Court Opinion

ID: 5357318
Source: CourtListenerOpinion
Date Created: 2022-01-08 07:08:32.948318+00
Date Added: 2024-06-11T08:29:49.503474
License: Public Domain

Taylor, J.
(dissenting). I dissent and vote to affirm. Although I admit that the views of the majority lead to a morally just result, that result is without foundation in law and involves a departure from the doctrine of Holmes v. Gravenhorst (263 N. Y. 148), defining the rights of the owner of mortgaged premises whose right of possession “ is an incident of title which, in the absence of contract, may be divested only under the method prescribed by law.” (Id. 152.) The case cited asserts in effect the legal truism that in the absence of an express agreement to that end in the mortgage, a mortgagor-owner, during the pendency of a foreclosure action of the premises, may not be disturbed in his possession or required to pay rent. (Id. 153.) The -majority view contemplates, practically, the payment of rent by the owner of two floors of the premises occupied by it, namely, the value of its use thereof, as a basis for the computation of a surplus within the purview of section 1077-c of the Civil Practice Act. It may not lawfully constitute such basis, for such surplus is one that “ the mortgaged property * * * shall have produced ” over and above specified charges. (Id.) As the statute reads, “ surplus ” may not be figured by charging this owner for its occupancy of a part of the mortgaged premises which it is entitled to occupy as an incident of its title. (Holmes v. Gravenhorst, supra.) Such a charge cannot be said to figure lawfully in surplus “ produced ” within the terms of the statute. To hold otherwise would be to legislate a new and amplified definition of surplus, which is not a judicial function.
Order reversed on the law and the facts, with ten dollars costs and disbursements, motion granted, and the matter remitted to Special Term to take proof and fix the reasonable rental value of the part' of the mortgaged property occupied by the owner in the conduct of its manufacturing business, which rental value so fixed should be included as income received from the property.