212 F. 1 | 3rd Cir. | 1914
Sweeney, the bankrupt, was a builder and seller of small houses in the city of Pittsburgh. As these
For several years after the notes were given, Sweeney paid the monthly installments until he had reduced the debt to $16,000. Meanwhile changes were taking place in the incumbrances and in the ownership of the mortgaged premises. Some of the second mortgage's were paid off, and others were substituted as collateral. In other instances the purchasers of the houses abandoned the attempt to pay the installments on the second mortgages and conveyed the legal title back to Sweeney (or sometimes to his wife); and in these instances leases were afterwards made by Sweeney and tenants went into possession thereunder. In the spring of 1912 Sweeney became financially - embarrassed and fell into arrears in payment upon the notes. He had always collected the installments on the-mortgages and the rents under the leases, and Bigham had never made these collections himself. But it was evident that both the installments and the rents were an important source of supply toward the monthly payments on the notes, and accordingly Bigham was insistent that they should be so applied. Quoting from his petition afterwards presented to the referee and now before us, he asserts that in consequence of his insistence Sweeney specially agreed to act as his agent, “to lease said premises, collect the rents thereof, account- monthly, and monthly pay over to petitioner and to petitioner’s account all the said rents collected by him”; these rents to be applied “on account of the sundry mortgages covering the several premises occupied by the said tenants, which said mortgages are included in the list of mortgages held by petitioner as collateral security, etc.” Sweeney denies the agency, and the referee makes no finding of fact on this subject.
But it appears without dispute that on July 20, 1912, Bigham, asserting the existence of such an agency, notified the tenants of its termination, and demanded that the rents should' thereafter be paid to himself. Two days later the petition in bankruptcy was filed, followed
The order of the District Court is affirmed.