Opinion
Argued June 12, 1890
Decided October 7, 1890
N.A. Woodward for appellant. Hobart B. Cone for respondent.
The object of this action, as the complaint shows, was first to reform and then to foreclose the mortgage in question. The findings of the trial court and the judgment entered thereon effected that object so far as the County Court had jurisdiction to entertain such an action and to make such a decree. The fact that an agreement was entered into by the parties but that, through mutual mistake, the mortgage in its written form did not express what was really intended by them, as found by the court, was warranted by the evidence and was sufficient to authorize a court of equity to decree reformation. ( Rider v. Powell, 28 N.Y. 310; Bush v. Hicks, 60 id. 298; Born v. Schrenkeisen, 110 id. 55; Pom. Eq. Juris. § 1376.)
The only question open to discussion is whether the County Court has jurisdiction of an action to reform a mortgage where part of the relief demanded is the foreclosure of such mortgage after it has been reformed. The County Courts are not courts of general jurisdiction, but have such powers as have been expressly conferred upon them by the Constitution and by the legislature pursuant to the authority of the Constitution. ( Griswold v. Sheldon, 4 N.Y. 581; Frees v. Ford, 6 id. 176; Arnold v. Rees, 18 id. 57; Const. St. of N.Y. art. 6, § 15.) While courts of general jurisdiction are presumed to have the powers that they assume to exercise until some limitation thereof is made to appear, the authority of courts of inferior jurisdiction must be shown. ( Chemung Canal Bank v. Judson, 8 N.Y. 254; Bosworth v. Vandewalker, 53 id. 597; People ex rel. Tweed v. Liscomb, 60 id. 559.) The Constitution does not confer jurisdiction in actions of this character upon the County Courts, but it directs that they shall have such "original jurisdiction as shall be provided by law." The legislature exercised the power thus confided to it by enacting that "the jurisdiction of each County Court extends * * * to an action for the partition of real property; for dower; for the foreclosure, redemption or satisfaction of a mortgage upon real property; or to procure a judgment requiring the specific performance of a contract relating to real property; where the real property, to which the action relates, is situated within the county." (Code Civ. Pro. § 340.) By another section it also provided that "where a County Court has jurisdiction of an action or special proceeding, it possesses the same jurisdiction, power and authority in and over the same and in the course of the proceedings therein which the Supreme Court possesses in a like case and it may render any judgment, or grant either party any relief, which the Supreme Court might render or grant in a like case." (Id. § 348.) Unless the jurisdiction essential to sustain the judgment appealed from was conferred by these sections it did not exist. While express power to take cogizance of such an action as this has not been given to the Courty Courts, it is claimed to exist not as a distinct feature, but as incidental to the power to foreclose a mortgage by enlarging the measure of relief and thus aiding to make the foreclosure effectual. An examination into the general nature and object of an action to foreclose and an action to reform a mortgage, shows, as was held in Avery v. Willis (24 Hun, 548, 550), that they are independent remedies that may be attained by separate actions open to separate and independent defenses. The former is a final remedy that by direct action affords the extreme relief to which the plaintiff is entitled, by a sale of the land covered by the mortgage and the payment out of the proceeds of the debt thereby secured. It is confined to a completed instrument and to the enforcement thereof as it was written. It will not lie until something is due upon the mortgage according to its terms, and it may be defeated, at any time before final judgment, by payment of the amount due with costs. (Code Civ. Pro. § 1634.) Even after judgment the like payment leads to an arrest of all proceedings to enforce the decree until another default. (Id. § 1635.) It operates only upon the land described in the mortgage and exclusively upon the interest therein described. On the other hand an action to reform a mortgage is not a final, but an intermediate remedy. It is primary and preparatory in purpose and until it acts there can be no foreclosure as to the land omitted. Its object is not to enforce but to establish the contract, not as it was written, but as it should have been written according to the agreement of the parties. Its action is indirect, because instead of collecting the debt, it renders it more secure. It cannot afford ultimate relief by selling the land and applying the proceeds. Its sole office is to correct mistakes by writing out the contract according to the actual agreement and thus it may operate upon other lands, including those not situated in the same county. It may be maintained whether anything is due upon the mortgage or not, and it cannot be defeated by partial payment. It is in no sense dependent upon or a part of an action of foreclosure, but rests upon a substantive cause of action dependent only upon itself. The one will lie when the other will not, and one may be prosecuted to final judgment and the judgment fully enforced, without affording any of the relief that is within the province of the other. Indeed, the action to foreclose may be dependent upon the action to reform, as there might be nothing to foreclose until reformation had been decreed. Different Statutes of Limitation apply to the two actions, which do not require the same parties, as one can, while the other cannot, afford relief against a purchaser in good faith and for value. While the two causes of action are frequently united, when relief is sought in a court possessing general equity powers, the pleadings, proof and principles of law that apply to the one have no application to the other.
We think, therefore, that the power to foreclose a mortgage does not include as incidental thereto the power to reform it, and hence that so much of the decree of the County Court as purports to correct the mistake in question was made without jurisdiction and is void.
The appellant claims that he had a written mortgage upon one-half of the premises and an unwritten or equitable mortgage upon the other half, and that the County Court had power to foreclose both, but we think that the statute when it refers to "the foreclosure, redemption and satisfaction of a mortgage upon real property," means a written mortgage only. It is also claimed that an action to reform a mortgage is an action "to procure a judgment requiring the specific performance of a contract relating to real property," within the meaning of the Code. (§ 340.) We agree, however, with the learned General Term in holding that this provision has reference to contracts that are complete, and that it does not extend to the reformation of an imperfect instrument, even if it is a lien upon land and in that sense related to real property.
The judgment should be affirmed, with costs.
All concur, except BRADLEY and HAIGHT, JJ., not sitting.
Judgment affirmed.