1 Keyes 222 | NY | 1864
I assent to the conclusion of the Supreme Court that the $490.03 ought tó be allowed as a payment on account of the interest due, and so much of the principal as it would extinguish. It follows from this conclusion, that there was no interest in arrear when the action was commenced, and hence also, that the plaintiff had no right to elect to consider the whole principal immediately payable. The complaint does indeed set forth such an election, but it was based upon the actual denial of the payment, and upon the allegation that a year’s interest was in arrears. The plaintiff’s case was that the whole principal and interest had become payable in consequence of the default in the payment of interest. When' it was determined that .there was no interest in arrear, the case made by the complaint was disproved; and there was then no foundation for the claim of the whole under the special clause in the bond and mortgage. I think, therefore, the defendant had no right to tender the whole principal without admitting a default in the payment of interest. It was an offer which the plaintiff was at liberty to reject or to accept. He rejected it, as he had a right to do. As the debtor was not bound by the election of the creditor, because the fact which authorized that election had not arisen, so the plaintiff ought not to be bound by it, because he has failed to establish the existence of the fact which alone gave him the right to make any election, and upon which alone he claimed that right. It is not like the case where one who is entitled to an advantage proposes to waive it, and the other party acts upon the waiver—there the person mak- ...
It is not probable that the plaintiff refused the tender on the ground that he would prefer to keep his money upon interest until the expiration of the original time of credit; no doubt he refused it because he believed the alleged payment was a matter by which he was not bound, and because the whole principal and interest were not tendered. But that is no consequence. It is very plain that the defendant had no right to tender an amount of principal which had not become payable, and the plaintiff was under no obligation to give any reason for refusing it. It is hard enough for a mortgage creditor to lose his debt because he has been mistaken as to the effect of a payment of a small part of the amount, and has refused a tender of what the debtor claimed, and has been enabled to establish, was the full sum due: He should not, in my opinion, incur this forfeiture in a case in which the debt tendered had not fallen due. The plaintiff is sufficiently punished for his mistake, or the mistake of his legal advisers, when he is turned out of court with costs, for insisting upon a case which he could not sustain. The court had no right to go further and pronounce a forfeiture
If this modification is agreed to by the judges, there ought to be no costs against either party in this appeal.
Upon the facts established by the findings, this appears to be a very, plain case. The plaintiff became the owner of the bond and mortgage in question on the 13th of May 1862, by assignment from the mortgagee. As assignee he took subject to all equities existing at the time of the assignment, in favor of the debtor against his assignor. Any demand which the debtor might then have applied or set off against the assignor, he may have applied or set off against the assignee. This principal is so well settled that it would be a waste of time and labor to cite authorities in its support. At the date of the assignment, the defendant Tatham, was, in equity if not in law, in respect to this bond and mortgage, the principal debtor, he having on the 26th day of January previous taken a conveyance of the mortgaged premises, subject.to the same mortgage. This conveyance was made to the defendant Tatham, at the instance and for the benefit of Alfred A. Arment who was the equitable though not the legal owner of the premises, and who had as such become liable to pay said bond and mortgage. The fall previous to this, Arment made an agreement with the plaintiff’s assignor to do certain work for the latter in the Beekman Hill Chapel, which was then being built on the grounds of such assignor,
In any view of the case it is entirely clear that the plaintiff could only enforce the bond and mortgage for ■ the amount due "over and above this $490.03 as against the defendant, Tatham, who insisted upon its application as a payment. Consequently it was only necessary for him to tender the balance over and above this sum, with the costs which had then accrued. The plaintiff had elected to consider the whole debt due, as he had the right to do, upon the mere
It is strenuously contended by the appellant’s counsel that the defendant, Tatham, is estopped by his deed from insisting upon the application of this amount for the work and labor to the mortgage debt. It is argued that having taken his deed subject to the mortgage-he can set up nothing against it, but must pay the full amount for which it was given. But no case has been cited, and I think none can be found making any such application of the principle of estoppel by deed. By taking the conveyance of the premises subject to a mortgage the grantee is precluded from setting up the defense of usury against the mortgage (Sands v. Church, 6 N. Y., 347; Shufelt v. Shufelt, 9 Paige, 137); and such a grantee would, I suppose be estopped from denying the fact of the existence of such a mortgage as against the grantor and his assignees and representatives. (Torrey v. Bank of Orleans, 9 Paige, 649; Denn v. Cornell, 3 Johns. Cases, 174.) But no such question arises here. The existence of the mortgage is conceded, and its validity, to the extent of the amount justly due upon it. And there is nothing, either in the terms of the grant or in the principles of equity, to estop the grantee from showing what amount has been paid and what amount still remains due. Certainly he was not estopped as against Dunscomb, and should not be as against his assignee, whose. duty it was to ascertain before taking the mortgage what claims there were existing against it. He was bound to inquire, and the law will hold him to the knowledge he should have acquired.
The judgment is right and should be affirmed.
All concur except "Weight, J.
Judgment affirmed.