Kellogg v. Conner

The Chancellor.

Naylor was not the trustee for Kellogg, nor was he under any legal or equitable obligation to redeem the mortgaged premises for the benefit of Kellogg, although Naylor was one of the cestui que trusts for whose benefit Kellogg took the junior mortgage upon the premises. If Kellogg the trustee had redeemed by virtue of the trust mortgage, it would undoubtedly have been, in equity, a redemption for the benefit of all the cestui que trusts, in proportion to their respective debts, after paying the re*313demption money and interest; as it would have been inconsistent with his trust to redeem for his own benefit exclusively. Saylor, however, as the owner of the equity of redemption for which he had agreed to pay the assignees $3800, was under no obligation to protect the rights of the prior mortgagee ; as he had no duty to perform towards any of the creditors of Conner whose debts were secured by the mortgage given to the complainant.

The only question for the jury to determine, therefore was, whether Saylor did in fact redeem, either by agreement or otherwise, for the use and benefit of the complainant and the other creditors whose debts were secured by that mortgage. And upon that point I think the jury came to the correct conclusion, that he did not.

The disposition of the purchase money of the equity of redemption which Saylor agreed to pay to the assignees of Conner, was a matter with which the complainant had no concern, as no part of that money belonged to him. It belonged to the creditors of Conner who were preferred in the assignment $ and if the assignees have misapplied it, in paying the debts of Saylor and others which were not preferred, the preferred creditors will have the right to call the assignees to account for such a misapplication of the proceeds of their sale of the equity of redemption to Saylor 1 but it cannot give Kellogg the benefit of Saylor’s redemption.

Neither could Kellogg’s subsequent offer to redeem make Saylor’s previous redemption enure to his benefit. For, by some inadvertence, the 5th section of the amendatory act of April, 1838, gives the redeeming assignee of the equity of redemption all the title of the original purchaser at the master’s sale, without making any provision for a redemption from him by a prior mortgagee, or judgment creditor.

The motion for a new trial must therefore be denied with costs.