153 Minn. 447 | Minn. | 1922
Defendant was the owner of a bond of $500 issued by the Twin City Motor Speedway Company, a corporation. This bond was one of a $350,000 issue, secured by a mortgage or trust deed upon certain real estate to the Minneapolis Trust Company as trustee for the bondholders. For value defendant transferred the bond mentioned to plaintiff and attached this guaranty: “St. Paul, Minn. Feb. 1st, 1916. For and in consideration of One Dollar to me in hand paid, I hereby guarantee the payment of interest and principal of the attached Twin City Motor Speedway Company first mortgage Bond No. 1612 as same matures. J. F. Sperry.”
There was default in the payment of the bonds and the trustee foreclosed the mortgage, bidding in the property in behalf of the bondholders for a sum which, had it been paid in cash by some other bidder, would have ratably paid off $355.50 upon the bond transferred to plaintiff. Plaintiff, ignoring the foreclosure, brought this action upon the guaranty. There was no dispute as to facts, but appellant objected to the proof as to what was eventually realized for the bondholders and that this amount, about 12 per cent of the face value of the bonds, could only be obtained by surrendering the bonds to the clerk of the district court.
When the evidence was in appellant moved that a verdict be returned for respondent for the difference between the face of the bond and interest and the ratable amount at which the property' was bid in at the foreclosure sale, that is, for $215.80. Respondent moved the court to direct a verdict in his favor for $678.44, the amount of the bond with interest. Respondent’s motion was granted. The appeal is from the order denying a new trial or the judg- j ment requested by appellant.
The defense herein was partial payment by the foreclosure of the mortgage or trust deed. The burden was on defendant to prove this defense. That the property mortgaged was bid in by the trustee for a certain sum, does not prove a payment upon this bond such as defendant guaranteed, namely, in cash or something which plaintiff has accepted in lieu thereof. As already stated, there was a total absence of proof of any acceptance by plaintiff of the result of the foreclosure as payment on this bond. Whatever benefit came therefrom is available to defendant when he makes good his contract of guaranty.
The order is affirmed.