167 N.Y. 285 | NY | 1901
The action was brought to recover possession of a bond and mortgage and certain assignments thereof from the defendant, the owner of the equity of redemption in the mortgaged premises who claimed to have received them on paying the mortgage. The controversy turns on the validity of that payment. The bond and mortgage were made by Benjamin R. Winthrop and others, trustees, and George Folsom and wife, to William E. Laight and another, trustees of Louisa M. Wilkes, on the 15th day of May, 1848, and after several mesne assignments were assigned to Ada L. Sutton (afterwards Ada L. Saalfield) on July 9th, 1883. One Francis H. Weeks, a lawyer, was the attorney for Mrs. Saalfield, and while she was the owner, the bond and mortgage and assignments remained in his possession. The appellant, Folsom, the owner of the equity of redemption, during this period paid the interest to Weeks. In May, 1886, he made such a payment to Weeks as attorney for Mrs. Saalfield and received from him a receipt on behalf of Morison, trustee. This was the only notice that Folsom at any time had that Mrs. Saalfield had transferred the mortgage. In June following Folsom paid to Weeks the principal of the mortgage with *287 the accrued interest and received from him the original bond and mortgage and the several assignments. The last two of these, that to Mrs. Saalfield and the assignment from Mrs. Saalfield to Daniel Morison as trustee, were unrecorded. Folsom returned these two assignments to Weeks with instructions to have them recorded and also to obtain a satisfaction piece from Morison, trustee, and retained the other instruments.
On November 29th, 1876, in contemplation of her marriage, the separate estate of Isabel Andrews (afterwards von Linden) was conveyed to Blandina B. Andrews on certain trusts therein specified. Mrs. Andrews having died, Daniel Morison was appointed trustee in her place in October, 1883. Morison employed Weeks, who was his attorney, to obtain an investment for the sum of seven thousand dollars belonging to the trust estate. Weeks brought the mortgage of Mrs. Saalfield to the attention of Morison, who looked at the mortgaged property and approved the security. Weeks thereupon obtained the assignment from Mrs. Saalfield, he having in his possession at the time the bond and mortgage and earlier assignments. The defendant Morison did not personally negotiate the transfer nor take any part therein except to approve the security and advance the funds. Weeks seems to have largely managed the administration of the trust for Morison. Morison knew that there was a Folsom mortgage, but could not swear positively that he ever saw the document. Morison was not in active business at this time, and it appears from his testimony that the securities of the trust estate together with his own were put in a tin box belonging to him and the box placed in the safe in Weeks' office and the key of the box intrusted to Weeks, so that, as a matter of fact, Weeks had always access to the box. Morison testified that the key was given to Weeks so that he might indorse any payments of interest which he might receive, but he denied that Weeks had any authority to receive the principal of the securities. In 1889 Morison resigned his trust and Weeks was appointed his successor. Weeks continued as trustee to *288 1893, when he was removed and the plaintiff appointed his successor. Weeks did not pay over to Morison or into the trust the moneys received by him from Folsom in payment of the mortgage, but appropriated such moneys to his own use. The trial court held that the payment to Weeks was a good payment to Morison, trustee, and that the defendant was entitled to hold the bond and mortgage which he had paid off. The Appellate Division by a divided court reversed the judgment of the Special Term and ordered a new trial.
The reversal was both on the law and the facts. For the appellant to succeed in this court it must appear that the undisputed facts entitled him to a judgment, those in controversy being resolved against him. The trial court might have found on the evidence that Weeks was authorized by Morison to receive the principal of the mortgage, but the inference to be drawn from the evidence was debatable, and, hence, for the purposes of this appeal, we must assume that Weeks was not given such authority. The only question presented for our determination is whether the possession by Weeks of the security, under the circumstances narrated, conferred upon him apparent authority to receive the principal, on which Folsom was entitled to rely. The general rule stated by all the text writers is that where an agent who negotiates a loan for his principal is allowed to retain possession and control of the security taken on the loan, he has apparent authority after maturity to receive payments for his principal. (Story on Agency, § 98; Meechem on Agency, § 273; Paley on Agency, § 274.) This rule has been repeatedly upheld by the decisions in this state. (Williams v. Walker, 2 Sandf. Ch. 325; Hatfield v. Reynolds, 34 Barb. 612; Wardrop v.Dunlop, 1 Hun, 325; Merritt v. Cole, 9 Hun, 98; Smith v.Kidd,
The order of the Appellate Division should be reversed and the judgment entered on the decision of the Trial Term affirmed, with costs in all the courts.
PARKER, Ch. J., O'BRIEN, BARTLETT, MARTIN, VANN and LANDON, JJ., concur.
Ordered accordingly. *292