Court Opinion

ID: 5201025
Source: CourtListenerOpinion
Date Created: 2022-01-06 15:52:27.47132+00
Date Added: 2024-06-11T08:27:11.775234
License: Public Domain

Kellogg, J.
(dissenting):
The payments upon the mortgage were all made'by Deyo with .his money, and were paid generally. In fact, the savings bank; the ■ owner of the mortgage, did. not know that he was treasurer of the literary association, and he did no act indicating to it that he was making the payment as such treasurer* While the receipts were issued in the name of the association, it was done according to the usual custom of the savings bank and because the association ivas •the mortgagor,, It was not done at the request of Deyo, or for any other purpose except in pursuance of this custom and .for convenience. There is nothing, therefore, tending to showr that the payment was not intended and understood as that of Deyo. The let- ' ters inclosing the checks were his personal letters -and not the letters of the association. The checks were drawn by him in the name of his mercantile firm upon the bank with which it dealt, but the mercantile firm never had any of the rent money and had no dealings with the literary association. It does not appear what rents Deyo collected from the property of the association, or that they were any . substantial part-of the payments which he made to the savings bank. It requires imagination to put life into the association, The only *7record of its proceedings since September, 1885, is as follows : At the annual meeting, September 19, 1885, no one was present but the president and secretary (Deyo)-, and there was no election. The stockholders met September 18, 1896, and thirteen trustees were elected, of which Mr. Deyo was one. September 28, 1896, at a meeting of the trustees, a chairman was elected, Mr. Deyo was chosen secretary, and no quorum being present the meeting adjourned to October second. October second a quorum was present, and Mr. Lefevre was chosen president and Mr. Deyo secretary and treasurer, and Mr. Craig was appointed a committee to see Mr. Lefevre and make some arrangement for the payment of a judgment against the association. Ho other meetings or proceedings seem to have been taken by the association as a corporate body since 1885. The only trustee sworn as a witness did not even know that he had been a trustee. Ho one seems to have taken any action with reference to this property or its operations, or with reference to this mortgage debt, except Mr. Deyo, and we may fairly assume that no one was concerned in paying the interest upon the mortgage except Mr. Deyo and that his interest in it was because he was liable upon the bond, and he apparently was concerned in getting what rents could be realized from the seemingly abandoned property and applying them to liquidate the obligation upon which he was personally liable. He kept no account of his proceedings, rendered no account to the association and .apparently kept no account with the association_ Whatever he received from rents lessened just so much the obligation he was under as a maker of the bond and postponed the' day when he must be called upon to make it good, and he alone was interested.
There is no claim of any authority or direction from the association to pay the interest or collect the rents. Having paid the interest with his own money he had a legal offset against any rents which he received or might have received from the association, and the evidence shows that the association was indebted to him in a considerable amount, probably arising from the fact that he had paid out more interest than he had received in rents. Where there are two parties liable upon an instrument and payments are made by one, such payments do not keep alive the debt against the other party, unless he is shown in some way to be a party to the payment, *8and the cases cited in the prevailing opinion bear upon süch a case They do not. bear upon a case where the party actually making the payments seeks to. avoid the effect of the payments made by him with Ms own money, under circumstances where he alone was interested in having the payment made. Where sureties upon a note understood that the principal part of the note had been paid from the. proceeds of the property of the original debtor and they paid the small balance unpaid, believing that it paid the note in full, the holder of the note having the same understanding and; delivering the note to them, and it subsequently developed that the judgment by which the previous moneys applied upon the note had been received was reversed, and a restitution was necessary., it was held' that a payment made under sitch circumstances by the sureties kept alive -the obligation against them, although they, supposed at the time .they were recognizing no further liability, the court saying: “ Under these circumstances the payments m'ade by the defendants must be deemed to have been made upon the note generally in the ordinary way.” (Jefferson County National Bank, v. Dewey, 181 N. Y. 98.) In other words, by making the payments they recognized that the note at the time was a valid obligation. But as a matter of fact it would be difficult to imply a promise by them to pay a note which they understood had been already paid and which had been surrendered ■ to ' them. Here the payments were made upon the bond generally, and in the ordinary way by the defendant himself,.and it would seem that there can be no question that lie recognized the bond as a valid obligation because he paid the money upon it. These payments of interest were made by some one, and it seems.much moré reasonable to hold that they were acts of Deyo and kept the obligation alive as to him than to hold that they were the. payments of the literary association ■ and kept the obligation alive as to it. It is a grave injustice to the savings bank which did not know that Deyo was treasurer now to hold that he made no payments, but that the literary association did, and it is giving the acts of Deyo a different construction than his conduct shows he intended they should have. I favor á reversal of the judgment both upon the law and the facts.
Judgment affirmed, with costs,