
    Henry Bloomgarden, Appellant, v. Ernst Hoffmann and Alma Hoffmann, Respondents.
    Second Department,
    January 11, 1907.
    Vendor and purchaser — specific performance — when owner can sell to third parties after appeal from decision of specific performance.
    Defendants sued to recover a deposit paid on a contract to convey lands on the ground that the title was unmarketable may ask specific performance as a counterclaim.
    When in such action the plaintiff is defeated and specific performance decreed and the plaintiff without stay of judgment or filing an undertaking pursuant to section 1823 of the Code of Civil Procedure takes an appeal, the defendants by selling the lands to third parties are not in contempt of court.
    The provision of said section 1323 allowing the owner to gell in cases of appeal applies where the owner is a defendant asking specific performance as a counterclaim, for such counterclaim is a cause of action.
    Although in the action the plaintiff did not recover his deposit and the amount was credited on the purchase price, the judgment of specific performance does hot vest the defendants with the right to retain the deposit, if they elect to sell to third parties.
    Appeal by the plaintiff, Henry Bloomgarden, from an order of the Supreme Court, made at the Kings County Special Term and entered in the office of the clerk of the county of Kings on the 19th day of April, 1906.
    
      
      Harry Zirn, for the appellant.
    
      Isidor Buxbaum,, for the respondents.
   Jerks, J.:

This is an appeal from an order of the Special Term denying a motion to punish the defendants for a contempt in failing to ©bey a judgment and thereby .defeating the rights of the plaintiff to his loss. In 1904 the defendants contracted to sell certain premises to the plaintiff,, who thereafter rejected the title as unmarketable and sued to recover $200 paid on account of his purchase and the incidental-expenses. The defendants joined issue, with the pleas of denial of the unmarketability and of “a separate and distinct defense and counterclaim ” that the plaintiff refused title because of an encroachment for which, though immaterial, the. defendants had offered and had tendered a rebate of $100 while the plaintiff had demanded $400. A prayer of the defendants was for specific performance with allowance for the encroachment. The plea for specific performance was a counterclaim available to the defendants. (Moser v. Cochrane, 107 N. Y. 35.)

The court after trial found the title marketable and adjudged that the allowance for the encroachment should be fifteen dollars; that the plaintiff within ten days after the service of judgment and notice of entry thereof should pay the consideration, less the fifteen dollars, and dismissed' the complaint on the merits. The defendants served the judgment on February 11, 1905. The plaintiff appealed therefrom on February 17, 1905. We affirmed the judg- . ment on March 2p 1905. (112 App. Div. 887) A copy of the order of affirmance was served on the plaintiff’s attorney on March 13, 1906. On March 19, 1906, the defendants 'were served personally therewith, and the plaintiff then tendered to them the consideration money and demanded performance, which was refused. Thereafter, Upon these facts and upon the allegation that the defendants had conveyed the premises to other persons on July 18, 1905, the plaintiff moved, as I have heretofore written. The defendants showed that á’t no timé before March 19, 1906, did the plaintiff offer to perform or intimate his willingness to do so, although they had always stood ready on their part until the said July 18, 1905 ; that no stay had been granted pending the plaintiff’s appeal from the judgment and asserted that they had acted in good faith in the conveyance made to other persons.

I am of opinion that the motion was rightly denied. The plaintiff did not comply with the terms of the judgment which required him to take the premises by payment of the consideration within ten days after entry and notice thereof, but appealed therefrom. The plaintiff’s appeal from the'judgment did not stay the defendants, for the appellant did not file an undertaking pursuant to the provisions of section 1323 of the Code of Civil Procedure. It is insisted, however, .that this section does not apply for the reason that it reads: “ When tlie appeal is from a judgment in favor of the owner of real estate in ah action to set aside a conveyance thereof or in an action to compel the specific performance of a contract for the sale thereof, such owner shall have the same right to sell or dispose of the same as though no appeal had been taken, unless the appellant shall file,” etc., while this is an action to recover a deposit.

I think that we should regard the spirit and purpose of the statute and so construe it as to carry out the legislative intent. (People ex rel. Wood v. Lacombe, 99 N. Y. 43, 49; Spencer v. Myers, 150 id. 269, 274 et seq.) The purpose of the statute is to prevent a mere appeal ipso facto from staying an owner, who has a judgment for specific performance, from selling his realty during that appeal. It matters not, then, whether the owner has recovered his judgment as a plaintiff or as a defendant. Further, I think that this case is fairly within the terms of the statute. A counterclaim is a cause of action (Code Civ. Proc. § 501), and is necessarily so ( Walker v. A. C. Ins. Co., 143 N. Y. 167; McCulloch v. Vibbard, 51 Hun, 227), and, therefore, this counterclaim may be regarded, when read with the provisions of the statute* as an action to compel a specific performance. The learned counsel for the appellant makes, the point tiiat the defendants’ counterclaim is necessarily that they can dispose of the property and keep his money paid on account of the purchase. Eot necessarily. The plaintiff sued to recover money paid on account of the purchase price on the ground that the title was unmarketable. The court decided that it was marketable, and decreed specific performance. The specific performance decreed involved payment by the plaintiff. The money already paid on account was'to be credited to him.- It does not follow, when the defendant's by their -act abandoned their right to specific performance, that the judgment still awarded to them the amount paid by the plaintiff on account of the purchase.

1 The order must be affirmed, with ten dollars costs and disbursements.

Hirschberg, P. J., Woodward, Rich and Miller, JJ., concurred.

Order affirmed, with ten dollars costs and disbursements.  