PITMAN TITLE TRUST CO. v. BATEMAN, 119 N.J. Eq. 595 (1936)

183 A. 479

PITMAN TITLE AND TRUST COMPANY, trustee, complainant-respondent, v. STEPHEN ROSCOE BATEMAN et al., defendants-appellants.

Court of Errors and Appeals.
Decided January 31st, 1936.

1. The defense of usury must be timely and strictly pleaded.

2. Defendant filed a petition for an order to vacate the final decree and fieri facias in this foreclosure proceeding, averring, inter alia, that he was obliged by complainant to assign to it the operating rights to an amusement park for a certain season, for which he has not been given a proper credit Held, unless the parties can agree on the amount of credit to be allowed the petitioner, an order will be made permitting the filing of an answer upon petitioner paying the fees of the special master whom the court directed to sell the mortgaged premises, as well as the advertising expenses already incurred by him.

3. Petition by certain banks asking that the final decree be vacated and they be permitted to appear as parties and make claim against complainant for payment of certain notes held by them which they claim is secured by a junior mortgage covering the premises, dismissed on the ground that the claim of the petitioners to an equitable interest in the mortgage is without foundation.

4. The fact that counsel who signed the bill of complaint made the master’s report on which the final decree is based, criticised.

On appeal from an order of the court of chancery advised by Vice-Chancellor Davis, who delivered the following opinion:

“The foreclosure herein proceeded, ex parte, to a final decree and fieri facias, the latter directed to a special master of this court to sell the mortgaged premises which lay in two counties. The special master advertised the properties for sale at an expense of approximately $500, and at that point a petition was filed by defendant Bateman, owner, for an order vacating the final decree and fieri facias and permitting him to file an answer. Bateman avers that he was obliged by complainant

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to pay nine per cent. interest on the mortgage loan for several years and that he was also obliged to keep on deposit with complainant for several years the sum of $12,500 without access to or use of said sum, in other words he charges complainant with usury to the extent of $4,800. The petition, however, is not based wholly on this ground; if it were, the application would be denied, since such a defense must be timely and strictly pleaded. Nevertheless, the relief sought by this portion of the petition is substantially accomplished by the voluntary offer of complainant to credit on the amount of the decree the sum of $4,334.21. But petitioner also avers that he assigned to complainant the operating rights to an amusement park for the season of 1934 for which he says he has not been given a proper credit. For this reason I am inclined to believe that he is entitled to put in an answer, on terms, however, in order that complainant may be obliged to render an accounting of the park operations; unless the parties can agree on the amount of credit which should be allowed the petitioner on this account, an order will be made permitting the filing of an answer upon the payment by petitioner of the fees of the special master and the advertising expenses already incurred by him.

“There is also filed with me a petition on behalf of three banks, represented by Mr. Bateman’s solicitor, to which petition Mr. Bateman makes an affidavit of general verification only, asking that the final decree be vacated and that they be permitted to appear as parties and make claim against complainant for payment of promissory notes held by them which they claim are secured by a junior mortgage covering the premises described in the bill (and other land) executed by Bateman to one Joyce and assigned by Joyce to complainant. The claim of the petitioning banks to an equitable interest in that mortgage seems to me to be without the slightest foundation; so far as appears before me neither the bond and mortgage, nor the agreement executed by Bateman and Joyce when the mortgage was executed refer in any way to the creation of any lien or interest in favor of the banks, nor has any deponent made any specific statement in support of such a

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claim; on the contrary, however, Mr. Joyce denies categorically that such a scheme or plan was contemplated by anyone at any time. That petition is therefore dismissed.

“Another matter which has been brought to the attention of the court is the fact that the master’s report on which the final decree is based, was made by the counsel who signed the bill of complaint. This, of course, should not be. If petitioner, Bateman, elects to file an answer on the terms herein suggested, the master’s report becomes a nullity; on the other hand, if the parties agree upon the amount for which the property shall be sold, or redeemed by Bateman, then there will be no need for considering further the matter of the master’s report.”

Mr. Oscar B. Redrow, for the appellants.

Mr. S. Rusling Leap and Mr. Joseph R. Applebaum, for the respondent.

PER CURIAM.

The order appealed from will be affirmed, for the reasons stated in the opinion delivered by Vice-Chancellor Davis in the court of chancery.

For affirmance — THE CHIEF-JUSTICE, CASE, BODINE, HEHER, PERSKIE, HETFIELD, DEAR, WELLS, WOLFSKEIL, RAFFERTY, JJ. 10.

For reversal — None.

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