Wager v. Link

12 N.Y.S. 68 | N.Y. Sup. Ct. | 1890

Learned, P. J.

This is an appeal by the plaintiff from that part of a judgment of foreclosure which denied him a personal judgment for deficiency against Link, and which gave Link costs. Jennie Sully, in 1869, executed the mortgage in question to plaintiff. In June, 1873, she conveyed the premises, to Kellogg by a quitclaim deed. In February, 1874, Kellogg executed to-plaintiff a bond conditioned to pay amount of the Sully bond and mortgage; stating therein that his bond was collateral to the bond and mortgage, and requiring the obligee to exhaust his remedy against the premises before suing-the bond of Kellogg. In April, 1875, Kellogg conveyed the premises to Link by full covenant- deed, subject to the payment of the bond and mortgage, by the terms of which deed Link assumed and agreed to pay said bond and mortgage as part of the purchase money.

The sole question is whether the obligation thus incurred by Link inures to the benefit of the mortgagee so that he can recover thereon. Link had no-knowledge of the bond executed by Kellogg to plaintiff. Mrs. Sully’s deed to Kellogg was on record; and, as Link purchased from Kellogg, he would be-chargeable with knowledge of the contents of that deed, and conversely would be entitled to assume from that deed that Kellogg was under no obligation to-pay the plaintiff’s mortgage. Link therefore cannot be said to have knowingly contracted with Kellogg for the indirect benefit of the mortgagee, being-‘ ignorant that Kellogg was under any obligation in respect to the mortgage. When a mortgagor conveys the premises, and in the deed the purchaser agrees-to pay the mortgage, then, equitably, the purchaser becomes the primary debtor, and the mortgagor becomes the surety. In such case the purchaser is liable to the mortgagee. But, in the present case, Kellogg, the purchaser, did not, by the purchase, become the principal debtor. Indeed, he did not enter into any agreement with Mrs. Sully, either at the time of the purchase or afterwards. Kellogg’s bond to the plaintiff was a distinct matter, and gave Mrs. Sully no rights against him. In fact that bond is expressly collateral to the Sully bond and mortgage, and cannot be enforced until theobligee has exhausted his remedy against the premises. Thus Kellogg stands-in a very different position from that of a purchaser, who, by his deed, liasagreed with the mortgagor and vendor to pay the mortgagor.

To go One step further, when a purchaser who has thus become the primary-debtor himself conveys to one who by the deed assumes the debt, then such second purchaser in his turn becomes in equity the primary debtor, and liable-to the mortgagee. Such liability, however, depends on the fact that his grantor was, at the time of the sale, the person primarily liable in equity to pay the-mortgagee. In the present case, as has been shown, Kellogg never became the primary debtor in equity, and never assumed any liability to Mrs. Sully, the mortgagor. The mortgagee, in order to hold Link liable to him, must deduce such liability through the mortgagor. If Mrs. Sully could sue Link, then the plaintiff could sue him. But as Kellogg’s bond to the plaintiff was a personal matter, unconnected with the sale by Mrs. Sully to Kellogg, and one which gave her no right of action, it follows that Link’s agreement with Kellogg was merely personal between them, and gave no right of action to any one but Kellogg himself. Kellogg took the agreement from Link for his own protection; and as Kellogg was only a surety, and as he did not obtain this security from the principal debtor, Mrs. Sully, the creditor, has no claim to it. Of course there is no question made here that Link is liable to Kellogg on the clause in the deed. The question is whether the plaintiff has any right to the benefit of that clause. We think he has not, for the reasons above stated. The doctrine which we have set forth is laid down in the cases of Vrooman v. Turner, 69 N. Y. 280; Turk v. Ridge, 41 N. Y. 201; Carter v. Holahon, 92 N. Y. 498.

We think that the error of the plaintiff is in assuming that the liability of Kellogg on his bond to the plaintiff was of such a character that any security which Kellogg took would be for the plaintiff’s benefit. But Kellogg, being himself only a surety, could take for his individual protection any security, except perhaps from the principal debtor; and the security thus taken would not, of necessity, be for the benefit of the creditor. Judgment appealed from affirmed, with costs against appellant.