Opinion
March, 1913.
Bernstein Quinn, for plaintiff.
Neier, Hance Van Derveer, for defendants Klein.
This is an action to foreclose a mortgage.
The defendants William Klein and Maria M. Klein contest the plaintiff's demand for a deficiency judgment against them.
Section 249 of the Real Property Law provides: "A mortgage of real property does not imply a covenant for the payment of the sum intended to be secured; and where such covenant is not expressed in the mortgage, or a bond or other separate instrument to secure such payment has not been given, the remedies of the mortgagee are confined to the property mentioned in the mortgage."
This provision relates to the clauses set forth in the statutory short form of mortgage contained in section 258 of the Real Property Law and to mortgages in substantially that form, and does not require that an instrument, which by its clauses is both a bond and a mortgage, shall contain a covenant for the payment of the indebtedness to justify a deficiency judgment.
The instrument upon which this action is brought describes itself as a "Mortgage — Bond" and reads in part as follows:
"Know all men by these presents that William Klein and Maria M. Klein, his wife, of the City, County and State of New York, Obligors, are bound to Bernhard Bloch, of the same place, Obligee, in the sum of Twenty-three hundred fifty dollars to be paid to the obligee on the fifteenth day of September, nineteen hundred and eleven, and interest thereon, at the rate of six per cent. per annum to be computed from the fifteenth day of September, 1908, and to be paid on the fifteenth day of March and September following until this obligation is wholly discharged.
"As collateral security for the payment of said indebtedness, said William Klein and Maria M. Klein, Mortgagors, in consideration of the premises and of the due receipt of one dollar mortgage to said Bernhard Bloch, Mortgagee, all * * *
"This instrument shall likewise apply to, bind, or inure to the benefit of the heirs, successors, legal representatives and assigns of said respective parties hereto.
"In witness whereof the said Obligors and Mortgagors hereunto set their hands and seals on the Fifteenth day of September Nineteen hundred and eight."
These provisions are very different from those contained in the statutory short form mortgage which refers to the indebtedness in a recital clause beginning with "Whereas" and then sets forth clauses that show that the statutory form purports only to be a mortgage and not also a bond.
The instrument here in suit expressly states an existing obligation and provides that it shall "apply to, bind or inure to the benefit of the heirs, successors, legal representatives and assigns of said respective parties hereto," making it in effect a bond and thereby entitling the plaintiff to a deficiency judgment. Elder v. Rouse, 15 Wend. 218; Consumers Brewing Co. v. Braun, 147 A.D. 171.
The contention of the two defendants Klein that the deed from them to Sigmund Katz of the mortgaged premises amounted to a payment of the instrument here sued on is without any foundation. Sigmund Katz at once conveyed the premises to the defendant Maria M. Klein. The two simply changed the ownership of the premises from William Klein to his wife, Maria M. Klein. Both deeds contain the express provision: "Subject also to two mortgages aggregating Fifty-three hundred and fifty dollars now a lien on said premises."
One of these two mortgages is the instrument here in suit, which, as stated above, is also a bond.
The plaintiff should have the usual judgment of foreclosure and for a deficiency, if any, with costs.
Judgment for plaintiff.