
    Florence Nunnally and Others, Appellants, v. Charles D. Robinson, as Receiver of the Mercantile Co-operative Bank, Respondent, Impleaded with Jeremiah W. Curtis, Individually and as Executor, etc., of Jeremiah Curtis, Deceased, and Others, Defendants.
    First Department,
    June 15, 1906.
    Foreign judgment of foreclosure — conclusive on heirs of mortgagor — if such foreclosure he collusive relief must he had in foreign tribunal. — next of kin.cannot sue personally to recover property.of estate.
    .The complaint in' substance alleged- that the plaintiffs were the heirs and next Of ' kin of an intestate who died seized of real property in .New Jersey, which "was ' subject to a mortgage;- that pursuant to a scheme to defraud the1 plaintiffs of "their rights in the estate (the details of which scheme were fully set forth) the mortgage had been- foreclosed in the" State of New Jersey and the proceeds diverted; A-discovery of all the details .of the alleged fraudulent scheme was asked, together with an accounting, etc. On-demurrer to the complaint,
    
      Held, that as the plaintiffs did not allege that they were not -made parties to the - foreclosure in the foreign State, the decree in that State was Conclusive against them, and their interest in the: property was cut off;
    That if, in fa.ct, they were not made parties to said suit, their remedy-was to sue : for .possession in the foreign court;
    That, so far as- alleged fraudulent dealings with the personal property of the estate was concerned, the plaintiffs had no cause of action as next of kin to " recover- the property, for the title vested in the administratrix, who was the "proper party -to recover it. , "
    Houghton, J., dissented-.
    Appeal by the plaintiffs, Florence Nunnally and others,.'from an interlocutory judgment of the Supreme Court in favor of. the. defendant- Robinson, as receiver, entered in the office .of the.clerk of the county of New .York on the 6th day of February, 190.6, upon the decision of the court,, rendered after a trial at the New York Special Term, sustaining a demurrer interposed by the said defendant receiver to the "amended complaint.
    
      Andrew Foulds, Jr., for the appellants.,
    
      Edmund S. Hopkins, for the respondent.
   Ingraham, J.

The plaintiffs are heirs at law and next of kin of William A. Nunnally, deceased, who died intestate on November 1, 1892, a resident of the State of'Mew jersey, leaving the defendant Mary Munnally, his widow, and the plaintiffs and the defendant Longley Munnally, his next of kin and heirs at law. At the time of his death the deceased .was the owner of certain real property In the State of Mew Jersey subject to- mortgages of $8,200 which were held by the defendant Curtis, as executor, and personal property of the value of $5,000 and upwards. Letters of administration were issued to tile defendant Mary Munnully, as widow of the deceased, by the probate courts of the State of Mew Jersey. There was a domestic corporation known as the Mercantile Co-operative Bank of which the defendant Robinson is the receiver. The complaint-alleges that about the year 1896 the defendants Mary Munnally and Longley Munnally were induced by the false and fraudulent representations of this Mercantile Co-operative Bank to do and permit to be done various acts in furtherance of a conspiracy and plan of said corporation together with the defendant Jeremiah W. Curtis, individually and as executor, to divest the plaintiffs of their lawful interest in the estate of the said William A. Munnally and to divert the same to the use of the said Mercantile Co-operative Bank; that in pursuance of tins conspiracy and plan a suit was brought to foreclose the mortgages held by the said Curtis, as executor of the real estate in Mew Jersey, and that in pursuance of a decree in said foreclosure proceedings the property was purchased at the said sale by said Curtis, as executor, for the sum of $6,000, leaving a balance due said Curtis of about $4,000 deficiency; that subsequently Curtis conveyed this property- thus purchased to the defendants Longley and Mary Munnally at a stated consideration of-$11,000, and subsequently the defendants Longley and Mary Munnally executed a mortgage on said property to Curtis, its executor, in the sum of $8,200; that in further pursuance of said conspiracy and plan, on or about the 15th day of May, 189J, in the State of Mew Jersey, said Longley and Mary Munnally executed a second mortgage on said property to the said Mercantile Co-operative Bank to secure the sum of $12,400, and the same debt was also secured by a chattel mortgage covering the household furniture situated in the house on said property, which personal property consisted of assets of the estate of the testator; that the consideration of this mortgage was the assumption. by, the corporation of the Curtis mortgage of $8,20.0, the payment by the bank to said Curtis, as- executor, of $1,800, an alleged - indebtedness of Longley bTunnally to the said. executor and the issuance of 121 shares of the stock of the s.aid bank to, the said Longley Nunnally as a borrowing member'thereof, upon terms set forth in said mortgages, and that as this chattel mortgage covered property Of the estate it .was void.. " ■

