1 Paige Ch. 618 | New York Court of Chancery | 1829
The Chancellor :—The assignment of the land contract in this case was given for the security of a debt and was therefore a mortgage. There does not appear to have been any agreement to receive it in full satisfaction of the debt at any time; and there can be no doubt of the right of the complainant to redeem. The assignment by way of mortgage in this case being of an interest in real estate, must be governed by the rules which are applicable to a mortgage of the legal estate. It is a mortgage of an equitable interest in the land mentioned in the contract. This court has jurisdiction in such a case to decree a redemption. Although there was probably in this case sufficient to put the other defendant on inquiry, if he did not actually know that this assignment was nothing but a mortgage, so as to authorize the complainant to claim a redemption against him, the circuit judge has thought otherwise and considered him a bona fide purchaser * without notice. There is no appeal from that part of the decree, and it cannot therefore be reviewed here. In such cases the equity of redemption instead of remaining an incumbrance on the land in the hands of the bona fide purchaser, attaches upon the money received by the mortgagee on the sale; (Whittick v. Kane, 1 Paige’s Rep. 202.) The decree in this case was therefore right in directing the payment of the balance received by the mortgagee on the sale of the land, over and above his debt, if the land could not be redeemed.
But the appellant contends that the equity court has erred in awarding costs against him on his bill for a redemption of the mortgage. As a general rule the complainant pays costs to the defendant on a bill to redeem, although he ultimately succeeds in obtaining the relief prayed for; but if he has been guilty of improper conduct, he will be deprived of his costs, and in some cases may even be compelled to pay costs; (Ditillin v. Gale, 7 Ves. 583; Morony v. O'Dea, 1 Ball & Beatty, 121, note.) If the mortgagor in this case had applied to Brockway for the surplus raised on the sale, over and above the amount due on this mortgage, and the latter had refused to account with him for it, I should have thought this decree right in not only refusing costs to the mortgagee, but also in charging him with the costs of the litigation; (Slee v. The Manhattan Company, 1 Paige’s Rep. 48.) But the complainant claimed a right to redeem the land in the hands of the assignee; and the principal part of the costs have been incurred on that account, and he has failed as to that part of the suit. The defendant Brockway does not appear to have acted fraudulently or in bad faith in selling the contract. He only mistook his legal and equitable rights, and that forms no ground for charging a mortgagee with costs on a bill to redeem.
So much of the decree as directs the appellant to pay costs to the respondent must be reversed, and the residue of the decree appealed from is affirmed; and neither party is to have costs as against the other, either in the court of equity, or in this court. If the appellant does not pay the amount decreed within twenty days, the respondent is to be at liberty to take out execution therefor in this court.
