Stiles v. Benjamin — 36 N.Y.S. 910

Majority

p. 910

STILES v. BENJAMIN.

(Supreme Court, General Term, Fourth Department.

December 26, 1895.)

Headnote

Agreement to Assign Mortgage—Damages.

Where a mortgagee received money on an agreement to assign the mortgage, on payment of the full amount thereof, and then assign's it to another, the measure of damages is the amount so paid him.

Appeal from circuit court, Broome county.

Action by OIney L. Stiles, administrator of Mary L. Stiles, deceased, against John Benjamin. From a judgment for plaintiff, defendant appeals.

Affirmed.

Argued before HARDIN, P. J., and MARTIN and MERWIN, JJ.

More & Scott, for appellant.

W. & G-. W. Youmans, for respondent.

July 21, 1886, Frances E. Ufford executed and delivered to the defendant her bond, and mortgage as collateral thereto, to secure the sum of $4,700, upon property described in the mortgage, situated in the village of Deposit. On the 17th of August, 1887, plaintiff’s testatrix, then bearing the name of Mary L. Chase, entered into a negotiation with the defendant in respect to the said mortgage, and on that day she advanced to him the sum of $1,500, and took from him a written instrument containing the following language:

“Received from Mary L. Chase one thousand five hundred dollars as a payment on bond and mortgage from Mrs. F. E. Ufford to me of four thousand seven hundred dollars, to be received and applied by me thereon, as between me and said Mrs. Chase. In order to protect Mrs. Mary L. Chase for any payments she now makes or may hereafter make, I agree when the money received by me shall amount to the full amount payable by said bond and mortgage, principal and interest, at the request of said Mary L. Chase, and payment by her of all expenses, to transfer and assign to her the said bond and mortgage, unsatisfied as to all payments made by her, to enable her to hold the same as a security for the money so advanced by her,—the intent and understanding being that, as between us, the payment shall be absolute; Mrs. Chase having no rights, except the right above provided, of assignment on payment to and receipt by me of the whole amount. John Benjamin.

“Dated, August 17, 1887.”

Subsequently payments were made,—on July 2, 1888, $500; July 25, 1889, $500; .May 26, 1890, $100; October 27, 1891, $200; and

p. 911

September 4,1893, $10. Mary Stiles, née Chase, died, leaving a last will and testament, which was admitted to probate, and the executor therein named having died, the plaintiff was appointed and qualified as administrator with the will annexed in February, 1894. It is alleged in the complaint that in March, 1894, the plaintiff tendered to the defendant the amount remaining unadvanced upon said mortgage, and demanded that the defendant execute to him an assignment of the bond and mortgage “in pursuance of the agreement.” And it is alleged the defendant neglected and refused to execute the said assignment. And it is alleged in the complaint that thereafter the defendant sold, assigned, transferred, and delivered to one Cook the bond and mortgage, who became the owner and holder thereof, and who commenced an action to foreclose the same. Defendant, in his answer, admits the execution of the agreement, substantially as set out in the complaint, and he also admits that he, “before the commencement of this action, sold, assigned, transferred, and delivered to David B. Cook said bond and mortgage by an instrument in writing conveying his interest therein; and he shows, upon information and belief, that the interest of said Gumming and Taylor in said bond and mortgage was also assigned to said Cook.” It appears by the evidence that the bond and mortgage had their origin at the time of concluding a litigation theretofore existing affecting the real estate described in the mortgage, and that the conveyance made by the defendant to Ufford was apparently in consideration of $3,700, and a mortgage was taken back to cover that sum, together with “$1,000 added to the purchase price of the property” to satisfy the claims of Taylor and Gumming, who had acted as counsel in the litigation, and in that agreement settling the lawsuit it was expressly agreed that the defendant should have $3,700 in a bond and mortgage, and that “the same shall be paid from the first payments made thereon.” Taylor assigned his interest in the mortgage to Cook on the 4th of January, 1894, and Gumming assigned his interest in the mortgage to Cook by an instrument bearing date July 28,1886. When the defendant recéived the payment of July 24, 1888, he executed another instrument, containing similar language to that found in the instrument of August 17, 1887, and when he received the payment of $500 in July, 1889, he executed another instrument, containing similar language, mutatis mutandis. Upon the trial it was conceded that the total amount of advances made by the testatrix amounted to $2,800. According to the evidence given on the trial the plaintiff had an interview with the defendant on the 27th of January, 1894, as to paying the balance of money and taking an assignment of the mortgage. The plaintiff states that interview in the following words:

