Court Opinion

ID: 3601567
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:47:53.867488+00
Date Added: 2024-06-11T13:57:03.463936
License: Public Domain

[EDITORS' NOTE:  THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 436 
The proceeding in this case was instituted before *Page 439 
the surrogate of Westchester county to compel the defendants, as executrix and executor, to file an inventory of the personal estate of the testator for the purpose of obtaining payment upon a deficiency judgment rendered against the said executrix and executor upon the foreclosure and sale of real estate under a mortgage executed by the testator in his life-time with his bond accompanying the same. An accounting was had and a decree was made directing the defendants to pay over a sum of money which they had in their hands to be applied on account of said judgment.
The position of the appellant's counsel is, that the judgment against the executrix and executor was illegal and void as not being authorized by the Revised Statutes against the executor of the mortgagor. The statute in question (2 R.S. 191, § 152) confers upon the court having jurisdiction in a foreclosure case the power to decree and direct the payment by the mortgagor of any balance of the mortgage debt that may remain unsatisfied, after a sale of the premises in the cases in which such balance is recoverable at law, and for that purpose may issue the necessary executions as in other cases against the property of the mortgagor or against his person." It is insisted that the use of the word "mortgagor" as effectually excludes all others as if the words "and no other" were added. Such a construction is not we think warranted by any rule applicable to the interpretation of statutes. The mortgagor in this case was liable on the bond for the debt for which the mortgage was given as security. If the mortgaged premises were inadequate and the security thus failed, the debt was still existing for what was unpaid, and the remedy was perfect against the mortgagor, under the statute which was evidently designed for the purpose of avoiding the necessity of two separate actions. If the mortgagor was alive the judgment would have been against him personally, and upon his decease his estate would have been liable to pay the same, and his executors or administrators could have been compelled to apply funds in their hands in liquidation of the judgment. That the action was brought after the mortgagor's death, and against the executors can make no difference, and does not relieve them *Page 440 
from the liability which the testator had incurred, and which they would be obliged to meet, had the judgment preceded his death. The foreclosure of the mortgage was in fact against the executors who were standing in the place of the mortgagor, and the judgment was against his representatives, who were liable to satisfy the same out of any assets of the mortgagor in their hands. It is very clear upon principle that the representatives are liable to pay the debt of a deceased party in any event. But if any doubt can properly arise it is settled by the statute (2 R.S. 113, § 2), which authorizes actions to be maintained by and against executors in all cases in which the same might have been maintained by or against their respective testators. The case ofLeonard v. Morris (9 Paige's Ch. 90) holds distinctly that when the mortgagor or other party personally liable for the deficiency in a foreclosure case is dead, his personal representatives may be parties to the suit to enable the complainant to obtain a decree that the deficiency be paid out of the estate in their hands in a due course of administration.
The rule stated is well settled, and if any different one was adopted the execution of a bond would be an idle ceremony in case of the maker's death. The Code, § 167, which provides that in actions to foreclose mortgages, if the mortgage debt be secured by the covenant or obligation of any person other than the mortgagor, such person may be made a party, and the court may adjudge payment of the residue of such debt remaining unsatisfied after the sale of the mortgaged premises against such other person, and may enforce such judgment is not inconsistent with the rule already stated and in no way interferes with the liability of the estate of a deceased mortgagor. Nor does it furnish any ground for limiting the liability of a mortgagor or prohibit a resort to his personal representatives for a deficiency in case of his death. The question what judgment should be entered where there are several parties besides the mortgagor who are separately liable does not now arise, and, therefore, it is not necessary to consider it on this appeal. The surrogate had no authority, we think, to pass upon the validity of the judgment. It was rendered by a court of *Page 441 
competent jurisdiction, and it cannot be impeached in a collateral proceeding. The executors were duly served with process, appeared by attorney, and the judgment was obtained upon due notice of motion for such judgment served upon the attorneys. It was a final adjudication between the parties by a competent tribunal as to their rights conclusive in another court, and the surrogate had no jurisdiction to try the questions which had been adjudicated. (Norton v. Woods, 22 Wend. 522; White v.Merritt, 7 N.Y. 352; Gates v. Preston, 41 id. 113;Demarest v. Darg, 32 id. 281.) And the authorities hold that this rule applies to matters which might have been litigated in the original action, as well as to those which are involved in or incidental to the issue or set up as a defense.
Nor had the surrogate jurisdiction to hear and determine the validity and amount of a disputed claim against the estate of the testator upon the accounting, or in any way to examine the same. (Tucker v. Tucker, 4 Keyes, 136; 4 Abb. Ct. of App. Dec. 428.) The judgment record before him in the foreclosure suit was conclusive, and upon no legal or equitable principles could it be there assailed.
The objection urged that the complaint in the foreclosure action does not lay the foundation for the judgment is not well founded. The complaint, which is in the usual form for the foreclosure of a mortgage, sets forth the making of the bond and mortgage by the testator with the date, amount and terms thereof; the death of the testator leaving a will; the proof of the will; the qualification of the executrix and executor, contains other necessary averments and demands that a sale of the premises be had, and that the executrix and executor may be adjudged to pay any deficiency which may remain unpaid upon the bond and mortgage after applying all the moneys realized applicable thereto. No objection has been interposed to the sale or to the regularity of any of the proceedings or to the judgment.
