
    Anna Seitz, Appellant, v. Magdalena Messerschmitt and Others, Defendants. Magdalena Messerschmitt, Purchaser, Respondent.
    First Department,
    February 8, 1907.
    Real property — escheat — when title of State not divested by foreclosure.
    When a mortgagor dies without heirs capable of inheriting, the lands escheat to the State which takes title subject to the mortgage. But ^sa sovereign State cannot be sued, without its consent, • the courts obtain no jurisdiction in an action of foreclosure, as against the State, even though the Attorney-General be made a party defendant.
    Under such circumstances the title of the State is not divested by the sale on foreclosure, and, if the Statute of Limitations has not run against the State, the purchaser’s title is not marketable.
    Laughlin, J., dissented, with opinion. ;
    Appeal by the plaintiff, Anna Seitz, from an order of the Supreme Court, made at the ¡New York Special Term and entered in the. office of the clerk of the county of ¡New York on the 19th. day of September, 1906, granting a motion made by Magdalena Messerschmitt to be relieved from her purchase made at a sale pursuant to an interlocutory judgment in partition, upon the ground that the title to the premises in question is unmarketable.
    ■ George Q. Collins, for the appellant and for infant defendants.
    
      Joseph T. Weed, for the respondent.
   Ingraham, J.:

The questions presented on this appeal are stated in the opinion of Mr. Justice Laughlin. There is one ground upon which I do not agree with him.

The conveyance of the referee on the sale 'under the judgment in the foreclosure action is the foundation of the title; in that action no defendant, as representing the - heirs at law of the mortgagor, was made a party, it being alleged that the mortgagor died owning the equity of redemption in the property without heirs at law, which it may be assumed meant without heirs at law capable of • inheriting real property in this State. The title is sought to be«sustained upon that theory. If, however, the owner of the equity of redemption died without heirs at law capable of inheriting the title to his- rfeal property, it escheated to the State, who, therefore,, became the owner of the proqierty in question, subject to the mortgage % :

T agree with Mr. Justice Laughliñ that the facts would justify a finding that the mortgagor and owner of the equity, of redemption died without heirs at law capable of inheriting, and that, therefore, at his death the title to the property vested by escheat in the State. The question, then, is whether the title of the State was affected by . the sale Under the judgment of foreclosure. The People of the State were not a party to the foreclosure action, and it always has been a settled rule of law that a sovereign State could not be sued in its own courts without its consent. This questioh is discussed by Mr. Justice: Mitchell in Kiersted v. People (1 Abb. Pr. 385), and the rule, as I understand it, is there stated. He quotes from Brohsoñ, J., 'in Delafield v. State of Illinois (2 Hill, 159), that where a State is made defendant the State courts cannot exercise jurisdiction.” It seems to me clear that if the courts of the State could acquire no - jurisdiction as against the State to affect its title to real property, making the Attorney-General of the State a party defendant in actions affecting real property, could give the coui;t no jurisdiction to sell the property of the State under a, judgment in that action. Hpon the assumption that the property escheated to the State, the State became the owner of the equity .of redemption, and to sustain the title.offered to the purchaser we must hold that the deed by the referee under the judgment of foreclosure conveyed the equity of redemption which had become vested in the State. If- the court had no jurisdiction over the State, in whom the title to the property had vested, it certainly could not sell the interest of the State in the property under a judgment in an action to- -which the State was not a party (2 R. S. 192, § 158; 3 R. S. [5th ed.] 273, § 88 [158]; 3 R. S. [6th ed.] 199, § 102 [158] ; revised in Code'Oiv. Proc. § 1632); and as the Statute of Limitations has not run against the State, I do not see hoW we can say that the interest of the State has been divested by the sale under this judgment.