“The morning of the 27th of January, 1894, Mr. Benjamin said, T have got to assign that mortgage to Cook.’ And I said, ‘What is the reason we can't raise the money?’ And I said, ‘We can raise the money in 24 hours, the whole $4,700.’ He said, T can’t sell it to you,’ and went out. He went off and said he couldn’t sell it to us. One time before that he agreed to sell it to me. * * * He afterwards declined to transfer the mortgage to me and said he had got to assign it to Cook, and did assign it to Cook.”

p. 912

The defendant, as a witness, disputes the tender, and states there was some conversation looking to his foreclosing the mortgage and bidding the property in to protect the interest of the estate represented by the plaintiff. The court has resolved the conflict in the evidence in that regard in favor of the plaintiff, and we see no occasion, upon looking into all the circumstances disclosed in the evidence, to question the propriety of the findings made favorable to the plaintiff after applying the rule which has so frequently been applied where the evidence is conflicting. See Smith v. McCluskey, 45 Barb. 610 . On the 3d day of February, 1894, the. defendant assigned, by a written instrument bearing that date, the bond and mortgage, “for a good and valuable consideration to him in hand paid, * * * bearing date the 21st day of July, 1886, made by Frances E. Ufford to me, said John Benjamin, to secure the payment of the sum of $4,700.” That assignment was acknowledged, and under it Cook acquired possession, and claimed to own the mortgage, and commenced an action to foreclose the same.

We think the agreements made by the defendant with Mrs. Chase were to the effect that the defendant would sell to her the bond and mortgage. The agreement made by him was broken. The excuse the defendant gave for breaking the contract was “that there was a contract made” to the effect that he would assign the mortgage to Cook. We think the excuse is entirely insufficient. The defendant, when he undertook with the testatrix to give to her an assignment of the bond and mortgage, and received her money in pursuance of the arrangement that he should transfer and sell the mortgage to her, became liable to carry out his contract, and it was his fault that he did not put a condition or qualification in the agreement, if one was needed, that in the event he was not required to assign it to* Cook, he would assign it to her. He made an undertaking that for the money he would assign to her the bond and mortgage. He failed to do so. She has suffered damages by reason of his failure to the extent of the amount of moneys which she has paid upon the contract, which he now fails to fulfill, and, whether the action be regarded as one for breach of contract, and damages in consequence thereof to the extent of the money which she has paid, or whether it be regarded as an action for money had and received, because of the failure of the party to perform his agreement,—the rule of damages adopted by the trial judge is right. Smith v. McCluskey, 45 Barb. 615 . In that case Bockes, J., said:

“There is no doubt but that the defendants had a right of action for the money paid by them on the contract. The contract had not been fulfilled. The party with whom they contracted had not performed his part of the agreement, and they had a right of action to recover their damages by reason of' such omission. Their damages, too, were the sums of money they had paid on the contract. * * ** Such money could be recovered back in an action for breach of the agreement.” Tompkins v. Dudley, 25 N. Y. 272 ; Ward v. Building Co., 125 N. Y. 286 , 26 N. E. 256 ; Stewart v. Stone, 127 N. Y. 507 , 28 N. E. 595 .

Undoubtedly the action for money had and received is to be disposed of upon equitable grounds. Otis v. Crouch, 89 Hun, 551 , 35

p. 913

N. T. Supp. 291. Applying the rule that is applicable to such an action, we are of the opinion that in equity and in good conscience the defendant “ought not to retain the money” which, ex equo et bono, belongs to the plaintiff. 2?or do we think the circumstances that the plaintiff’s testatrix may have had some information that the defendant was under some stringent obligation to assign the bond and mortgage to Taylor and Gumming, or some interest therein, was sufficient to defeat this action. The defendant deliberately put it out of his power to comply with his agreement made with the testatrix, and, having done so, he ought to return the money which he received from the testatrix, advanced in the faith that she was to have an assignment therefor of the bond and mortgage in question. We are satisfied with the views given by the trial judge in determining the case at the circuit, and we are of the opinion that his conclusion is just and equitable.

Judgment affirmed, with costs. All concur.

Cases cited

Smith v. McCluskey 45 Barb. 610 N.Y. Sup. Ct. 1866-05-01 p. 912
Tompkins v. Dudley 25 N. Y. 272 N.Y. p. 912