Decided: January 25, 1972.
HENRY J. HURDY, PLAINTIFF-RESPONDENT,
MICHAEL A. RUSSO, JR., MICHAEL A. RUSSO, SR., AND FLORENCE RUSSO, HIS WIFE, DEFENDANTS-APPELLANTS
Collester, Mintz and Lynch.
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Plaintiff holds bonds which were secured by second mortgages on realty; defendants are obligors on the bonds (defendant Michael A. Russo, Jr. having been the actual mortgagor). After foreclosure of the first mortgage and purchase of the property by the first mortgagee at the sheriff's sale, plaintiff brought suit on his bonds and was granted a summary judgment below. Defendants appeal, contending that they should have been allowed (under N.J.S.A. 2A:50-3) to prove the fair market value of the property originally covered by the mortgages, and to deduct said value from the balance due plaintiff.
We find defendants' argument to be without merit. N.J.S.A. 2A:50-8, under which this case properly arises, does not contain the deduction provisions for market value contained in N.J.S.A. 2A:50-3. Where, as here, plaintiff's security is extinguished by the foreclosure of a prior mortgage, he cannot look to the collateral for satisfaction of his
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debt, simply because there is none. Summary judgment was properly granted. Court Investment Co. v. Spatola , 136 N.J.L. 519 (E. & A. 1947); Hillside National Bank v. Silverman , 116 N.J. Eq. 463 (Ch. 1934).