Case Name: James Campbell, Appellant, v. Philemon Birch, Respondent
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1875-03-23
Citations: 60 N.Y. 214
Docket Number: 
Parties: James Campbell, Appellant, v. Philemon Birch, Respondent.
Judges: 
Reporter: New York Reports
Volume: 60
Pages: 214–220

Head Matter:
James Campbell, Appellant, v. Philemon Birch, Respondent.
One E. M. H. executed to C. H. a chattel mortgage which recited that it was given to secure the payment of a debt of $1,000, and was conditioned for its payment according to the terms of a note of the mortgagor. Plaintiff agreed to loan to E. M. H. a sum of money upon his procuring an assignment to him of the mortgage as security. The mortgage was then past due. C. H. executed an assignment which, by its terms, transferred ah her right and title in the mortgage to plaintiff “ until he is fully paid.” The note was not transferred. In an action to recover possession of the mortgaged property, held, that if essential to give effect to the assignment, it might he held that the assignee acquired an interest in the debt for which both the note and the mortgage were securities; that the mortgage being incident to the debt, not to the note, the retention of the latter by the assignor did not conclusively establish that she did not intend to transfer the debt with the mortgage, hut that the legal effect of the transaction was to transfer to plaintiff the property embraced in the mortgage as security for his advances.
(Argued February 12, 1875;
decided March 23, 1875.)
Defendant claimed under a prior mortgage to one F. Plaintiff asked the court to submit to the jury the question, whether he made tender of payment of that mortgage before suit brought, and whether defendant claimed under it when demand was made. The court refused. Held, no error; that the tender, if made, did not reinstate the mortgagor’s title; and the omission of defendant to set forth the sources of his title did not, under the circumstances, estop him from asserting any title he had.
Defendant also claimed under a subsequent mortgage, and a bill of sale from E. M. H. Plaintiff requested the court to submit to the jury the question as to whether they were bona fide. The court refused so to do. Held, no error; that there being no question as to the validity of the mortgage under which plaintiff claimed, he was entitled to recover unless defeated by the mortgage to F., and that the bona fides of the subsequent instruments was immaterial.
Some items of property covered by plaintiff’s mortgage were not included in the mortgage to F. Held, that as this question was not raised upon the trial and as plaintiff’s requests assumed the right of the defendant to the property, if the questions raised were answered adversely, plaintiff could not change his ground and allege error, upon appeal, to which his conduct had contributed.
Appeal from judgment of the General Term of the Supreme Court in the fourth judicial department, entered upon an order denying a motion for a new trial and directing a judgment in favor of defendant upon a verdict.
This was an action to recover possession of certain personal property.
On the 4th January, 1867, Edward M. Hawkins executed to Catharine Hawkins a chattel mortgage upon the property, which recited an indebtedness of the mortgagor to the mortgagee in the sum of $1,000 for money borrowed, and was conditioned for the payment of that sum on the first July, then next, according to a promissory note that day given by the mortgagor. On the 2d December, 1867, plaintiff made an agreement with E. M. Hawkins to make a loan to him if he would procure an assignment to him of said mortgage. The mortgagee, with knowledge of the agreement, executed an assignment of all her “right and title” to the mortgage to' plaintiff “ until he is fully paid; ” upon the receipt of which plaintiff made the loan as agreed. The note was not transferred with the mortgage but remained in the possession of the mortgagee. After the debt to plaintiff became due, he demanded the property, which was then in possession of defendant, who refused to deliver it. Defendant claimed title, on the trial, under a mortgage executed by Edward M. Hawkins, dated November 1st, 1866, and an assignment thereof to him. This mortgage did not cover all the property covered by the first mentioned mortgage, but this fact does not appear to have been suggested on the trial. Defendant also gave in evidence another chattel mortgage executed by Hawkins to himself, subsequent to the one under which plaintiff claimed, and also a bill of sale of the property from Hawkins.
