Draper v. Draper — 55 N.Y. St. Rep. 11

Majority

p. 11

George W. Draper, Resp’t, v. Horace S. Draper, et al., App’lts.

(Supreme Court, General Term, Fourth Department,

Filed September 23, 1893.)

Headnote

Mortgage—Absolute deed and agreement to reconvey.

A deed absolute on its face of property subject to encumbrances for an expressed consideration which was not in fact paid, and an agreement to re-convey the premises on payment of the claims against the place, considered together, constitute a mortgage, and not a gift with the privilege of repurchase.

Appeal from judgment of special term in favor of plaintiff.

_ On March 12, '1879, the plaintiff conveyed certain premises to Ms brother, the defendant Horace S. Draper, by a deed, absolute on its face, and for the expressed consideration of $500. Such premises were subject to about $6,000 of encumbrances thereon, and nothing was in fact paid by the defendant for such convey

p. 12

ance. On receiving such conveyance, he gave back to the plaintiff the following written agreement: “I hereby agree that whenever, after this date, George W. Draper pays to me the amount of claims, principal and interest, against the place transferred this, day by him to me, that I will transfer the same back to him without further cost to him. Geddes, March 12, 1879. Signed, Horace S. Draper.” This action is brought for an accounting by the defendant of the amounts paid by him upon the encumbrances-against the premises, and of the rents and profits received by him therefrom, and for a reconveyance upon payment to him of the-balance so found to be due him. Upon the trial at special berm the court held that the conveyance and paper taken back should be construed together, and constituted a mortgage; that the defendant stood in relation to the plaintiff as a mortgagee in possession of the premises, and was liable to account as such, and to re-convey the premises upon being paid the amount due him as-such; and ordered an interlocutory judgment to that effect.

Homer Weston, for app’lts; Stone, Gannon & Pettit, for resp’t.

The appellants contend that the deed executed to the defendant, and the written agreement taken back by the plaintiff, should not be construed as a mortgage, because at the time the relation of debtor and creditor did not exist between the parties, and the defendant did not assume any obligation to pay or advance anything for the plaintiff ; that, for such reason, he was not in a situation to require any security from the plaintiff, and therefore the idea that the deed was intended as a mortgage is-effectually rebutted. His claim seems to be that the transaction was a voluntary gift of the premises to the defendant, with the privilege of repurchasing them upon paying the amount of the-liens then existing against them. It is utterly incredible that the plaintiff ever agreed to give the property to his brother, and purchase it back for something over $6,000, still covered with the encumbrance upon it. From the whole evidence it is manifest that the defendant was to advance the amount due upon the encumbrances, or at least so much of it as was necessary to beep the creditors quiet and prevent a sale of the property, and hold the title as a security for the. advances so made. In this case there was no sale from the plaintiff to the defendant. There is nothing in the writing taken back that indicates a resale was intended, but everything indicates that security for advances tobe made was intended. It does not require the citation of authorities to show that, under such circumstances, the relation of mortgagee and mortgagor must exist between the parties. Rogers v. N. Y. & Texas Land Co., 134 N. Y., 197 ; 48 St. Rep., 263 ; Simon v. Schmidt, 41 Hun, 318 ; 2 St. Rep., 388 . None of the authorities to which we are referred by the appellants’ counsel contradict such a conclusion. Assuming that the defendant is a mere mortgagee in possession of the plaintiff’s property, there will be no dispute but that he is liable to account, and to reconvey' upon being paid his debt. Horn v. Keteltas, 46 N. Y., 607 ; Simon v. Schmidt, above cited.

It is further contended that the complaint is not sufficient to-

p. 13

warrant the judgment ordered by the special term. Every fact •necessary to establish the relation found to exist between these parties is averred in the complaint. When an answer is served, .and a trial had, any relief may be granted that is consistent with such averments. Rogers v. N. Y. & Texas Land Co., 134 N. Y., 219 ; 48 St. Rep., 263 . We do not discover any error in the rulings made upon the trial, and, on the whole case, conclude that the judgment should be affirmed, with costs.

Hardest, P. J., and Merwbst, J., concur.