The only questions raised in this case are in regard to the construction of the covenant of the defendant; and if the construction contended for by the defendant is the correct one, whether the title to the farm of Backus Culver was defective. The covenant contained two provisions: one that the farm would if the title of Backus Culver to it was good, sell for enough to cover the prior mortgages and the one due to the bank, and the other that if upon foreclosure of either of the mortgages there should be a deficiency in the amount applicable to the plaintiff's mortgage he, the defendant, would pay such deficiency.
It seems to me hardly necessary to decide whether the defect in the title was proved, or whether if it had been, it would have affected the defendant's liability under the first part of the agreement. The latter part of the defendant's *Page 315 covenant bound him to pay any deficiency that might exist on a sale of the premises under a foreclosure of either of the mortgages. It was not in any manner made depend ant on the previous condition, and it was by no means affected by any defect of title of Backus Culver. The mortgage foreclosure was of a mortgage given by Joshua Culver. His title was undisputed. The title given by the foreclosure was not disputed, and on the sale all claim to the premises was abandoned. There was no necessary connection between the two conditions. The first covenant was as to the sufficiency of the farm to pay all the claims upon it. This was made conditioned on the validity of the title of Backus Culver. The second was an agreement to pay any deficiency on the mortgages. It is undoubtedly a rule in the construction of contracts, that they are to be construed in the light of the surrounding circumstances, with a view to ascertain the intent of the parties. (Waldron v. Willard, 17 N.Y. Rep. 466.) The application of that rule would not help the defendant here. If the condition as to the title could be made applicable to the second provision it would be to excuse the defendant's liability if from such defect of title, the foreclosure became ineffectual. Where the title given is perfect, and the supposed defect does not in any manner affect the sale, there is no good reason why the defendant should be relieved from liability.
But even under the first provision of the covenant the defendant would not, as this case comes before us, be entitled to relief. The admission shows it is true that a claim had been made for a part of the property, but it also shows that the court had decided adversely to the claim and the claimant had appealed, but that afterwards the claim was abandoned and the action discontinued. It was for the defendant to show the defect in the title. A mere claim by action did not establish it, and it certainly was not strengthened by a decision adverse to the claim. Giving the defendant all the benefit he could derive from the construction of the contract as claimed by him, he has not *Page 316 established any right to relief. There is no proof that the title was defective, and the evidence in the admission is that the court held the title good.
The first provision of the agreement may be read so as to contain two stipulations: 1st. that the value of the farm was enough to pay all the incumbrances upon it; and 2d. if the title of Backus was good the same would bring on foreclosure (of Backus Culver's mortgage) sufficient to pay all. With this construction, there would be no ground for applying the exception to the latter provision.
But under any view of the case there is no evidence from which we could say the title was defective.
The judgment should be affirmed.