Stephen V. R. Watson, Appellant, v. The New York Central Railroad Company, Respondent

Stephen V. R. Watson, Appellant, v. The New York Central Railroad Company, Respondent. The lien of a judgment upon real estate is purely statutory, and it is within the power of the legislature to abolish this lien at any time before rights have become vested, or estates acquired under it, and to confine the remedies of the creditor to the property held by the judgment debtor at the time of the issuing of execution. A provision, therefore, causing the lien of a judgment which has not ripened into a title, to be superseded by the taking of the land under proceedings in the exercise of the right of eminent domain, on payment of compensation to the owner of the land, is valid. In proceedings for the condemnation of lands, under the provisions of the acts incorporating the B. and A. R. R. Go. (Laws of 1836, chap. 243, and of 1843, chap. 169), judgment creditors were not required to be made parties. They are in no sense “owners.” Upon the completion of the proceedings and payment of the compensation to the owner, the company acquired the right to the possession and use of the lands, free from all judgment liens. By the act of 1843, the vice-chancellor was substituted for the county judge, as the officer before whom the proceedings were to be had. (Argued November 15, 1871; decided January 16, 1872.) Appeal from judgment of the General Term of the Superior Court of Buffalo, affirming judgment of the Special Term in favor of defendant, entered on the decision of the court. This is an action of ejectment brought to recover the possession of a strip of land occupied by the defendant in the city of Buffalo. On the 18th day of November, 1841, Israel T. Hatch recovered a judgment against Elijah A. Bigelow, who is the common source of the title. On the 10th day of August, 1844, the sheriff sold the premises in question, under an execution issued to him on that judgment, and they were bid off by Rufus Watson, to whom the sheriff delivered his certificate of sale. On the 23d day of January, 1846, the sheriff executed and delivered a deed of the premises to Mr. Rufus Watson. On the 31st day of January, 1846. Rufus Watson conveyed the premises to the plaintiff. • The defendant claimed to have proven a paramount right to the possession of the premises in question, under the following evidence: The plaintiff and William X. Watson, on the 3d day of May, 1841, recovered a judgment against Elijah A. Bigelow. On this judgment an execution was issued.and returned nulla Iona before the 1st of September, 1841. On the 22d day of September, 1841, the plaintiffs in that judgment filed a creditor’s bill, in the late Court of Chancery, against Elijah A. Bigelow alone. On the 19th day of February, 1842, Elijah A,. Bigelow, pursuant to an order of the Court of Chancery, entered in the creditor’s suit, made an assignment of. all his property to William Watson as receiver. On the 22d day of August, 1842, Elijah A. Bigelow filed his petition in bankruptcy in the United States District Court for the northern district of New York, and was duly declared a bankrupt, and Benoni Thompson was appointed his assignee in bankruptcy. ■ On the 16th day of November, 1843, the Attica and Buffalo Railroad Company instituted proceedings, under its charter, by petition to the vice-chancellor of the eighth circuit, to take the .premises in question, and others, for the purposes of its incorporation. The receiver, William Watson, as such receiver, and Benoni Thompson, as such assignee, were named in the proceedings, but neither Mr. Bigelow nor the complainants, in the creditor’s suit, nor Mr. Hatch, were named in the proceedings, or notified of them. The final order was made in those proceedings on the 23d day of February, 1844. The Attica and Buffalo Railroad Company entered into the possession of the premises on the 23d day of February, 1844, under and by virtue of the proceedings aforesaid. The defendant succeeded to the rights of the Attica and Buffalo Railroad Company. The court at Special Term decided that the judgment recovered by Israel T. Hatch against Elijah A. Bigelow, having been docketed prior to the assignment by him to William Watson, as receiver, was a lien upon the lands in question, as against such receiver, or any person claiming under him, notwithstanding such judgment was recovered and docketed subsequently to the filing of the creditor’s bill. That the Attica and Buffalo Railroad Company, by its proceedings to acquire the land in question, became possessed of such land, during the continuance of its incorporation, for the purpose of its railroad, and that the plaintiff is possessed only of the reversion, and not to a present right of possession of such land. To the last part of this decision the plaintiff’s counsel excepted. The court also decided that it was not necessary, in order to take the land, free of the judgment creditor’s lien thereon, to make him a party to such proceedings; and that the