Steckler v. Fabrikant

In an action to foreclose a chattel mortgage, the appeal is from an order which grants respondent’s motion for summary judgment and denies appellant’s cross motion for similar relief. Order modified by striking from the first ordering paragraph the word “granted” and by substituting therefor the word “denied”, and by striking from said order everything following the word “ denied ” in the second ordering paragraph. As so modified, order unanimously affirmed, without costs. The record sufficiently establishes that appellant’s mortgage, not having been filed in New York County where the mortgaged property was situated, was void as against creditors of the mortgagor (Lien Law, §§ 230, 232). It does not conclusively appear, however, whether respondent’s status is now that of a creditor, armed with a judgment and legal process authorizing seizure of the property, and thus in a position to question appellant’s mortgage (cf. Button v. Rathbone, Sard & Co., 126 N. Y. 187; Sanford v. Boland, 287 N. Y. 431, 436) or whether his status is merely that of a subsequent mortgagee, whose mortgage was given for a past consideration, and whose rights as a creditor were surrendered and merged in his mortgage. If he occupies the latter status, he is not a subsequent mortgagee in good faith and for a fair consideration within the meaning of section 230 of the Lien Law. (Thompson v. Van Vechten, 27 N. Y. 568, 581; Button v. Rathbone, Sard & Co., supra; Diana Paper Co. v. Wheeler-Green Elec. Co., 228 App. Div. 577, 579.) The issues may be more adequately developed and determined on a trial. Present — Nolan, P. J., Beldoek, Murphy, Ughetta and Hallinan, JJ.