Court Opinion

ID: 3318573
Source: CourtListenerOpinion
Date Created: 2016-07-05 17:36:07.909127+00
Date Added: 2024-06-11T12:39:46.390645
License: Public Domain

The facts proved by extrinsic evidence, as stated in the finding, strongly favor the construction of the covenant in question contended for by the defendant. I cannot concur in the conclusion reached by the majority of the court, that the record shows that in the transaction with the plaintiff, the defendant and E. P. Yale were but one party, or that they were to be so regarded in their dealing with the trustees, Sloper and Minor. On the contrary, as I interpret the finding, neither the plaintiff nor any other party to the transaction understood that the defendant was the purchaser of the plaintiff's land, or that he was to pay for it, or that he was to own or pay for the brick stock, or was to have any interest in it, except as a security against loss by having mortgaged his property, or that he was to do anything further in the transaction than to give a second mortgage upon property worth $12,000, subject to a mortgage to Yale College of $8,000, to secure the payment of E. P. Yale's notes to the plaintiff.
If the defendant also undertook to save the plaintiff harmless from the first mortgage, which, under the present circumstances, would require him to pay the E. P. Yale notes of $6,000 with unpaid interest, such promise must be found in the language of the mortgage deed.
The language of the covenant of the mortgage, "and save the grantee harmless from all incumbrances to date," should not be construed as a promise to protect the plaintiff against the first mortgage. Such a construction would give to these words a meaning inconsistent with that of the other covenants of the deed, and would make them a covenant to protect the fee of the land against all incumbrances, instead of an undertaking to protect the equity of redemption, which was alone conveyed by the mortgage, and which, from the entire language of the deed, was, I think, all that was intended to be protected as a security to the plaintiff.
The defendant was not personally liable, even to Yale College, for the first mortgage debt, as it appears that the bond and mortgage for $8,000 was given by E. P. Yale before the defendant became the owner of the property. *Page 244 
As indicating that it was not the intention of the defendant to assume the $8,000 mortgage, or to protect the plaintiff from that incumbrance, we find in the mortgage deed from the defendant to the plaintiff, first, that the mortgage to Yale College is expressly excepted from the covenant against incumbrances; second, that it is also excepted from the final covenant to warrant and defend the premises conveyed; and third, that the defendant expressly covenants what he will do regarding the first mortgage, namely, that he will keep all interest on it paid when due. These covenants should be held to so qualify the absolute covenant in question, that its true meaning is to save the grantee harmless from all incumbrances other than the first mortgage.
It is true, that the exception of a certain mortgage from the covenant against incumbrances has been held not to necessarily relieve the grantor from liability under the covenant of warranty from the operation of which the mortgage is not excepted, upon the ground that such qualified and absolute covenants are not of the same import, and therefore not necessarily inconsistent with each other, since a grantor may be unwilling "to guarantee his title generally, and yet may readily undertake that his grantee shall not be disturbed." The deduction drawn from the existence of such absolute and limited covenants in the same deed being "that the covenanter admits that there is an incumbrance upon the property, but undertakes and warrants that it shall never disturb the title of the grantee." 8 Amer.  Eng. Ency. of Law (2d ed.), p. 75; King v. Kilbride, 58 Conn. 109, 117; Estabrook
v. Smith, 6 Gray, 572. But these cases do not assume to state it as a rule that a covenant of warranty which is absolute in its terms will always be so construed, although a prior mortgage be excepted from the covenant against incumbrances. Undoubtedly the true rule is to ascertain from the entire instrument the real intention of the parties, and to construe the covenant with reference to such intention. Killian
v. Harshaw, 7 Ired. 497. See footnote to Gainsford v.Griffith, 1 Saund. 51. 61. The decision of each case must depend upon all the provisions of the particular deed under *Page 245 
consideration; and it has accordingly been frequently held that where a deed only purports to convey an equity of redemption, covenants absolute in their terms may properly be construed as applying only to the equity of redemption conveyed by the deed. Brown v. South Boston Savings Bank,148 Mass. 300; Ayer v. Philadelphia  B. F. B. Co., 157 id. 57; People ex rel. Weber v. Herbel, 96 Ill. 384; Drury v.Holden, 121 id. 130; Freeman v. Foster, 55 Me. 508; Hooper
v. Smyser, 90 Md. 363. And so in the case at bar, the inquiry should be: did the covenant to save the grantee harmless from all incumbrances refer to incumbrances upon the fee, or upon the equity of redemption conveyed by the second mortgage?
