McClave v. Sterne — 44 N.Y. St. Rep. 550

Majority

p. 550

John McClave, Resp’t, v. Simon Sterne, App’lt.

(Supreme Court, General Term, First Department,

Filed February 18, 1892.)

Headnote

1. Mortgage—Assignment—Evidence of consideration.

J. conveyed certain premises to S., subject to a mortgage ; thereafter an action was begun to foreclose the same, and J. purchased it for $3,216.50. Subsequently he gave it to McG. and plaintiff, to collect for him, they to repay him the amount paid out to protect himself, and the balance, if any, to be divided between themselves. It appeared that McG. subsequently-procured J. to assign the mortgage to B., the consideration expressed being $2,000 ; that defendant gave McG. his check for $2,000, and he paid the proceeds to J.; that B. afterwards assigned the mortgage to defendant without consideration, The mortgage was redeemed by payment of $5,597.50, and the court directed that defendant be repaid the $2,000. Plaintiff brought suit to recover one-half that amount as a balance over the amount due J. Feld, that the court erred in giving judgment for plaintiff, as the $2,000 was paid to J. in consideration of the transfer of the-mortgage.

2. Same—Immaterial facts.

Whether the money represented by the check of defendant to McG. was. defendant’s nr money which McG. had deposited with him, was entirely immaterial with respect to plaintiff’s demand, that being a question entirely between themselves.

3. Same.

Nor had the plaintiff any interest in'questioning the propriety of the-assignment of the mortgage by B. to defendant without consideration, after McG.’s death.

Appeal from judgment entered after trial at special term. ■

J. A. Beall, for app’lt; A. Price, for resp’t

This action was brought to recover upon-an alleged agreement between one John J. McGrurk and the plaintiff.

p. 551

The complaint alleged that in the spring of 1886 the said McGrurk was employed by one Mrs. Louise Jarvis to prosecute the ■collection of a bond and mortgage on property situated in the ■city of New York, to secure the payment of the sum of $3,000 ; that such employment was entered into by said McGrurk upon the express understanding that he should have as pay for his services all moneys which might be recovered over and above the sum of $3,266.90.

The complaint further alleges that the plaintiff secured to said McGrurk his employment as attorney in said proceeding, and in consideration thereof it was' agreed that said plaintiff should receive one-half of all the moneys realized upon said mortgage ■over and above the $8,266.90 aforesaid, and his employment by the owner of said bond and mortgage was made upon that express condition, and was. so accepted by said McGrurk; that said McGrurk proceeded in his efforts to collect or realize upon said bond and mortgage until his death in February, 1888, and that in ■aid of his contract of employment he procured the assignment of ;said bond and mortgage to one Brennan in April, 1886, which assignment was wholly without consideration, and wholly for the purpose of carrying out the contract aforesaid; that thereafter .and after the death of McGrurk in July, 1888, said Brennan, at the instigation' and procurement of the appellant Sterne, assigned the bond and mortgage to Sterne, which said assignment was wholly without consideration on the part of Sterne; that thereafter the owner of the premises upon which the mortgage was a lien by leave of the court paid the amount due on said bond and mortgage,. namely, $5,597.50, into court, and the mortgage was discharged of record, and that thereafter the appellant Sterne and the owner of the bond and mortgage procured an order of this ■court by which the sum of $3,266.90, agreed by said McGrurk to be paid tó the owner in his lifetime, was directed to be paid to her or her attorney, and the balance paid into court, namely, $2,330.60, was directed to be paid to said Sterne, the •defendant herein, as his attorney, and such payments were made; .and that said Sterne had notice of the plaintiff’s claim upon said bond and mortgage, and the plaintiff was entitled to receive one-half of the sum received by said Sterne, namely, $1,165.30. The .answer of the defendant denied the allegations of the complaint, except the existence of the bond and mortgage in question, the payment of the amount into court, and the receipt by said defendant of the sum alleged.

The court found the agreement substantially as alleged in the •complaint, but that of the sum received by said Sterne he was entitled to receive for his own account $150 counsel fee and eighty-live dollars .costs, and gave judgment in favor of the plaintiff for one-half of the balance, viz., $1,047.80, and from the judgment thereupon entered this appeal is taken.

Upon an examination of the evidence in this case, we think the learned judge erred in the conclusions of fact which he drew from the evidence produced upon the trial; and a very brief examination of the evidence seems to us to demonstrate the fact that no

p. 552

such agreement as was claimed in the complaint was ever entered into by the owner of the bond and mortgage and McGrurk and the plaintiff, but that the sole agreement was that McGrurk and the plaintiff should divide the profits which might arise over and above the amount due upon the bond and mortgage upon a sale-of the premises upon which it was a lien.

