Court Opinion

ID: 5483278
Source: CourtListenerOpinion
Date Created: 2022-01-10 02:02:02.273068+00
Date Added: 2024-06-11T08:33:38.965472
License: Public Domain

Desmond, J.
(dissenting). This proceeding was brought by the City of New York to condemn several parcels of land on and near the Harlem River, and the question is as to whether the awards made for three of those parcels belong to respondent Superintendent of Insurance, as liquidator of a mortgage company, or to appellants Coogan. The same parcels had been, in about 1920 (when owned by Harriet Gr. Coogan, who died intestate in 1947, and was the mother of, and predecessor in title of, appellants) the subject of an earlier condemnation suit brought by Eighth Avenue Railroad Company. Since that earlier acquisition by condemnation was for railroad purposes, it is certain that the interest which passed to the railroad company by that condemnation decree was not a fee title but an easement in the lands for railroad purposes, and that the fee title remained in appellants’ predecessors with the right to re-enter if the railroad use should be permanently abandoned, as it was, some years later (Miner v. New York Central & H. R. R. R. Co., 123 N. Y. 242; Roby v. New York Central & H. R. R. R. Co., 142 N. Y. 176 ; Hudson & Manhattan R. R. Co. v. Wendel, 193 N. Y. 166; Harris v. Elliott, 35 Pet. [U. S.] 25).
In 1935, Eighth Avenue Railroad Company, owner of that easement, being then in receivership, discontinued its railroad *457operations, and in 1936, pursuant to court order, permanently abandoned its railroad franchise. Mrs. Coogan then had a right to re-enter, but never did so. Other pertinent facts will be mentioned later, when we discuss the respective positions of the rival claimants. What is undisputable is that in 1935 or 1936, the easement ended and Mrs. Coogan’s right to re-enter became absolute. The claim of her children, as her heirs, to this condemnation award is resisted, however, by respondent Superintendent, whose own claim thereto, upheld below, is based: first, on alleged adverse possession; and, second, on his purchase of the parcels at a judicial sale following the foreclosure, at the Superintendent’s suit, of a mortgage and a tax lien. We will take up, in that order, those contentions of the Superintendent of Insurance.
But, first, we need some background facts as to how the Superintendent came into the picture. In 1921, Eighth Avenue Bail-ways Company, owner as aforesaid of a railroad use easement in the premises, gave to a bank a $280,000 mortgage purporting to (but obviously not) incumbering the fee of all three parcels. Later, and again seemingly describing a nonexistent fee title, Eighth Avenue gave a deed of the lands to its wholly-owned subsidiary corporation. Meanwhile, and until the 1935 receivership above mentioned, Eighth Avenue, or its subsidiary, continued to apply the property to railroad uses. In June, 1936, the mortgage having meanwhile become the property of New York Title and Mortgage Company, and respondent Superintendent of Insurance being that company’s official liquidator, and the mortgage being in default, the Superintendent, under an assignment of rents, took possession (at least to the extent of collecting the rents) of the parcels described in the mortgage. Later in 1936, the Superintendent purchased, for about $52,000, a New York City tax lien covering two of the three parcels described in the mortgage. It sufficiently appears that part, at least, of that $52,000, came not from rents collected by the Superintendent, but from other sources. In 1939, the Superintendent brought an action to foreclose both the mortgage and the tax lien. Mrs. Coogan, predecessor of appellants and then the owner of the rights which appellants are now asserting, was named as a defendant and appeared by attorneys but filed no *458answer. The suit went to judgment and sale, and the Superintendent, as purchaser at the referee’s sale, tooka referee’s deed to the parcels.
