Case Name: TUSCANY v. PAPP et
Court: Ohio Court of Appeals
Jurisdiction: Ohio
Decision Date: 1928-04-16
Citations: 6 Ohio Law Abs. 672
Docket Number: No. 8974
Parties: TUSCANY v. PAPP et.
Judges: (Levine and Vickery, JJ., concur.)
Reporter: The Ohio Law Abstract
Volume: 6
Pages: 672–673

Head Matter:
TUSCANY v. PAPP et.
Ohio Appeals, 8th Dist., Cuyahoga Co.
No. 8974.
Decided Apr. 16, 1928.
F. E. Bruml, Cleveland, for Tuscany.
Nicholas Papn. Cleveland, for Papp.

Opinion:
SULLIVAN, PJ.
It is a well established doctrine that where a grantee assumed the obligation for the payment of a mortgage, he becomes personally liable to the mortgagee and the latter is then in a position where he may elect to treat the grantee as principal on the evidences of indebtedness and the makers as surety or he may reverse the order by his own election. We think this rule of law finds authority in Denison University v. Manning 65 OS. 138; Society of Friends v. Haynes 47 OS. 423 and Stearns on Suretyship, p. 25, Section 23 and Section 90.
_ In the case at bar we have the loan association in good faith increasing the loan and furnishing the money to the new owner, Puch-has; this was done with the consent of Tuscany, the owner of the second mortgage, and at the request of Puchhas, the owner; the in ducement for the additional loan unquestionably must have been the consent to the transaction on the part of Tuscany and when he waived priority in a transaction where the association, the owner and the second mortgagee were parties, and when it was done upon the express understanding of consent and waiver, then it follows as a matter of law that Tuscany cannot repudiate the express terms of the contract because he is estopped from so doing by virtue of his waiver of priority. This legal and equitable aspect of the case, by the relationship between Tuscany and Papp, at least to the extent that it could affect the lien of The West Side Savings & Loan Association, is prior to any of the other liens because of the contract of which the waiver forms a basis, made by the association, the second mortgagee and the owner of the property.
In this case the question of innocent parties is not involved. The record shows a bona fide contract, the basis of which was the consent and waiver upon which the increased loan was made, and the first mortgage cancelled, and the change in the mortgage was made by one having unquestioned authority and thus an alteration was made in the note and mortgage which is the subject of the action about which there can be no issue. The question at bar is one purely of contract and the parties concerned executed it, the bank acted in good faith,the loan was made, and the claim of the plaintiff that he was prejudiced in his rights thereby is of no legal avail under the record in the case and the authorities applying thereto.
Tuscany, as plaintiff, was the moving factor in securing the increased loan and the cause of-the association cancelling the first mortgage and parting with its money. He was the inducement by his act of waiver, on an instrument he owned, and controlled, that caused the association' to release its first security and part with its funds. By his own act he contracted in writing to subordinate his lien to the association for the new loan. These are acts upon which the association obviously depended to make the loan and, but for which it would not have made the loan. Now he comes as plaintiff to undo the act which he created. It is an act which bars him by estoppel from wrecking the structure which he himself builded in conjunction with the owner and the association.
Under such a status the law prevents him from shifting position to- the injury of the association, acting in good faith, to its substantial injury. The law frowns upon such conduct and its penalty is to hold him to his own agreement, even to his injury, as against the association acting in good faith.
Thus holding a decree may be entered in favor of The West Side Savings & Loan Association in conformity with this, opinion.
(Levine and Vickery, JJ., concur.)