Rowley v. Feldman

Laughlin, J.: This matter has frequently been before the court, and the facts are fully stated in the published opinions. (Rowley v. Feldman, 66 App. Div. 463; S. C., 74 id. 492; affd., 173 N. Y. 607.) It is not necessary that we should more than state the proposition involved, and, briefly, the facts upon which its determination depends. The Special Term denied the motion to punish the respondent for contempt, upon the ground that the plaintiff may issue execution to recover the money which the respondent is required to pay by the order. — 402 — This.is a foreclosure action. The respondent purchased the property on the public sale by the referee, but he failed and' refused' to complete his purchase. The plaintiff then, upon proof of .the respondent’s default and notice to him, made an application to the court for an order that the property be resold and that the respondent be adjudged to pay the deficiency, if any, together with the extra costs and expenses. The respondent still failing to comply wi'th his bid, the court granted the motion. On the resale the property sold for considerably less than the respondent’s bid. The plaintiff entered a deficiency judgment, and, in order to reduce the respondent’s liability, if possible, issued execution thereon. Subsequently, upon the respondent’s neglecting to pay the deficiency judgment and extra costs and expenses, a motion was made to punish him for contempt. This motion was granted, but -upon appeal it was reversed upon the ground that the respondent was first entitled to be heard upon the amount of his liability. (66 App. Div. 463.) A formal application was then made to the Special Term to fix the amount of the respondent’s liability under the previous order directing á resale of the property and adjudging him liable for the deficiency and extra costs and expenses. The respondent appealed to this court from, the order made upon that motion fixing the amount of - his liability, and we modified it by striking out an item of seventeen dollars, auctioneer’s fees and exchange charges, by the terms of sale payable by the purchaser on the resale, and. thus reduced the liability of the respondent, and affirmed it as modified. (74 App. Div. 492.) On appeal the Court of Appeals affirmed the order as modified by this court. (173 N. Y. 607.) Pending the last-previous appeal to' this court the motion to punish the respondent was made. The order as modified by us has not been re-served. The respondent insists that he could only be punished under the order as modified. .The difficulty with that position is that it had. . not been modified at the time the application to punish him was made and denied.. Of course, after the order was modified, the plaintiff could not proceed on the original order. Two adjudications against the respondent have become final and beyond, review :■ .First. The order directing that upon a resale of the property, necessitated through his refusal to complete his bid, he shall be liable for the deficiency 'and extra costs and expenses; and, second-, the — 403 — order fixing the amount of that liability and directing him to pay the same to the referee. The latter order was slightly modified upon appeal, as has been seen, but it was in all other respects sustained. Even with respect to the part concerning which it was modified it was not invalid, but, at most, deemed erroneous by the appellate court. The respondent made no offer to comply with the order in whole or in part. Until it was modified or reversed it was his duty to obey; consequently, the subsequent modification is no defense. The learned justice at Special Term denied the motion upon the authority of Leslie v. Saratoga Brewing Co. (33 Misc. Rep. 118). There is but little, if any, difference between this case and that. The learned justice who there wrote the opinion held that an execution coiild be based on such an order, or upon a judgment entered thereon, and the order or judgment enforced by execution, and that, consequently, the order could not be enforced by contempt proceedings. It appears to us that proceedings by execution for the enforcement of an order directing the payment of money, or by execution upon judgment to be entered thereon, do not apply to this order. Here, it will be observed, the money is directed to be paid to the referee, not to the plaintiff. The plaintiff could not issue execution. If issued at all it would have to be issued by or in the name, of the referee. That would not only be an unusual but an extraordinary proceeding, which we think was not contemplated. Section 1240 of the Code of Civil Procedure, which provides for the enforcement of final judgment by execution, is in terms only applicable to a judgment in favor of one party against the other; but even if the referee would be a party within the meaning of this provision, yet, under subdivision 4 of section 1241, the judgment could be enforced by contempt proceedings, since it would require “ the payment of money into court, or to an officer of the court.” Judgments for money due upon contracts,, express or implied, or as damages for non-performance of contracts, are expressly excepted from this provision ; but the respondent’s bid is not a contract with the plaintiff or with the other parties to the action, or, strictly speaking, a contract at all. No action can be maintained for its breach. (Miller v. Collyer, 36 Barb. 250.) It was a mere offer to or undertaking with the court through the referee, and the failure-to perform is a — 404 — breach of duty to the court which the court alone can redress or punish. It would, therefore, seem that even if the order may be treated as a judgment, it may be enforced by contempt proceedings. . But however this may be, the respondent is directed by the order to pay a specific sum of money to a referee named, and the validity of that order has been adjudicated