Stanwix v. Leonard

109 N.Y.S. 804 | N.Y. App. Div. | 1908

Smith, P. J.:

It was a material part of plaintiff’s case as assignee of the claims of Clute against this defendant to show a right of action in him prior to the assignment to her. This she attempted by introducing testimony of a delivery to Clute by the mortgagor of the mortgaged property. The mortgagee, however, left Stanwix in actual custody of the property, directing him to sell it and turn the money over to him, Clute. The title thus shown to have vested in Clute by virtue of his taking possession under his mortgages, although not an absolute one, may be deemed to have vested in him the entire beneficial interest in the property in question for the purposes of this action, while the principal obligation remained unpaid. But if at any time after taking possession of such property, and prior to the assignment, the notes or their renewals, to secure which the respective liens were created, were actually paid by Stanwix, Clute’s beneficial interest in the property has lapsed and the entire title has reverted to Stanwix, the original mortgagor. Such entire title has also carried with it any.right of action arising out of the sale of a part of the property or from the use of the property which might have vested in the beneficial owner during the period of his qualified ownership.

Had these notes been paid prior to the assignment ? Stanwix, as chief witness for the plaintiff, testified on his redirect examination: “ I sold all of those brick made in 1896 and collected the money, with the exception of those that were Leonard’s. I collected the money. * * Every brick that was sold of this brick manufactured in 1896 I reported the sales to Jacob H. Clute, collected the money and gave it to him, and he went to the Albany County Bank and took up those notes. * "x" * Those were notes that were indorsed by Jacob H. Clute in the Albany County Bank.” Stanwix testified elsewhere that as early as when he began manufacturing brick in 1897, under his agreement with defendant, several hundred thousand of the twenty arch kiln of 1896 had already been sold by him. It appears that the value of brick at the yard at this time was about $4 per I, 000. At this price the amount handed over to Clute would be near $3,000. The clear import of the foregoing testimony would seem to constitute at least prima facie proof of the satisfaction and discharge of the three notes amounting to $675, and any possible renewals, to secure which -the first three mortgages were given. Payments made to one holding several different obligations will be first applied to the discharge of the oldest obligations. (Dows v. Morewood, 10 Barb. 184; Allen v. Culver, 3 Den. 284.) There is also a presumption that payments made from proceeds of sales by a mortgagor of mortgaged property pursuant to instructions from the mortgagee are intended by the mortgagor to be applied, and by the mortgagee actually are applied, to satisfy the specific obligations on account of which the mortgage liens were created. There is no evidence of any other application of these payments by the parties. The plaintiff does not seem to have overcome by proof the presumptions of payment fairly raised by her own evidence, and must accordingly be deemed to have failed to show her right to bring action upon the claims set out in her complaint.

Upon the view of the case here taken it becomes unnecessary to examine the conflicting testirnony given before the referee. The principal witness on the plaintiff’s side appears to have been her brother, the said David H. Stanwix, and it may well have been to his interest, by way of avoiding the setting up of a possible counterclaim by this defendant, to claim that Olute rather than himself continued to be up to the time of the assignment to the plaintiff the owner of the causes of action sued on. It follows that an order should be entered reversing the judgment appealed from, discharging the referee and granting a new trial herein, with costs to abide the event.

All concurred, except Chester, J., not voting; Kellogg, J., concurred in result.

Judgment reversed on law and facts, referee discharged and new trial granted, with costs to appellant to abide event.