Blydenburgh v. Bingham — 38 N.Y. 371

Majority

p. 371

William J. Blydenburgh, Executor of the last will of Richard F. Blydenburgh, deceased, Appellant, v. Amos F. Bingham, George G. Johnson and David H. Decker, Respondents.

Headnote

Discharge of surety from obligation. A release by the judgment creditor, from the operation of a judgment, of lands in which it is thought the judgment debtor may have some contingent interest, and to relieve the premises from the possible cloud arising therefrom, does not exonerate the surety of such judgment debtor, where it is shown, that the judgment debtor has, in fact, no interest whatever in the lands so released, and that the judgment was in consequence no lien upon such lands.

The relation of the judgment creditor to the property released must possess more than a suppositious or imaginary value and advantage, in order that the release shall discharge the surety from liability.

This action was brought by the executor of Bichard F. Blydenburgh, deceased, to exonerate the estate of the testator from the payment of a judgment, docketed in Kings county, against the defendant Johnson and the testator, on a note-made by the former and indorsed by the latter, as security. The relief was claimed upon the ground that the defendant Decker, being the owner of the judgment, had released therefrom to the defendant Bingham, certain real estate, consisting of six city lots in Brooklyn, which was subject to the lein, legal or equitable, of said judgment. The facts, as found by the court which tried the cause, are substantially as follows: On the 14th day of February, 1857, the defendant Johnson, for a valuable consideration, conveyed the premises above mentioned, by a quitclaim deed, to the defendant Bingham, which conveyance was recorded in Kings county, on the 26th day of March, 1858. The judgment above mentioned, was recovered by Emanuel Hoffman and Henry Schubart, for the sum of $558.20, on the 8th day of July, 1857, and was docketed in Kings county, on the 11th day of the same month. On the 19th day of January, 1861, the defendant Johnson and his wife, executed and delivered to the defend

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ant Bingham, a warranty deed of said lots for the expressed consideration of one dollar, and other good causes and considerations. On the 20th day of November, 1862, Hoffman and Schubart, assigned their judgments to the defendant Decker, for a valuable consideration, and on the 29th day of the same month, Decker released the six lots from the judgment. And the court further found that at the time of the docketing of the judgment, of the assignment thereof to Decker, and of the release of the lots therefrom to Bingham, the defendant Johnson had no interest in said lots, but the same were the property of the defendant Bingham. That at the time of the assignment of the judgment and the release of the lots, the defendant Bingham was embarrassed, and was owing the defendant Decker a large sum of money, which the latter could not get, nor get it secured unless the six lots were released from the said judgment, and that for that reason he purchased the judgment and paid the face thereof for it, and then released the said lots, holding the judgment as collateral security for the debt due him from Bingham. That the property released was incumbered for its full value, aside from the said judgment, and that the said judgment is still due and unpaid, and is a lien upon the real estate of the said Bichard F. Blydenburgh, deceased. And the judge found as a conclusion of law, that the said David H. Decker is the owner of the said judgment, and is entitled to hold the same as a lien against the real and personal estate of Biehard F. Blydenburgh, deceased. Judgment was entered for the defendant, which was affirmed at General Term, and from the judgment of affirmance, the plaintiff has appealed to this court.

George Miller, for the appellant.

J. H. Hedley, for the respondent.

The facts found by the court below, must be conclusive against the theory upon which the plaintiff, in his complaint, bases his claim to relief. That theory is that the

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six city lots in Brooklyn was subject to the lien of the judgment of Hoffman and Schubart, as the property, legal or equitable, of Johnson, the principal debtor, and that the release of those lots by the holder of the judgment, without the consent of the surety, Blydenburgh, discharged the latter from the obligation of his suretyship, and entitled him to a discharge of his estate from the judgment. The conclusion no one will dispute, if the premises be as stated. The difficulty is, that the findings below entirely negative those premises. The conveyance by quitclaim from Johnson to Bingham, was five months earlier than the docketing of the judgment, and, though the deed was not recorded until some months later than the judgment, it is not claimed that the lien of the judgment had priority for that reason. Some objections to the quitclaim deed were urged by the appellant, both on the trial and on the argument, but no facts were shown which detract in any degree from its force and validity as a conveyance of all the interest of Johnson in the property, and upon this point the finding of the court below must be held conclusive, viz., that at the time of the docketing of the judgment and of the release of the lots, Johnson had no interest in them. The subsequent deed of Johnson and wife may have been sought and obtained for the signature of the wife, but whatever its puipose, it conveyed nothing as to Johnson which had not previously been conveyed.

Indeed, I do not understand the appellant as insisting upon the argument here, that the judgment was in fact a lien, either legal or equitable, upon the lots, but as claiming that it was so far considered to be such, and was, thus, so far a cloud upon the title to the property, that it gave the judgment creditors a position, relative to that property, which was worth something, to the benefit of which the surety was entitled to be subrogated, and which could not be released without in some degree affecting his rights and remedies.