effect of such proceedings was to confer a right of possession on the Attica and Buffalo Railroad Company, paramount to the lien of such judgment. The plaintiff’s counsel excepted to this decision. J. Ganson for appellant. Judgment liens are defects of title, and so recognized by the legislature and the courts in these proceedings. (Matter of N. Y. C. R. R. Co., 20 Barb., 419; Dows v. Congdon, 16 How. P. R., 571; Laws of 1847, chap. 272, § 3.) The term “ owner,” in these statutes, includes all having any legal or equitable private rights in the property taken. (Ellis v. Welch, 6 Mass., 246, 251; Parks v. Boston, 15 Pick., 198, 203; M. C. and B. Co. v. Townsend, 24 Barb., 658; Ex parte Jennings, 6 Cow., 518, 525, 526; Baltimore and Ohio Railroad v. Thompson, 10 Maryland, 76; Turnpike Road v. Brosi, 22 Penn., 29; Brown v. Powell, 25 Penn., 229; Enfield Toll Bridge Company v. Hartford, etc., Railroad Co., 17 Conn., 454.) The commissioners were not authorized to appraise damage or award compensation to any one save the owner. (Hill v. Mohawk and Hudson Railroad Company, 3 Seld., 152; Regina v. Metropolitan Comm. of Sewers, 18 Eng. Law & Eq., 213 ; Jones v. Reed, 1 John. Cases, 20; 4 Black. Com., 268; Rex v. Whitear, 3 Burr., 1366; Linder v. Plass, 28 N. Y., R., 465.) The award of the commissioners was an adjudication, and final. (S. V. R. Co. v. Moffatt, 1 California R., 577; Visscher v. The Hudson River Railroad Company, 15 Barb., 37; In the Matter of Mount Morris Square, 2 Hill, 14.) A statute conferring a right not vested by common-law, will not be so construed as to go beyond its letter. (Dewey v. Goodenough, 53 Barb., 54.) A.'P. Laming for respondent. By the filing of the creditor’s bill, plaintiffs therein acquired an equitable lien, and any lien or transfer thereafter was subject to it. (Corning v. White, 2 Paige, 567; Storm et al. v. Waddell, Assignee, etc.; De Kay v. Waddell et al., 2 Sandf. Ch., 494.) The conveyance to receiver vested him with title as of time of filing bill. (Chautauqua County Bank v. White, 2 Seld. [6 N. Y.], 236; Storm et al. v. Waddell, 2 Sandf. Ch., 494; Brown v. Nichols, Adm’r, 3 Hand, 26, 30, 43.) It is no objection that the order and assignment were in general terms, “ all the real estate.” (Roseboone v. Mesher, 2 Denio, 61, 67; Bayard v. Hoffman, 4 John. Ch., 450; Chaut. Co. Bank v. White, supra.) The lien of a judgment is statutory, and can be abrogated by statute. (Morse v. Gould, 11 N. Y., 281.) [MAJORITY — Rapallo, J.] Rapallo, J. It is found by the court below that the defendant has succeeded to the rights of the Buffalo and Attica Railroad Company in the land in dispute. If by the order of the vice-chancellor, made in February, 1844, the Buffalo and Attica Railroad Company acquired the right to the possession and use of the land during the continuance of its charter, for the purposes of its incorporation, the plaintiff could not maintain ejectment, and the defendant was entitled to judgment. The plaintiff claims that by the order of the vice-chancellor, the company obtained no rights which could be set up as against him, for the reason that his title was derived under a subsequent sheriff’s sale on execution upon a judgment, which was a lien upon the land at the time of the institution of the proceedings by the railroad company before the vice-chancellor, and that the judgment creditor in whose favor such lien then existed was not made a party to the proceedings. The court below held that the act under which the proceedings for condemnation of the land were instituted, did not require that judgment creditors be made parties thereto. (Laws of 1834, p. 228; 1836, p. 323; 1843, p. 226.) That under those acts the .proceedings were to be taken only against the owners of the land, and that compensation was to be made only to such owners. That a judgment creditor having a mere statutory lien was' in no sense an owner, and that the title of the railroad company, when acquired under the acts, became paramount to such lien. The provisions of the acts in question are fully referred to in the opinion delivered at General Term by Hasten, J., and we concur with the learned judge that they admit of no other construction than that the owners were the only necessary or proper parties to the proceeding. The general railroad laws of 1848 and 1850 provide for making parties all persons interested, as owner, tenant, lessee or encumbrancer. But no such provision was contained in the act of 1836, chap. 242, under which the Buffalo and Attica Railroad Company derived its powers, or in the act of 1834, chap. 177, referred to in the act of 1843, chap. 169. In those acts the only parties for whom notice or compensation are provided are the owners. • The terms “ owner or owners,” as used in these statutes, "being intended to designate the parties entitled to the compensation which is substituted for the land taken, should be held to embrace all persons having estates in the land, in possession, reversion or remainder. (Parks v. The City of