Majority
p. 46The New Loan Officers of the County of Albany against Capron.
Headnote
Á discharge under Ihe act for giving relief in eases of insolvency, (passed the * 12th of April, 18.13. 1 A7. R. L, 4L0. sess. 36. ch. 1)8. see. 9.) obtained the 6th of May, 1817, is a good bar to an action of covenant brought by the loan officers of Albany, on a covenant contained in a mortgage, to recover the balance remaining due on the mortgage, executed by'the defendant, under the act passed the 14th of March, 1792,(2 Greenl. L. Nexo York, 400.) after a sale of the mortgaged premises pursuant to the act. and the proceeds of which were insufficient to satisfy the principal and interest due on the mortgage, and which, by the terms of the mortgage, were payable, when demanded, at any time after the first Tuesday of May, 1815; it being a debt due, at the time of the application for relief, under the act, on the 17th of February. mi.THIS was an action on a covenant contained in a mortgage, dated the 4th of May, 1814, given by the defendant to the plaintiff's, for securing the payment of one thousand dollars, conditioned to be paid, with the interest thereon, when the same should be demanded, at any time after the first Tuesday of May, 1815, and which the defendant covenanted to pay accordingly.
The declaration, after setting forth the indenture of mortgage, and that on the first Tuesday of May, 1817, the principal and sixty dollars interest remained unpaid, stated that the mortgaged premises, pursuant to the terms of the mortgage and of the act under which the loan was made, were sold, and that the proceeds of such sale were not sufficient to pay the principal and interest due on the mortgage; but after deducting such sale and the charges, &c., there remained in arrear and unpaid of the principal and interest, the sum of 796 dollars and 87 cents, of which the defendant had notice, and was required to pay ; but that the defendant wholly neglected to pay the same, &c,, contrary to his covenant, &c.
The defendant pleaded, 1. Non est factum: 2. That after the principal and interest were due and payable on the mortgage, and the cause of action, if any, had accrued to the #píaintifís, and before the exhibition of their bill, to wit, on the I9th of February, 1817, a creditor of the defendant (who was then in prison, and had been imprisoned for sixty days and upwards, upon execution in a civil action, &c.) applied to the recorder of the city of Albany, for relief, under the act for giving relief, in cases of insolvency, passed the 12th of April, 1813, (1 N. R. L. 460. sess. 36. ch. 98. sec. 9.) setting forth the proceedings under the act, and his conformity thereto, and his discharge, signed by the recorder of Albany, dated the 6th of May, 1817, &c., wherefore he prayed judgment, whether the plaintiffs ought to have and maintain their said action against him, &c.
The plaintiffs replied to the second plea, that the cause of action set forth in the declaration, and stated in the second and last breach assigned, accrued after, and not before, the time of granting the defendant’s discharge, to wit, on the 22d of April, 1818, and this they prayed might be inquired of by the country. To this replication the defendant demurred, and the plaintiffs joined in demurrer, which was submitted to the court without argument.
delivered the opinion of the court. The question here turns on the effect of the defendant’s discharge.
p. 47
If the mortgage money was due at the time of the defendant’s discharge, though payable at a future day, the case would come within the provisions of the insolvent act, and the defendant would be protected by it. By the. terms of the mortgage, the principal was payable at any time after the first Tuesday of May, 1815, when demanded by the plaintiffs ; it was, therefore, a debt at the time of the application, by a creditor of the defendant, to the recorder of Albany, in February, 1817, under the 9th section of the insolvent act, although payment may not have been demanded at that time. This case, therefore, does not come within the principle decided in Frost v. Carter, ( 1 Johns. Cas. 73 .) or the Mechanics'’ & Farmers’ Bank v. Capron, ( 15 Johns. Rep. 467 .) In those cases, the debts were not due ; nor had they accrued to the plaintiffs, at the time of the discharge under the insolvent act; the defendants owed no debt to the plaintiffs at the time of their discharge, and #their eventual responsibility was altogether contingent. In the present case, the defendant stood indebted, and was liable to be sued long before his discharge. The only contingency in the case related solely to the amount for which the mortgaged premises should sell; and, independently of the mortgage operating on the land, the defendant stood personally responsible on his covenants. I do not perceive that this case differs from any other case of a debt secured by mortgage ; the mortgagee may hold to his lien ; but if he resorts to the person, and if the debt be due at the time of the discharge, though payable afterwards, the debtor is absolved by the discharge.
This debt was, in effect, due to the county of Albany; for, if any deficiency happens on a sale of the mortgaged premises, it is to be assessed and levied on the county where the deficiency happens, as other county charges. The plea, then, being good, and operating as a bar to the suit, the matters set forth in the replication do not present a state of facts impugning the discharge, and the defendant must have judgment,[1]
Judgment for the defendant.
(a) (a) See 16 Johns. Rep. 254 , note.
Cases cited
- Frost v. Carter 1 Johns. Cas. 73 p. 47