
    Lena Simon, Respondent, v. Catherine A. Neef, Appellant.
    Second Department,
    December 19, 1913.
    Mortgage — foreclosure — personal claim for deficiency—counterclaim alleging defect in title.
    In a suit for the foreclosure of a mortgage in which a deficiency judgment is asked the court should not disregard a counterclaim by the defendant for damages based upon the ground that the title to the property at the time of the conveyance by the plaintiff to her was in the city of New York, and in the State, and a judgment for the plaintiff on the pleadings should be reversed.
    Appeal by the defendant, Catherine A. Neef, from an order of the County Court of Kings county, entered- in the office of the clerk of said county on the 16th day of September, 1913.
    
      Raphael Link, for the appellant.
    
      A. Sidney Galitzka, for the respondent.
   Jenks, P. J.:

This appeal is from an order of a County Court that grants judgment on the pleadings in a foreclosure of a mortgage on realty and appoints a referee to compute. The sole question for consideration arises upon the counterclaim of the defendant mortgagor, against whom a deficiency judgment is asked. She pleads that the deed of conveyance among other things contained a covenant on the part of the plaintiff that the premises were free from all incumbrances; that, on information and belief, at the time of the conveyance the premises were not free, but that the title then and theretofore was and now is in the city and the State of New York; that the premises were originally land under water which have been filled in; that the Supreme Court of this State has decided that a title substantially similar was defective and not in the owners of record but in the said city and State; that for the foregoing reason and others the title attempted to be granted and conveyed by the plaintiff was wholly defective and valueless; that the plaintiff has not warranted and defended the title to this defendant, but on the contrary the said city and State at the times aforementioned have the superior and paramount title. She asks for damages and asserts her willingness and ability and makes the offer to place the plaintiff in statu quo, to deliver up the premises and to convey them with all the right, title and estate granted by the plaintiff to her.

I think that the counterclaim should not have been disregarded. (Shire v. Plimpton, 50 App. Div. 117, 122; Merritt v. Gouley, 58 Hun, 372; Wilt. Mort. Forec. § 447; Merchants’ Nat. Bank v. Snyder, 52 App. Div. 612.) The reasons are well stated in Shire v. Plimpton (supra) and need not be restated.

It is quite true that when a purchaser has possession under the deed he cannot defend on defect of title save in case of fraud or failure of consideration (McConihe v. Fales, 107 N. Y. 404), for the reason that the court would not arrest the action on the debt so long as the debtor was not evicted. (Platt v. Gilchrist, 3 Sandf. 118; Dunning v. Leavitt, 85 N. Y. 30, 36, and cases cited.) But we are considering a counterclaim in an action where a personal claim is asserted against this defendant. The cardinal rule of equity is to dispose at one time of all the causes of action “ between the same parties arising from the same subject-matter.” (General Underwriting Co. v. Stilwell, 139 App. Div. 190.) We are cited to our decision in Kouwenhoven v. Gifford (144 App. Div. 355). I may say, in the words of Chase, J., in Cassada v. Stabel (98 App. Div. at 605): “Each case must be determined after a careful consideration of the facts upon which a breach of the covenant is claimed.”

I advise that the order be reversed, with ten dollars costs and disbursements.

Thomas, Carr, Rich and Putnam, JJ., concurred.

Order of the County Court of Kings county reversed, with ten dollars costs and disbursements.  