Goebel v. Iffla

Full title: MAX GOEBEL, Respondent, v . SOPHIA IFFLA, Individually and as Trustee…

Court: Court of Appeals of the State of New York

Date published: Nov 27, 1888

111 N.Y. 170 (N.Y. 1888)

19 N.Y. St. Rptr. 105

18 N.E. 649

Opinion

Submitted October 2, 1888

Decided November 27, 1888

Ferdinand Kurzman for appellant.

John J. Gleason for respondent.

DANFORTH, J.

The application for leave to mortgage is put by the respondent upon the provisions of chapter 275 of the Laws of 1882, and chapter 26 of the Laws of 1884, amending article 2, title 2, part 2, of the Revised Statutes, "Relating to uses and Trusts." That act provides that the Supreme Court may, upon such terms and conditions as it deems just and proper, authorize a trustee to mortgage real estate held by him for the purpose of raising funds to be applied in preserving or improving it. It may be, as the appellant claims, that the order, in this case, exceeds that intended by the legislature, inasmuch as it covers not only the interest of the trustee and beneficiaries of the trust, but also takes in the rights and interests of persons who may be entitled in remainder on the expiration of the trust. It is not necessary, however, to pass upon that question, for those persons were made parties to the foreclosure of the mortgage, and so given an opportunity to pay off the mortgage if they saw fit to do so, or defend against it, and show, if they could, that it could not be enforced against them. They did neither. The case, therefore, is distinctly within the principle on which Jordan v. Van Epps ( 85 N.Y. 427), and Barnard v. Onderdonk (98 id. 158), were decided, and is controlled by the rule that a judgment rendered by a court having competent authority to deal with the subject-matter involved in the action, and jurisdiction of the parties, is final and conclusive between them.

The cases cited by the appellant do not contravene that doctrine. Many of them were reviewed by the late learned Chief Judge DAVIES in Frost v. Koon ( 30 N.Y. 428), and from that examination, and the cases referred to, it appears that, while prior incumbrancers are neither necessary nor proper parties to an ordinary action of foreclosure, and that when made such under the general allegation that they claim an interest "as subsequent purchaser, incumbrancer, or otherwise," a decree will not affect them; and moreover, that if the facts upon which the plaintiff relies to defeat that prior title are stated, the defendant whose title is thus assailed may demur to the complaint upon the ground that the plaintiff has no right to bring him into court upon the foreclosure to try the validity of his title, yet, if the party so made a defendant should, instead of demurring, answer and litigate the question, and then judgment should go against him, no case decides that the judgment would not conclude him in a collateral action, nor do those cases decide that where such facts are stated as will if admitted, subject that title to the plaintiff's mortgage and to the relief sought, the party against whom they are alleged will not in like manner be estopped from afterwards setting up his interest as against the judgment in the foreclosure action. And what binds him can be questioned by no one else. The present case is within the general rule, that a judgment is conclusive between the same parties and their privies upon all matters embraced within the issue in the action, and which were or might have been litigated therein. It is immaterial whether issue was joined by the defendant, or tendered by the plaintiff and left unanswered. The rule applies as well to a judgment by default when the facts stated warrant the relief sought as to one rendered after contest. ( Gates v. Preston, 41 N.Y. 113; Newton v. Hook, 48 id. 676.)

We agree, therefore, with the General Term in the conclusion that the title tendered to the purchaser is a good title and that he should be required to complete his purchase.

The order appealed from should be affirmed, with costs.

All concur.

Order affirmed.