Action of contract to recover monies held under, an escrow agreement. The cause was submitted under the following agreed statement of facts:
“On March 12, 1964, the plaintiffs purchased from one Otis Vaughn the property at 10 Stella Road, Boston, and in connection with this purchase they gave to the defendant a first mortgage on this property for the purpose of securing a loan of $12,000.00. The mortgage conditions, among others, stated that
‘The Mortgagee is hereby specifically authorized to pay when, due, or at any time thereafter, all municipal taxes, charges and assessments, and insurance premiums, upon the mortgaged property and to charge the same to the account of the Mortgagor.’
“The conditions of the purchase were such that the plaintiffs and Otis Vaughn as the Seller made an adjustment of 1964 real estate taxes on the basis of the 1963 taxes rate and the plaintiffs were credited by the Seller *177with the sum of $111.40, this sum representing the Seller’s portion of 1964 taxes on the property assessment of $5,800.00. There were no other stipulations or agreements between the parties as to real estate taxes for 1964.
“As a further condition of its mortgage with the defendant, the plaintiffs established a ta'x escrow account with the defendant for the payment of real estate taxes on their property to the City of Boston for the year 1964 and on March 12, 1964 the plaintiffs paid to the defendant for this tax escrow account the sum of $289.80 and thereafter were to pay the monthly sum of $48.30 to the defendant towards this tax escrow account. At all times pertinent to the several transactions involved, the account of the plaintiffs with the defendant was current and up to date.
“On January 1, 1964 the property at 10 Stella Road was assessed to the Seller, Otis Vaughn, who was entitled to a tax exemption under provisions of G.L. c. 59, §5, as a veteran. The 1964 City of Boston tax bill was issued in his name and there was stamped thereon ‘Veteran’s credit $199.60’ with a balance of the tax due in the amount of $379.24. Some time in September, 1964 Otis Vaughn presented this veteran’s tax abatement slip to the defendant and on September 22, 1964 the defendant deducted from the plaintiff’s tax escrow account the sum of $199.60 and gave the same to Otis Vaughn.
“This deduction of $199.60 by the defend*178ant from the tax escrow account which it held for the plaintiff was done without the knowledge, consent or permission of the plaintiffs. The plaintiffs thereafter made demand upon the defendant to restore the sum of $199.60 to their tax escrow account, the defendant refused to do so, and as a result the plaintiffs have brought this court action against the defendant for the recovery of $199.60.
“All of the plaintiffs’ interrogatories and the defendant’s answers thereto may be admitted in evidence.”
Treating the above statement as a “case stated” the court ignored the requests for. rulings filed by the parties and found for the plaintiff in the amount of$ 199.60. The defendant being aggrieved by the finding brings this report.
The defendant was a trustee for the purpose of paying taxes. There was no privity of contract between Mr. Vaughn, the seller of this property, and the defendant. The defendant owed no obligation to the seller of the property, Mr. Vaughn. Its obligation was to pay the taxes and then to account to the plaintiff for the balance of the money due, or if it failed to have enough money in the tax escrow account it was to notify the plaintiff of a balance that might be still due the City of Boston. The payment to the seller, Mr. Vaughn, by the bank was not a payment of taxes. It was an abatement which in effect is a reduction in taxes and not a tax payment.
Had the taxes been assessed in a greater *179amount than the plaintiff had deposited in the escrow account then the plaintiff would have been undoubtedly required to pay the difference. Conversely, since the net amount of taxes due was less than the amount the plaintiff had advanced, it is only fair that the excess in the escrow account be refunded to the plaintiff or applied in reduction of the unpaid mortgage principal.
Report dismissed.