Court Opinion

ID: 3631844
Source: CourtListenerOpinion
Date Created: 2016-07-06 00:11:07.240395+00
Date Added: 2024-06-11T14:07:41.342110
License: Public Domain

The plaintiff seeks to recover back from the defendant a sum of money, which, as he claims, was wrongfully exacted from him by the defendant upon his payment of the principal of a bond given to secure a loan of money to him. His right to it must depend upon whether the money was paid under compulsion; for if the payment was voluntary, with no duress of the person, or of goods, he is concluded. There was neither misrepresentation, nor mistake; for the payment was pursuant to an agreement and I am unable to perceive in the circumstances disclosed any ground for the recovery.
The plaintiff had borrowed $80,000 from the defendant and had given his bond, secured by a mortgage of real estate in New York, for the repayment. The loan was to be paid in two years. If default was made in the payment of interest, the principal sum became due immediately. Each instrument contained the following clause: "That the said James Kilpatrick shall have the privilege of paying said principal sum of $80,000, with accrued interest thereon, at any time after August 28, 1900, and prior to August 1, 1901, (the due date of the bond), upon payment to said company, in addition to said principal sum and interest, of the further sum of $1,000." Presumably, the $1,000 represented an indemnity to the company for the shifting of so large a loan and the temporary loss of the investment. The plaintiff failed to pay his interest on August 1, 1900, and, within a few days, the defendant commenced a suit in foreclosure of the mortgage; but, a few days later and before any appearance, or answer, voluntarily discontinued it, without costs. After the commencement of the foreclosure action, the plaintiff claims to have arranged to obtain the loan of $95,000 upon the mortgaged *Page 172 
property; but the time, or terms, of the arrangement do not appear, nor does it appear that the defendant knew anything of the arrangement at the time when it discontinued the foreclosure suit. What does appear is that a nephew of the plaintiff, after the foreclosure suit was begun, spoke to the defendant's attorney and requested a little more time than the twenty days to answer, as he though that they would be able to obtain another loan. At a later interview, the defendant's attorney informed him that the foreclosure action had been discontinued and that his client would sue for the interest due, and would not take payment of the principal without the additional payment of the $1,000 stipulated for. Thereafter, on August 28, 1900, the plaintiff paid the amount of the principal of his bond, with the additional $1,000.
It seems to me clear that the payment was, in law, voluntarily made. The defendant abandoned its foreclosure suit and decided to allow the loan to remain. The plaintiff could, then, have paid the interest; but he preferred to pay off the existing loan and to borrow a larger sum upon the property. This he had the right to do; but he could only exercise it by complying with the stipulation of his bond, in paying the $1,000 for the privilege. If it should be considered that the defendant, by its commencement of the foreclosure action, had forfeited, or compromised, its rights, then the plaintiff should have made a tender of the moneys due upon his bond; in which event, upon the defendant's refusal to accept them, he could have appealed to the courts to compel the discharge of the mortgage. (See Kortright
v. Cady, 21 N.Y. 343, 347.) The two courses were open to him, to continue the existing loan, or to pay it off, and he chose the latter; which was to his convenience and advantage, as enabling him to borrow a larger amount. If the bargain shall be said to have been a hard one, the agreement was willingly entered into and I do not think it should be avoided upon the vague theory of some coercion in fact. It cannot, as I think, well be held that there was any duress, which coerced the plaintiff to make payment. There was no obligation upon him, at the time, to *Page 173 
pay the principal; though there was an advantage which he wished to seize upon, in his ability to borrow more upon his property. If the defendant had placed itself in a position, where it was bound to take the principal sum, it had withdrawn from that position and the plaintiff, as I have pointed out, made no tender in discharge of his indebtedness, upon which to predicate a right to have the satisfaction thereof decreed in equity. The utmost he can urge is that the defendant compelled him to abide by the strict terms of his agreement. That was not illegal and no circumstances are shown, which warrant the court in granting relief, whether upon the ground of fraud; or of duress of the person, or of goods; or to prevent injury to property rights.
For these reasons, as for those stated by Mr. Justice PATTERSON, in the Appellate Division, I advise the affirmance of the judgment.
HAIGHT, VANN and WERNER, JJ., concur with BARTLETT, J.; CULLEN, Ch. J., concurs with GRAY, J.; O'BRIEN, J., absent.
Judgment reversed, etc.