The cases in which courts of equity have allowed a State or the Attorney-General of a State to he made a party defendant have been cases in which there had been a lien upon real or personal property, which apparently was owned by the State and the Attorney-General was made a party, not for the purpose of affecting the rights of the State, but to notify him of the existence of the controversy, so as to give him an opportunity to appear and protect the interests of the State if he so desired. But in no case that I can find has it ever been held that where real property had vested in a State, making either the State or the Attorney-General a party to an-action affecting such real property without legislative sanction, could divest the State of the property that had vested in it. While the Attorney-General was the legal office!1 of the State, he had no power to divest the State of real property, that power resting solely with the Legislature. Making him a party did not bind him to interpose on behalf of the State, and upon principle I cannot see how it can be said that making him a party to the action and his appearance in the action mould vest the court with jurisdiction to sell the property of the State so as to divest it of title,

I do not think we can declare in this action, to which the State is not a party, that the title of the State to this property has been divested by the sale under the foreclosure suit, and, therefore, I think the title is not marketable.

The order should, therefore, be affirmed, with ten dollars costs- and disbursements.

Clarke and Scott, JJ., concurred; Laüghlin, J.,- dissented.'

Laughlin, J. (dissenting):

The premises in question are known as Nos. 657 and 659 East One Hundred and Fifty-first street, borough of The Bronx, city of New York, and consist of a parcel fifty feet in width by one hundred and fourteen feet in depth, on the northerly side of the street, commencing twenty feet easterly from Melrose avenue. In 1860 the easterly twenty-five feet were owned in fee simple absolute by William Bower, who on the twenty-first day of March, that year, duly mortgaged the. same, his wife joining in the mortgage. The mortgage by mesne assignments came tomne Herbert J. McDonald, who in. the month of November,. 1871, brought an action .in the Supreme Court, Westchester county,, to fdreclose the same. The mortgagor had died in the meantime,, but Ms widow, who liad joined •in the mortgage, was' living. She was made a party defendant,, and-both summons and oonvplqint were personally served upon her, but. she defaulted in,appearing. -The only other "defendant was. “ Marshall B. Champlain,'Attorney-General of the State of Mew York, in behalf of the people of the State of Mew York.” It was alleged in theconrplaint that the mortgagor had died “leaving his-widow . and no heirs at law or next of kin, and by reason whereof Maiv shall B. Champlain as Attorney-General' of the State of Mew York, in behalf-of the people of said State of Mew York, have or claim to have some interest in or lien upon the said moi-tgaged premises.” Champlain as a party defendant, by the description contained in the title, served the usual notice of appearance, which he- subscribed “ M. B. Champlain, Attorney-General for the people .of the -State of Mew-York,” and therein waived notice of all proceedings, except notice of application- for surplus moneys. Upon proof of service upon the defendant Bower, and this notice of appearance, the usual steps and proceedings in a foreclosure action were -taken and had, and judgment of foreclosure was entered, under which the property was sold by -the sheriff to the defendant Bower,, the widow of the ■mortgagor, and a conveyance thereof executed to her by him- on the 14th day of February, 1872. ■ The premises were struck off to her on her bid, which just ecpialed the amount of the indebtedness and the costs and expenses of the action, and, as there was no surplus, no surplus money proceedings were had. By mesne "conveyances from the purchaser "at foreclosure sale, the property became vested ■ in one'Joseph Messerschmitt in or prior to 1880. -It.does not. expressly appear whether of not the purchaser " at the foreclosure went into possession at once.' The plaintiff is the daughter of said Messerschmitt by his first wife, and the' defendant, the purchaser here, is his second wife. They derived the title which it was sought to partition in" this, action, and which lias been sold, through him. It is evident that tliis- was a friendly application to determine the marketability of the title, because the widow, who is the purchaser, as well as plaintiff, her stepdaughter, presents an - affidavit showing her knowledge concerning the possession and title of. her husband. It appears by their affidavits that Messerschmitt was in possession-as early as 1880 ;■ that the premises were then inclosed by a substantial inclosure, and about five years thereafter he built two apartment houses tliereon? which -covered the entire frontage, and that that part of the premises not covered by the buildings remained inclosed by a substantial inclosure until after his death in 1894, or during a period of about twenty-five years; that during this entire period no claim adverse or hostile to the ownership or title of said Messerschmitt was made by any person or persons to their knowledge, and that they never learned from him that such claim was ever made.

