Before default also the mortgagor's interest is subject to levy and execution on the theory that the sheriff can seize and sell as well as the mortgagor could convey; i.e., subject to the mortgage. Galen v. Brown, 22 N.Y. 37; Leadbetter v. Leadbetter, 125 N.Y. 290, 26 N.E. 265, 21 Am. St. Rep. 738. But if the mortgagor defaults — i.e., fails to pay the sum secured by the mortgage or any part thereof when such part becomes due — the mortgagee's defeasible title immediately becomes absolute by operation of law.' Bragelman v. Daue, 69 N.Y. 69. Therefore, after such default and after such creation of absolute title in mortgagee, the mortgagor has no interest left that is subject to execution.
The attaching creditor could not levy otherwise than as subject to the mortgage after possession was taken by the mortgagee. (Bailey v. Burton, 8 Wend. 339; Galen v. Brown , 22 N.Y. 37; Hall v. Sampson , 35 N.Y. 274; 91 Am. Dec. 56; Jones on Chattel Mortgages, secs. 556, 557.) The title having become absolute the property was not subject to seizure on attachment, and could only be reached by garnishment, if at all.
Though he made the levy three days before the receiver was appointed, yet he took nothing by it for the reason that the defendant in the execution had no interest upon which the lien of the execution could attach. The law seems to be settled in this state that after default the mortgagor has no interest in the mortgaged property that can be sold on execution against him. ( Hull v. Carnley, 11 N.Y. 502; Hall v. Sampson, 35 id. 274; Galen v. Brown, 22 id. 37; Manchester v. Tibbetts, 121 id. 223.) The event had happened that made the mortgage instantly due, and there was no right of possession in the mortgagor when the levy was made.
The plaintiff having, after the defendant's levy upon the property, demanded that it be surrendered and delivered to her, and the defendant having refused to so surrender or deliver, became liable for its conversion. As the husband, the mortgagor, had made default in the payment of the mortgage, and it was past due, he had no interest in the goods subject to levy or sale on execution. ( Hull v. Carnley, 11 N.Y. 502; Hall v. Sampson, 35 id. 274; Galen v. Brown, 22 id. 37.) Moreover, upon the findings of the referee, the plaintiff had, before the levy by defendant, taken possession of the property under her mortgage, and the debtor in the execution had, therefore, neither title, possession nor the right of possession, and though the defendant assumed to levy only on such interest as the husband had in the property, yet that fact coupled with his refusal to surrender the goods to the plaintiff, subjected him to liability.
A mortgaged chattel is subject to execution in satisfaction of a debt due from the mortgagor to a creditor, if in fact the mortgagor has retained possession of the property and the levy is made prior to default. ( Galen v. Brown, 22 N.Y. 37; Hall v. Sampson, 35 id. 274; Leadbetter v. Leadbetter, 125 id. 290; Ellis v. Rickett, 232 id. 515.) There is no cogent basis, while subjecting mortgaged personalty to levy, upon which to predicate an exemption from like process for goods which have been sold pursuant to a conditional bill of sale.
When extrinsic evidence, properly introduced, creates an ambiguity in an instrument otherwise reasonable and clear in its language, the ambiguity may be explained by the same kind of evidence. Galen v. Brown, 22 N.Y. 37; Tillotson v. Race, 22 id. 126; Abb. Tr. Ev. 130, note; Matter of Hastings, 6 Dem. 307. Another well-settled rule of interpretation of wills is that where a will is capable of two constructions, one of which will dispose of the entire estate of the testator and the other leave a portion undisposed of, the former will be adopted.