Pearson v. Bailey

180 Mass. 229 | Mass. | 1902

Holmes, C. J.

This is an action upon a contract, arising from the acceptance of a deed poll, to assume a mortgage. The deed conveyed one of two lots, both of which were subject to the mortgage. It was decided in Pearson v. Bailey, 177 Mass. 318, that a subsequent grantee of the other lot who took it subject to the mortgage could not sue upon or get the benefit of this con*231tract. The present suit is by the administrator of the estáte of Elbridge M. Pearson, the defendant’s grantor, to whom the defendant’s promise was made. The case was submitted to the Superior Court on agreed facts, and comes here on exceptions to refusals to rule either that the plaintiff could not recover or that he could recover only nominal damages.

Elbridge M. Pearson, before conveying the second lot, subjected it to a second mortgage for $10,000. But this mortgage was part of the estate of one Elbridge G. Pearson and was left by him to his widow, Mary P. Pearson. She was appointed his executrix in February, 1897, and the next month took a conveyance of the second lot. In October, 1897, she conveyed the second lot with full covenants, subject to the first mortgage but saying nothing in her deed about the second. It must be taken, therefore, that she appropriated the second mortgage to herself according to the terms of her husband’s will, Shurtleff v. Ferry, 138 Mass. 259, and that at latest, when she conveyed the land free of it, as she had power to do, there was a merger, or discharge of the land, and that the second mortgage disappeared. This therefore need trouble us no further.

As has been implied, after taking the contract in suit Elbridge M. Pearson sold the second lot subject to the first mortgage, and therefore ended his interest in the contract so far as the land was concerned. The defendant contends that Pearson’s interest by reason of his personal liability also has been ended by a transaction between the defendant and the mortgagee, carried through since this suit was begun; and therefore that the court should have ruled as requested that the defendant was liable at most only to nominal damages.

The transaction referred to was a covenant not to enforce any claim upon the mortgage note, but to look wholly to the mortgaged property for satisfaction of the debt. There is no question that such an agreement made with a mortgagor is valid, and leaves the right to collect the debt from the property unimpaired. Hayden v. Smith, 12 Met. 511, 515. Hemenway v. Bassett, 13 Gray, 378, 380. Bentley v. Vanderheyden, 35 N. Y. 677. The only ground suggested by the plaintiff for giving a less effect to the mortgagee’s covenant in this case is that it was not made with his testator, the mortgagor, but with the defendant. If, *232notwithstanding the difference of parties, the estate which he is administering now is safe from all claims, only nominal damages should be recovered. There was some suggestion on behalf of the defendant that there should not be even a technical recovery, but, as it is not disputed that there has been a breach of the contract, we assume that the plaintiff is entitled to judgment, and that the only question is for how much.

It seems to us that the covenant with the defendant sufficiently protects the plaintiff against suit. The defendant, by setting it up and using it in this suit, makes himself trustee of the obligation for the plaintiff. It would not be a violent conjecture that the mortgagee understood and has notice that the covenant was obtained for this purpose and is in no better position to accept a release from her covenant than the defendant would be to give one. A payment by the defendant would have discharged the mortgage. Kilborn v. Robbins, 8 Allen, 466, 471. McCabe v. Swap, 14 Allen, 188, 191. Locke v. Homer, 131 Mass. 93, 108. But, if the mortgagee is not already privy to the plaintiff’s rights, she can be notified at once. If the defendant should attempt to grant a release before the mortgagee receives notice, if notice be necessary, it would be a sufficient reason for entering judgment for substantial damages in this case. If such a release were granted after notice, a court of equity, if necessary, would see that it was not made use of, and a court of law also would protect the plaintiff. Troeder v. Hyams, 153 Mass. 536, 538. The present owner of the land will have no claim against the plaintiff if the mortgage is foreclosed, for even as between those parties the land is the fund first to be resorted to, having been sold subject to the mortgage. Pratt v. Buckley, 175 Mass. 115, 116. We see no way in which the plaintiff can suffer harm from the defendant’s breach. See Rice v. Sanders, 152 Mass. 108, 111, 116.

Exceptions sustained.

midpage