The defects in the title claimed by the purchaser were that the equity of redemption which was in the heirs of the mortgagor, or the people of the State was not foreclosed, owing to the failure of the plaintiff to make unknown heirs of the mortgagor (Code Proc. § 135, as amd. by Laws of 1860, chap. 459, § 4) or the people of the State parties defendant. The purchaser in claiming that the heirs of the mortgagor should have been made parties defendant, relies upon the rule that it is presumed that no man dies without heirs. (22 Am. & Eng. Ency. of Law [2d ed.], 1291, and cases cited; Ettenheimer v. Heffernan, 66 Barb. 374; Bradley v. Dwight, 62 How. Pr. 300; Pitkin v. New York & New England R. R. Co., 64 Conn. 482; Harvey v. Thornton, 14 Ill. 217; Lawson Presump. Ev. [2d. ed.] 249; Bell v. Hall, 76 Ala. 546; John, Admr., v. Hunt, 1 Blackf. [Ind.] 324.) The appellant, however, contends that such presumption is overcome by the allegations of the complaint in the foreclosure action, which were not controverted, and, therefore, stands as if determined by the court upon the trial of an issue. If it had been alleged that he left only one heir who was made a defendant and defaulted, surely it would not be necessary to prove the allegations by calling witnesses, and the burden would be on the purchaser of showing other heirs. It would seem, unless it is impossible that a person could die without heirs at law, capable of inheriting his realty, that this allegation of the fact would be controlling, at least in the absence of some evidence of the existence of heirs. It is manifest that there may have been blood relations and yet not heirs at law capable of inheriting the land. The allegations of the complaint should be construed as meaning that he left no heir capable of inheriting for that is the sense in which the term is used in the complaint and it is strictly its legal meaning. (Tillman v. Davis, 95 N. Y. 17.) In 1871 alien heirs were incapable of inheriting real property in this State. (Luhrs v. Eimer, 80 N. Y. 171, 178.) Moreover, the presumption that- no one dies without leaving heirs capable of inheriting his real property cannot be. conclusive, for lie may, and that the State shall then take by escheat the Constitution expressly contemplated. (Const. [1846] Art. 1, § 11.) It is evident that there is no hard and fast rule on the point, and tKat it is possible that one may die without heirs capable of inheriting, and that- circumstantial evidence, or great lapse of time', may be sufficient to overcome the presumption that he did not. In the second edition of the American and English Encyclopedia of Eaw (Vol. 22, p. 1291) the law on this subject is stated as follows: “ Owing to the recoge niz id fact that' comparatively few persons die without-heirs, either-near or remote, it is presumed that decedents leave heirs. But the non-existence of heirs within a particular degree may be established by circumstantial evidence, and after a great lapse of time and the' nomappearanee of heirs, ' their non-existence may be presumed.” In Harvey v. Thornton (supra), which was a foreclosure action in which the decree was taken by default, the mortgagor’s administrator was made a party defendant, but liis '■heirs- were not joined in any form", arid there was no allegation that there were not heirs. The court held that. "there was a -presumption that heirs existed capable of inheriting, but the court said: “It may 'perhaps be, if the bill had contained an allegation that the mortgagor died without heirs, that the decree might be sustained. But in the absence of such an averment, it is clearly the duty of this "court'to intend that there are persons in existence who inherited the equity of redemption.’-’ In Moran v. Conoma (59 N. Y. Super. Ct. 101; affd., 128 N. Y. 591) objection was made to a title by the purchaser on foreclosure, upon the ground that proof should have been offered as to persons described in the summons .as- unknown, absentees and heirs at., law of the mortgagor, to show who such unknown persons and absentees were, or to show that the mortgagor did in fact die without heirs. It appeared that he left the city of New York shortly after giving the mortgage and had not been heard, from for upwards of thirty-.five years. It was held that the objection, was not sufficient to release the purchaser, the court following Wheeler v. Scully (50 N. Y. 667), where the mortgager, after executing the mortgage in 1853, left home and had not been heard from at the time of the foreclosure. He was served by publication and his unknown heirs were made parties defendant. The objection raised to the title was that it was to be presumed that the mortgagor was dead and he left heirs at law who might be infants, who would not be barred by the judgment. It was held that even if the service would not have been good against infants, if the mortgagor had died leaving infant heirs, yet the burden of showing infancy rested upon the purchaser.

