Coonley v. Coonley

-By the Court, Beardsley, J. The main question is which party shall bear the loss of Thorn’s mortgage. When the mortgage was transfered to the plaintiff, it had been due to the defendant about two years, and he had then been debtor to the plaintiff on the decree more than one year. The defendant insists that the mortgage was received in satisfaction and discharge of the amount then remaining due on the decree, or, if not so received, that the subsequent acts or omissions of the plaintiff produced that result. All this is controverted by the plaintiff. That the mortgage money, had it been paid, would have extinguished the balance of the decree, not otherwise satisfied, admits of no doubt, and is not a point in contest between these parties. The circuit judge charged that the mortgage, having been transfered to the plaintiff upon a pre-existing debt, was not to be deemed an extinguishment of such indebtedness, unless expressly agreed to be received in full satisfaction and discharge thereof. This branch of the charge was unobjectionable. But the learned judge also told the jury that there was another point for their consideration, which was, “ whether the plaintiff had not affirmed the contract and assumed the mortgage as her own, by extending the time for payment to ’Thornand in that event she was “ estopped from denying that she took the mortgage absolutely, and could not now return it to the defendant and charge him with the amount that “ if she extended the time of payment the loss must fall on herself.” I see no evidence whatever, in the case, of an agreement by the plaintiff to extend the time for payment of this mortgage ; all she said was, that she did not want the principal. But this was not giving time; indeed, it amounted to nothing. Time is not-extended by simply omitting to sue; something positive is necessary. Something obligatory on [319] the creditor; his hands must be tied so that he can not •sue if he would. The right of action must be suspended or barred. (Orme v. Young, 1 Holt’s N. P. R., 84.) We need not inquire how far a right "to prosecute an action on the decree or judgment of a surrogate can be suspended by a paroi engagement, for 'here was no evidence of an agreement of any description. In this instruction, I think the judge erred, and that a new trial should be ordered. This would dispose of the case but that there are other points in the charge which it is proper briefly to notice. The judge instructed the jury .that if Thorn, the mortgagor, was able to pay the mortgage when it was received by the plaintiff, and if she could have had the money by asking for it, or could have collected it by reasonable exertions, and had neglected to do so, until Thorn became insolvent and unable to pay, she could not afterwards throw the loss upon the defendant. This instruction assumes that the mortgage was not originally agreed to be received in satisfaction of the balance of the decree, but that such became its effect by the plaintiff’s omission to call for and enforce payment while Thorn was solvent and able to pay. The mortgage was overdue when the plaintiff received it. This was in March, 1840, and Thorn failed in July, 1841, having paid interest to the plaintiff to the third of January in that year. I believe no case can be found, and we certainly were furnished with none on the argument, which countenances the idea that the mere omission to enforce payment of such a> demand as this, for the period which here occurred, although incolvency takes place during the delay and the debt is thereby lost, is any defence to the original debtor of whom the demand was received. Here was no express agreement by the plaintiff to prosecute the mortgage, and one can not be implied. Nor was the plaintiff, even if that could affect the question, requested to proceed and collect the demand. She simply forbore to sue or press for payment, and in doing so violated no obligation of law or duty, towards the defendant or any one else. Delay to sue, until a demamd is [320] canceled by lapse of time, might present a different question ; but the delay which occurred in this instance did not, in my opinion, in the slightest degree change the rights or liabilities of these parties. Where checks, or bankers’ cash notes, substantially the same thing, for both are payable on demand (1 Chit, on Bills, 521, 10th Amer. ed.), are received on a precedent debt, as money, they must be presented within a reasonable time, or the person, by whom they were received, thereby makes them his own. The case of Ward v. Evans, 2 Ld. Raym., 928, cited on the argument, was of this description, as also is Olcott v. Rathbone, 5 Wend., 490. So, where a bill or note, payable at a future time, is taken on a pre-existing debt, the person of whom it is received, being holden thereon as drawer or endorser, and so, by law, requiring notice of non-acceptance or non-payment, to charge him absolutely, the law implies an undertaking to make demand and give due notice, and an omission to do so discharges the person by whom the bill or note was so turned out, not only from all liability on the instrument but from the original debt on which it was received. Several cases of this description were refered to on the argument. (Chamberlyn v. Delavire, 2 Wils., 353; Smith v. Wilson, Andrews, 187, 228; Kearslake v. Morgan, 5 T. R., 313; Dayton v. Trull, 23 Wend., 345; Hebden v. Hartsink, 4 Esp., 48.) The last two cases were rather determined on a principle of evidence, than on any thing else; they hold, and certainly correctly, that where .bills or drafts have been received by a creditor "upon a debt due to him, and the time for payment has passed, it will be presumed they were paid until some account of them is given. (See, as to bills or notes when taken for debts, Chit, on Cont., 766, 5th Amer. ed.) None of the cases cited are in conflict with what has been stated. In Jones v. Savage, 6 Wend., 658, a bill of exchange was given by the purchaser on the purchase of goods, and it was held that the seller could not recover for goods sold, without showing that the purchaser had been duly charged on the bill. In the present case there was a precedent' debt; but no [321] bill or note, drawn or indorsed by the defendant, and payable at a future time, was received. An over due mortgage was transfered to the plaintiff, in effect, as collateral security for what the defendant owed to her, and that was all. She was not bound to sue, and has lost no right by omitting to do so, nor has that omission extinguished the indebtedness of the defendant, or impaired his obligation to make payment. The case is so drawn that I can not undertake to say what was decided about the Houghtaling receipt for eighty dollars. It may have been evidence for the jury, more or less cogent, to charge the plaintiff with the amount, and this is, perhaps, all which the judge intended to decide. It probably will be fully explained on another trial. New trial granted.