Court Opinion

ID: 6278201
Source: CourtListenerOpinion
Date Created: 2022-02-18 16:07:32.434105+00
Date Added: 2024-06-11T09:00:07.733532
License: Public Domain

Opinión by
Porter, J.,
The appeal in this case is by the defendant, who assigns for error the action of the court below in making absolute a rule for judgment for want of a sufficient affidavit of defense. The claim of the plaintiff arose out of a transaction involving the sale and conveyance of a lot of ground, upon which was erected a building, in the city of Philadelphia. Carrie Gansman, on November 11, 1910, conveyed the lot to the plaintiff, who gave his bond, containing a warrant of attorney to confess judgment against him, secured by a mortgage upon the property, for $5,000 of the purchase money. The plaintiff, upon the same day, conveyed the property £o the defendant, by a deed which covenanted that the conveyance was made “under and subject to the payment of the mortgage debt or principal sum of five thousand dollars with interest thereon” meaning the mortgage debt above mentioned. The defendant made default in the payment of the principal sum of said bond and mortgage and a writ of scire, *505facias was issued upon the mortgage, prosecuted to judgment, and the property was, on April 2, 1912, sold under said proceedings for a sum insufficient to pay the mortgage debt, leaving a balance due on the bond of $972.87. The defendant had due notice of this proceeding. Carrie Gansman subsequently entered judgment against t¿e plaintiff upon his bond, by virtue of the warrant of attorney contained therein, and the damages were therein assessed in the said sum of $972.87, of which proceeding this defendant had due notice. The plaintiff having paid the amount of this judgment, in several installments, to Carrie Gansman, subsequently brought this action alleging the right to recover the same of the defendant. The statement of the plaintiff and the affidavit of defense are in harmony as to the facts thus far stated.
That upon the covenants of the deeds and the bond and mortgage, standing alone, the plaintiff is entitled to recover of the defendant any amount which he had been legally required to pay upon the bond because of a deficiency in the amount realized from the sale upon the mortgage to discharge the debt is conceded by the defendant. “The words 'under and subject’ in a conveyance, import that the grantee takes the land subject to an encumbrance, the amount of which has been deducted from the agreed price, and the covenant to be inferred from it is that of indemnity for the protection of the grantor:” Faulkner v. McHenry, 235 Pa. 298; Tritten’s Estate, 238 Pa. 555; May’s Estate, 218 Pa. 64. The defendant contends that this case is taken out of the operation of this rule because of averments in the affidavit of défense, which may be summarized as follows. The agents of Carrie Gansman had entered into a written agreement with this defendant, dated October 27, 1910, under the covenants of which Carrie Gansman, who then owned the property, agreed to sell and convey the same to the defendant, who agreed to purchase the same at a price agreed upon, a part of the *506purchase money, “Five thousand ($5000.00) dollars to be secured by a second mortgage (straw bond) for the term of one year interest at six per cent.” The defendant asserts that the words “straw bond” thus inserted in the agreement must be construed to mean that neither the maker of the bond nor any other person, no matter what the terms of the instrument thereafter to be made might be, was to be legally liable to be called on to pay anything upon the bond. He argues that, therefore, the plaintiff was not called upon to pay the amount of the judgment which had been entered against him and that that payment must be held to have been a voluntary one. These two words, thus included in the parenthesis, in the agreement of sale cannot be held to control all the covenants of the deed, the bond and the mortgage which were subsequently executed and superseded the provisions of the agreement. The term “straw bond” is not usually understood as referring to the covenants of the bond or whether those covenants are legally enforceable; this term is usually accepted as referring to the financial .standing of the man who makes the bond. The bond is a real bond, but the man who makes it is supposed to be execution proof. The words in this agreement meant that this defendant should not be required to assume a direct liability to Carrie Gansman for the payment of the amount of the bond, nor should hé be required to furnish a bond made by a party who was financially satisfactory to her. These parties put their own construction upon this clause of the agreement, when the time came for carrying it into execution; as is disclosed by the affidavit of defense: “I aver that, in pursuance of said agreement, on the 11th day of November 1910, for the purpose of executing the mortgage and straw bond under this agreement, title to said property was conveyed by said Carrie Gansman to plaintiff, that thereupon said bond and mortgage were executed by plaintiff, and immediately thereafter deed ^ag executed by said plaintiff *507to me.” • The result was that this .plaintiff delivered to Carrie Gansman a bond which not only bound him personally but contained a warrant of attorney authorizing confession of judgment against him; The defendant may have thought that this plaintiff was a straw man from whom nothing could be collected, but in this he was mistaken. The plaintiff had not been a party to the agreement of October 27 and there is no allegation in the affidavit of defense that he knew anything about that agreement at the time he executed and delivered the bond to Carrie Gansman. The affidavit of defense does not aver any fact which would have been available to the plaintiff as a defense- against the bond which he had executed and delivered. The bond was an unconditional undertaking to pay money, a part of the money remained unpaid, and Carrie Gansman was entitled to enter judgment, which this plaintiff has paid.
The judgment is affirmed.