Avon-By-The-Sea Land & Imp. Co. v. McDowell

• Decision Date: 06 February 1906
• Parties: AVON-BY-THE-SEA LAND & IMP. CO. v. McDOWELL et al.
• Court: New Jersey Court of Chancery

62 A. 865

AVON-BY-THE-SEA LAND & IMP. CO.

v. McDOWELL et al.

Court of Chancery of New Jersey.

Feb. 6, 1906.

Bill by the Avon-by-the-Sea Land & Improvement Company against Louis G. McDowell and others. Heard on bill, replication and proofs. Decree for complainant

A. C. Hartshorne, for complainant. S. A, Patterson, for defendants.

EMERY, V. C. Complainant is a judgment and execution creditor of a Mrs. Albertson, and the defendant Thompson is the purchaser, and the defendants McDowell and Faust are the lessees, of personal property of the judgment debtor levied on or claimed to be levied on prior to the purchase and lease. The lessees, at the time of the levy claimed, were also in possession of the personal property under a lease from the judgment debtor, and McDowell, one of the lessees, was at that time holder of two chattel mortgages on the property for the sum of $860. Both the mortgages were then due, and expressly authorized the mortgagee, in case of judgments against the mortgagor, to take immediate possession of the mortgaged chattels and sell them to pay the mortgage debt. The judgment was recovered on November 28, 1900, the execution returned with a levy on real estate and personal property of the debtor at the January term (1901) of the Monmouth circuit, and the conveyances of the real estate and personal property by the debtor to the defendant Thompson were made on or about April 9, 1901. On May 14, 1901, Thompson leased the hotel and furniture in question to McDowell and Faust for five months, at the rent of 17 1/2 per cent. of the gross receipts of the business during the tenancy; $475 to be paid in cash at the time of signing the lease, and the balance at the termination of the lease, or sooner closing of the hotel. The lease contained the further provision that the lessees should have the right, on the final settlement, to deduct from the rents the amounts due on the two notes given to McDowell by Mrs. Albertson, then amounting to $915.20, principal and interest, which were to be credited as so much paid on the rent, provided the 17 1/2 per cent. amounted to a sum equal to the cash paid and the amount then due on the notes, and if the percentage was not sufficient to satisfy the whole amount of the notes the lessees were to credit on the notes only the amount of the balance due on the rentals. These notes to McDowell were the notes secured by the chattel mortgages on the furniture, and it was admitted on the hearing that $300 over and above the amount due on the mortgages has accrued as rent under the lease. Complainant in August, 1901, became the purchaser at sale under the execution of the right, title, and interest of the judgment debtor in the furniture for the sum of $30. The furniture was not taken from the possession of the lessees and mortgagee by the purchaser, but has been sold since the filing of the bill by consent of the parties, and the proceeds of sale...