Jenkins v. Bishop

Chester, J.:

In 1897 the appellant Simon Bishop purchased a farm upon which there was a mortgage of $5,000 which he assumed and agreed to pay-as a- part of the purchase price. In February, 1907, the plaintiff purchased said mortgage from the owner thereof. At that time there was due and unpaid of principal $5,000 and accrued interest $211.18. Nothing was thereafter paid on the mortgage except the sum of $25 in March, 1907.. In May, 1908, plaintiff commenced this action to foreclose the mortgage. The appellant in his answer alleged a parol agreement between himself and the plaintiff at or about the time when plaintiff purchased said mortgage by which agreement plaintiff agreed with the appellant to purchase said mortgage at the most favorable price possible and that he would give the appellant the benefit of any reduction he might procure on such purchase and credit such reduction as a part payment of the amount due on the mortgage; that plaintiff would carry and hold the same and give appellant an opportunity to repay to him the sum which lie actually paid therefor in installments and interest or the appellant might at his option repay him such sum as plaintiff might actually pay therefor.

The plaintiff in fact purchased the bond and mortgage for the sum of $2,500. The appellant’s son and wife testified to several conversations they had with plaintiff previous to the purchase of the bond and mortgage by him in which he agreed to purchase the same at the best price he could and give the appellant the benefit of any reduction he could procure.. These conversations were denied by the plaintiff. The trial justice held that the agreement set forth in the answer was void as being without consideration and also under the Statute of Frauds and conferred no rights or obligations upon any one. (62 Misc. Rep. 87.)

We think the alleged agreement is void because of lack of consideration and mutuality between the parties. The appellant did not pay or give anything to the plaintiff to induce him to act and if he had failed to make the purchase in pursuance of the alleged agreement the appellant would not have had a cause of action against the plaintiff for damages. The appellant assumed no obligation by reason of the proposed purchase that he was not under because of his original agreement to pay the mortgage when he *106bought the farm. There was no mutuality or consideration between the .parties and the alleged agreement, therefore, cannot be enforced. (Levy v. Brush, 45 N. Y. 589, 595.) Nor was there any trust relation or agency between the parties. (Wheeler v. Reynolds, 66 N. Y. 227.)

The case of De Wandelaer v. De Wandelaer (89 App. Div. 113),. decided by this court and cited by the appellant, is not an authority in favor of his contention.- That was a case where one Eclder, while he was acting as trustee for the benefit of creditors of (Hidden De Wandelaer, purchased two judgments against said De Wandelaer, under an arrangement with said De Wandelaer that he would purchase the same, so that they would not be used to prevent De Wandelaer from afterwards engaging in business, and that the amount paid therefor should afterwards be repaid by De Wandelaer to Eckler. This agreement was sworn to by both"-the parties and Eckler in his accounts rendered to Dé Wandelaer set out these judgments at the price he paid for them. In addition to this Eckler under his trust as general assignee paid to himself' a dividend on these judgments of twenty per cent, the same as the other creditors received. The relation of Eckler to De Wandelaer was of such a-fiduciary character that any benefit he might receive in purchasing these judgments must necessarily inure to De Wandelaer, or his creditors, and. he could get no benefit from any transaction in connection with the estate or trust.he was administering. Here there existed no sucli trust relation'.

If we are right that there was no mutuality or consideration between the parties it' is unnecessary to consider the question of the Statute of Frauds.

The judgment, however,'is erroneous in so far as it charges the appellant with any deficiency which may arise on the sale of the mortgaged property, for the reason that the grantors of the appellant were not personally liable for the mortgage debt, and, hence, the appellant did not become liable notwithstanding his agreement to pay the mortgage contained in the deed to him by his grantors. (Vrooman v. Turner, 69 N. Y. 280; Carter v. Holahan, 92 id. 498, 504.)

.The judgment should, therefore, be modified by striking therefrom the provision for the personal liability of the appellant as to *107any deficiency which may arise on the sale of the property, and as-so modified should be affirmed, without costs.

All éoncurred, except Kellogg, J., dissenting in memorandum, in which Sewell, J., concurred.