Hauselt v. Patterson

• Decision Date: 03 March 1891
• Parties: HAUSELT et al. v. PATTERSON et al.
• Court: New York Court of Appeals Court of Appeals

124 N.Y. 349

26 N.E. 937

HAUSELT et al.

v.PATTERSON et al.

Court of Appeals of New York,

Second Division.

March 3, 1891.

Appeal from judgment of the general term of the supreme court in the first judicial department, entered upon an order made November 18, 1889, which affirmed a judgment in favor of the plaintiffs' testator, entered upon a decision of the court on trial at special term. The action was brought to recover the amount of the deficiency of a mortgage debt of John H. McCunn, who died in July, 1872, leaving a will by which he devised all his real estate to trustees. He left surviving as his heirs at law capable of inheriting real estate his sister of half-blood, Jane McCunn, afterwards McDonald, and three nieces, Elizabeth Patterson, Catherine Bonner, and Martha Hettrick. In April, 1873, Mrs. Patterson brought an action for partition of the land of which McCunn died seised, founded upon the alleged invalidity of the devise of his real estate, and the action resulted in the determination that such devise was void, but no partition or sale was made pursuant to the judgment, which was entered November 1, 1881, nunc pro tunc, as of January 25, 1878. McCunn died seised of several parcels of land, one of which was a certain lot bounded on Twenty-Third street in the city of New York, upon which he, in December, 1854, made a mortgage to the City Fire Insurance Company to secure the payment one year thereafter of the sum of $5,000, according to the condition of a bond, also made by him to such company. He paid no part of the principal sum, but did pay the interest up to February 1, 1872. In March, 1874, the insurance company, in an action brought for that purpose, recovered a judgment of foreclosure and sale of the mortgaged premises, and in October, 1876, the plaintiffs' testator becoming the owner by assignment to him of such judgment, afterwards caused the premises to be sold pursuant to it. The proceeds of the sale furnished nothing to apply upon the mortgage debt, and in November, 1881, judgment for deficiency was entered, amounting to $7,606.54 and interest from January 1, 1879, against the executors of the will of the decedent. About the time of the commencement by Mrs. Patterson of her action before mentioned, the heirs of McCunn severally conveyed certain portions of their interests in the land to Christopher Finn, amounting together to 44-120 parts of such lands. And before the commencement of this action Mrs. Hettrick died intestate, leaving, her surviving, five children; and Jane McDonald died, leaving a will, by which she devised her real estate to two trustees, with the right of succession to the survivor of them. The defendant Stevenson is such surviving trustee. This action was commenced in 1885 against the present defendants and the children of Mrs. Hettrick, deceased. The first trial resulted in a judgment of dismissal of the complaint, which judgment was by the general term reversed as to the appellants and affirmed as to the other defendants. 4 N. Y. Supp. 772. The last trial resulted in a judgment in favor of the plaintiffs' testator for the amount of that former deficiency in the foreclosure action.

FOLLETT, C. J., dissenting.

Preston Stevenson, for appellants.

Lewis Sanders, for respondents.

BRADLEY, J., ( after stating the facts as above.)

Inasmuch as the descent on which this action is founded was cast upon the heirs of John H. McCunn prior to the repeal, by Laws 1880, c. 245, of article 2, tit. 3, c. 8, pt. 3, of the Revised Statutes, the inquiry is suggested by counsel whether the provisions of the latter were, for the purposes of the remedy, still operative. Code, § 3352. That, however, is a matter of no importance in this case, as those provisions of the Revised Statutes, so far as applicable to it, and the substituted provisions of the Code of Civil Procedure, are substantially the same. The right to maintain this action is dependent upon the construction and effect of the statute, which provides that ‘whenever any real estate subject to a mortgage executed by any ancestor or testator shall descend to an heir or pass to a devisee, such heir or devisee shall satisfy and discharge such mortgage out of his own property, without resorting to the executor or administrator of his ancestor, unless there be an express direction in the will of such testator that such mortgage be otherwise paid.’ 1 Rev. St. p. 749, § 4. Prior to this statute, the personalty was the primary fund for payment of mortgage debts as well as others of the ancestor; and at common law the heir was not chargeable with simple contract debts of such decedent; nor was he, unless mentioned in the bond of the ancestor, liable for debts by specialty of the latter; and, when so named, his liability was to the extent only of the land which descended to him. This liability of the heir was, in this state, at first extended so as to embrace simple contract debts as well as specialities, whether the heir was mentioned in them or not; and for the purpose of charging him by means of action at law a system of practice was provided by statute. Laws 1786, c. 27; 1 Rev. Laws, 316. That was superseded by the Revised Statutes, which furnished provisions for suits by and against legatees and against next of kin, heirs, and devisees, and between heirs and devisees. 2 Rev. St. p. 450. Under those provisions the liability of heirs and devisees was secondary, and dependent upon the insufficiency of the personal estate of the decedent. The only exception to the primary charge of the debts upon the personalty was in the provisions of section 4 of the Revised Statutes, before mentioned; and that did not in terms charge the heir with personal liability, nor was it contemplated by the statute that he should be so liable irrespective of the property which descended to him, but rather that his liability to pay the mortgage out of his own property should be measured by and not exceed that which descended to him from his ancestor. The evident purpose of the revisors was, in the case provided for, to make the land the primary fund for the payment of the mortgage debt, (3 Rev. St., 2d Ed., p. 600;) and to give it practical effect that section and the other provisions of the statute on the subject, so far as applicable, are in pari materia. In that view the remedy is by action in equity having the nature of a proceeding in rem in such sense that, when the land has not been aliened by the heir, the execution of the judgment shall be had by levy upon the real estate descended to him. 2 Rev. St. p. 454, § 47; Code, § 1852; Butts v. Genung, 5 Paige, 259;Schermerhorn v. Barhydt, 9 Paige, 28;Wood v. Wood, 26 Barb. 356. And to hold, as urged by the defendants' counsel, that the remedy is confined to the mortgaged premises, would not give effect to the apparent purpose of the statute as represented by its terms. Such limitation is not consistent with its provision that the heir shall satisfy and discharge the mortgage out of his own property. Nor is it reasonable to suppose that the statute was intended to create a personal liability of the heir for the amount of the mortgage debt, but, as we construe the statute, its design was to make, so far as practicable, the realty primarily chargeable with the payment of a debt of the decedent secured by mortgage on his land, and that when with the mortgaged premises the heir inherited other lands of the same ancestor he should take them altogether cum onere the mortgage debt, assuming that there was a personal liability of the decedent to pay it at the time of his decease. Roosevelt v. Carpenter, 28 Barb. 426. This, however, was not intended to give such creditor a preference over other creditors of the decedent in the proceeds of the lands not covered by the mortgage when there is a deficiency of the personal estate to pay them. 2 Rev. St. p. 453, §§ 39, 40; Code, § 1856. The preference of the mortgage creditor in the mortgaged premises...