Opinion
January 11, 1939.
Present — Hill, P.J., McNamee, Crapser, Bliss and Heffernan, JJ.
This is an appeal from a judgment in an action to foreclose a purchase-money mortgage. The properties were exchanged between the defendants-appellants, Cohen and Carlin, and the defendant-respondent, Rose Gordon. Deeds were executed for the properties exchanged and it was agreed as part of the contract of exchange that a purchase-money mortgage should be given for the difference in value to Gordon, between the properties conveyed. The properties were to be conveyed clear of all incumbrances. The defendants-appellants executed to Gordon the mortgage which is the subject of this action and executed an estoppel certificate. The mortgage and certificate were immediately transferred to the plaintiff. It appears that the Gordon property, unbeknown to any of the parties, was incumbered by unpaid taxes for which the property was later sold and conveyed. The possession of the grantees in the Gordon deed was never disturbed. When the plaintiff brought this action to foreclose the mortgage the defendants interposed a counterclaim and cross-claim against Gordon asking for the rescission of the contract on account of the tax lien and deed. No fraud was alleged and the facts were stipulated to the trial court. The trial court held that the plaintiff was entitled to foreclosure and dismissed the defendants-appellants' counterclaim and cross-claim and gave a judgment of foreclosure which is the subject on appeal in this action. The defendants-appellants were not entitled to maintain their counterclaim. Their sole remedy was an action at law for damages for breach of covenant of seizin. ( Peabody v. Kent, 213 N.Y. 154; Hilliker v. Rueger, 228 id. 11.) Judgment unanimously affirmed, with costs.