If the complaint was insufficient, the executrix and executor could have demurred, or, if their liability was disputed, have interposed an answer and thus tried the question. Having had *Page 442 
their day in court and failed to avail themselves of this opportunity, they are not authorized upon an accounting before the surrogate to set up matters which properly belong to the tribunal where the action was brought and the judgment obtained. Nor is there any ground for claiming that under the statute (1 R.S. 749, § 4) something more must be alleged in the complaint than was alleged here to entitle the party to a deficiency judgment against an executor or administrator.
A question is also made to the effect that there was delay in bringing the foreclosure suit, and it is insisted by reason thereof the premises depreciated in value and that the loss occasioned thereby should be borne by the mortgagee and not by the estate of the testator. We think that the executrix and executor, if they had any such defense, should have set it up in the foreclosure suit. Independent, however, of any such consideration, the delay in the foreclosure of the mortgage, without any request to foreclose or any offer to pay, was not of such a character as to relieve the defendants from liability. The real estate was devised to these defendants and the legal estate was vested in them as trustees and not in the heirs at law. They made no tender of the money and no complaint as to the delay, and at one time refused an offer for the premises of several thousand dollars more than the mortgage, evidently preferring to hold on in expectation of a rise in value of the property. There was no delay occasioned by the mortgagee, which exonerates them from paying the deficiency.
Johnson v. Corbett (11 Paige, 265), which is relied upon by the appellant's counsel, presents entirely different features, and is not, we think, in point, and none of the authorities cited are adverse to the views which we have here expressed.
It is also insisted upon this appeal that Purdy, the executor, never had any part of the assets of the estate in his possession or under his control and never took any part in the management of the estate. It does not appear, from the record before us, that this point was distinctly presented upon the hearing before the surrogate, and therefore it does not now arise. If it was presented the proof shows that Purdy rendered a joint *Page 443 
account with his co-executrix, and no claim is made therein that he was not liable or that he did not jointly participate in taking charge of and receiving the assets, and in the disposition and control of the estate.
It also appears that he qualified as an executor under the will, and acted as such throughout. Upon an application being made to compel the filing of an inventory of the personal estate, he alone made an affidavit that he was one of the executors and that the deceased left no personal property which had come to the hands or knowledge of the executors, except some household furniture, etc., which was set apart for the widow and family of the deceased. When the executors were cited to render an account, such account was made out in the name of Henry Purdy as executor, and Mrs. Fogel as executrix. To this account schedules are annexed, and it is stated that schedule A "contains a statement of all the property which has come into our hands, by us
sold." That it was fairly "sold by us," and of "all interest for moneys received by us for which we are legally accountable." That "no other assets have come to our possession." Schedule B is stated to contain "a statement of all moneys paid by us for funeral expenses," and schedule C of all "claims of creditors presented to and allowed by us," etc., "and moneys paid by us to creditors." The affidavit annexed to the account is signed and sworn to by each, the executor and executrix, and contains the usual verification as to its correctness, and states that the account "contains a full and true account of all the receipts and disbursements on account of said estate, and of all sums of money and property which has come into our hands or into the hands of either of us," and no separate account is presented by either of them. These statements are virtually an admission of joint action and of a joint liability. The proof also shows that the executor offered the mortgaged premises for sale at one time and refused to take a price which was offered because he considered it as not enough for the property. He testified that he was one of the executors. He superintended the removal of a building on the real estate, and tried to raise *Page 444 
money to pay off the mortgage. According to the account, he and his co-executrix received an award of a large amount for land taken, a considerable sum from rentals of real estate, and a still larger amount upon the sale of real estate. The facts establish quite satisfactorily that he acted jointly with his co-executrix in the management of the estate, and although the executor testified that he had nothing to do with it, and the executrix swears that she had the sole management, this general evidence and conclusion of the witnesses is not sustained and is overborne by the strong evidence to which we have referred. As the evidence stands, the surrogate was fully justified in holding that the executor was accountable for the execution of the trust which he had assumed and chargeable for the moneys realized.
There was no error in the finding as to the amount that the executors had in their hands. Under the will the entire real estate was devised to and vested in them and the account shows that they received large amounts upon an award, for rents and real estate sold. The amounts thus received were assets for the payment of debts and distribution among legatees after the payment of debts. The real estate could not be reached under proceedings to sell under 2 R.S. 209, § 53, and the other acts relating to that subject, for it had already been sold and the moneys arising therefrom as well as from the rents and the award had been paid over to the representatives. They received it for the estate and were clearly liable to account therefor to the petitioner.
No other point is made which requires examination, and the judgment of the General Term should be affirmed.
EARL, DANFORTH and FINCH, JJ., concur; TRACY, J., concurs in result; ANDREWS, Ch. J., and RAPALLO, J., take no part.
Judgment affirmed. *Page 445