It appears from the evidence that in June, 1868, one William A. Whitbeck conveyed to Nathaniel Jarvis, Jr., certain premises, and took back a mortgage of $3,000 to secure part of the consideration money on said purchase. This mortgage is the invest-' ment in question. In December, 1868, Jarvis and wife conveyed the said premises to one Mary J. Squires, subject to the mortgage-in question. In 1869 Whitbeck assigned the mortgage to oneBronk Van Loan. In December, 1876, Van Loan commenced an action against Mary J. Squires, and her husband and Nathaniel Jarvis, Jr., and others, for the foreclosure of this mortgage. On the 1st of January, 1878, Mr. Jarvis purchased said bond and mortgage, taking an assignment in the name of his wife, Mary L. Jarvis, but paying for the same out Of his own money’the sum of $3,215.50, being $3,000 principal and $120 costs and disbursements, and the balance seems to have been interest.

Subsequent to this time, in or about 1886, Mr. Jarvis gave this-bond and mortgage to McGrurk to collect for him, who was an attorney introduced to him by the plaintiff. He told them if they would pay him the amount he had already paid in order to-save himself from a judgment of deficiency, stating the amqunt at $3,100 odd, that all that they realized over and above that amount he would let them divide between themselves share and share alike. The arrangement with McGrurk was that if he would on a sale of his property, through the plaintiff and himself realize sufficient to pay him the amount he had paid for several years, amounting to $3,100, with the accumulations of interest, thereon, he would allow him and the plaintiff to divide it between themselves share,and share alike.

In furtherance of that arrangement Mrs. Jarvis assigned the-bond and mortgage in April, 1886, at the instance of McGrurk to* one Henry T. Brennan, the consideration expressed in the instrument being $2,000. It further appears that McGrurk and the appellant Sterne had business relations together and that about this time, on the 16th of April, 1886, said Sterne gave to said McGrurk a check payable to his own order for $2,000 which he drew in-cash. It further appears that McGrurk paid to Jarvis at or about this time four $500 bills. It is true that Jarvis states that no consideration was paid to him on behalf of his wife on account of that assignment. But it seems to me, in view of the fact that Mr. Jarvis advanced his own money on the purchase of this bond arid mortgage, and the fact that he received at' or about this time $2,000 from McGrurk, and that $2,000 was mentioned as the consideration of the assignment of that bond and mortgage to Brennan who was to hold the same for McGrurk, that the conclusion is-irresistible, notwithstanding the fact that Mr. Jarvis in another part of his testimony states that this $2,000 had nothing to

p. 553

do with the assignment, that lie did receive that sum on that account.

And this conclusion is borne out by the fact that he further testified that McGrurk and the plaintiff were to receive all over and above the amount due him. Now, the amount due him was $3,216.90, with interest from January 1, 1873; and it further appears that when the sum due on this bond and mortgage was paid into court, amounting to $5,597.50, by the consent of the parties Mrs. Jarvis, who had made the assignment of the bond and mortgage to Brennan, was paid $3,266.90, and the appellant Sterne, to whom Brennan had assigned the bond and mortgage without consideration, was to receive $2,330.60. Thus the amount which Mrs. Jarvis was to receive was about the sum of $3,216.90, which Mr. Jarvis had advanced on the assignment of the bond and mortgage to her, with interest from January, 1878, to the time of the payment of the bond and mortgage, the $2,000 being ■credited thereon as of April, 1886; and the appellant was entitled to the $2,000 then paid, with interest to the time of the deposit into court; and upon the settlement in respect to the division of "these moneys, these are substantially the amounts received by the parties interested in the bond and mortgage. There was no profit to which the plaintiff could lay any claim whatever. There is no testimony throughout the case in conflict with this conclusion and it harmonizes all the declarations which were testified to as being made by the various parties in connection with the transaction.

Whether the moneys represented by the check of Sterne to Mc-Grurk were Sterne’s moneys or were moneys which McGrurk had deposited with Sterne to be kept for him is entirely immaterial so far as this controversy is concerned. That is a question between .Sterne and the estate of McGrurk.

Nor has the plaintiff any interest in questioning the propriety ■of the assignment of the bond and mortgage by Brennan to Sterne without consideration after McGrurk’s death.

We think, therefore, that there was no evidence whatever to support the contention of the plaintiff, and that the judgment should be reversed and a new trial ordered, with costs to appellant to abide the event

O’Brien and Lawrence, JJ., concur.