Ursula A. Ryan, Respondent, v. Elizabeth E. Benjamin, Individually and as Administratrix, etc., of Elijah H. Benjamin, Deceased, Appellant, Impleaded with Laura Rood and Others Defendants.
Third Department,
September 17, 1908.
Stay — proceeding to sell real estate to pay decedent’s debts and action for partition simultaneously pending — when neither proceeding nor action should be stayed.
The plaintiff as heir brought action to partition lands of her ancestor, embracing iu that action lands confessedly owned by the ancestor and also lands which he had conveyed by a deed placed in escrow and delivered at his death. The grantee, under said deed defended, asserting title and alleging that the personal property was insufficient to pay the decedent’s debts, on which defenses the plaintiff took issue by reply. A proceeding instituted by the defendant as creditor was also pending in the Surrogate’s Court brought for the purpose of selling the decedent’s real estate to pay his debts because of the insufficiency of the personal property.
On motions made by the respective parties to-stay the partition and the proceedings in the Surrogate’s Court,
Held, that the proceedings in the Surrogate’s Court should not be stayed pending the determination of the action for partition, for in the latter the issue as to the deficiency of assets pending in the Surrogate’s Court was wholly irrelevant, for the proceeds of the partition sale must be deposited with the county treasurer to await the issue of the proceeding before the surrogate, and in any event such issue could not be raised by an heir, having no interest in the payment of the debts of the ancestor.
Held, further, that the action for partition should not be stayed in order to protect the real estate of the decedent from costs in case of the defendant’s success, because the costs of such action being in the discretion of the court, the proceeds of the sale of property left by the decedent could be deposited with the county treasurer unimpaired by costs under section 1588 of the Code, thus protecting the creditors of the estate.
Kellogg, J., dissented.
Appeal by the defendant, Elizabeth E. Benjamin, as administratrix, etc., from an order of the Supreme Court, made at the Cortland Special Term and entered in the office of the clerk of the county of Cortland on the 5th day of March, 1901, denying defendant’s motion to stay all proceedings in this action, and granting plain till:’s motion to stay a proceeding instituted in the Surrogate’s Court of Chenango county to sell certain real estate of defendants intestate for the payment of his debts.
*52Upon the 24th of February, 1906,. Elijah H. Benjamin died. At his death he was the owner of certain Personal property, which was. appraised at $162 over and above the statutory exemption, and of two pieces of real estate of the value of about $300. Some three years prior to his death he had executed a deed to the defendant ' Benjamin, which was delivered in escrow to Laura Bood, to be delivered to the defendant in case the said decedent died before the said defendant. After the'death of .the said Elijah Benjamin the deed was delivered to the defendant Benjamin and was duly recorded. The papers show that the indebtedness of the estate' amounts to about $650. Elijah Benjamin left him surviving his widow, Elizabeth Benjamin, who was appointed administratrix of the estate, and two daughters, one Ursula A. Ryan, this plaintiff, and another, Laura Rood, one of the defendants.
Upon the 29th of May, 1906, this action was brought by Ursula A. Byan against the defendant Benjamin and others, to partition the real estate of the decedent. That action sought to partition both the real estate that was confessedly the real estate of the decedent at his death, and also the real estate, a deed of which had been executed to the defendant prior to the death of the decedent. In that action the defendant Benjamin appeared and asserted her title to the property included in the deeds aforesaid, arid also alleged that the personal property was not sufficient to pay the debts. The plaintiff answered, denying the title of the defendant in the said property, and also alleging that the personal property was sufficient to pay the debts.
Two motions were then made — one by the defendant to stay-the proceedings in this action until the determination of the proceeding in Surrogate’s Court; another by the plaintiff to stay the defendant fi’om proceeding in Surrogate’s Court- until the hearing and-determination of- this action. These motions were argued together, and resulted in one order, "which denied the defendant’s motion to stay the plaintiff’s proceeding and granted the plaintiff’s motion to stay the defendant’s proceeding before the surrogate of Chenango county until the hearing and determination of this action. From that order the defendant Benjamin lias here appealed.
H. D. Preston [Rowland L. Davis of counsel], for the appellant.
W. E. Burdick [M. H. Kiley of counsel], for the respondent.
*53Smith, P. J.:
The learned justice at Special Term has granted the plaintiff’s motion to stay the proceeding in Surrogate’s Court on the ground that the issues presented in that proceeding could all he disposed of in the trial 'of this action, and as this action was first brought, such issue should be there tried and determined. We cannot agree with this conclusion. The main issue presented in the proceeding in Surrogate’s Court is as to the deficiency of personal assets to pay the decedent’s 'debts. This issue is wholly irrelevant to the partition action, inasmuch as the proceeds of the sale must be deposited with the treasurer of the county to await the issue of the proceeding in Surrogate’s Court. (Code Civ. Proc. § 1538.) The fact that the defendant has alleged the insufficiency of personal assets, and that has been denied by the plaintiff in her reply, does not make relevant an otherwise irrelevant issue. Mor is there any issue in that proceeding as to whether decedent died seized of the real estate, claimed by the defendant Benjamin. The requirement of the Code of Civil Procedure (§§ 2749, 2752) that the petition in that proceeding must describe all of the property owned by decedent at his death is mainly for the purpose of enabling the surrogate to determine what parcels shall be first sold. It may be that a creditor could raise the issue that decedent owned other real property at his death, if the property sought to be sold were insufficient to pay the debts. But such an issue could not be raised by an heir who has no legal interest that the debts of the intestate be paid, or no right to have such other property'first sold. Mo decree, therefore, in that proceeding could bind plaintiff in this action as to the ownership of the real property in dispute.
Defendant Benjamin shows more reason in her application for a stay in this action. Her position is that this partition action will be contested and a large bill of costs incurred, which, if defendant succeeds, will be charged upon the two small pieces of real estate that were concededly owned by decedent, at his death; that such costs will consume the value of this real estate, and that nothing will be left to the creditors, who are entitled to this real estate for the payment of their debts before the litigants for the payment of their costs. This contention seems to us reasonable and just. If the plaintiff would contest with the defendant Benjamin the title to *54the property claimed to have been deeded by the decedent, there is no equitable reason why their costs of such a contest should come out of real estate which ought more equitably to be applied to the payment of the decedent’s debts. To work out the equity of the creditors, however, it. is not neqessary to stay plaintiff’s action. The costs of this action of partition are in the discretion of the court, and the trial court- may require that the proceeds of these two small pieces of property be deposited with the treasurer of the county, under section 1538 of the Code, unimpaired by the costs of the litigants in this action. Such a provision in the judgment of partition would give full protection to the creditors of .the estate. The order should, therefore, he modified by striking therefrom the provision for a stay of the proceedings in the Chenango County Surrogate’s Court, and as modified should be affirmed, with ten dollars costs and disbursements to the appellant as against the plaintiff.
All concurred, except Kellogg, ' J., dissenting on ground that this action should be stayed.
Order modified as stated in. opinion, and as so modified affirmed, with ten dollars costs and disbursements to the appellant as against the- plaintiff.