Court Opinion

ID: 3633209
Source: CourtListenerOpinion
Date Created: 2016-07-06 00:12:09.009602+00
Date Added: 2024-06-11T13:40:37.778335
License: Public Domain

[EDITORS' NOTE:  THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 52 
The transactions which gave rise to this controversy are, in substance, these: Allen and Stevens made their mortgage to the Home Insurance Company for $4,000, from whom they received $2,000 only.
They, nevertheless, provided the means with which to pay to the company the full sum of $4,000, and placed it in Buckley's possession for that purpose. Buckley transferred the same means to Coyle, who transferred it to the defendant, Auld, for the same purpose; and now, because Allen and Stevens did not receive from the insurance company the full sum specified in the mortgage, and were not benefited to its full amount until they received, on account of it, credit upon their *Page 53 
indebtedness to the plaintiff, since Auld became possessed of the means appropriated to its payment, he has seen fit to intermeddle with matters that did not concern him; and instead of paying the full amount of the mortgage, in accordance with the wishes of Allen and Stevens, out of the means provided by them, or allowing it to be appropriated to that purpose, he has tendered the $2,000 advanced by the insurance company, and refuses to pay the balance or allow the means in his possession to be appropriated to its payment, and volunteers the objection that the mortgage is not a valid lien beyond the sum advanced by the company. Suppose it is not, that is not a matter that concerns him. His situation is no better than one who takes title to lands subject to the payment of an usurious mortgage, which by statute is absolutely void. The purchaser taking title subject to it is estopped from questioning its validity, and must pay it if he has agreed to; and if not, he must allow the lands conveyed subject to it, to be applied to its payment. (Sands v. Church and others, 6 N.Y., 347; Murray
v. Judson and Sands, 9 N.Y., 73; Hartley v. Harrison,24 N Y, 170.)
Numerous other cases in the courts of this State prior as well as subsequent to those referred to, might be cited in support of this proposition. Allen and Stevens had the right, which no purchaser from them had the right to gainsay, to pay or provide for the payment of the full amount specified in this mortgage. The provision here made for its payment was not for the benefit of Buckley, or Coyle, or Auld. Each of them was a stranger to it. Neither of them had any legal interest in it.
In considering the defence of usury to a mortgage, for the payment of which a provision had been made similar to the one now under consideration, BRONSON, Ch. J., in Dix v. Van Wyck (2 Hill, 522), remarked that "a mere stranger or one who has no legal interest in the question shall not officiously intermeddle in the matter and take advantage of a statute not intended forhis benefit." Auld took pains to prove on the trial that he knew before he purchased the premises, *Page 54 
subject to the payment of the sum specified in this mortgage, that the insurance company had advanced only $2,000 upon it. If, knowing that fact, he purchased it with a view of making the defence interposed by him and to avoid the payment of the excess, it neither aids his defence nor redounds to his credit. His position, in principle, is in no respect different from what it would have been had Allen and Stevens counted out in cash the sum specified in the mortgage and placed it in the hands of Buckley as their messenger, with directions to pay it to the company, and he had placed it in the hands of Coyle, by whom it had been delivered to Auld, with the same directions, and, instead of paying it, he had tendered the $2,000 originally advanced to them upon the mortgage, and by way of defence, as to the balance, had come into court and admitted that Allen and Stevens had furnished him with funds with which to pay the balance, and had since received from the plaintiff, who owned the mortgage, the excess over the $2,000, and that they wished him to pay over their funds in his hands in satisfaction of it, and had nevertheless proposed to prove that the mortgage was not a valid security for the payment of that excess. With all these concessions preceding his offer it would, doubtless, have been overruled. The defence which prevailed on the trial, and which has been sustained by the General Term, sustains in principle such a proposition, and cannot be upheld. The judgments of the General and Special Term must therefore be reversed and a new trial ordered.