Paterno v. Eagar

Per Curiam. Defendant purchased real estate in New Jersey from plaintiff’s assignor, giving.a bond and mortgage on the property. The mortgage was foreclosed in a proceeding in the State of New Jersey in which defendant, a resident of the State of New York, was not served and did not appear. The foreclosure proceeding resulted in a deficiency. No personal judgment on the bond for the deficiency was or could.be obtained against the defendant in the foreclosure proceeding in New Jersey. The plaintiff, therefore, brought this action in New York, on the basis of personal service, to recover on the bond the amount of the deficiency. [179] A majority of the Appellate Term held that the action is not an action to recover on the bond but seeks to obtain a deficiency judgment based upon a foreclosure action in New Jersey without personal service upon the defendant. We hold that the action is upon the bond. While the complaint, in unnecessary detail, refers to the foreclosure proceeding and the resulting deficiency, and seeks judgment for the amount of that deficiency, the action is nevertheless basically upon the bond. The amount of the deficiency may be relevant to the measure of recovery, but the obligation of the defendant upon which the action is brought is the bond. The plaintiff is, therefore, entitled to a trial to prove the extent of defendant’s remaining liability on the bond, after the defendant is given all allowable credits, including the amount of plaintiff’s recovery in the foreclosure proceeding. Accordingly, the determination of the Appellate Term should be reversed, with $20 costs and disbursements to the plaintiff in this court, and $10 costs and disbursements in the Appellate Term, and the order of the Gity Court denying defendant’s motion for summary judgment affirmed. Dore, Cohn, Wasservogel and Peck, JJ., concur; Martin, P. J., dissents and votes to affirm the determination of the Appellate Term. Determination reversed, with $20 costs and disbursements to the plaintiff in this court, and $10 costs and disbursements in the Appellate Term, and the order of the City Court affirmed. [See post, p. 753.]