In support of this view of the matter, the appellant urges the facts found, that Decker could not get security for his debt from Bingham, unless the lots should be released from the judgment, and that, for that reason, he was willing to

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pay, and that the judgment creditors, in fact, received the' face of the judgment for the assignment of it. But these circumstances by no means establish the fact, that the position of the judgment, creditors’ relation to this property was of any real value. Its advantage was, at most, suppositions and imaginary. If Johnson had no interest in the lots when the judgment was docketed, nor at any time thereafter, the existence of that judgment could affect the negotiation of the security offered by Bingham only upon the mistaken supposition, that it was a lien upon the property. ISTor can it be said, that the position of the judgment creditors’ relation to this property did, in fact, avail them the face of the judgment.- That judgment must be supposed to have been perfectly good, without reference to these lots. It was collectible from Blydenburgh, the surety, whose solvency was unquestioned, so that Decker got full value for his money, in obtaining the judgment, without reference to the release of the lots, and, after the release, he held the judgment as collateral security for so much of the debt of Bingham.

It is-quite clear, that, in executing the release of the lots from the judgments in question, Decker released nothing which could have availed in its collection, and, consequently, that the rights and remedies of the surety were in no manner affected by such release.

Counsel for the appellant insisted, with much earnestness, that there was a pbssibility that Johnson might have had some interest in the lots, and that therefore the surety might have been prejudiced by their reléase from the judgment, and he, cited some authorities, in .point, to show that the question was not, necessarily, “ has the surety, in fact, been prejudiced,” but, “has there been a change in the relations of the parties, by which he may have been prejudiced ?”

But here, as before, the appellant is concluded by the positive finding of the court below, that Johnson had no interest in the lots in question, a finding which negatives even the possibilty referred to.

■ There was another finding in the case, which is, probably, equally fatal to the plaintiff’s claim to relief, viz., that the

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property was already incumbered for its full value, before the docketing of the judgment against Johnson, but it is unnecessary to inquire as to the effect of prior liens, when it is found, as above, that the judgment against Johnson was not a lien at all.

The judgment appealed from should be affirmed.'

The plaintiff seeks, in this suit, to exonerate the real and personal estate of Richard F. Blydenburgh, deceased, from the payment of a judgment of §558.58, obtained July 8, 1857, in favor of Emanuel Hoffman and Henry Shubart, against the said Richard F. Blydenburgh and George G. Johnson, upon a promissory note by Johnson, and indorsed by the said Blydenburgh for his accommodation. The plaintiff’s case is based upon the theory, that, Johnson being the principal debtor, and Blydenburgh the surety, Blydenburgh has been released and discharged in law by the acts and doings of the defendant Decker. That Decker, knowing that Blydenburgh was surety, procured from Hoffman and Shubart, the plaintiffs in said judgment, an assignment of the same on the 20th ¡November, 1862, and, on the same day, released certain lots of land from the operation of the said judgment, and that said lands had belonged to the said Johnson once, and that the said judgment was a lien upon the said lands so belonging to the said Johnson, and that, by the release thereof, the defendant Blydenburgh, as surety, was released. The judge before whom the case was tried has found the fact, that, at the time of the docketing of the said judgment, and at the time of the assignment thereof to the said Decker, and at the time of the release by him of the said premises in the complaint mentioned, the said George G. Johnson had no interest in the same, but that the same were the property of the defendant Amos F. Bingham. As there was evidence upon which to predicate such a finding, it is conclusive upon this court. I do not see, however, how the court could have found otherwise.

The deed from Johnson to Bingham, of the 14th February, 1857, was good in form, and operative to pass all of Johnson’s

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title to Bingham. This conveyance being before the recovery of the Johnson judgment, and there being no evidence to impeach it, the finding of the judge is in accordance with the evidence. The subsequent execution of a deed in 1861, by Johnson and wife, of the same premises to Bingham, being made for the purpose of releasing the wife’s contingent right of dower, affords no evidence to impeach the prior conveyance of Johnson. At any rate, the finding of the judge upon this question is conclusive upon this court. ■

The plaintiff also made the claim in his complaint, and sought to maintain it upon the trial, that the defendant Decker purchased the said judgment of Hoffman and Shubart, for the benefit of said Johnson and Bingham, and to hold it for their benefit, and that, Johnson being the principal debtor, the judgment should not be permitted to remain against Blydenburgh, the surety. The judge finds this issue against the plaintiff: He finds, that Decker purchased the judgment for his own benefit, with his own money, for the purpose of securing an indebtedness at that time due, and owing to him, by the said Bingham, and that the said judgment is not held by the Baid Decker for the benefit of the said Johnson and Bingham, but for his own benefit, and as collateral security for moneys due to him by the said Bingham. This finding is in accordance with the evidence. The plaintiff entirely failed to prove the case made in his complaint, as the judge who tried the cause has found, and there is no principle upon which this court can interfere with his findings, and if the findings are sustained, the plaintiff is not entitled to any relief in this action.

I fully appreciate the argument of the appellant’s counsel, that the contract Qf the surety' cannot be, in any manner, interfered with, nor can his rights of subrogation be taken away by the creditor. His contract is strictissima juris, and the creditor must not deal with the debtor, or the security which he holds upon the debtor’s property, to the prejudice of the surety, unless he intends to release the surety. Ho such thing has been done here, if Johnson never owned any of these lands after this judgment was obtained. This

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was a question of fact to be determined upon the trial, and was justly found against the plaintiff upon the trial. The same is true in regard to the question, whether this judgment was purchased by Decker for Johnson’s benefit. The judgment of the Supreme Court must be affirmed.

All agree to affirm.

Judgment affirmed.