In Bradley v. Dwight (supra) which was an action to redeem, the plaintiff claimed through the People by release from the Legislature of their title by escheat. The defendant claimed title under foreclosure wherein it was alleged that the owner of the equity of redemption died seized of the premises, intestate, unmarried and without issue, leaving him surviving a father, an alien who also died without issue. The People of the State were not made a party defendant, either directly or indirectly. The defendant and his grantees had been in possession under the deed in foreclosure. A demurrer to the complaint was sustained upon the ground that it did not affirmatively appear that the owner died without heirs having legal capacity to take as he might have had brothers or sisters. But inasmuch as there was no allegation in the complaint in foreclosure in that case that the owner of the equity of redemption died without heirs, it is not an authority on the point now under consideration.

It appears to me that there is no defect in this title disclosed on the face of the record and that it is incumbent on the purchaser to show that there were heirs. (See Greenblatt v. Hermann, 144 N. Y. 13; Wheeler v. Scully, 50 id. 667; Moran v. Conoma, 59 N. Y. Super. Ct. 101; affd., 128 N. Y. 591; Hagan v. Drucker, 90 App. Div. 28; Lenehan v. College of St. Francis Xavier, 51 id. 535 ; Goodwin v. Crooks, 33 Misc. Rep. 39; affd., 58 App. Div. 464; Matter of Sullivan, 51 Hun, 378; Barson v. Mulligan, 66 App. Div. 493.) The judgment in partition under which the premises have been sold establishes presumptively that the title .offered for sale is in the parties to the action of which the purchaser is one. (Goodwin v. Crooks, supra.) In view of the fact that the widow of the mortgagor was made a party defendant, and the complaint containing the allegation that her husband died without heirs was served upon her, it is reasonable to infer that -the allegation in the complaint was in accordance with the-facts, especially-as-it was assumed that title has. escheated to the State and the Attorney-General was made a party. In those circumstances there was no likelihood of collusion.

Moreover, I am of opinion that, upon this branch of the case, the . title is good by lapse of time. It is-, to be. borne in mind that the only right in the mortgagor! or in his heirs, if he left 'any, was a right of redemption' after the mortgagee or .those who becamé sub- - rogatéd to his rights under the mortgage by the judgment in foreclosure came into possession of the premises. (Lunny v. McClellan, 116 App. Div. 473.) The Statute of Limitations- against such an action is ten years after possession is taken by the mortgagee or his successor in interest. (Hubbell v. Sibley, 50 N. Y. 468.) It is likely that the purchaser went into possession immediately, but in any event it appears that the father, of the plaintiff aind -husband of the purchaser was in Undisturbed possésSion by virtue of the title derived from the foreclosure of the mortgage for. a period of abou-t twenty-tive years. If any heirs were living the statute would- have been against them whether adults or infants. It' is' a reasonable inference that the purchaser on the- foreclosure took possession of the premises, for we find his successor in interest in possession in 1880. If .the- heirs Were of age at the time, the -purchaser under the decree in foreclosure went into possession, the Statute of Limitations commenced to run at once and would not be suspended by a. subsequent devolution . of title to -infants. (Jackson v. Robins, 15 Johns. 169 ; Ottinger v. Strasburger, 33 Hun, 466; affd., 102 N. Y. 692; Fleming v. Griswold, 3 Hill, 85 ; Swearingen v. Robertson, 39 Wis. 462; Becker v. Van Valkenburgh, 29 Barb. 319.) If the heir was then an infant just born, the running of the . Statute of Limitations would be complete after the lapse of thirty-óne years¿ There .may be no presumption that the heirs were -adults, but there-is a presumption that they were not insane or under other-disability which is not a normal condition. There’ is. little hardship in this' .particular case in giving weight to the defense of the Statute of Limitations against an action to redeem, in view of the fact that the purchaser is personally familiar with the facts relating to possession for a period of more than twenty-five years, as are the other parties to the action, some of whom, at least, would be available as witnesses.

