Newbold v. Newbold

1 Del. Ch. 310 | New York Court of Chancery | 1825

The Chancellor

refused to award the writ, and assigned the following as his reasons :

Upon the best consideration which I can give to the subject, I do not think that upon the case made in the petition the writ of injunction should be ordered.

It seems to me to be clearly and reasonably settled that a mortgagee may use all the remedies upon a bond and mortgage which the law affords, at the same time, and consequently any one of them which he prefers; but that he shall not take a double satisfaction for the debt. In Booth vs. Booth, 2 Atk. 343, Lord Hardwicke says, “ though “ the defendant is foreclosing the equity of redemption “ here, yet he is not precluded from bringing an ejectment “ at law at the same time, unless there is something very “ particular to take it out of the common case.” And Lord Redesdale, in 1 Sch. & Lef. 176, states the general rule to be, that “ where a party is suing in this Court he “ shall not be allowed to sue at law for the same debt. “ But the case of a mortgage is an exception to this rule ; “ he has a right to proceed on his mortgage in equity,and “ on his bond at law at the same time.” In the case before Lord Redesdale there was something ‘ very particular,’ (as Lord Hardwicke said), which formed an exception to the general principle, but not applicable to the present question. And in 3 Johns. Ch. Rep. 331, Chancellor Kent says it seems to be generally admitted in the books, that the mortgagee may proceed at law on his bond or covenant at the same time that he is prosecuting his mortgage in Chancery.

If the mortgagee may thus proceed, both at law and in equity, he certainly may have the fruit of both, or of either, so that he does not take a double satisfaction ; and whether he proceeds at law on the bonct and mortgage, or at law on the bond and in equity on the mortgage, the principle is the same. Here, the mortgagee is not proceeding on the mortgage. In 1 Yeates R. 9, where a suit was brought on a bond which accompanied a mortgage, the Court would not prevent the plaintiff from levying it on what land he pleased. The case of Holditch vs. Mist, 1 P. Wms. 695, is stronger ,than the present, and yet the Court would not compel the party to resort to a particular fund but left him to his common remedy. The case of Folliott vs. Ogden, 1 H. Blk. 124, and Wright vs. Nutt, 1 PL. Blk. 136 : 3 Bro. Ch. Rep. 326, are not applicable. In 3 Bro. Ch. Rep. 334-5, that case of Wright was argued on this principle, that Sir James Wright had all his property in Georgia confiscated, was himself a banished man, that the fund to which the creditors should resort was the confiscated property in the hands of the State of Georgia, and that the person who had access to a fund for the payment of his debt, to which the debtor had not access, should make it available before he comes upon the debtor personally. Here, the debtor has access to all the funds, and may avail himself of all of them; and there can be no reason for compelling the creditor to resort to one alone. His remedy upon the bond is as much his right as a remedy upon the mortgage, and there does not appear to be any equity in compelling him to resort to one or the other, especially as there is no oppression in the act, although there may be some inconvenience, and indeed an entire frustration of the petitioner’s scheme in establishing a own at the mouth of the canal. In Wright vs. Simpson 6. Ves. Jr. 714, the former cases Of Wright, although perhaps not over-ruled, are not assented to by Lord Eldon. Hays vs. Ward, 4 Johns. Ch. Rep. 123, has some allusion to this subject, but that case relates mainly to the rights of a surety.

According to the petitioner’s affidavit he has had a large surplus of assets for the payment of his debts. They may be thus stated:

ASSETS.

Estimated value of the mortgaged premises, ■ $50,000.00

Plantations in Bucks, county, purchased for 50,000.00

Fourteen houses in Philadelphia, estimated at 14,000.00

Total, $114,000.00

LIABILITIES.

The three prior mortgages, $25,000.00

The present bond and mortgage, 15,400.00

The subsequent judgment, 34,668.02

75,068.02

Add for interest, say, 20,000.00 ' 95,068.02

Surplus of assets, $18,931.98

With all these funds in the power of' the petitioner, it may be asked why he does not pay off the bond and mortgage ? I see no reason for taking this case out of the common course.

But it appears that the plaintiffs at law have met with real difficulties in getting this money in Pennsylvania. The mortgaged land did sell at a sale made by the sheriff, under another judgment, for a sum sufficient to discharge this and all the other mortgages, and to leave a balance of from $7,000 to $10,000 ; and yet, because the petitioner conceived that the property had been sold for much less than its real value, he applied to the Court and had the sale set aside. How, this proceeding interposes a serious difficulty ; for it may be inferred that the highest and best price bidden is not to be taken as the measure or standard of the value, but that a sale by the sheriff is to depend upon some imaginary value. It is not alleged that there was any irregularity in the sale, nor any unjust or unfair conduct in the sheriff, or in any other person ; nor indeed was any security given that there should be a proper advance on a second sale. Under all these circumstances it seems to me that no ground is laid for the interposition of the Court of Chancery. The petition states that after the sale was set aside the petitioner conveyed the mortgaged premises to Alexander Helmslie, in trust for the mortgage creditors, and gave the possession of them to Michael Newbold,Thomas Newbold and William Black, Jr., to receive the rents and profits ; and that they have accordingly ever since retained the possession thereof, and received the rents and profits, as petitioner believes, to at least the amount of three or four thousand dollars; and that the executors have the means of effecting a sale of the premises when they think proper'. The date of this trust deed is not given, but it was after the 16th or 17th of January, 1826, and whether before or after the judgment was entered and execution issued in New Castle county does not appear. The terms of this contract are not stated, and I can form no opinion bow far it ought to affect or restrain the plaintiffs at law from proceeding on their judgment and execution. The fee simple, I suppose, is vested in Helmslie, in trust; aud that is all that can, with certainty, be inferred. It does not appear, to whose benefit the rents are first to be applied. These plaintiffs at law have not the first mortgage ; and it is to bfe supposed that the oldest mortgages would be preferred. However, enough of this trust sale is not given to furnish any ground upon which I can satisfactorily award the injunction. Bents to the amount of three or four thoxisand dollars, since January last, seem to be a monstrous sum, unless there be something very uncommon, in the production of the farm, fertile as it may be, aud profitable as it may he from its local situation. The transaction seems to be an extraordinary one for executors to engage in, and should be more fully explained to make it the ground for grantingthe prayer of the petition.

Petition dismissed.

Afterwards, on the 26th of October, 1826, another petition and affidavit of the same petitioner was presented to the Chancellor praying the same relief as did the former. This latter petition and affidavit alleged as a further ground of equity that after the sale by the sheriff of the tract of land in Delaware county, Pennsylvania, and the setting aside of the same by the Court, the petitioner proposed to the defendants, the executors of Thomas Hewbold deceased, to convey and assign the said mortgaged premises to a trustee for the creditors, with power to sell the same and to apply the proceeds in discharge of the liens thereon; that said proposal was acceded to by the executors, who nominated for such trustee one Alexander'Helmslie; that thereupon, the petitioner executed such conveyance to said Helmslie, upon the trust aforesaid; and pursuant thereto the executors took possession of the premises; that said conveyance was made with the express understanding and agreement that the property so conveyed was to be first resorted to for the payment of the liens against it, according to their priority.

Hpon this petition an injunction was awarded, as prayed for. , .