Boston, 15 Pick., 198.) All persons having proprietary interests are entitled to compensation, for the aggregate of those interests constitute the ownership or fee. It has been frequently helthat tenants for years are owners within the meaning of similar statutes. (Turnpike Road v. Brosi, 22 Penn. State R., 29; Brown v. Powell, 25 id., 229; B. and O. R. R. v. Thompson, 10 Md., 76; Parks v. City of Boston, 15 Pick., 198.) Also that a franchise issuing out of the land may be regarded as real estate, for which the owner is entitled to compensation. (Enfield Bridge Co. v. Hartford and N. H. R. R. Co., 17 Conn., 454.) But a judgment creditor of an owner has no estate or proprietary interest in the land. He stands wholly upon the law, which gives him a remedy for the collection of his debt by a sale of the land under execution, in case sufficient personal property of the debtor should not be found. This remedy is not secured by contract, hut is purely statutory, and in aid of it acts have been passed, from time to time, authorizing a sale of the land which the debtor owned at the time of the recovery or docketing of the judgment, or at any subsequent period, and making the judgment a lien upon the land. The duration of this lien and the mode of its enforcement and discharge are subjects which appertain to the laws for the collection of debts; and the rules upon those subjects have been changed, from time to time, according to the will of the legislature. The power of the legislature to regulate those matters can not be doubted. Acts have been passed shortening and lengthening the duration of the liens of existing judgments, and even providing for their extinguishment without any proceeding to which the judgment creditor was a party. By the act of April 2d, 1813 (1 R. L., 500), it was provided that no judgment theretofore rendered should be a lien for more than ten years from April 9, 1811. By the act of April 3, 1821, the lien of judgments recovered between April 9, 1811, and April 2, 1813, was extended to ten years from the time of docketing; and the lien of judgments on which executions had been issued was further extended three months. By the act of May 14, 1840, the duration of the lien of all then existing judgments was reduced to five years from the time that act took effect. (Laws of 1840, chap. 386, § 32.) By the act in relation to the foreclosure of mortgages (Laws of 1840, chap. 342, § 9), it was provided that judgment creditors need not be made parties to foreclosure suits, and that the lien of their judgments should be cut off by the foreclosure though they were not parties. This act applied to existing as well as future judgments. By section 282 of the Code, the real estate of the debtor may be exempted from the lien of the judgment by being marked secured on appeal, and this provision, when originally adopted, applied to then existing judgments. It is clearly within the power of the legislature to abolish the lien of all judgments at any time before rights have become vested or estates acquired under them, and, placing real estate on the same footing as personal property, to confine the remedies of the creditor to the property held by the debtor at the time of issuing the execution. This would be no greater exercise of power than the abolition of the right of distress for rent, or of the lien of the landlord on property taken in execution, or of the right of imprisoning the debtor. Yet the validity of such laws has been fully recognized even where they affected existing claims or judgments. They do not take away property, or affect the obligation of contracts, but simply affect legal remedies. There can, therefore, be no doubt of the validity of a provision causing the lien of a judgment, not ripened into a title by a sale, to be superseded by the taking of the land under proceedings in exercise of the right of eminent-domain, on payment of compensation to the owner of the land. We think that the act of 1836 had that effect. It is claimed on the part of the appellant, that if the judgment creditor is not an owner, the act makes no provision for divesting his interest; and therefore the effect of the order of condemnation is to vest in the company the right to the land, subject to the lien of the judgment, in the same manner as if the company had taken by deed from the owners. But such a construction cannot be admitted. The object of the act was to delegate to the company the right of eminent domain, to the extent necessary to enable it effectually to secure its roadway, etc., in case it should fail to obtain it by contract with the owners. It provides for the appraisement, on notice to the owner or owners, of the value of the land taken, and of any further damages which the owners may sustain by the construction of the road, injury to buildings, etc. The whole amount of this appraisement is directed to be paid to the owners. There is no provision for assessing the value of the interest of the owners, subject to the lien of judgments, or for