According to the allegations of the complaint in the foreclosure action the title had escheated to the People of the State. If the owner of the equity of redemption died, as is alleged, without heirs, then his title and interest escheated to the State without any action on the part of the People or their representatives. (Johnston v. Spicer, 107 N. Y. 185; Const. 1846, art, 1, § 11; Ettenheimer v. Heffernan, supra.) It is claimed that the People should have been made a party eo nomine. Our attention, however, has not been called to any statute authorizing the plaintiff in a foreclosure action to make the People of the State a party defendant as the owner of the equity of redemption, and of course in the absence of such a statute, the rule is that the People, being the sovereign, may not be sued. It was provided by. statute at that time that the People might be made a party to an action in partition of lands held by the People and by individuals as tenants in common (R. S. [5th ed. vol. 3, p. 620 ; 6th ed. vol. 3, p. 597] pt. 3, chap. 5, tit. 3, §§ 108, 109) and is now so provided- in the Code of Civil Procedure (§ 1594), but in view of the rule prohibiting an action against the sovereign, that would not justify making the People a party to a foreclosure" action. On application for letters of administration in case of intestacy unless it appeared that the deceased left next of kin entitled to his estate, the statute at that time required that a citation should be issued to and served on the Attorney-General who in cases of escheat appeared for the People. (R. S. [vol. 2, p. 76] pt. 2, chap. 6, tit. 2, § 37; Gombault v. Public Admr., 4 Bradf. 226.) This provision is now contained in section 2663 of the Code of Civil Procedure. (See Throop’s Code Civ. Proc. [1880 ed.] § 2663, note and present statute.) Section 2616 of the Code of Civil Procedure which is also partly founded on this provision of the Revised Statutes (Throop’s Code Civ. Proc. § 2616, note and present statute), provides- for issuing a citation to .the Attorney-General, and not directly to the People, in cases of probate of wills relating to real estate, where the heirs of the decedent cannot be ascertained. By amendment to section 1627 of the Code of Civil Procedure, by chapter 528 of the Laws of 1899, authority now exists for joining the People as a party defendant in an action for the foreclosure of a mortgage on real property where they have a subsequent lien,-by Serving the Attorney-General. If the People could have been lawfully joined as a party1- defendant I am of opinion that since service might have been made on the Attorney-General, who alone could have appeared for them, what was. done in view of his appearance for the .People, without questioning the procedure, should be regarded as a sufficient designation- of the People as a party defendant, and sufficient service, or at least the appearance should bo deemed, pre.sumptively at least, a voluntary appearance for the People^ in whose behalf he assumed to appear,' and a -waiver of any irregularity or defect in the title in the summons. (See People v. Hydrostatic Paper Co., 88 N. Y. 623; Sperry v. Reynolds, 65 id. 179 ; Brown v. Nichols, 42 id. 26. See Supreme Court Rules 1871, rule 14, in force at thát time.). The Attorney-General had no interest in the suit except in his. official capacity as representing the People. Since the People had not consented to be made a party defendant in.stich a case, the mortgagee, whose rights accrued before the State acquired an interest, would be deprived of his right to foreclose the mortgage . .and to have the judgment pass good title as against the People, whose rights were, subordinate to those of the plaintiff,' unless the court of equity devised some plan for giving the People notice and an opportunity not to litigate their title, but to come in and protect it by redeeming or bidding. It appears that a practice was devised by which, where the People had or .claimed a lien on premises subsequent or subordinate to the rights of the plaintiff, and in other suits in equity where they were interested, they were given notice by naming the Attorney-General in his official capacity as a party defendant and serving process upon him. (Varick v. Smith, 5 Paige, 137; Garr v. Bright, 1 Barb. Ch. 157 ; Kiersted v. People, 1 Abb. Pr. 385.) On principle that rule should be applied to a case where the People had become the owners of the equity of redemption.

I am of opinion, therefore, that the title was marketable. I think it falls within the cases holding that where it is possible that a- fact exists which, would affect the title, but that it is. extremely improbable and a remote contingency, the' court may compel a specific performance. (Ferry v. Sampson, 112 N. Y. 415; Hagan v. Drucker, 90 App. Div. 28; Lenehan v. College of St. Francis Xavier, supra; Cambrelleng v. Purton, 125 N. Y. 610; Hamershlag v. Duryea, 58 App. Div. 288; affd., 172 N. Y. 622 ; Empire Realty Corporation v. Sayre, 107 App. Div. 415.)

‘ It follows that the order should be reversed, with ten dollars costs and disbursements, and motion granted, with ten dollars costs.

Order affirmed, with ten dollars costs-and disbursements. Order filed.  