The complaint then sets up certain statutes of the State of New Jersey in relation to corporations doing business in that State, and alleges that the said mortgages, contracts and transactions were made and entered into in the State of New Jersey and provided for the payment of more than the legal rate of. interest under the la.ws -of .that State; that subsequently Longley N"urmally failed to comply with his contract with the said' bank, and thereupon, the bank took possession of the personal property covered by the chattel mortgage and commenced an action to foreclose the mortgage upon the real estate, ■ . .

It is further alleged that by the interlocutory judgment entered in that foreclosure, suit the bank Was directed first to sell the shares of stock held, by Longley Nunnally and to credit the proceeds- of such sale or the withdrawal value of said stock upon the mortgage before, *■ proceeding with, the sale of the real estate; that there was. received by the said bank upon the said foreclosure sale and. upon the .sale upon said personal property the sum of $1,500 and upwards over and above the amount of . the alleged mortgage • debt and interest, ' and all expenses and costs of the foreclosure and sale, and that in addition thereto there should have been realized from the sale óf said stock the sum of. about $1,500 or the withdrawal value of the same,, in a like amount,, which should have been credited; that the said surplus has never been accounted -for or paid into court in pursuance of said decree in foreclosure and that demands have been • made- against the receiver of the said bank for an accounting, and the plaintiffs ask judgment Compelling the defendants Longley and Mary Nunnally, and .each of them, to discover and disclose the-full details of the transaction, whereby the legal title to said real prop- .. er-ty_ was transferred to said Longley,-including any and all payments made to said • defendant Curtis, individually or as. executor, . by said Longley and Mary ..Nhnnally, or either of them, or by any person in their behalf, and compelling the said Longley to account for the moneys and the value of the property wrongfully under his control, and unlawfully paid out and disposed of by him, and declaring that said property so held by him was so held in-trust for the plaintiffs, and compelling the defendant Robinson to account for the sums of money and other considerations paid by the Mercantile Co operative Bank to and received by it from each of the defendants, and for other relief.

The defendant Robinson, as receiver, demurred to this complaint upon the ground that it did not state facts sufficient to constitute a cause of action, which demurrer was sustained.

Upon this appeal the plaintiffs seem to have abandoned any claim that there was a cause of action, except as against the defendant Robinson, as receiver, for an accounting for the moneys received upon the foreclosure sale; but upon these allegdtions it is clear that the title of the defendant Curtis to the property acquired upon the sale and foreclosure of the real property in the State of Mew Jersey cannot be questioned in this court. The property is in Mew-Jersey. It appears in the complaint that the mortgages were foreclosed and the property sold under a decree of the courts of Mew Jersey. It is not alleged that these plaintiffs were not parties to that foreclosure suit, and nothing is alleged to show that Curtis did not acquire by that suit a good title to the property. There is a general allegation of fraud and conspiracy, but no facts are alleged upon which such allegations can be based, and there is nothing to impeach that sale or to justify these plaintiffs as heirs at law of the testator in attacking that proceeding. If they are not parties to the foreclosure suit their proper, remedy is to sue for the possession of the property in which they had an interest in the courts of Mew Jersey. If they were parties, the decree in that suit is conclusive as against them, and their interest in the property is cut off by the foreclosure. So far as this personal property is concerned, upon which it is alleged one of the defendants gave a chattel mortgage to the bank, of which property the bank subsequently took possession, if that property belonged to the deceased the title to it vested in the administratrix. The action is not brought to enforce the right of the estate to the property. If that property belonged to the estate the administratrix is the proper: party to recover it, and -these plaintiffs have no cause of action as next of kin of tlie deceased. There is nothing, therefore, to justify any judgment against the defendant Robinson, as receiver, and. the demurrer was properly sustained.

■It follows that the' appeal from the decision must he dismissed, with costs, and judgment appealed from affirmed, wjth costs, with leave to plaintiffs to amend the; amended- ..complaint upon payment of costs in this court and in the court below.:

O’Brien,. P. J., McLaughlin and Clarke, J J., concurred ; Houghton, J., dissented.

Appeal from decision dismissed, with costs; judgment affirmed, with costs, with leave to plaintiffs to amend on payment of costs in this court and in the court below.' Order filed.  