72 Minn. 71 | Minn. | 1898
Judgment was ordered and entered herein in favor of the plaintiff upon the pleadings, from which the defendant appealed. The record presents a single question for our determination. It is, does the answer state facts constituting a defense. We answer it in the negative.
This action is to recover from the defendant, upon an assumption clause in a deed to him, the amount of a promissory note for $383, due December 19,1891, with interest, and secured by a second mortgage upon real estate executed by the makers of the note to Clark B. Davison. The mortgagors conveyed the mortgaged premises to the defendant, who, in consideration thereof, assumed and agreed to pay the mortgage as well as a prior mortgage on the premises for $800. The plaintiff is the owner of the note and mortgage in question (which has not been paid) through certain mesne assignments from Davison. Substantially the foregoing are the allegations of the complaint, and they are admitted by the answer.
For a defense the defendant alleges that on March 27, 1890, he conveyed the mortgaged premises by warranty deed, duly recorded, to C. W. Board, who by an assumption clause therein agreed to pay the mortgages; that on November 18,. 1890, Board conveyed the mortgaged premises, by warranty deed duly recorded, to the Bank of Superior, which by an assumption clause therein agreed to pay the mortgages; that both Board and the bank are insolvent, but that the bank was able and willing to pay the note down to the close of the year 1896, when it made an assignment for the benefit of its creditors; that the note was never presented to the bank for
1. The defendant claims that this case falls within the settled rule of equity that any laches by the creditor in the care or management of collateral remedies or securities, if loss ensues, will discharge the surety pro tanto. This rule has no application to the facts of this case. When the defendant assumed and agreed to pay the note and mortgage he became, as between him and the makers, the principal debtor, and they the sureties, and in like manner his grantee became the principal debtor, and he a surety, and the grantee of the latter, the bank, became the principal debtor, November, 1890. In other words, from maturity of the note, December 19, 1891, to the close of the year 1896, the defendant was a surety for the debt, and the bank the principal debtor, during which time it was solvent; and would have paid the note if it had been presented for payment, but the principal is now insolvent.
No laches can be charged to the plaintiff or his assignor in not redeeming from the first mortgage. They were not bound to pay it off or redeem from the foreclosure sale. Besides, there is no claim made that the land was worth any more than the first mortgage. The defendant had the right, at any time after the note became due, to pay it, and be subrogated to all the rights of the mortgagee or his assignee to the note and the mortgage securing it, and thereby put himself in a position to redeem from the first mortgage or to enforce payment by the bank. No claim is made that the time of payment of the note was ever extended, and this case is one where the creditor simply delayed enforcing his claim against the principal debtor, who in the meantime became insolvent. Such mere passive failure to pursue the principal debtor does not release the surety. Hungerford v. O’Brien, 37 Minn. 306, 34 N. W. 161; Benedict v. Olson, 37 Minn 431, 35 N. W. 10; Osborne v. Gullikson, 64 Minn. 218, 66 N. W. 965.
2. This action was commenced September 24, 1897. The defendant’s promise to pay the note and mortgage in question was made
Judgment affirmed.
