Court Opinion

ID: 8267712
Source: CourtListenerOpinion
Date Created: 2022-10-16 19:12:56.693757+00
Date Added: 2024-06-11T16:43:25.475827
License: Public Domain

The opinion of the court was delivered by
Van Syckel, J.
Anna Paulison being the owner in fee of the premises marked 1, 2, 3, 4 on the above diagram, agreed by parol in August, 1871, to let a portion thereof to the Acquackanonk "Water Company for the term of twenty-one years, with the privilege of successive renewals, for the purpose of erecting thereon a reservoir with connecting pipes, for water-works. In pursuance of this agreement the water company constructed the reservoir marked A on the diagram, with the necessary connections to supply water.
After repeated attempts to obtain from Mrs. Paulison a written lease in accordance with the terms of the verbal agreement, the *593water company in October, 1872, accepted from her a lease in writing upon somewhat different terms. This lease, which was recorded on the 26th day of October, 1872, must be presumed to embody the terms of their contract.
In the summer of 1872, and before the execution of the said lease, Mrs. Paulison commenced the erection of a dwelling-house upon the said premises, marked H on the diagram. •
In January, 1874, lots marked B and O were mortgaged by Mrs. Paulison to the Real Estate Trust Company.
In March, 1874, she mortgaged lot marked D to one Gerard.
In April, 1875, she mortgaged lot E to the Manhattan Life Insurance Company, expresslyreserving to the said water company the reservoir, connecting pipes and its rights under the aforesaid lease.
In March, 1876, Birch & Bender filed a lien-claim against the said dwelling-house, including the entire premises marked 1, 2, 3, 4, as the curtilage. Unsuccessful attempts were made to reduce the curtilage.
Subsequently, judgments were obtained by Birch & Bender and by other lien-claimants, in all amounting to about $3,200. A special fi. fa. was issued upon the Birch & Bender judgment for the sale of the entire lot 1, 2, 3, 4.
The Real Estate Trust Company filed a bill to foreclose its mortgage, making the lien-claimants parties.
Gerard filed a like bill.
The Manhattan Life Insurance Company filed a bill to foreclose its mortgage on the 5th of May, 1876, making the lien-claimants parties, on which a decree was rendered July 10th, 1877, declaring the lien-claims to be prior to said mortgage, and directing that lot marked E be sold, expressly reserving and excepting therefrom the said water company’s reservoir, pipes and rights under said lease, to pay and satisfy in the first place the said several lien-claims, and in the second place the said mortgage of the said Manhattan company.
The said water company was not made a party to any of these foreclosure suits.
*594Execution was issued upon this decree, directing a sale in pursuance of the terms thereof.
Soon after the filing of this bill of foreclosure the special ji, fa. was issued upon the judgment of Birch & Bender.
Thus the sheriff had in his hands the execution on the lien-judgment, directing the sale of the entire premises 1, 2, 3, 4 to pay the lien-claims, and also the execution on the said Manhattan company’s decree, directing the sale of lot marked E, excepting the water company’s rights as aforesaid.
The Real Estate Trust Company, the Manhattan Life Insurance Company and Gerard arbitrated as to the amount each should contribute to the satisfaction of the lien-judgments, and on the I2th day of June, 1877, the arbitrators made an award, in which the said parties acquiesced.
Thereupon the Real Estate Trust Company paid the propertion assigned to it, and upon petition to the chancellor obtained an injunction restraining Birch & Bender from selling under the lien-execution the land mortgaged to it.
Gerard obtained a like injunction as to the premises mortgaged to him.
The water company was not a party to any of these proceedings.
The Manhattan company purchased the lien-judgments and took an assignment thereof, and after the arbitration, on the 4th of August, 1877, procured a sale to be made by the sheriff under the lien-executions of the entire premises marked 1, 2, 3, 4, excepting only lots B, C and D, and not excepting the reservoir and rights of the said water company. At that sale the said Manhattan company became the purchaser through its agent, for less than $400, and thereby reversed the order of priority established by the decree in its own foreclosure suit.
After the purchase under the lien-execution, the Manhattan company brought ejectment against the said water company, to recover possession of that part of the said premises held by said water company under the aforesaid lease.
The water company thereupon filed its bill in the court of chancery against the said Manhattan company, praying:
*5951. That the account may be taken under the direction of this court of the amount paid by the defendant or its attorney, in satisfaction of the bid made at said sheriff’s sale, and of the amounts contributed by parties interested in the portions of the said curtilage not sold at said sale, towards re-imbursing said defendant for said bid.
2. That the relative values of the estate of your orator in the lands demised to it in and by said lease, and the remaining portion of the lands sold and conveyed to said defendant, by virtue of the' execution issued in said suit to enforce said mechanics lien, may be ascertained under the direction of this court, and that this court having due regard to such values may determine such proportion of the amount paid by the defendant to satisfy said bid as may be equitable to be paid by your orator to the defendant, and that upon such payment being made, the defendant may be decreed to hold the lands and tenements demised to your orator in and by the said lease, subject to the said lease and the terms and conditions thereof.
3. That the said defendant may be enjoined from its said suit of ejectment so far as the same respects the lands demised to your orator in said lease and hereinbefore particularly described.
That relief, having been denied in the court below, is sought by appeal here.
From the preceding statement of facts, there can be no doubt as to the due order of priority in equity of these several conflicting claims, assuming that the reservoir is embraced in the curtilage of the dwelling erected and so subject to the liens, which is not intended to be hereby conceded. Nor is it intended to be admitted that the lessee in possession is not to be regarded as an owner under the mechanics lien law, and as such entitled to summons.
The lien-claims were the superior lien, and the lands mortgaged to the Manhattan company should have been first sold to satisfy those claims. That proving insufficient for the purpose, the premises mortgaged to Gerard should have been next sold; then the lots mortgaged to the Real Estate Trust Company, and lastly, if any balance remained unpaid, the reservoir and interest *596of the water company. If the Manhattan company had sold under and by virtue of the foreclosure decree, the rights of all' parties would have been duly regarded. By the scheme it resorted to, it has obtained an undue advantage at law,, and put itself in a position that in equity it ought not to be permitted to retain. It is apparent from the case that the premises subject to the rights of the water company are worth many times the amount of all the lien-claims. The sale under the lien-execution cannot in equity be permitted to deprive the water company of its rights, from the fact that lots B, C and D were expressly excepted and reserved from that sale. Those lots, under an equitable marshaling of the assets, were subject to be sold to pay the liens before the interest of the water company in the premises was resorted to. The command of the execution at law was to sell the entire premises, and if that had been done, a surplus might have been produced to which the water company could have resorted for indemnity. The fact that the sheriff was enjoined by a competent court from selling the three parcels specified, cannot affect this controversy, for the reason that the water company was not a party to the suit in which the injunction order was issued and had no opportunity to resist it.
It is manifest that the injunction was granted upon the understanding that all parties in interest acceded to it. It was the outcome of the arbitration between the mortgagees in reference to the liens, in which the complainant in this case took no part, and of which it had no knowledge.
Such an order could not have been obtained if the status of the water company had been brought to the notice of the court.
The decree below should be reversed, with costs. The defendant should be decreed to hold the lands purchased as aforesaid, subject to the rights of the complainant under the said lease, and the further prosecution of the ejectment suit should be enjoined.
The defendant is not entitled to claim contribution from the complainant to the payment of the liens, unless those portions of the premises primarily liable are insufficient to satisfy the-lien-claims.

Decree unanimously reversed.