138 N.Y.S. 419 | N.Y. App. Term. | 1912
The action was brought on the original debt as security' for the_payment of which a chattel mortgage had been given. The fixtures had been purchased from Lingelheim subject to a mortgage held by the plaintiffs on which there was due fifty-four dollars and eighty-four cents. Subsequently to the purchase of the fixtures the defendant borrowed one hundred dollars from plaintiffs; fifty-four dollars and eighty-four cents was applied in satisfaction of Lingelheim’s mortgage and the balance paid to defendant. As this was not “ a chattel mortgage made to secure the purchase price of chattels,” section 139 of the Municipal Court Act
The plaintiffs, without foreclosure, took the chattels into their possession and evidently disposed of them at private sale to a second-hand dealer for thirty dollars. This sum they credited upon the debt. Defendant was credited also with ten dollars and fifty cents for merchandise sold to plaintiffs. They bring this action, not to recover the deficiency, because there having been no foreclosure the deficiency had not been ascertained. Where, however, the mortgagee, instead of foreclosing the mortgage, takes possession of the chattels pledged, the debt is thereby satisfied, providing the chattel be of sufficient value for the purpose. Case v. Boughton, 11 Wend. 108; Stoddard v. Denison, 38 How. Pr. 296; M. Groh’s Sons v. Feldman, 40 Misc. Rep. 303, 304. It will become necessary to ascertain the true value of the chattels. If it equals or exceeds the debt the complaint will be dismissed. If it is less than the debt, the plaintiffs should have judgment for the balance. The evidence on this point being, contradictory there will have to' be'a new trial.
Judgment revers'ed and new trial granted, with costs to the appellants to abide the event.
Lehman and Hotghiciss, JJ., concur.
Judgment reversed and new trial granted, with costs to appellants to abide the event. •