The Superintendent’s claim of adverse possession is untenable as to any of the parcels, since neither he, nor the railroad company or its subsidiary corporation, ever had a possession which was hostile to the fee title of appellants and their predecessors. An unescapable requirement of law is that possession, to be adverse, must be hostile to the true holders of the title (Belotti v. Bickhardt, 228 N. Y. 296, 302). Accordingly, adverse possession can never be based on possession or use under a license or permit from the owner of the fee (Matter of City of N. Y. [Piers Old Nos. 8-11], 228 N. Y. 140, 155; New York Central & H. R. R. R. Co. v. City of Buffalo, 85 Misc. 78, 90; Hinkley v. State of New York, 234 N. Y. 309, 316). Possession and use begun with consent are presumed so to continue (Harrison v. New York Central R. R. Co., 255 App. Div. 183, 186, affd. 281 N. Y. 653; Treadwell v. Inslee, 120 N. Y. 458; Lewis v. New York & Harlem R. R. Co., 162 N. Y. 202, 221). “ Adverse possession must be exclusive, under no permission or license or favor upon the part of the owner; the claim must be under color of independent title, exclusive of any right derived from the actual owner * * * When the entry upon land has been by permission or under some right or authority derived from the owner, adverse possession does not commence until such permission or authority has been repudiated and renounced and the possessor thereafter has assumed the attitude of hostility to any right in the real owner * * * ‘if the first possession is by permission it is presumed to so continue until the contrary appears ’ [Lewis v. New York & Harlem R. R. Co., 162 N. Y. 202, 220] ” (Hinkley v. State of New York, supra, pp. 316-317). That rule, apparently universal throughout the United States, has been properly applied to railroad use easements, the holdings being that possession after the railroad use ends is not “ adverse possession ” unless and until there has been direct notice, to the title owner, of the hostile claim (Branch v. Central Trust Co., 320 Ill. 432; City of Grand Rapids v. Pere Marquette Ry. Co., 248 Mich. 686). Miner v. New York Central & H. R. R. R. Co. (123 N. Y. 242, 250, supra) is not to the contrary, since, so far as pertinent at all, that decision depends on its special *459facts, including an actually adverse possession by an entirely different corporation. How far our own courts go in enforcing the rule itself is vividly illustrated by City of New York v. Coney Is. Fire Dept. (259 App. Div. 286, affd. 285 N. Y. 535). There a volunteer fire department, in 1893, took land under a deed from a predecessor of the City of New York, which deed imposed the condition that it be used “ for fire purpose ” only; in 1898 such use was permanently abandoned but the volunteer fire company remained in "possession for about forty years longer. Notwithstanding all that, the courts held, in the Coney Island case, that there was no adverse possession by the company and the right of the city to effect a re-entry continued. There was “ no real question of adverse possession ”, held the Appellate Division (p. 289), since, after the fire use had been openly abandoned, the city had the right to re-enter at any time it chose. In the present case, the railway use began and continued with the permission of the true owner, the Superintendent’s later possession was subordinate to the railroad company’s (see Becker v. McCrae, 193 N. Y. 423, 427) and there never was notice to appellants or to their predecessor that a new and hostile right was being asserted. Thus, adverse possession could not have commenced to run until the Superintendent took the referee’s deed in 1941, thereby asserting a new title. But the necessary fifteen years (Civ. Prac. Act, § 35) did not lapse from the time of the delivery of that deed till, in 1952, the city took title to, and possession of, all the parcels, in the course of this present condemnation proceeding. We conclude that there is no basis for the Superintendent’s claim of title by adverse possession. ‘ ‘ It would shock that sense of right which must be felt equally by legislators and by Judges, if a possession which was permissive, and entirely consistent with the title of another, should silently bar that title ” (Marshall, Ch. J., in Kirk v. Smith, 9 Wheat. [U. S.] 241, 288).
Respondent’s other claim to ownership stands on his foreclosure judgment and referee’s deed. As to the foreclosure of the tax lien, we think he must be held to have taken the referee’s deed in trust for appellants. No decision has been found with precisely the same facts as ours, but to the facts of our case there is clearly applicable the settled rule of equity that one *460in possession of realty whose position is such that he owes some protective or similar duty to the owners of other interests, cannot purchase an outstanding interest and use it to exclude those other persons to whom he has a duty (as to the generality of that rule, see Burhans v. Van Zandt, 7 N. Y. 523, 526, 527, and, particularly, Rothwell v. Dewees, 2 Black [U. S.] 613, 614, 619; see elaborate note and numerous citations, 140 A. L. R. 294). Thus, purchase by a mortgagee in possession, of a tax lien, is regarded as payment of the taxes and a foreclosure of the lien is, in equity, a nullity (Ten Eyck v. Craig, 62 N. Y. 406; Burchard v. Roberts, 70 Wis. 111; Shepard v. Vincent, 38 Wash. 493). Quite recently, in Van Duzer v. Anderson (306 N. Y. 707), we made a similar holding as to the purchase of an outstanding tax lien, by a tenant in common. Here, the Superintendent, not having rent moneys available therefor, may not have been under a duty to buy the old lien, but the question is as to what his position was when he did in fact buy it. He was in possession of the properties in the right of the railroad company, or its subsidiary corporation (Becker v. McCrae, supra). The railroad company had defaulted in its obligation to pay taxes during occupancy. There was of course no such obligation on appellants or their predecessor to pay those very taxes, or any reason for their doing so. Occupying the premises in the alleged right of the easement holder, the Superintendent, buying such a tax lien, could not equitably use that lien to destroy the fee title on which his own possession depended. If that were possible, the owner of an easement, by mortgaging it, defaulting on the mortgage, and arranging for the payment by the mortgagee of taxes payable by the holder of the easement, and having those taxes foreclosed, could use his own default to enlarge his easement into a fee title.
Nor can respondent claim any right from the purported foreclosure of his mortgage, since the easement on which the mortgage was a lien had ended by nonuser, and the mortgage was a lien on nothing.
Full equity will be done to both sides of this dispute by holding that the award belongs to appellants, subject to a lien thereon, to respondent, for the amount paid by him for the tax lien, with appropriate interest.
*461The order should he reversed, with costs in all courts, and the matter remitted to Special Term for further proceedings consistent herewith.
Lewis, Oh. J., Froessel and Van Yoorhis, JJ., concur with Dye, J.; Desmond, J., dissents in an opinion in which Fuld, J., 'concurs; Conway, J., taking no part.
Order affirmed.