Opinion
April 6, 1906.
Henry R. Ham, for the appellant.
Theodore Connoly, for the respondent.
The plaintiff, in proceedings supplementary to execution, was appointed receiver of the property of one Edelmuth, and as such brought this action to determine the title to, and recover Edelmuth's interest in, an award made to unknown owners for land taken by the city of New York for street purposes.
The complaint alleged, in substance, that on December 24, 1897, Edelmuth was the owner of an undivided one-sixth part of the land taken; that on that day title vested in the city of New York, for which an award of $336 was made to unknown owners; that on February 3, 1904, the plaintiff in proceedings instituted for that purpose was appointed receiver of Edelmuth's property; that he gave the bond required, entered upon and has since been discharging the duties of his office. The complaint also alleges a demand for and refusal of payment by the city. The city, among other defenses, interposed the following:
"III. And for a further and separate defense the defendant, The City of New York, upon information and belief, alleges that the plaintiff is not now and was not at the time of the commencement of this action entitled to claim, sue for or recover any part, parcel or portion of the award herein sued upon, in that the plaintiff as by his complaint alleged claims to have been appointed such receiver in supplementary proceedings on the third day of February, 1904, and in that on examination of the docket of judgments, in the office of the Clerk of the County of New York, it appears that the judgment upon which these proceedings are founded was entered on the seventh day of August, 1891, in City Court of the City of New York and duly docketed in said County Clerk's office on the eighth day of August, 1891; a period more than ten years prior to entry of the alleged order appointing this plaintiff receiver therein.
"IV. And for a further and separate answer and defense the defendant, The City of New York, alleges that there is a defect of parties defendant in that one Louis Edelmuth, the person of whom as aforesaid the plaintiff herein claims to be receiver in supplementary proceedings, has not been made a party plaintiff or defendant herein, and that the aforesaid Louis Edelmuth is a necessary party to the action."
To each of these defenses the plaintiff demurred upon the ground that it was insufficient in law upon the face thereof. The demurrer was overruled and the receiver has appealed.
I am of the opinion that the demurrer should have been sustained. As to the third defense, the contention of the learned corporation counsel is that inasmuch as the judgment, under which the proceeding was instituted which resulted in plaintiff's appointment, was recovered more than ten years prior to the time of his appointment, the order appointing him was either void or else of no effect under the decision of Importers Traders' National Bank v. Quackenbush ( 143 N.Y. 567), but that case is not in point, nor do I think it has any application. That was an appeal from an order vacating a stay of proceedings and denying a motion by the appellant to set aside an execution issued upon a judgment and order for the examination of the judgment debtor in proceedings supplementary to execution. There, the judgment was recovered in 1879 and the execution upon it was issued in 1894, which was returned unsatisfied and thereupon an order was obtained requiring the defendant to appear and answer in supplementary proceedings, and it was simply held that a motion to vacate the order was improperly denied; that under section 1251 of the Code of Civil Procedure the lien of the judgment upon defendant's real estate ceased after ten years and the execution was ineffective to reach all of the debtor's property; that the judgment creditor's legal remedy had not been exhausted, inasmuch as no steps had been taken to re-establish the lien on the real estate, and for that reason the proceeding was improperly instituted. It also appeared that a prior execution had been issued upon the judgment immediately after its rendition, which was returned unsatisfied and it was held that the right to maintain supplementary proceedings accrued upon the return of that execution and was barred after the lapse of ten years, in the absence of some proceeding to revive it, to which the debtor was a party.
Here, the only allegation in the third defense is that the order appointing the receiver was made more than ten years after the docketing of the judgment. The judgment was docketed August 7, 1891. The receiver was appointed February 3, 1904. The appointment of the receiver is, of course, a step in the proceedings supplementary to execution and he may be appointed at any time in the course of a properly instituted proceeding. (Code Civ. Proc. § 2464.) If the proceeding itself is instituted within the required time, then the date of the appointment is entirely immaterial, and for aught that appears, the proceeding which resulted in the appointment of this plaintiff may have been instituted (and in the absence of an allegation to the contrary such must be presumed) within the time prescribed by statute. The only limitation within which such proceeding may be instituted is contained in section 2435 of the Code of Civil Procedure, which is, "At any time within ten years after the return, wholly or partly unsatisfied, of an execution." The ten years does not begin to run with the docketing of the judgment, but with the return of the execution. As already indicated, there is no allegation that the proceeding was not instituted within ten years after the return of the execution, and, therefore, the validity of the appointment itself is not questioned by this defense. The receiver was appointed before the award was made, and under section 2468 of the Code of Civil Procedure, title to the award, when made, immediately vested in him. The moment that the title to the land vested in the city, that moment the judgment debtor ceased to have any interest in the land as the award made took its place. ( Ballou v. Ballou, 78 N.Y. 325; King v. Mayor, 102 id. 171.) The award being personal property the ten years' limitation as to liens upon real estate has no application. ( Treacy v. Ellis, 45 App. Div. 492; Van Loan v. City of New York, 105 id. 572.)
As to the fourth defense. The judgment debtor is not a necessary party. The title to the award in so far as he had any interest therein vested in the receiver and the only interest that the judgment debtor thereafter had was the right to an accounting in the event of a surplus after the payment of the judgment. ( Matter of Wilds, 6 Abb. N.C. 307; Goddard v. Stiles, 90 N.Y. 199; Bostwick v. Menck, 40 id. 383.)
And in addition to this, if there were a defect of parties, then the city should have demurred. It appeared upon the face of the complaint if the fact were important that the judgment debtor should have been made a party to the action, and the omission to join him as a party should have been raised by demurrer. Not having been thus raised, it was waived. (Code Civ. Proc. §§ 488, 499; De Puy v. Strong, 37 N.Y. 372; Straus v. Tradesmen's Nat. Bank, 36 Hun, 451.)
The judgment appealed from, therefore, must be reversed, with costs, and the demurrer sustained, with costs, with leave to the city to serve an amended answer on payment of the costs in this court and in the court below.
O'BRIEN, P.J., PATTERSON, LAUGHLIN and HOUGHTON, JJ., concurred.
Judgment reversed, with costs, and demurrer sustained, with costs, with leave to the city to amend on payment of costs in this court and in the court below. Order filed.