and established. It is not material or necessary to determine whether an .execution would issue to enforce the order, for by section 779 of the Code of Civil Procedure, which authorizes the issue Of an execution upon an order, it is expressly provided that “ nothing, herein contained shall be so construed as to relieve a party or person from punishment as for contempt of court for. disobedience to an order in any case when the remedy of enforcement by such proceedings now exist.” Section 14 of the Code of Civil Procedure provides that “ a court of record has ¡lower to punish, by fine and imprisonment, or either, a neglect or violation of duty, or other misconduct, by which a right or remedy of a party to a civil action or special proceeding, pending in the court may be defeated, impaired, impeded or prejudiced, in either Of the following cases: * * * 8. In any other case, where an attach•ment or' any other proceeding to punish for a contempt, has been usually adopted and practiced in a court of record, to enforce a civil remedy of a party to an action- or special proceeding in that court or - to protect the right of- a party.” Courts of chancery and equity have’from-,time immemorial punished by contempt proceedings parties bidding -on judicial sales and failing to complete their purchase, upon' the ground that by bidding they subject themselves to the jurisdiction of the court and in effect become parties to the proceeding. (Requa v. Rea, 2 Paige, 341; Lansdown v. Elderton, 14 Ves. Jr. 512 ; Executors of Brasher v. Cortlandt, 2 Johns. Ch. 505 ; Cazet v. Hubbell, 36 N. Y. 677; Archer v. Archer, 155 id. 415; Andrews v. O'Mahoney, 112 id. 567; Stokes v. Hoffman House, 167 id. 554.) Where a purchaser fails to complete his purchase, it is a - matter of judicial discretion whether to compel him to perform his bid by contempt proceedings, or to direct a resale upon notice to him, and hold him liable for the deficiency, with interest and costs. (Graham v. Bleakie, 2 Daly, 55, 60; Burton v. Linn, 21 App. Div. 609; Camden v. Mayhew, 129 U. S. 73.) If the resale had not been directed, there could be no question but that the court — 405 — could have compelled the respondent to complete his bid by fining or imprisoning him, or both. His failure to complete would have-been the basis of the contempt proceedings then, and it is the basis of the contempt proceedings now. He had every opportunity to complete his bid, and he cannot be heard to say that he is prejudiced by a resale being directed, instead of proceedings having been taken against him for contempt at that time. He claimed to be without means. A resale was for his benefit and advantage; it reduced his liability. He thus had an opportunity to induce others to bid and he had the further benefit of an effort on the part of the plaintiff to enforce payment against the persons liable on the mortgage for the deficiency. We fail to see how his original contempt has been in any manner waived by the subsequent proceedings. If proceeding to a resale, after a defaulting purchaser has had notice and an opportunity to be heard, constitutes a waiver of the contempt of which he has been guilty, then the courts are powerless to protect suitors. If the bidder should be irresponsible and the plain-tiff should institute contempt proceedings without a resale, the. imprisonment of the bidder would not satisfy the indebtedness for which the property was to be sold. If the defaulting purchaser' were confined for the contempt, this would require that the referee remain ready to convey title to him upon performance. (Code Civ.. Proc. § 2285.) The payment of this indebtedness would thus be delayed indefinitely unless a resale should be decreed. We see no reason or justice in construing an order or decree for a resale as a waiver of the contempt. There is no difference in principle between enforcing the payment of this deficiency by contempt proceedings and enforcing complete performance of the bid originally. (Camden v. Mayhew, supra, 85.) An execution will issue under section 779 of the Code of Civil Procedure to enforce an order directing the restitution of money paid out of court on a judgment subsequently reversed on an appeal, but this is not the exclusive remedy; and since it directs the payment of money into court it is not a final judgment enforcible by execution under section 1240 and subdivision 4 of section 1241, and in any event it is well settled that the court in such case is authorized to enforce the order by contempt proceedings as well as by execution. (Devlin v. Hinman, 40 App. Div. 101; 161 N. Y. — 406 — 115 ; Newell v. Hall, 74 App. Div. 278.) These authorities are quite analogous and tend to sustain the the views already expressed. It is essential that the court should have this authority. Those bidding upon judicial sales must be prepared to perform, for otherwise their act is an unwarranted interference with judicial proceedings. It is for the interest of bidders that a resale may be.directed without first resorting to contempt proceedings against .them. The statutory provisions are susceptible of a construction that will permit this practice and the precedents do not prevent its adoption. It follows, therefore, that the order should be reversed, with ten dollars costs and disbursements, and the motion granted," with ten dob lars costs, and the respondent adjudged guilty of contempt and fined the amount of his liability under said order, less the amount stricken therefrom on the former appeal, and interest and costs of the motion,, but not of the appeal; and that a formal order in the usual form as required by the Code, adjudging the contempt and directing his commitment therefor, be entered. Pattebson, O’Bbien, Ingbaham and McLaughlin, JJ., concurred. Order reversed, with ten dollars costs and disbursements, and motion granted as stated in opinion, with ten dollars costs. ;