At the close of the testimony defendant’s counsel asked that the court direct a nonsuit. The plaintiff’s counsel asked the court to submit the questions to the jury, whether the mortgage and bill of sale to the defendant were bona fide, whether there was a tender by the plaintiff upon the mortgage of Fellows, and whether any claim was made by the defendant under the Fellows’ mortgage at the time of the demand, or not until after the suit was commenced; also, to charge that there was no transfer of the note in the Fellows’ mortgage, and therefore no title passed under the Fellows’ mortgage. The court declined so to do and plaintiff’s counsel duly excepted.
The court directed the jury to find a verdict in favor of the defendant, to which direction the plaintiff’s counsel duly excepted.- The court directed that the case and exceptions be heard in the first instance at General Term.
J. C. Cochrane for the appellant.
There was no intent to sever the note from the mortgage. ( White v. De Villiers, 1 J. Cas., 173.) The bona fides of the transaction was a proper question for the consideration of the jury. (Smith v. Acker, 23 Wend., 653.)
W. F. Cogswell for the respondent.
The assignment of the mortgage, unaccompanied by a transfer of the note, was a nullity. (Merritt v. Burtholock, 47 Barb., 253 ; affirmed, 36 N. Y., 44.) If the mortgagee had remained the owner of the mortgage and had advanced money to the mortgagor in place of plaintiff, the mortgage could not be held as a security therefor. (Tuscott v. King, 2 Seld., 157; Walker v. Snediker, 1 Hoff. Ch., 145; Diver v. McLaugton, 2 Wend., 596; James v. Morey, 2 Cow., 293; 4 Kent Com., 175; Yelverton v. Sheldon, 2 Sandf. Ch., 481.) All plaintiff’s title must come from the mortgagor. (Mead v. York, 2 Seld., 452; Tuscott v. King, id., 147.) Plaintiff’s only remedy was by proceedings in equity to redeem. (Charter v. Stevens, 3 Den., 33; Burdick v. McVanner, 2 id., 170.)

Opinion:
Andrews, J.
It is claimed by the defendant that the assignment from Mrs. Hawkins to the plaintiff of the mortgage from Edward M. Hawkins, was a nullity, for the reason that the note of the mortgagor, given at the same time with the mortgage, and to secure the same debt, was not transferred with the mortgage to the plaintiff. The argument is that the debt and the security could not be separated, and that Mrs. Hawkins, by retaining the note, retained the debt, giving to the plaintiff only the incident, which could have n o existence apart from the debt it was given to secure. If it was essential to give effect to the assignment from Mrs. Hawkins to the plaintiff, to hold that the plaintiff acquired by that transaction an interest in the debt held by Mrs. Hawkins against her son, I should have no difficulty in reaching that conclusion. The intention of the parties was to give to the plaintiff security for the money he was about to advance to the son ; and that purpose, it was supposed, might be accomplished by a transfer of the' mortgage to the plaintiff; and Mrs. Hawkins, at the request of the son, with full knowledge of the facts, executed and sent to him the assignment, to be delivered to the plaintiff. By the terms of the assignment she transferred to the plaintiff all her right and title in the mortgage "until he is fully paid." There is no express reference, in the assignment, to the debt owing by the mortgagor, or to the note held by the mortgagee; and Mrs. Hawkins retained possession of the note until the trial. The mortgage recites an indebtedness from the mortgagor to the mortgagee of $1,000, and that the mortgage was given for securing its payment; and the condition is for the payment of the sum mentioned, at a time stated, according to the note of the mortgagor, and contains the usual power of sale in case of " non-payment of the debt and interest." It is a general principle applicable to the construction of grants or contracts, that They should be construed so as to give them effect, according to the intention of the parties. When a thing is granted, every thing possessed by the grantors passes, as incident, which is necessary to make the grant effectual. (Broom's Leg. Max., 464, and cases cited.) The mortgage and the note were both securities for the debt. The mortgage was incident to the debt and not to the note; and the retention of the note by Mrs. Hawkins did not conclusively establish that she did not intend to transfer to the plaintiff, with the mortgage, the debt recited in it. (Hill v. Beebe, 13 N. Y., 556.)
