citations: 121 A.D. 609
Docket Number: 
Parties: Leon Pizer, Appellant, v. George W. Herzig and Others, Respondents.
Judges: 
Reporter: Appellate Division Reports
Volume: 121
Pages: 609–611

Head Matter:
Leon Pizer, Appellant, v. George W. Herzig and Others, Respondents.
First Department,
October 25, 1907.
Mortgage — foreclosure — receiver of rents and profits.
When a mortgage specifically provides that on default the mortgagee is entitled to the appointment of a receiver of the rents and profits as a matter of right . without notice to the mortgagor, which receiver shall apply the rents and profits over expenses to the payment and satisfaction of thé mortgage, the mortgagee . . is entitled to such receiver without proof of the insolvency of the mortgagor, especially , where there is a serious doubt as to the sufficiency of the security.
Appeal -by the- plaintiff, Leon Pizer, from an order of the' Supreme Court-,, made at the New -York Special Term and entered-in the office of the clerk of-the county-of New York on the 1st day Of August; 1.90'T, denying the ¡ilaintiff’s motion for the appointment of á recei ver of the rents; issues and-profits' during the pbndbfiby of an action to foreclose a mortgage on real estate^ ■
Max Schleimer, for the appellant.
Irving L. Ernst, for the respondents.

Opinion:
Per Curiam:
This action was brought to- foreclose a purchase-money second mortgage on premises on Madison avenue near One Hundred and Fourteenth street in the city of New York. The mortgage -provided, among other things, that if default be-made in the payment, of any interest or installments or in any of the conditions of the said bond and mortgage upon a complaint filed or any other legal proceedings' commenced for the foreclosure of the mortgage,, -the mortgagees or their legal representatives or assigns shall be entitled as a matter of right and without regard to the value of. the premises above described or the solvency or insolvency of -the mortgagor or of any owner of said premises and without notice to the mortgagor, his heirs or assigns to the appointment by any competent court or tribunal of a receiver of the rents, issues and profits of said premises, with the power to lease said premises for a term to be approved of by the- court, with power to pay taxes, assessments and water, rents - which may become liens on said premises and keep the same insured, and with power to take proceedings to dispossess tenants and make all necessary repairs, and with such other powers as may be deemed necessary and after deducting all charges and expenses attending the execution of the said trust as receiver. . Tile receiver ".shall apply the residue of the said rents and profits to the- .payment and satisfaction of this mortgage and the bond' accompanying the same;, or to any deficiency which may arise after applying the proceeds of the said sale of premises to the amount due, including interest and costs and expenses of the foreclosure sale." . ,
The motion for the receiver .herein was based on the ground that. the mortgagor agreed that the rents, issues and profits should be added to'tlie mortgagee's security; that the said defendant is committing a waste upon the premises, and that the premises have depreciated in value, .
While the provision in a mortgage that a mortgagee shall be entitled as a matter of right and without regard to the.value of the premises, or the solvency or insolvency of the mortgagor, to the appointment of a receiver is not conclusive upon a court of equity, yet this contract of the parties is to be considered when the court is asked, ih the exercise of its discretion, to appoint a receiver. When, in addition thereto, the mortgagor has specifically pledged the rents and' profits, there is respectable. authority to the effect that the mortgagee is entitled to such receiver without proof of the insolvency of the mortgagor and inadequacy of the security.
In the case at bar the mortgage contained each of the said provisions, and there was sufficient proof in the papers submitted to raise a serious doubt as to the sufficiency of the security.
We think the learzied court at Special Term improperly exercised its discretion in denying the motion for the appointment of a receiver and that, therefore, the order appealed from should be reversed, with ten dollars costs and disbursements, and the motion granted, with ten dollars costs.
Present — Patterson, P. J., Ingraham, Laughlin, Clarke and Houghton; JJ.
Order reversed, with ten dollars costs and disbursements, and motion granted, with ten dollars costs.