Opinion
08-20-1896
GEORGE et ux. v. GEORGE.
Leon Abbett, for complainants. Geo. T. Wert for defendant.
Bill by Richard George and wife against Samuel M. George, executor, to cancel an assignment of a mortgage to defendant's testator, and to have defendant, who had, on foreclosure sale thereof, become the purchaser, declared to hold the same as trustee for plaintiffs' use. Decree rendered declaring that defendant held the premises subject to plaintiffs' right to file a bill to redeem.
Leon Abbett, for complainants.
Geo. T. Wert for defendant.
EMERY, V. C. This case presents a single disputed question of fact relating to the purpose for which a mortgage was assigned by the complainants, Richard George and Sarah A, his wife, to Philip R, George, the defendant's testator. On March 15, 1887, the complainants conveyed to one Joseph Braeznell a farm in Morris county, of which the bill alleges Richard George to have been the owner, and as part of the purchase price received from Braeznell a bond for $6,500, secured by mortgage on the premises, the bond and mortgage being given to the complainant Richard George. On or about April 26, 1887, as the bill alleges, the complainants executed and delivered an assignment of this mortgage to Philip R. George, now deceased, to secure him from any loss or damage by reason of his executing a recognizance for $5,000 on behalf of one John Rosewarne, who had been indicted in the Morris county quarter sessions. Rosewarne died before the time fixed for his appearance. The bail bond was discharged on October 11, 1887, by order of the sessions, and the complainants' case is based upon the claim that, the purpose of the assignment having failed, they were entitled to a return of the mortgage. The bill then claims that Philip R. George retained the mortgage; that after his death, his executor, the defendant Samuel M. George, foreclosed it as an absolute owner in a suit to which complainants were not parties, bought in the property, and now holds it The relief asked is that defendant be declared trustee of the lands for complainants, and account for the rents and profits. The defendant admits the assignment to his testator, the foreclosure of the mortgage, and his purchase of the property; but denies that it was assigned as collateral or security for the purpose mentioned, and sets up that Philip R. George purchased the mortgage for full value. The assignment was, on its face, an absolute assignment of the mortgage; and no written evidence, directly relating to the purpose of the assignment, has been produced on either side, both parties relying upon oral evidence as to the object of the assignment. The witnesses upon both sides show that the assignment was intended as collateral security, and the dispute arising upon the evidence is whether the mortgage was assigned solely for the purpose alleged in complainants' bill, or whether it was assigned to secure Philip R. George for advancesmade by him at the request of the complainant Mrs. George, in the payment of advances to her son William George, or debts or claims against him. In view of the contradictory character of the proofs, the case is one which must be decided by the weight of the evidence, in connection with the probabilities of the case. The complainants' case is sustained by one witness, Mr. Albridge C. Smith, the attorney of Mrs. George, a member of the New York and New Jersey bar, whose credibility is not attacked or impugned. He says that, acting on behalf of Richard George and William R. George, his son, who had been indicted with John Rosewarne, he had been endeavoring to secure bail in Morris county for Rosewarne, who was in custody, and that William George, of Dover, a brother of Richard and Philip R. George, was willing to become bail for Rosewarne if he could be indemnified; that William George required a deposit of either $2,000 or $3,000 to be placed in his hands as part of the condition for going on his bond, and Mr. Smith says that the mortgage and assignment were delivered to Mr. Cunningham, the son-in-law of Philip R. George, who was acting for him, with the understanding that Cunningham was to take the mortgage, and raise sufficient money on it to indemnify William George, so that he would go on the bail bond. The assignment was delivered to Mr. Cunningham on May 20, 1887, and on May 21, 1887, William George and Philip R. George did become bail for Rosewarne, and he was released. There is no proof, however, that any money was ever deposited with William George to secure him, or any independent evidence that he ever asked or required security. Richard George was in Mexico at this time, and Mr. Smith says that the complainant Sarah George was present, and authorized the delivery of the mortgage to Mr. Cunningham for this purpose; but Mrs. George herself says that she knows only what she has been told by Mr. Smith about what became of the mortgage. The case in complainants' bill rests substantially, therefore, on the evidence of Mr. Smith alone. The account of the transaction given by the defendant's witnesses is substantially as follows: William R. George, the complainants' son, had been arrested in New York on Saturday, May 14, 1887, upon the New Jersey indictments, and was in custody until Monday, May 16th, when he was released on habeas corpus proceedings. It was deemed desirable that he should leave this city at once, to avoid rearrest, and, his father being then absent in Mexico, an appeal was made to his uncle, Philip R. George, the superintendent of the Cooper & Hewitt works at Ringwood, to advance money for him. Philip R. George came to New York on Monday, May 16th, in response to this appeal, and advanced $1,000 for William R.'s benefit, without any security, and upon Mrs. George's promise that her husband would reimburse him on his return from Mexico. This $1,000 was given to William R., or applied for his benefit, and he was kept in concealment in New York for some days. During this time, and before May 20th, additional charges were made against William R. George of overdraft or embezzlement, amounting to at least $5,000, from a company of which he was an officer; and when this charge was made it was deemed important that this claim should be settled at once. Between May 16th and May 20th efforts had been made by Sampson George (a son of Philip) and Cunningham to dispose of the mortgage for the purpose of raising funds, but without success, and on May 20th Sampson George says he returned the mortgage to Mr. Smith. In order to raise the money necessary for the purpose of meeting the claim of the company, Philip R. George was again appealed to on May 20th, but he declined to advance any more without security, and it was then agreed that for whatever money he advanced he should have the mortgage as security.
