Deyermand v. Chamberlin

J)ykman, J.:

This action is for the foreclosure of a mortgage, and in it a judgment has been entered against the defendant Chamberlin, personally, for a deficiency, on a claim that he assumed the payment of the mortgage. He has appealed from that judgment, and we have now' to determine whether the claim against him is well founded. There exists a difference of opinion respecting the principle upon which the liability of a promisor rests for the payment of an incximbrance mentioned in the assumption clause of a deed of convey,-ance which he accepts, but all agree that it rests either upon the *113•doctrine of agency or of trusts. If on the' former, the promisor is regarded as the agent of the person for whose benefit the promise is made, and if on the latter, the promisor is regarded as receiving money or other property for the third party. In either case a ,/romise or undertaking is a necessary prerequisite to any personal liability. "Without an agreement to assume the payment of amortgage named in a conveyance, no right of action against the grantee, personally, inures to the holder. Therefore, without the meeting •of the minds of the grantor and grantee in such an agreement, there can be no personal liability. All such responsibility rests upon •contract.

In this case the uncontradicted testimony shows that the defendant Chamberlin consented to take the title of the property in question from John I. Mandeville, for the purpose of passing it, by conveyance, to Sarah E. Mandeville, the aunt of John I. Mandeville. A deed was- made out and executed to Chamberlin by John I. Mandeville and wife, containing a clause by which Chamberlin was made to assume the payment of two mortgages on this jame property, aggregating the sum of $9,000 in -amount, one of •them being the mortgage foreclosed by this action. This deed was placed on record by Mandeville’s lawyer, and was not seen by ■Chamberlin until a long time after its execution. It never was .delivered to him, and he did not know that it contained the assumption clause, and never assented thereto in any way. He did not purchase the property, and did not sign the deed. He never owned the property, and only took the mere naked title for the purpose of passing it to Sarah E. Mandeville, which he did by the execution and delivery of a deed therefor, a few days thereafter, without receiving- any consideration therefor. He derived no personal benefit from the transaction, but consented to take the naked title and transfer it to the aunt of his grantor, for his accommodation, in payment of a debt due to her from his firm. It is entirely clear, therefore, that the assumption clause in the deed to Chamberlin never received his assent. He made no preliminary agreement for the payment of the mortgages, and never consented to the deed as it was drawn.

No principle, enunciated in any of the numerous decisions in our *114courts on this subject, will secure the personal liability of the-appellant Chamberlin. On the contrary, the doctrine of all the-cases is, that there must be a contract by the party sought to be charged. In the celebrated case of Garnsey v. Rogers (47 N. Y., 240), Judge Rapallo, in speaking of the promise of which a third person could enforce the performance, says: “ To entitle him to an action, the contract must have been made for his benefit. He must be the party intended to be benefited.” In the case of Vrooman v. Turner (69 N. Y., 284), Judge Allen, speaking of the rights of the third party claiming the benefit of an undertaking, says r “ A legal obligation or duty of the promisee to him will so connect him with the transaction as to be a substitute for any privity with the promisor, or the consideration of the promise, the obligation of the promisee furnishing an evidence of the intent of the latter to benefit him, and creating a privity by substitution with the promisor.” *

The old idea was, that the ground of liability was that of equitable subrogation or substitution of the creditor, to all securities held by his creditor, the surety of the principal debtor, which the grantee became on agreeing to assume the payment of the debts, and this idea has never been repudiated. If, therefore, there be lie assumption, and consequently no security, theie remains nothing to which the creditor can be substituted.

As no person can be deprived of his property without due process of law, so there can be no personal liability imposed upon a party without his agreement, express or implied.

As there was no such agreement by the appellant, the judgment against him is erroneous.

The plaintiff occupies the position of an assignee of the mortgage foreclosed, and must abide by all the equities existing in relation thereto. (Schafer v. Reilly, 50 N. Y., 61.)

The judgment appealed from must be reversed, with costs.

Gilbert, J., concurred. Present — Barnard, P. J., Gilbert and Dykman, JJ.

Judgment and order apjiealed from, so far as it decrees Chamberlin *115liable for deficiency, reversed, and new trial granted, with costs to abide tbe event.