
    RUTHERFORD REALTY CO. v. COOK.
    (Supreme Court, Appellate Division, First Department.
    January 8, 1909.)
    Mortgages (§ 199)—Foreclosure—Rents Pending Action—Stipulation.
    Plaintiff in a mortgage foreclosure action, in which it was decided defendant was not liable for the deficiency, was not entitled to have applied on the deficiency the rents accruing during foreclosure, and deposited in a bank under a stipulation that the balance after payment of fixed charges against the property should “be held to abide the event of the action,” this being at most an agreement that, if it was finally determined defendant was personally liable for any deficiency, the surplus rents should be applied thereto.
    [Ed. Note.—For other cases, see Mortgages, Dec. Dig. § 199.*]
    Appeal from Special Term, New York County.
    Action by the Rutherford Realty Company against Willet F. Cook. From an order directing payment of funds to plaintiff, defendant appeals. Reversed,' and motion denied.
    -Argued before INGRAHAM, McRAUGHRIN, CRARKE, SCOTT, and'HOUGHTON, JJ.
    
      Martin E. Stover, for appellant.
    H. H. Snedeker, for respondent.
    
      
      For other eases see same topic & § number in Dec. & Am. Digs. 1907 to date, & Rep'r Indexes
    
   HOUGHTON, J.

The plaintiff held mortgages upon real erty owned by the defendant Cook, and. obtained a judgment of foreclosure, adjudging that Cook should -pay any deficiency that might arise on the sale. Cook had interposed various defenses to the foreclosure action, and, on his appeal to the Court of Appeals, that court decided that he was not liable for deficiency, and directed that the judgment be reversed unless the plaintiff stipulated to eliminate that part of its judgment (191 N. Y. 555, 84 N. E. 387), which stipulation was given.. During the progress of the litigation, a motion was made by plaintiff for the appointment of a receiver of the rents. This motion was adjourned from time to time, and various stipulations were entered into by the parties, to the effect that the rents of the property should be applied to the payment of ground rent, taxes, and insurance. Instead of an order appointing a receiver being entered, a general stipulation was finally made that the rents from the premises be deposited in the Fourteenth Street National Bank of the city of New York to the joint account of the defendant Cook and the plaintiff’s attorney, out of which should be paid taxes, ground rent, and insurance premiums, any remaining sum “to be held to abide the event of this action.” The litigation extended over a period of some years and a sale was not had until August 4, 1908, on which the premises brought some $13,000 less than the amount due. At the time of the sale there was on deposit $13,000 and over, from which the court has directed there be paid to the plaintiff the amount of the deficiency arising on the sale.

We think the order was erroneously granted. The defendant Cook was the owner of the premises, and as such owner was entitled to the rents. He consented, however, while the foreclosure action was pending, and while he was contesting the right of the plaintiff to foreclose and to charge him for any deficiency which might arise on the sale of the premises that the rents might be impounded and the fixed charges against the property paid therefrom, any balance, however, to abide the event of the action. The “event of the action” so far as he personally was concerned was his liability for the deficiency. That liability the court of last resort relieved him from. The language of the various stipulations does not warrant the interpretation that he agreed that any surplus of rents should be paid to the plaintiff in case the property did not bring enough at the sale to pay the amount due on the mortgages. The utmost that can be said to have been agreed by the stipulations was that, in case it was finally determined that he was personally liable for any deficiency, the surplus rents should be applied in satisfaction of that liability. He being the owner of the rents, and that event not having ultimately transpired, the money belongs to him, and it was erroneous to direct it to be paid to the plaintiff.

Some unpaid ground rent and some insurance appears to have fallen due before the day of sale. Whether all or some parts of these amounts should be deducted from the fund on deposit before payment of it to appellant we do not now decide, as those matters are not before us.

The order should be reversed, with $10 costs and disbursements, and the motion denied, with $10 costs. All concur.  