209 A.D. 710 | N.Y. App. Div. | 1924
The mortgage in question with an accompanying bond was executed November 5, 1921, by the appellants to one Morris Horowitz for the sum of $14,882.50, bearing interest at the rate of six per cent per annum. Horowitz at the same time and as part of the same transaction executed an assignment of the bond and mortgage to Rose Evans and she subsequently assigned the same as a gift to her daughter who is the plaintiff herein. Horowitz did not furnish any of the consideration for the bond and mortgage. The reason why he became the nominal mortgagee and the immediate assignor thereof to Rose Evans was to secure his guaranty for the first two payments of principal amounting to $4,000 and interest, which guaranty was contained in his assignment. There was an existing mortgage on the premises on which there was unpaid $5,500 with interest from August 10, 1921, which mortgage was owned by Charles Evans, the husband of Rose Evans. This mortgage was satisfied by Charles Evans and the amount thereof was included in the mortgage in question. In addition thereto the appellants only received $6,300 for the mortgage of $14,882.50. In order to procure an additional loan of $6,500
The former mortgage of $5,500 was not tainted by this usurious bargain and probably may be revived and enforced. In Patterson v. Birdsall (64 N. Y. 294) the headnote is as follows: “ A valid and subsisting obligation is not destroyed because included in a security or made the subject of a contract void for usury; although formally satisfied and discharged it may be revived and enforced in case the new security or contract is invalidated.” We may not, however, in this action enforce that mortgage, first, because it was not owned by the plaintiff, and second, because such procedure is not within the contemplation of the pleadings. (Hansee v. Phinney, 20 Hun, 153; Campbell v. Campbell, 23 Abb. N. C. 187.)
. The judgment should be reversed on the law and facts and the complaint dismissed, with costs.
All concur.
Judgment reversed on the law and facts and complaint dismissed, with, costs. The court disapproves of the seventh finding of fact; in