The cases of King v. Kilbride and Estabrook v. Smith, supra, do not apply here, since the decisions in those cases were based upon the fact that the covenant against incumbrances, and the covenant to warrant and defend, were not directed to the same thing, and that therefore the exception of a prior mortgage from the former did not render it inconsistent with the latter, from which such mortgage was not excepted. The covenant in the case before us, to save the grantee harmless from all incumbrances, is not what is known under our law as a covenant against incumbrances, and which is personal in its character, but is a covenant to indemnify against incumbrances, which is executory, and, like the covenant of warranty following it, runs with the land. Rawle on Covenants for Title (5th ed.), §§ 70, 204; Mitchell v. Warner, 5 Conn. 497,516; Davis v. Lyman, 6 id. 249, 256; Butler v. Barnes, 60 id. 170, 192.
The general covenant of warranty is an undertaking to protect the land against all lawful claims, and that the grantee shall enjoy the land free from all incumbrances; and therefore includes a covenant to save the grantee harmless from an existing mortgage not excepted from its operation. King
v. Kilbride, supra. If it was intended, therefore, that the defendant should protect the plaintiff against the first mortgage, it is difficult to understand why that mortgage should have been expressly excepted not only from the covenant *Page 246 
against incumbrances but also from the covenant of warranty. The construction adopted by the majority opinion renders the covenant in question, and the covenant to warrant and defend, since both refer to the same subject, inconsistent with each other; inasmuch as it is provided by the former that the grantor is to defend against the first mortgage, and by the latter that he is not to defend against it.
That the covenant in question was intended to apply only to the equity of redemption conveyed by the mortgage, is made still more apparent by the defendant's covenant to pay the interest on this particular mortgage. His promise is, not that he will pay or assume the mortgage, but that "he will keep all interest on said first mortgage paid when due." If he has covenanted to save the plaintiff harmless from the first mortgage, there seems to be no reason why he should also have agreed to pay the interest on that mortgage. The purpose of the covenant to pay the interest on the first mortgage was evidently this: by excepting the first mortgage, as he did, from the covenant against incumbrances and of warranty, he excepted from the operation of both of these covenants not only the principal of the first mortgage debt, but the interest then due or that might thereafter become due.Smith v. Read, 51 Conn. 10; Shanahan v. Perry,130 Mass. 460. But desiring to limit the excepted incumbrance to the principal of the first mortgage debt, he covenanted to pay the interest as it became due, thereby undertaking that if it became necessary for the defendant, in order to protect his security, to pay off the first mortgage, or to redeem in case of foreclosure, he would be required to pay only the principal of the first mortgage debt.
The deed is somewhat carelessly drawn, but I think from the language of the entire instrument it is sufficiently clear that the defendant intended to give the plaintiff a mortgage upon the equity of redemption after the Yale College mortgage, limiting that incumbrance to the principal of the mortgage debt, and to covenant to protect that title; and that the covenant to save the grantee harmless from all incumbrances is qualified by the other covenants and provisions of the deed, *Page 247 
and is limited to all incumbrances other than the first mortgage. As this construction reconciles the two otherwise repugnant covenants of the mortgage, is consistent with the purpose of the deed to convey only an equity of redemption, and with the intention of the grantor as shown by the language of the entire deed and the situation of the parties, it should be adopted.
The fact that two constructions are possible does not justify the application of the maxim, verba chartarum fortiusaccipiuntur contra proferentem. That doctrine should only be resorted to when all other rules of exposition fail. 1 Sw. Dig. 234; 2 Black. Comm. 380. There was no error in construing the covenant in question as claimed by the defendant.