In *824an action to foreclose a lien on a public improvement fund, order denying the appellants’ motion to set aside the report of the official referee and to dismiss the cross-counterclaim of the village of Larchmont modified so as to sustain the cross-counterclaim of the village of Larchmont to the extent of the amount of the appellants’ claim against the public improvement fund in question, under its assignment. As so modified, the order is affirmed, with ten dollars costs and disbursements to respondent. This lien action is an equitable action and in our opinion the village of Larchmont may not counterclaim the entire amount of its deposit with the appellant bank. Since, however, this deposit includes the public improvement fund involved in this action, the village is entitled to set-ofl, by way of counterclaim, so much of said deposit as may be sufficient to extinguish the claim of the bank under its assignment against the public improvement fund in question. Lazansky, P. J., Young, Hagarty, Carswell and Davis, JJ., concur.