Mehlhop v. Central Union Trust Co.

Smith, J. (dissenting) :

I am unable to agree with the conclusion reached by the court that the judgment in the foreclosure estops the plaintiff from making this claim. In 15 Ruling Case Law, section 455, it is said: In order to bar a second action the circumstances of the first action must have been such that the plaintiff might have recovered for the same cause of action alleged in the second.” Under the principle stated in this rule if the plaintiff in this action were unable to recover upon this cause of action in the foreclosure action, he is not estopped by the adjudication of that action of the amount due upon the mortgage. This plaintiff’s defense in the foreclosure action was that the mortgage was not due by reason of an extension of time agreed upon between the parties upon the payment of $3,000 upon the mortgage. It is very clear that the claim here could not be asserted as a counterclaim in that action, nor could this plaintiff have appealed from the judgment in that action because he was not aggrieved by the judgment inasmuch as a lesser amount was found due upon the mortgage than he claimed to be due.

In Cauhape v. Parke, Davis & Co. (46 Hun, 306; affd., 121 N. Y. 152) upon the trial of an action brought by the plaintiff upon a contract alleged to have been made with the defendant, the only evidence offered by the plaintiff was the judgment roll in a prior suit between the same parties, wherein the referee had found that *9such a contract was made, but had refused to grant any relief, upon the ground that he had no jurisdiction to do so. It was there held, that the existence of this contract was not res adjudicata between the parties by reason of the finding in the previous action in such a sense as to render such former finding of fact binding upon the defendant in this suit, and that a judgment dismissing the complaint for a failure to prove the existence of the cause of action sued on should be affirmed.” Mr. Justice Bartlett, in writing for the General Term in this department in his opinion says: “ Before that finding could successfully be invoked against the defendants as a prior adjudication, we think it would have to appear that it constituted a decision, or the basis of a decision, from which the defendants could have appealed.”

If in a foreclosure this plaintiff, there defendant, had simply asserted that the amount due upon the mortgage was $3,000 more than is claimed by the plaintiff, judgment would have been ordered on such an answer as frivolous. The right of the plaintiff to recover back the $3,000 paid was not a material issue in that action, because no relief in this plaintiff’s favor could have been granted upon such an issue. In House v. Lockwood (137 N. Y. 269) the court said: Although a decree in express terms professes to affirm a particular fact, yet, if such fact were immaterial to the issue, and the controversy did not turn upon it, the decree will not conclude the parties in reference to such fact.” In Reynolds v. Ætna Life Ins. Co. (160 N. Y. 635, 652) the court said, in speaking of a former judgment: It is final only as to facts litigated and decided which relate to the issue, and the determination of which was necessary to the determination of that issue.” In Campbell v. Consalus (25 N. Y. 613) it appeared that Consalus on a former occasion had sued for cancellation of a mortgage on the ground that it had been paid. To ascertain whether his claim of payment was well founded, the referee before whom the action was tried had taken and stated an account between Consalus and the mortgagee, and had found that a balance of $2,754.88 remained still unpaid. Accordingly, judgment was rendered dismissing the complaint. Thereafter Campbell, who in the meantime had acquired the mortgage, brought foreclosure and relied upon the former judgment as an adjudication that $2,754.88 was due from Consalus. But the Court of Appeals held otherwise, and held that the judgment was only an estoppel as to the fact that there was some amount remaining unpaid upon the mortgage, but was not an estoppel as to the amount remaining unpaid, although the matter was contested and findings made stating the amount found due upon the mortgage.

In this case the question as to the purpose for which the money *10was paid was not material to the issue there determined. This plaintiff was not required in that action to insist that the plaintiff should recover more than he claimed in his complaint. This plaintiff was not liable upon the debt and was simply the owner of the equity upon which the mortgage was being foreclosed, and as to the issue here presented, that issue was not material to the issue raised by this plaintiff in that action as to whether the mortgage was then due, and the judgment, therefore, was not an estoppel against him. If the plaintiff in this action had there claimed a lesser amount due than was claimed by the plaintiff in that action, that issue would have been material. The claim of the plaintiff in this action that these moneys were not paid upon the mortgage and that a greater sum was due, did not raise a material issue.

The matter was submitted to the court for its decision and the court decided in favor of the plaintiff, and the judgment should be affirmed.

Judgment and order reversed, with costs, and complaint dismissed, with costs.