Berliner v. Kuttnerr

85 Misc. 461, 147 N.Y.S. 308

• Court: Appellate Terms of the Supreme Court of New York
• Decided: May 15, 1914
• Status: Published

Opinion

Blackmar, J.

We gather from the meager record that this action was brought by plaintiff, as receiver in supplementary proceedings, to recover from the defendant damages for the conversion of chattels taken by the defendant from the judgment-debtor under a chattel mortgage which was fraudulent and void as to creditors. The judgment was for plaintiff, and from the judgment and an order denying a motion to set aside the verdict and for a new trial defendant appeals.

Such an action cannot be maintained. A receiver in supplementary proceedings takes title to the personal property of the judgment-debtor as of the time of filing the order appointing him. Code Civ. Pro., § 2468. By virtue of plaintiff’s appointment, he obtained no greater or other title than the judgment-debtor then had. But the chattel mortgage was valid as against the mortgagor and void only as to creditors. It follows that no title to the chattels passed to the receiver from the judgment-debtor, who was the mortgagor, for as against him the mortgage was good. As the defendant took the chattels under a mortgage valid as to the mortgagor, the mortgagor could not maintain an action for conversion, nor could a receiver derive a right to maintain such action from a judgment-debtor who did not possess it.

A fraudulent chattel mortgage is void as against creditors of the mortgagor (Pers. Prop. Law, § 35), and a receiver in supplementary proceedings, in addition to the property of the judgment-debtor, takes such rights as the creditor at whose suit he was appointed has. As to such creditor, chattels fraudulently, conveyed still remain the property of the judgment-debtor; but a judgment-creditor has no title to the property of the judgment-debtor. He has a right only to the satisfaction of his judgment from such property, which he may secure by execution. If, therefore, the mortgage is void as to the creditor, his only remedy is in his execution, or he may appeal to a court of equity to clear away the obstruction of fraudulent conveyances. A judgment-creditor cannot sue for con-' version of the property of a judgment-debtor, neither can he confer that right on a receiver in supplementary proceedings.

As the receiver does not obtain the right to maintain such action from either the judgment-creditor or judgment-debtor, no more is it conferred on him by chapter 314' of the Laws of 1858, now section 19 of the Personal Property Law. The word “ receiver ” in that law does not include a receiver in supplementary proceedings. Under the doctrine noscitur a sociis, the “ receivers ” mentioned in that act are those who represent not only the judgment-debtor, but all creditors sharing equally; but a receiver in supplementary proceedings represents only the -judgment-debtor and the creditor at whose suit he is appointed. He does not represent other creditors.

The conclusion is that a receiver in supplementary proceedings cannot maintain an action for the conversion of chattels conveyed by the judgment-debtor to the defendant with intent to defraud his creditors. Stephens v. Meriden Britannia Co., 160 N. Y. 175.

The judgment is reversed and the complaint dismissed on the -merits, with appropriate costs in the court below and costs of the appeal to the appellant.

Maddox and Kelby, JJ., concur.

Judgment reversed, with costs.