retaining any part of the value of the land as indemnity against such judgments. The whole value must be paid to the owners, or deposited in bank, and the owners are left to pay their own debts. The act then states what right the company shall obtain by virtue of such payment to the owners, and the order made thereupon. On the completion of the proceedings, the company is declared to be possessed of the land during its corporate existence, with the right to use the same for the purposes of the road. This declaration excludes the implication, that, after the owners have been compensated, the right of any other person to interfere with the possession or use of the land is reserved, or that, in order to retain such use, the company is bound to satisfy liens of judgment creditors, after having been compelled to pay the whole value of the land to the owner. What recourse the judgment creditor might obtain in .equity upon the proceeds paid to, or deposited to the credit ■of the owner, is a question not involved in this controversy; neither is it necessary to consider how the rights of mortgagees would be affected by the proceeding, or what protection they could obtain. The matter of the lien of judgments being wholly under the control of the Legislature, they had power to confer upon the company the right of possession and use of the land free from all such liens, on paying the value of the land to the owner; and we think it was manifestly their intention so to do, modifying to that extent the laws giving liens to judgment creditors. In the present case, this modification had been made before the judgment relied upon was recovered; but it is not necessary to rest our conclusion upon that ground. The act of 1847 (ch. 272, § 3) is referred to by the counsel for the appellant, as implying that an outstanding judgment affecting the interest of an owner who had been compensated, was recognized by the Legislature as a defect in the title. But no such inference can properly be drawn from the act of 1847. Its provisions afforded a remedy to the railroad company in cases where land, obtained by conveyance from an owner, was subject to liens under which title had subsequently been perfected, and the title of the company was thus rendered invalid, and also in cases where, in proceedings for condemnation, some owner had been omitted. The objection taken in the points, that the case does not show that the final order was recorded, was not taken at the trial. If taken, it might have been in the power of the defendant to furnish the proof. The ease does not show that the order was not recorded, and we have frequently held that we will not reverse a judgment on the ground of a mere omission of a finding or of proof of a fact, susceptible of proof, unless the point was taken at the trial. The only other objection raised to the validity of the proceedings is, that the orders subsequent to the appointment of the appraisers should have been made by the county judge, and not by the vice-chancellor. The act of 1836 directed that the application should be made to the county judge for the appointment of a jury of appraisers, and that on the filing of their inquisition, and proof of the payment of the amount, he should make a final order reciting the proceedings, which order should be recorded. It gave no power to the county judge to modify the appraisement. The act of 1843 provides that the act of 1836 be so altered that instead of a jury, three appraisers shall be appointed by the vice-chancellor, according to the provisions of the act of 1834, chapter 1 IT, section 16, and: that the damages may be increased or diminished by the vice-chancellor, as provided in that act. The act of 1843 is silent as to who shall make the final order. But it contains no provision indicating that a part of the proceedings shall be conducted before one officer and part before the other. It is very imperfect in its frame and language, and leaves much for construction. But it clearly required the first application to be made to the vice-chancellor, and required the submission to him of the proceedings of the appraisers, that he might confirm or modify their award as to damages; and we think it did not contemplate a subsequent proceeding before the county judge, or that an order should be made by him reciting proceedings not had before him, but before the vice-chancellor. Reading the three acts together, we think it was the intention of the act of 1843 to substitute the vice-chancellor for the county judge throughout the proceeding. Having come to the conclusion that, conceding the Hatch judgment to have been a lien at the time of the condemnation, it was cut off or superseded by the proceedings, and that no irregularity or invalidity in the proceedings is shown, a discussion of the question of adverse possession is not necessary, and the judgment must be affirmed, with costs. Church, Ch. J., Allen and Grover, JJ., concur; JFolger, J., dissents; Beckham, J., of kin to plaintiff, not voting. Judgment affirmed.