Steneck Trust Co. v. Engler

New Jersey Court of Chancery

Steneck Trust Co. v. Engler

161 A. 818, 111 N.J. Eq. 210

DecidedAugust 5, 1932

StatusPublished

This text of 161 A. 818 (Steneck Trust Co. v. Engler) is published on Counsel Stack Legal Research, covering New Jersey Court of Chancery primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook

Steneck Trust Co. v. Engler, 161 A. 818, 111 N.J. Eq. 210 (N.J. Ct. App. 1932).

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Opinion

This is a suit to foreclose a mortgage for $13,000 which was made by defendants William E. Engler and wife to Steneck Trust Company, one of the complainants. Undivided interests in this mortgage were assigned to various persons under so-called mortgage participating certificates. Paul A. Marimaldi is the holder of one of these certificates in the amount of $12,000. The certificate gave to the trust company the right to enforce the mortgage. The certificate contemplated the appointment of a trustee for the benefit of the holders of certificates, but no such trustee was ever designated.

A default occurred on the mortgage, and this suit was instituted. In the meantime the trust company had come into the hands of the commissioner of banking and insurance for its liquidation. The trust company, the commissioner and the holders of participation certificates, including Marimaldi, were named as complainants in the bill. Marimaldi now asks that his name be stricken out as a complainant and added as a defendant. He asserts that his rights are or may be adverse to that of the trust company and the commissioner, and for that reason he is unwilling to allow them to conduct the suit on his behalf.

It would seem that the trust company is in the position of a trustee, and that Marimaldi as a beneficiary is a proper party complainant. Tyson v. Applegate, 40 N.J. Eq. 305. Marimaldi does not oppose the foreclosure, but is apprehensive lest his rights may be prejudiced regarding the disposition of the proceeds. There does not seem to be much substance to this fear, since it is common practice for this court to adjudicate the rights by the complainants.

However, I do not see how Marimaldi, without his consent, can be compelled to join in the bill as complainant. The refusal of a person to join as a party complainant is well recognized, and provision for this contingency is expressly made in the rules of this court. Rule 5 reads as follows:

"5. All persons claiming an interest in the subject of the action and in obtaining the relief demanded, either jointly, severally, or in the *Page 212 alternative, may join as complainants, except as otherwise herein provided.

A person entitled to join as complainant, but declining to do so, may be joined as defendant, the reason therefor being stated in the bill of complaint."

An order will be advised for the relief applied for.

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This is a suit to foreclose a mortgage for $13,000 which was made by defendants William E. Engler and wife to Steneck Trust Company, one of the complainants. Undivided interests in this mortgage were assigned to various persons under so-called mortgage participating certificates. Paul A. Marimaldi is the holder of one of these certificates in the amount of $12,000. The certificate gave to the trust company the right to enforce the mortgage. The certificate contemplated the appointment of a trustee for the benefit of the holders of certificates, but no such trustee was ever designated.

A default occurred on the mortgage, and this suit was instituted. In the meantime the trust company had come into the hands of the commissioner of banking and insurance for its liquidation. The trust company, the commissioner and the holders of participation certificates, including Marimaldi, were named as complainants in the bill. Marimaldi now asks that his name be stricken out as a complainant and added as a defendant. He asserts that his rights are or may be adverse to that of the trust company and the commissioner, and for that reason he is unwilling to allow them to conduct the suit on his behalf.