Kelly v. Ruppert — 173 A.D. 116

Majority

p. 116

Elizabeth Kelly, Respondent, v. Jacob Ruppert, Appellant.

First Department,

June 2, 1916.

Headnote

Evidence — chattel mortgage made payable on demand — oral agreement contradicting writing inadmissible—injunction.

In a suit to foreclose a chattel mortgage which is expressly made payable on demand, it is error to admit evidence of an alleged verbal agreement by which demand for payment was not to be made so long as the mortgagor performed certain agreements, for such evidence contradicts the terms of the written instrument.

Hence, such alleged oral agreement is not ground for enjoining the mortgagee’s suit of foreclosure.

Appeal by the defendant, Jacob Ruppert, from an order of the Supreme Court, made at the New York Special Term and entered in the office of the clerk of the county of New York on the 27th day of March, 1916, in so far as it enjoins and restrains the defendant, until the 1st day of October, 1916, from foreclosing or attempting to foreclose a certain chattel mortgage held upon property belonging to the plaintiff.

Ashbel P. Fitch, for the appellant.

Otho 8. Bowling, for the respondent.

In June, 1915, Daniel T. Kelly, plaintiff’s husband, started a saloon business, and bought of the defendant certain fixtures for which he agreed to pay $7,500. He also borrowed $500 to pay for his license, which ran until the first day of October following, To secure the moneys for the price of the fixtures

p. 117

and for the money loaned, he gave a chattel mortgage upon the fixtures for the said sum, the chattel mortgage being made payable on demand.

Upon the first day of October this plaintiff, the defendant and Daniel T. Kelly agreed that the interest in the saloon business should be transferred to this plaintiff. At that time $1,500 was loaned to her for the purpose of procuring a license for a year. The property was transferred by Daniel T. Kelly to this plaintiff, and she in, writing assumed the payment of the mortgage to the defendant as therein stipulated, and also assumed the payment of the $1,500 loaned to her. Thereafter differences arose between the plaintiff and the defendant, and the defendant stopped selling beer to the plaintiff and demanded the moneys due under the chattel mortgage, and threatened to foreclose the same. This action was then brought to .enjoin the foreclosure, upon the ground that while the mortgage was in terms made payable upon demand, the verbal agreement between the parties was that demand should not be made so long as Daniel T. Kelly and the plaintiff performed their part of the agreement with the defendant and paid certain percentages which were stipulated in the contract to be paid, and were not in any way in default to the defendant. It is further alleged that the plaintiff was not in any way .in default to the defendant, and that the mortgage had, therefore, not become due and should not be foreclosed.

The main question argued upon the briefs and at the hearing was, whether this- verbal agreement alleged by the plaintiff could be proven in face of the written agreement that the mortgage was payable on demand. There was no request for a reformation of the mortgage, as the mortgage was by its terms made payable on demand for a specific purpose. It would seem so clear as not to need argument- that an oral agreement that a written obligation payable on demand should not be payable except on certain conditions is contradictory of the terms of the written agreement. By that written agreement demand might be made at any time. By the oral agreement demand could only be made upon the plaintiff’s default in performing her obligations to the defendant.' The plaintiff, therefore, cannot make proof of said oral agreement, and has shown no legal

p. 118

reason why the defendant should he enjoined from foreclosing the chattel mortgage.

The order must, therefore, be reversed, with ten dollars costs, and the motion denied, with ten dollars costs.

Clarke, P. J., Laughlin, Scott and Davis, JJ., concurred.

Order so far as appealed from reversed, with ten dollars costs and disbursements, and the motion denied, with ten dollars costs.