Court Opinion

ID: 5441434
Source: CourtListenerOpinion
Date Created: 2022-01-08 18:03:46.412089+00
Date Added: 2024-06-11T08:32:01.189501
License: Public Domain

Sharpstein, J., dissenting.
I dissent. It appears that the mortgage sought to be foreclosed was executed by the defendants Corbin and Handy to plaintiff’s assignor, G. P. Cornell, *202and that after the execution of the mortgage, and before the commencement of this action, the mortgagors conveyed the mortgaged premises to the defendant corporation. That being so, I think it to be well settled that the defendant who took and holds the premises subject to the prior mortgage is estopped from questioning the consideration or validity of it. (Freeman v. Auld, 44 N. Y. 50.) In New York it was repeatedly held that one who took title subject to a usurious mortgage, which by a statute of that State was absolutely void, ivas estopped from questioning its validity. (Sands v. Church, 6 N. Y. 347 ; Murray v. Judson & Sands, 9 N. Y. 73; Hartley v. Harrison, 24 N. Y. 170; Dix v. Van Wyck, 2 Hill, 522.) And I think it equally clear that the defendant Corbin, one of the mortgagors, after conveying his entire interest in the mortgaged premises to the defendant corporation, cannot in this action attack the validity of the mortgage on the ground that it was obtained from him through fraud. No personal judgment is sought against him for any deficiency there may be after applying the property, to the debt. The pleadings show that he had no title or interest in the mortgaged premises to be affected by the decree. His being a stockholder in the defendant corporation would not in any conceivable case entitle him to set up-a defense which the corporation could not. Nor do I think that he could have the matters set up in the cross-complaint which the court refused him leave to file, litigated in this action. The relief which lie demanded was a judgment against his co-defendant Handy for the sum of $300,000, and to have the plaintiff adjudged to be an involuntary trustee of the notes and mortgage executed by him, Corbin, and Handy, for the benefit of him, Corbin.
In the language of Comstock, C. J., in National Fire Insurance Company v. McKay et al. 21 N. Y. 191: “I do not see that anything was in litigation between him and the plaintiff, or that any judgment could be rendered against him, except one for costs for interposing a groundless defense to the suit. According to the answer, no cause of action existed against him. The complaint claimed nothing against him personally, and stated no facts as the foundation of such a decree. The answer showed that he had no title or interest in the mortgaged premises tó be affected by the decree.” The plaintiff seeks to have the mortgage *203foreclosed, and alleges facts sufficient to entitle her to that relief.
The only other party interested in the question is the defendant, who purchased the mortgaged premises subject to the mortgage. I am unable to discover how defendant Corbin, who, according to his answer, has no interest in the mortgaged premises, can thrust himself into a case in which the sole question is, whether the plaintiff is entitled to a judgment which will affect nothing except the mortgaged premises. How he is going to litigate in this action, the question whether he has been defrauded by his co-defendant, Handy, and other persons who are not parties to the action, is to me incomprehensible. If Chater v. S. F. Sugar Refinery Co. 19 Cal. 220, or Shorb v. Beaudry, 56 Cal. 446, sustains the contention of the appellants, I must confess my inability to see it. I am unable to discover that any such question was involved or considered in either of those cases.
I think the judgment and order appealed from should be affirmed.