Sebring v. Quinn

Rodenbeck, J. The second defense of the defendant raises the question of res adjudicate/, and the third defense interposes the plea of another action pending. The doctrine of res adjudicata and the plea of another action pending are not available where the same issues are not involved in the two proceedings although it may require a reexamination and readjudication upon some features of the questions involved. Dawley v. Brown, 79 N. Y. 390. The surrogate had no power to pass upon the priority of the creditors’ and plaintiff’s liens. The plaintiff’s lien was created after the death of the decedent and was not a creditors’ lien which the surrogate had the power to pass upon. If the deeds to Hassan and the Hamiltons were voidable so that the title passed to the heirs of the decedent when the deeds were set aside, the surrogate was without jurisdiction as creditors ’ liens attach only to property of which the decedent died seized. If the deeds were void because Phelps was of unsound mind and not competent to [633] execute and deliver the deeds, he died seized of the property and the lien- of the creditors would attach unless priority is to be given the lien of the plaintiff and his associates for establishing the funds against which the lien of the creditors is asserted. The judgment in the action to set aside the deeds is that they were fraudulently obtained while the decedent was of unsound mind and not competent to make them. If the deeds were void at their inception the title never passed out of the decedent and he died seized of the property. If they were merely voidable Hassan and the Hamiltons held the title until the deeds were set aside and the decedent was not seized of the property at the time of his death and in that case the creditors had no lien and the surrogate no jurisdiction. His decision therefore was not an adjudication upon the question of the priority of the liens which is involved in this action. The third defense interposes the plea of another action pending. The Supreme Court in the special proceedings had authority to pass only upon the lien of the plaintiff and his associates and had no power to pass upon the priority of the liens of the judgment creditors of the decedent and of plaintiff and his associates. The order in the special proceedings did not even undertake to pass upon the lien of the plaintiff and his associates but postponed it until after the final accounting in the Surrogate’s Court. If the plaintiff and his associates wait until after the distribution of the estate the funds to which their lien might attach will be partly distributed and under this ruling the lien of an attorney may be entirely defeated, where the creditors’ liens exceed the amount of the fund, although he creates the fund. The special proceeding is therefore not a proceeding pending in which the plaintiff can determine the question involved in this [634] action as to the priority of his lien and that of the judgment creditors. The plaintiff is entitled to an order sustaining the demurrer to the second, third and fourth defenses, with leave to the defendant to amend within twenty days from the service of an order in accordance herewith. Ordered accordingly.