Case Name: The First National Bank of Paterson vs. Byard and others
Court: New Jersey Court of Chancery
Jurisdiction: New Jersey
Decision Date: 1875-05
Citations: 26 N.J. Eq. 255
Docket Number: 
Parties: The First National Bank of Paterson vs. Byard and others.
Judges: 
Reporter: New Jersey Equity Reports
Volume: 26
Pages: 255–257

Head Matter:
The First National Bank of Paterson vs. Byard and others.
A mortgage given to a bank to secure payment of 810,000 in six months, contained a proviso as follows: “ This mortgage being given to secure whatever amount of indebtedness may at any time hereafter exist from the said John Byard to The First National Bank of Paterson,” &c. Held, that the mortgage was not restricted by the proviso to the indebtedness o the. mortgagor to the bank, arising from direct dealings between them, but was security also for the amount of notes made by the mortgagor to the order of a third person, and by him endorsed to the bank and discounted for him.
Bill for foreclosure and sale of mortgaged premises. On •exceptions to master’s report.
Mr. I. Van Wagoner, for the exceptant.
Mr. H. A. Williams, for complainants.

Opinion:
The Chancellor.
The exceptant is the holder of a mortgage subsequent to •that of the complainants. Both mortgages were given by John Byard, and. are on the same property. The master has reported that there is due on the complainants' mortgage the sum of $4655.48, almost all of which is due on notes made by Byard to the order of one McNab, by whom they were endorsed to the complainants, who discounted them for him. The only question raised on the argument was, whether the indebtedness of Byard to the complainants, on those notes, is covered by the complainants' mortgage. The proviso of that instrument, after stating that the mortgage was given to secure to the complainants the payment of $10,000 in six months from its date, with interest, according to the condition of Byard's bond to them, adds: This mortgage being given to secure whatever amount of indebtedness may at any time hereafter exist from the said John Byard to The Eirst National Bank of Paterson, and whenever the same shall be paid without any deduction or defalcation for taxes, assessments, or any other impositions whatsoever, then and from thenceforth these presents and said obligation, and everything herein and therein contained shall cease and be void." The proviso does not confine the indebtedness to such as may be contracted or arise in. any particular way or at any particular time, but expressly declares it to be the intention of the parties to the mortgage, to secure whatever indebtedness may at any time thereafter exist from Byard to the complainants. I see no ground for the proposition, Rat the object of the mortgage was to secure only such indebtedness of Byard to the bank as might arise from direct dealings between them.
The exceptions will be overruled, with costs.