Hoyt v. Doughty — 6 N.Y. Super. Ct. 462

Majority

p. 462

Hoyt v. Doughty and others.

Headnote

Where two unite in mortgaging their lands owned in severalty, each is presumptively liable for half the debt, and his lands are primarily chargeable to that extent.

A subsequent unrecorded agreement, by which one of two joint mortgagors of lands owned by them severally, agrees to pay off the whole debt, does not affect subsequent bona fide purchasers of his lands for value without notice of the agreement; and as to him, the mortgage debt will be charged one half upon the lands of each mortgagor.

I. and J., owning lands in severalty, joined in mortgaging them to D. for a joint debt. I. afterwards executed a bond of indemnity to J., agreeing to pay the whole mortgage. Subsequently I. executed mortgages on his lands to other parties, for a valuable consideration, who had no notice of the bond or agreement between him and J. On the foreclosure of the mortgage to D., held, that J.. could not, as against the subsequent mortgagees, compel the collection of the whole of it from the lands of L to their prejudice, and that half of it was collectible from the lands of J.

(Before Oakley, Ch. J., and Sandford and Paine, J. J.)

March 8;

March 15, 1851.

This was a suit to foreclose a mortgage for $1000, executed December 31st, 1829, by John Doughty and Isaac Doughty, to Jacobus Dikeman, duly recorded, and on the 13th of April, 1850, assigned by his executor to the complainant. The mortgage was on two distinct parcels of ground in the city of New York, one of which was owned by John Doughty, and the other by Isaac Doughty, in severalty. The latter consisted of four lots on 121st-street.

On the. reference hereafter stated, the following facts appeared. The object of executing the mortgage was to raise money for the discharge of certain joint liabilities of John and Isaac Doughty, as sureties.

In 1837, some arrangement was made between John and Isaac Doughty, by which the latter was to assume the payment of the whole of the mortgage, and thereupon Isaac, on the 16th October, 1837, executed to John Doughty a bond, with a condition that he, Isaac, would pay the mortgage, and would indemnify and save harmless John therefrom.

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Subsequently, in 1845, Isaac Doughty executed to the complainant and Philip Tillinghast, a bond with a mortgage on the lots in 121st-street, and other lands. This bond and mortgage were to secure the payment of $5500. At the time of the execution and recording of this mortgage, the mortgagees had no notice of the arrangement between John and Isaac Doughty, as to the payment of the mortgage of 1829, or of the bond of indemnity given by Isaac to John. It was proved, however, that when this mortgage was executed, the complainant and Isaac “ figured up that $1000 was due on the 121st-street property” of Isaac D., and it was claimed that this established notice to the complainant of John Doughty’s equity.

In 1847, Amanda Eels, having some judgments against Isaac D., which were a lien on his real estate, cancelled the same, and received from him his mortgage on the 121st-street lot, and the other premises embraced in the mortgage given by Isaac D. to the complainant. There was no evidence that she had any' notice whatever .of the arrangement by which Isaac D. had assumed the payment of the whole mortgage to Dikeman, or of his having executed to John D.' a bond of indemnity to that effect.

These subsequent mortgages were recorded about the time they were executed. The bond of indemnity never was recorded.

John Doughty having died, his executors and devisee were made defendants in the suit, as were also Amanda Eels, Philip Tillinghast, William Colwell, and Isaac Doughty. The latter put in an answer. In July, 1850, the usual judgment was rendered in the cause, for a foreclosure of the mortgage to Dikeman, and a sale of the premises mortgaged thereby, directing the surplus, if any, to be brought into court.

On the 11th of September, 1850, the court, on the application of John Doughty’s executors, ordered a reference to ascertain whether John IV executed the original mortgage as surety for Isaac D., or for his benefit, and whether Isaac ever assumed to pay it as between him and John Doughty.

The lands mortgaged to Hoyt and Tillinghast, and to Eels, were inadequate, to pay the amount of their mortgages, and Isaac D. had no other property.

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The referee reported the facts above stated, and thereupon an order was made by Duer, J., directing the sheriff, in executing the decree for sale previously entered, to raise one half of the debt and costs, (i. e., the original mortgage of 1829,) out of the parcel of land owned and mortgaged by John Doughty, and the other half out of the premises on 121st-street, owned and mortgaged by Isaac Doughty.

From this order, the devisee and executors of John Doughty appealed to the general term.

J. JS, Gary, for the executors and devisee of John Doughty,

cited 2 Paige, 300; 6 Ibid. 35; 8 Ibid. 300; 3 Sand. Ch. R. 135; 4 J. C. R. 17, 20; 17 Ves. 520; 1 Story’s Eq. Jur. §§ 642, 645.

8. A. Grapo and T. W. Twicer, for the plaintiff and P. Tilling-hast.

N. Ketchum, for Amanda Eels.

By the Court.

We agree fully with the counsel for John Doughty’s representatives, that on the execution of Isaac Doughty’s indemnity bond in 1837, he became the principal debtor for the amount of the Dikeman mortgage, and John D. was thereafter, his surety. As the facts were at that date, on a foreclosure of the mortgage, the whole of Isaac D.’s four lots on 121st-street, would have been ordered to be sold before resorting to the land mortgaged by John. — And if the latter had taken the precaution to record the bond of indemnity, as being what it really was, an equitable mortgage on Isaac’s lots for the payment by him of John’s half of the mortgage debt, the difficulty now presented would never have arisen. The same result would have been attained, by taking and recording a direct mortgage from Isaac, with a condition to pay and discharge the Dikeman mortgage.

But upon the unrecorded bond of indemnity, this right of John as against the land of Isaac was a mere equity, which

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could not avail him against subsequent purchasers for a valuable consideration, in good faith, without notice of its existence. Hoyt and Tillinghast became such purchasers, by the mortgage executed to them by Isaac Doughty in 1845, and there is no sufficient evidence that they had any notice of the equity by which the Dikeman mortgage was' to be paid by him. That mortgage, upon its face, was the joint and equal debt of both Isaac and John; and notice that it was, or had become otherwise, must be proved against the subsequent mortgagees. The testimony about figuring up the amount due on the 121st-street property, is altogether too slight to warrant us in inferring notice of this equity; especially when Isaac Doughty, who was examined as a witness for John’s representatives, could not remember that he gave any information of it to those mortgagees.

As to Amanda Eels, the third mortgagee, there is no pretence of notice to her in any form. She also was a purchaser for value, having surrendered some judgments against Isaac Doughty on the faith of the mortgage, and John D.’s equity cannot stand against her legal right thus acquired.

The subsequent mortgagees do not ask to have the securities marshaled in their favor. They do not claim to charge the whole Dikeman mortgage upon John D.’s land. They simply require that it shall be collected, as by its terms it was originally collectible, one half from each of the mortgage debtor’s lands. It is John Doughty’s representatives who seek to marshal the mortgages, by throwing the whole burthen of that mortgage on the lands of Isaac Doughty. This they are not entitled to do, because it would interfere with the rights of subsequent purchasers for value without notice of their equity.

The order appealed from is right, and it must be affirmed.