In the assignment of the mortgage the name of the assignee had not been filled in when the assignment was executed and acknowledged on April 26th, the intention of Mr. and Mrs. George being to sell the mortgage, and it was executed in blank on account of Mr. George's departure for Mexico. Pending the efforts of Sampson George and Cunningham to sell the mortgage, the blank in the assignment was not filled, but when these efforts were abandoned, and the mortgage was returned to Mr. Smith on May 20th, as Sampson George states, the mortgage was assigned to his father as security for any advances he should make, and his name was then filled in the assignment, and it was delivered. After this assignment, and between May 20 and June 9, 1887, Philip R. George advanced the $5,000. This was in addition to the $1,000 advanced on May 14th. This statement of the purpose for which the mortgage was assigned to Philip R, George is given substantially by three witnesses,—Sampson George, Joseph Cunningham, and John George,—and both Sampson and John George say that nothing was said about Rosewarne. Cunningham, however, says that there was some talk about Philip George's securing Rosewarne's bond for $1,000, but he is not sure what was done about it The statement of defendant's witnesses is to some extent corroborated by the probabilities of the case. It is more probable that Philip R. George insisted on and received the security for the moneys he proposed to advance at once for William's benefit, which were likely to be about $5,000, than that he should be willing to advance these sums without any security, but should, on the other hand, demand security only for money he was to raise to "back-bail" his brother William George on Rosewarne's bond. It does not appear that he ever deposited any money at all with William. If Philip was disposed to insist on security, it is difficult to understand why heshould only desire security for the Rosewarne bond, and not for his immediate advances. The possible reconciliation of the testimony on both sides is that the mortgage was assigned as collateral to secure him for all advances he made on account of William, or of his brother Richard, and that the liability of his brother William on the Rosewarne bond to the extent of $1,000 or $2,000 was also to be secured. But in this situation it is evident that the burden is on the complainant to establish by the clear weight of evidence that the advances made at the request of Mrs. George were not to be secured. The preponderance of evidence is on the side of the defendant, and his witnesses' statement of the transaction is further corroborated by the subsequent correspondence between Richard George and his brother Philip R., in reference to the amounts advanced by the latter for William. By this correspondence, which was after Rosewarne's death, it appears that it was known as early as April, 1888, by Richard George, that Philip R. George claimed to hold the mortgage to secure his advances for William; and, although Philip's right to retain the mortgage was disputed on other grounds, and by other persons than complainants, the claim that the mortgage was assigned only in connection with the Rosewarne bond does not seem to have been made until some years after Philip R. George's death.
Considering the whole evidence, I find that the complainants have failed to mase out the case alleged by their bill. The bill admits an assignment of the mortgage by both of the complainants to Philip R. George, and does not contest the validity of the assignment upon any grounds. The simple question raised on this bill is whether the assignment was made for the purpose alleged in the bill, but, inasmuch as upon the evidence taken by defendant it would seem that the complainants have a right to redeem the mortgaged property upon paying the amount due to Philip R. George, I will hear counsel for complainants, if he desires, upon the question whether, on this bill, a decree for such redemption and account can be made; otherwise the dismissal will be with costs, but without prejudice to filing a bill to redeem. Tne complainants, not being parties to the foreclosure suit, are not cut off by those proceedings.