Majority
p. 389THURSTON a. MARSH. Supreme Court, First District ; Special Term, November, 1857.
Headnote
Foreclosure.—Interest Clause.—Fating Monet into Court. —Tender.It seems, that under the Code, tender of the amount due in a foreclosure suit can only be made in the form of an offer by the defendant to allow the plaintiff to take judgment for a specified sum, with costs.
In an action to foreclose a mortgage containing an interest clause, for failure to pay an instalment of interest, defendant obtained an ex parte order allowing him to pay the interest in arrear into court; and having paid it, he answered, averring the payment.
Held, that he had mistaken the practice. He should have offered payment to the plaintiff, and on refusal, and on his excuse for the original default, have applied for a stay of proceedings in the action.
Motion to vacate an ex parte order permitting defendant to pay money into court.
This was an action for the foreclosure of a mortgage to secure the payment of $2750 in three years, but containing an interest clause to the effect that in case default was made in paying the
p. 390I. This is not a case unprovided for by the Code. Provision is made by section 385. Rule 89 does not permit resort to the old practice where the Code provides a remedy.
interest on any day it was made payable, and it remained unpaid and in arrear for the space of ten days, then the whole principal, at the option of the plaintiff, should become due and payable. The complaint alleged a default in the payment of $96.25, six-months’ interest, which became due and payable on the 19th of September, and that the same had remained unpaid and in arrear for the space of ten days ; wherefore the plaintiff had elected to claim to have the whole principal secured by the mortgage, and that by reason thereof there was justly due the' plaintiff upon the said mortgage the said principal sum¡ with interest, &c., and in the usual form asked for a sale of the mortgaged premises.
Before putting in his answer, and upon the complcdnt alone, the defendant obtained the following exponte order.
Title of the Cause.
On motion of James Moncrief, attorney for the defendants in this action, it is ordered that the defendants have leave to bring into court the sum of ninety-eight dollars, admitted by them to be due the plaintiff in this cause ; and that thereupon (unless the plaintiff shall accept thereof, with costs to be taxed, in full discharge of this action) the same shall be struck out of said plaintiff’s complaint in this action, and the same shall be paid out of court to the plaintiffs or their attorney; and that on the trial of the issue (to be joined) in this action, the said plaintiffs shall not be permitted to give evidence for the sum so brought into court.
After obtaining this order, defendant put in his answer, alleging, among other things, that he had paid the amount of the interest into court, as appeared by copy of the order and clerk’s receipt annexed to this answer.
The plaintiff now moved to vacate the order allowing defendant to pay the money into court. The motion was submitted upon written points.
Allan Melville, for the motion.
p. 391II. The objection to the order is, that if permitted to stand without complaint it may prejudice the plaintiff. It either means something or nothing. Without hearing the plaintiff, an important allegation is struck out from his complaint, and he is not to be permitted to give evidence of it. Where is the precedent for this ? III. In equity there was never any such practice as payment of money into court by the defendant on his motion. In some c&sesplamiiff could compel defendant to pay money into court. (2 Barb. Ch. Pr., 236; 1 Hoff. Ch. Pr., 319, and cases cited.) And even at law payment of money into court was only allowed where the action was brought only for a sum certain, or capable of being ascertained by mere calculation, and therefore in trespass case, trover, and replevin, it was not allowed. (1 Burrill, 406; and see 2 Rev. Stats., 553; also 9 How. Pr. R., 398.) This action, being for the foreclosure of a mortgage, is for something more than the recovery of money (3 Abbotts' Pr. R., 273). It is a proceeding in rem.