But, under the circumstances disclosed in the case,, the real intention and legal consequence of the transaction was to transfer to the plaintiff the property embraced in the mortgage, as security for his advances, and not to make him simply the assignee of the mortgage. Before the assignment default had been made by the mortgagor, and the conditional title created in Mrs. Hawkins, by the mortgage, had become absolute, leaving in the mortgagor only a right of redemption in equity. (Butler v. Miller, 1 Comst., 496; Burdick v. Mc Vanner, 2 Denio, 170.) She could sell the property as owner; and when she assigned the mortgage to the plaintiff, she transferred the property itself. The mortgage was the muniment of the title and stood as its representative, and the plaintiff acquired by the assignment her title to the property which would revert to her when the plaintiff's debt should be satisfied. It follows that, whatever right Mrs. Ha-wkins had, as against the defendant, could be asserted by the plaintiff. The plaintiff stood, when the suit was commenced, in the same position in respect to the property as Mrs. Hawkins would have occupied if she had made no assignment, and was claiming the property under her mortgage title.
The defendant claimed title as assignee of a mortgage from Hawkins to Fellows, executed prior to the mortgage to Mrs. Hawkins, and also under a bill of sale and a mortgage, from Hawkins subsequent thereto. The judge, at the conclusion of the case, upon motion of the defendant, directed a verdict in his favor. When the motion was made the plaintiff's counsel asked the court to submit to the jury certain questions touching the Fellows mortgage: First, whether there was a tender of payment of that mortgage by the plaintiff before suit brought; and, second, whether the defendant claimed under it when the plaintiff demanded the property. He also requested the court to charge the jury that the defendant acquired no title by the transfer from Fellows, on the ground that the note mentioned in the mortgage was not transferred with it. The court was. not requested to submit to the jury the question of the bona fides of this mortgage, and the judge was clearly right in refusing the requests made by the plaintiff in respect to it. The tender, if made, did not reinstate the title of the mortgagor. (Charier v. Stevens, 3 Den., 33.) The omission of the defendant, when the demand of the property was made by the plaintiff, to state the origin and character of his title, did not, estop him from afterward asserting any title he might have; and it clearly appeared that it was the intention of Fellows to transfer, with the mortgage, the mortgage debt. The plaintiff also requested the court to submit to the jury the question whether the mortgage and bill of sale to the defendant, executed subsequent to the plaintiff's mortgage, were bona fide.
It is to be assumed that the mortgage to Mrs. Hawkins, under which the plaintiff clai med, was valid. The court could not have directed a verdict for the defendant on the ground of its invalidity, nor, so far as it appears, did it do so. The plaintiff was entitled to recover under that title unless it was defeated by the defendant's title under the Fellows mortgage, which was the prior and paramount lien; and as the bonafides of that mortgage was not questioned, the direction of the verdict was clearly proper, except for the fact now asserted, but which was not suggested at the trial, and which from an inspection of the instruments appears to be true,, that some articles of property, of small value, covered by the mortgage to Mrs. Hawkins are not included in the Fellows' mortgage. As to these the plaintiff was entitled to recover; and if it had been suggested to the court that they were not included in the prior mortgage, the proper directions might have been given. But the requests made by the plaintiff in opposing the motion to direct a verdict, assumed the right of the defendant to the property in litigation, if he stood in the right of Fellows, and the bill of sale and mortgage to him were bona fide. The plaintiff, cannot now change his ground. The case was tried on the assumption that the Fellows' mortgage embraced all the property included in the plaintiff's mortgage, and the plaintiff cannot now ask for the reversal of the judgment because the. court proceeded upon a mistake of fact which was occasioned by his own conduct.
The question of the bonafides of the bill of sale and mortgage to the defendant, as the case stood when the verdict was directed, was irrelevant; but if material, there was no evidence which would have justified a verdict impeaching them; and as the plaintiff was not a subsequent creditor or purchaser (within 2 R. S., 136, § 5), the court was not bound to submit the question of bona fides to the jury. (Bennett v. Earll, 21 Wend., 117; Frisbey v. Thayer, 25 id., 399.)
The judgment should be affirmed with costs.
All concur; Church, Ch. J., and Folger, J., in result.
Judgment affirmed.