Dibble v. Richardson

Woodward, J.: We are confronted upon this appeal with the same difficulty which apparently operated upon the court at Special Term—the lack of evidence to support the plausible theory of the defendants — for while there can be no doubt of the power of a court of equity to look behind the form of a mortgage, and, in a proper case, to hold that the mortgagor is a mere' surety for the debt of another and entitled to all the rights incident to that relation (Erie County Savings Bank v. Roop, 80 N. Y. 591, and authorities cited), there are no presumptions in favor of suretyship, and where the mortgage recites an indebtedness on the part of the mortgagor, evidence is required to show a different state of facts before there is any ground on which a court of equity may properly intervene. Nor is the fact that a person other than the mortgagor actually received the money to his own use conclusive upon this point; it is necessary to show that the mortgagee understood the transaction, and that the mortgage was accepted as security for a debt owed by another. “ My difficulty was and is to make a finding of fact that the defendant wife was accepted only as a surety, and not as a principal debtor, by the deceased,” says the learned justice at Special Term, and as we have already suggested, the same difficulty confronts us upon this appeal. The court, after admitting evidence which, to say the least, encroaches upon the inhibitions of section 829 of the Code of Civil Procedure, was unable, though apparently willing, to find evidence [522] to support the contention of the defendants, and the record certainly discloses no fact which would warrant this court in holding that the findings,'or refusals of the court to find, involved error of which the defendants may complain. . This action was brought to foreclose a mortgage for $6,000, given by the defendant Annie 0. Richardson to the testator, to secure a bond for thó same amount, given by the same defendant to the testator; and judgment for any deficiency is prayed for against the said defendant. Defendant husband is a co-executor with the plaintiff in this action, and is joined as a defendant only because he refused to' unite with the plaintiff in bringing the action. The answers of both defendants plead payment of the $6,000 under the provisions of the last will and testament of Mary Callahan, deceased, which provision reads as follows: “ I hereby direct and provide that in case any sums of money should be owing to me or to my estate from Asa B. Richardson, that such sum or sums shall not be claimed from, him by executors, but shall be treated as a bequest to him ; and any evidence of indebtedness from him shall be given up and canceled -by my executors.” The contention of the defendants is that while the mortgage recites that, “ Whereas, the said Annie C. Richardson is justly indebted to the said party of the second part (the testatrix) in the sum of six thousand dollars lawful money o'f the United States,” etc., the real debtor was the husband of the defendant Annie 0- Richardson; that the mortgage was given merely as a surety for his debt, and that this indebtedness of the husband being canceled by the provisions of the codicil of the will ■of the deceased, the surety is released. We should find no difficulty in supporting this contention if there was evidence to show •that the testator accepted the mortgage with the understanding that it was intended as a security for the indebtedness of the husband; but the cáse is barren of such evidence, and the mortgage itself, declares that the defendant Annie C. Richardson is justly indebted. “ The transaction shows,” tó use the language of the learned court at Special Term, “ that she did not loan the money on the faith or credit of the husband, but on the bond and mortgage of the wife.” There is no suggestion that the testator took any obligation from the husband; that she ever recognized him as owing to her any sum of money secured by this mortgage; and in the absence of evidence [523] • to show that the testator understood that she was lending money to the defendant Asa B. Richardson, rather than to the wife, and that the latter made and executed the bond and mortgage as a surety, no' rule of equity with which we are familiar would justify a reversal of the judgment. This is clearly the-doctrine in all of the cases which we have been able to find in this State (Erie County Savings Bank v. Roop, supra, and authorities there cited), and it is consistent with rules of equity as universally applied. The intent of contracting parties is to be looked for primarily in the words and terms of the contract (Bank of Albion v. Burns, 46 N. Y. 170, 175), and in the case at bar the contract of the defendant Annie C. Richardson was to repay $6,000 for which she was “ justly indebted to the said party of the second part.” A provision in the codicil of a will' of the testator releasing Asa B. Richardson from any indebtedness which he might be owing at the time of her death cannot be construed as releasing Annie 0. Richardson from the terms of her contract, unless it is clearly established that there was an understanding on the part of the testator that the mortgage was intended to stand as surety for the indebtedness of the. husband of the mortgagor. No evidence of this is to be found in the case now before us, and it follows that the judgment must be affirmed. The judgment appealed from should be affirmed, with costs. Hirschberg and Jenks, JJ., concurred; Sewell, J., read for reversal, with whom Goodrich, P. J., concurred.