IV. If this practice is to be sanctioned, the form of the order is wrong in preventing evidence of part of the plaintiff’s claim ; the rule at law being, that if the plaintiff succeeds, he recovers the whole amount claimed, and credits what has been paid into court ( 7 Hill, 30 ). The order should be vacated, and the defendant put to his offer to take judgment for the amount he admits to be due, under section 385. The practice does not depend upon the particular facts of the case as alleged in the complaint, nor upon the nature of the defence, because the motion for the order to pay in was made, and order obtained, before the answer was drawn up, as the fact of payment into court is set up in the answer. The question turns entirely upon the nature of the action, as one for the foreclosure of a mortgage, in which the defendant, by his application before answer, admits a part of the plaintiff’s claim. His defence to the other part of the relief demanded is not to be considered, because it does not come before the court properly until the trial. If the Code does not provide a way in section 385, resort must be had under Buie 89 to the former chancery practice, which did not permit payment of money into court on defendants application, and therefore does not avail the defendant.
p. 392—I. It appears to me that the plaintiff’s application is founded on an entire misapprehension of the practice in such case, and of the effect of paying money into court. He refers to section 385 of Code, which relates only to a confession of judgment, and is so held by the court. (Johnson v. Sagar, 10 How. Pr. R., 453; Emery v. Emery, 9 Ib., 130.) And he refers to 1 Barb. Ch. Pr., 236, which relates only to the plaintiff's compelling defendant to pay into court money which he admits to be due. Our case is neither, but is simply the defendant’s admitting he owes so much, and paying it, not confessing a judgment for it. II. Hnder the old and the present practice, whenever a defendant pleads tender he must bring the money into court. How ? Precisely in the way which it has been done in this case. (1 Burrill's Pr., 406; 1 Tidd's Pr., 561.) Tidd says the motion for leave to bring money into court is a motion of course; and always heretofore the practice was to hand the money to the clerk, take his receipt, and enter a rule in the Common Rule Booh, and then serve the original receipt and copy rule on the plaintiff. III. The plaintiff is never prejudiced by this act of the defendant. There are only two modes in which the plaintiff can be affected by it. 1. Where he takes the money out of court: 'then it is his act in so doing that affects him. 2. Where the court finally determines that he is not entitled to any more; and there he ought to be prejudiced. IV. Heither the Code nor the Rules have altered the old practice, where a party acknowledges he owes money and wants to pay it. Who has a right to prevent his paying it ? The plaintiff will not receive it from him. He does the next best thing, and that is, pays into court, whence the plaintiff can take it out whenever he pleases, and the defenda/nt never can. To him it is gone forever. He has paid it. V. The only thing that has caused any embarrassment in the present case is this, that now the judges (in this district) will not allow the cleric to enter any common rule, which was always entered by the party, at his own peril, afterwards ; and the present order is, according to the true practice, nothing more than a common order, entered ex parte of course, and entered at the peril of the defendant. It in no way affects the plaintiff unless
John W. Edmonds, opposed.
p. 393he takes out the money, or unless the court shall hereafter adjudge in the matter.
—Tender after suit was confined to “ actions at law” (2 Rev. Stats., 553). In those actions costs were fixed, and not discretionary. They were adjusted also to each successive service in the cause. There'was no percentage applicable in gross to the whole. Hence the Code, even in such actions, makes no provision for a tender as distinguished from a confession. It permits the defendant to serve an offer to “ allow judgment” for a specific sum, with costs. On such a judgment, the percentage may be added, and the costs thus complete. But no provision is made for a percentage without a judgment. Whether, therefore, a tender can now be made after suit, except in the form of an offer to allow judgment, may at least be doubted. It certainly cannot, as it seems to me, in a foreclosure suit. Such suits, it is well known, were not “ actions at law,” as understood in the Revised Statutes. They were suits in equity, and subject to all the equitable jurisdiction of the court. They are so still. In such suits, costs, under the Code, “ may be allowed or not, in the discretion of the court” (§ 306).
The defendant has mistaken the practice. He should have offered to pay the interest accrued, and upon its refusal, and a reasonable excuse for the seeming want of precise punctuality, have obtained, as he might, an order to "stay all proceedings, till a further default, if any should occur.
Order accordingly.