Meeker v. Warren

• Decision Date: 24 February 1904
• Citation: 57 A. 421,66 N.J.E. 146
• Parties: MEEKER v. WARREN et al.
• Court: New Jersey Court of Chancery

57 A. 421

66 N.J.E. 146

MEEKER

v. WARREN et al.

Court of Chancery of New Jersey.

Feb. 24, 1904.

Bill by John H. Meeker, as administrator of Chauncey S. French, against Helen E. Warren and others.

John H. Meeker, pro se. Mr. Duffield, for defendant Knapp.

Adrian Riker, pro se, as receiver of the Newark Coal Co.

STEVENS, V. C. The material facts are as follows: The bill is filed by complainant a judgment creditor, against Helen E. Warren, a judgment debtor. It prays, in the alternative, that a deed given by her to John E. Knapp may either be set aside on the ground of fraud, or may be declared to be a mortgage. The complainant has Joined as parties other Judgment creditors whose judgments antedate his own. He insists that his Hen is superior to these Judgments, and also to the mortgage deed, if it shall be deemed such. The defendants, except Mr. Knapp and Mrs. Warren, are holders of judgments recovered against Helen E. Warren in the months of January, March, and May, 1898. No executions issued thereon until after execution issued by complainant The conveyance by Mrs. Warren to Mr. Knapp bears date May 31, 1890. It was recorded December 7, 1899. The complainant's judgment, for $879.12, was recovered on June 20, 1902, and execution issued thereon on the same day.

The principal question is one of priorities. Under the evidence, there can be no doubt that the deed was given to secure Mr. Knapp as surety on a lease made by the Orange Bank to Mrs. Warren. There is no proof that this deed is fraudulent, and it stands, therefore, as a mortgage to secure the money which he paid ($816) on his guaranty.

This being so, the case conies directly within the authority of Clement v. Kaighn, 15 N. J. Eq. 48, of Williams v. Gilbert, 37 N. J. Eq. 84, and of Andrus v. Burke, 61 N. J. Eq. 297, 48 Atl. 228. Under the rule laid down in those cases, the priorities are as follows: (1) Knapp's mortgage; (2) complainant's judgment; (3) the judgments of defendants, in the order in which executions were issued.

It is earnestly argued by complainant's counsel that the cases above cited, and which are cases in this court, are repugnant in principle to Hoag v. Sayre, 33 N. J. Eq. 552, decided by the Court of Appeals. The difficulty with this position is that that court thought otherwise. Beasley, C. J., said: "Chancellor Green decided that the first judgment on the mortgaged premises, by reason of the failure to sue out execution upon it, should be postponed to the incumbrance of the Junior judgments, and, as an inevitable consequence, that it should be postponed to the mortgage which was prior to the junior judgments, and whose priority was not to be affected by any laches of the holder of a prior judgment." He said further that the principle of decision then announced was but the development of the principle maintained and acted on in Clement v. Kaighn. In Clement v. Kaighn there was first a judgment without execution, then a mortgage, and then judgments followed by executions levied. In Hoag v. Sayre, as the case stood in the Court of Appeals, there was, first, a mortgage, not properly filed, but of which the second mortgagee had actual notice; then, a second mortgage; then, a judgment, with execution. In the first case the order of priority was held to be (1) the mortgage; (2) the junior judgments; (3) the senior judgment. In the second case the order of priority was held to be (1) the judgments to the full extent of the first mortgage; (2) the second...