Charter v. Stevens

3 Denio 33 | N.Y. Sup. Ct. | 1846

By the Court, Beardsley, J.

The execution of the mortgage transferred to the defendant a defeasible title to the property mortgaged, but which became absolute at law by the failure to pay at the stipulated time. The plaintiff, however, was not thereby divested of all interest in the property, for he still had an equity of redemption which the court of chancery would protect and enforce. On the other hand, the mortgagee might go' into chancery to compel a speedy redemption or to foreclose that right, and the same object might be attained by a fair public sale of the property, on due notice to the mortgagor. These arc familiar principles, and apply wherever the relation of mortgagor and mortgagee of personal property exists. (Langdon v. Buel, 9 Wend. 80; Patchin v. Pierce, 12 id. 61; White v. Cole, 24 id. 142, 3; Story on Bail. 2d ed. § 287; Conard v. The Atlantic Ins. Co., 1 Pet. 441; Hart v. Ten Eyck, 2 John. Ch. R. 100.)

It has been adjudged that a tender of the mortgage money, after default in payment, would not, at law, re-invest the mortgagor with his former title to the property; (Patchin v. Pierce, supra, and 8 John. 96;) but an acceptance of the amount tendered—that is, full payment being made, at any time—would, as between mortgagor and mortgagee, extinguish all right and interest of the latter in the property mortgaged. If made before the pay day had past, it would satisfy the conditions on which the property had been transferred, and thus- defeat it altogether; and if made after forfeiture, it would be conclusive evidence that the forfeiture had been waived, and that all right under the mortgage was extinguished. (Patchin v. Pierce, supra ; Parks v. Hall, 2 Pick. 206, 210, 211; Barry v. Bennett, 7 Metc. 354, 360, 361; Hatch v. White, 2 Gal. 152.)

I think what had been done in this case was equivalent to absolute payment of the mortgage money. The mortgage provides that on failure to pay at the time specified, the mortgagee might “ take possession of the said property and sell the same at public auction after giving six days’ notice of sale and satisfy said above mentioned sum of money and the interest of the same and the costs of selling the same.” Default in payment had. been made, and the mortgagee proceeded to sell under the authority contained in this clause of the mortgage. And before he sold the horse, which alone is now in question, enough money had been raised to satisfy the amount due and unpaid, with interest and expenses. The end and object of the mortgage had thus been fully attained, and the mortgagee had no longer any right to the property which remained unsold, or to sell it under the mortgage. He certainly was not bound to proceed and sell under this power, but might have retained all the property mortgaged as his own, leaving the mortgagor to enforce his right of redemption as he best could. But the mortgagee chose not to stand on that right: he elected to raise the amount of the debt due to him by a sale under the power. This he had a right to do; but when his debt was thus paid, all right to the residue of the property was necessarily extinguished, and the power to sell became ipso facto void. For what honest purpose could the mortgagee claim any right to the property then remaining unsold, or proceed further under this power to sell? His debt was paid. He had chosen to collect it under the power to sell, without involving the subject in a chancery litigation, and he should abide the result of the course he elected to pursue. In equity, after satisfying the mortgage debt, he would have been a trustee of the residue of the property, and must have accounted for it to the mortgagor. And having proceeded under a legal power to coerce payment of his debt, he must be taken to have waived all right and title to so much of the property as was not required for that purpose. The sale of the horse was therefore wholly unauthorized, and the action was sustained.

New trial denied.