Zanzonico v. Zanzonico, A-137.

• Decision Date: 06 June 1949
• Docket Number: No. A-137.,A-137.
• Citation: 66 A.2d 530
• Parties: ZANZONICO v. ZANZONICO et al. (T. R. REALTY CO., Intervenor).
• Court: New Jersey Supreme Court

66 A.2d 530

ZANZONICO

v.ZANZONICO et al. (T. R. REALTY CO., Intervenor).

No. A-137.

Supreme Court of New Jersey.

Argued May 23, 1949.

Decided June 6, 1949.

Appeal from former Court of Chancery.

Suit by Joseph Zanzonico against Michael Zanzonico, individually and as executor of the last will of Antonio Zanzonico, and Carmela Zanzonico, for foreclosure of certain mortgages involving an account, wherein the T. R. Realty Company intervened and Carmela Zanzonico filed a counterclaim. From the decree, plaintiff appeals.

Decree affirmed.

On appeal from a decree of the former Court of Chancery advised by Vice Chancellor Bigelow, who filed the following opinion:

‘This is a foreclosure suit involving a complicated account. While the proofs are vague and unsatisfactory, I hope to reach a conclusion that will do substantial justice to the parties.

‘ [1] In 1936, Antonio Zanzonico, since deceased, mortgaged to Ella Mandelbaum two parcels of land in Newark, one at the corner of South Seventh Street and Fourteenth Avenue, which I will call ‘Fourteenth Avenue’ and adjoining it on South Seventh Street, another lot that I will refer to as ‘Seventh Street’. Antonio was the owner of Fourteenth Avenue, but his title and the title of his mortgagee were subject to the interest of his wife Carmela, who did not join in the mortgage. Seventh Avenue was owned by Antonio and Carmela as tenants by the entirety. Mrs. Mandelbaum sold the mortgage to complainant June 15, 1938, but no assignment was executed until 1940, and then, by mistake of the scrivener, it read as an assignment to Antonio and not to complaint. The bill prays that the assignment be reformed and the proofs are clear on this point. However, Mrs. Mandelbaum is not a party to the suit and so I doubt if reformation can be decreed, but the same result can be reached in other ways. Complainant's title to the mortgage will be established.

‘In 1937, to secure a debit of Antonio's, he and his wife mortgaged Fourteenth Avenue to complainant. This mortgage does not cover the lot held by the mortgagors as tenants by the entirety. Complainant assigned this mortgage to one Zuckerman in 1938, but repurchased it November 11, 1941.

‘On July 27, 1938, Antonio mortgaged both lots to Allied Service Bureau, and again his wife did not join. This mortgage was assigned to complainant the following month.

‘ [2] Now, as to the amount due. The Mandelbaum mortgage was given to secure $1,621.17, payable in two years with interest at 6 percent. Complainant bought it for $1,125.17, but at the same time he took from Antonio an estoppel certificate that there was due on it $1,237.50, with interest from July 1, 1938. Two days before he purchased the mortgage, he paid Antonio $75 and there had been other dealings between the parties. I have no doubt that Antonio and complainant intended that any prior indebtedness should be secured by the mortgage and that the sum of $1,237.50 includes such indebtedness as well as the amount paid Mrs. Mandelbaum.

‘Complainant has presented checks made by him to one Marx in the year beginning July, 1938, and totaling $588, and asks that they be taken into account. But since there is no proof that they were loans to Antonio or have any connection with the case, they will be disregarded. Also, the $40 check to Philip Mandelbaum December 7, 1940. Three checks to the order of Antonio in July and August, 1938, aggregating $1,340, are the loan which is secured by the third mortgage. Complainant also produced other checks to Antonio and promissory notes made or endorsed by him. In the statement, exhibit C-15, complainant asserts a debt to him of $150 in connection with the notes. Three receipts for $180 in all, dated in the fall of 1940 and signed by complainant, will be taken as evidence of payment of any unsecured debt then owing by Antonio to complainant.

‘ [3] [4] Other receipts in evidence show that from July 3, 1938, to August, 1941, Antonio paid complainant a total of $1,090. Interest on the mortgage, the principal of which was reduced from time to time, was about $142.50 during the period and until November 1, 1941. So that the total payments were sufficient to pay interest to that date and reduce the mortgage principal to $290.

‘The second mortgage was given to secure $1,000. When Mrs. Zuckerman reassigned it to complainant in the fall of 1941, she warranted that there was due thereon $1,000 with interest at 5 percent from October 7, 1941. The third mortgage secured $1,340 with interest at 6 percent from August 15, 1938. As I have applied all of complainant's receipts to the first mortgage and to the open debt, I will consider that nothing was paid on account of the second and third mortgages. Then, on November 1, 1941, complainant took possession of both properties by virtue of his mortgages. There had been litigation between Antonio and Carmela, his wife, and an execution sale, the result of which was that Antonio was entitled to all the rents during their joint lives, not only from Fourteenth Avenue but also from Seventh Street which was owned by the parties as tenants by the entirety. Antonio's death occurred January 20, 1942, an event which brought a radical change in the situation, so we will strike a balance on that date. There were three buildings on the two lots, of which complainant took possession. In them were one store and eleven apartments, one of which was occupied by Antonio, who paid no rent. Allowing for vacancies, rents should have been about $175 monthly, or, for three months, $525. Proof of complainant's actual receipts is wanting and I will charge him with this sum. On October 2, 1941, he had paid some tax arrears, and later he paid other taxs, water rents, and for certain repairs, and loaned Antonio $15, a total of $396.78. So his net receipts were $128.22. This sum will be applied to interest on the first mortgage to January 20, and reduction of the principal to $165. After such application and on January 20, 1942, there was unpaid on the second mortgage $1,000 principal, plus accrued interest at 5 percent, amounting to $14.30, and on the third mortgage the principal sum of $1,340 and accrued interest at 6 percent, amounting to $261.50, or a total on all three mortgages of $2,780.80.

‘ [5] [6] An ejectment action in the Supreme Court (46 A.2d 565, 24 N.J.Misc. 153, 166 A.L.R. 964) eventually established that the widow Carmela, from the death of her husband, was entitled to Seventh Street free and clear of complainant's mortgages. He, however, remained in possession thereof, as well as Fourteenth Avenue, until June 1, 1945. He is accountable to her for all rents which he collected or should have collected during the three years and four months following the death of her husband, and is entitled to credit for all proper expenses in connection with the property. Carmela, as dowress, also has a right to one-half the rents of Fourteenth Avenue subsequent to January 20, 1942. She joined in the second mortgage but not the first or third, and so her share of the rents may be applied to interest or principal of the second mortgage...