Pierson v. Clayes

The opionion of the court was delivered by Williams, Ch. J. The object of this bill is, to enable the orator to redeem a certain mortgage, executed by him to Benjamin Harrington, on which a decree of foreclosure has, heretofore, been made, in the court of chancery, and to open the decree for that purpose. It is stated that, in the year 1836, the orator mortgaged a certain tract of land in Shelburne,to the said Harrington, for the sum of eleven hundred dollars, and that, afterwards, on the 13th of October, 1836, he mortgaged the same land, with some other, to George Clayes, one of the defendants ; that, at the August term of the court of chancery, in 1840, a decree of foreclosure, was obtained on the mortgage executed to Harrington, by which Pierson was decreed to pay the sum of nine hundred ninety two dollars eightytwo cents, by the 12th of September, 1841, and the residue, by the 24th of June, 1842. It is stated, that this mortgage became the property of the defendant, Clayes, and in consequence of a negotiation, between the orator, Pierson; and the defendant, Clayes, the amount due on the 12th September, 1841, was not paid : that the failure to complete the negotiation, was not on the part of Pierson, but on the part of Clayes. This bill Clayes has answered, and the answer is traversed. A decree of foreclosure, according to our practice, is an absolute and final decree in the first instance; and unless the court of chancery could relieve against such a decree, when the mortgagor had failed to perform, without any fault on his part, and in consequence of the acts of the mortgagee, there would be a manifest failure of justice ; and although the court would step with great caution in relieving a mortgagor from a decree of foreclosure, yet there may be circumstances [103] which would require them to relieve him from the forfeiture, when the mortgagee can be sure of receiving his debt. We think these circumstances exist in the case before us. On the 11th day of September, 1841, Pierson carried to Clayes, who had control of the Harrington mortgage, a proposition from Morse, not only to satisfy that mortgage, but also the one to Clayes, a great part of which was not then due. To this proposition Clayes returned an answer, not accepting the proposition of Morse, but making another, not greatly varying from it, which is in the following words : “ To Henry S. Morse. Dear Sir: I have received a line £ from you by Mr. Uzal Pierson, saying that Samuel Fletcher 1 and yourself would pay me one thousand dollars in December £ next, and two thousand dollars more within a year from that ‘ time, if you can have the place clear, that is to say, Benja- £ min Harrington’s and my mortgage discharged. The amount £ of Benj. Harrington’s and my mortgage, including interest £ and cost, will be about thirty-two hundred dollars. £L. M. Hagar has obtained Harrington’s quit-claim deed, £ and an assignment of all his interest. Hagar has agreed to 1 deed all his interest to me if the property falls into his £ hands ; then 1 shall be prepared to deed the same, by re- £ leasing and quit-claiming all my right, title and interest to £the same, on condition that I receive Samuel Fletcher’s and £ your joint note, with interest from date, for ope thousand ‘ dollars, payable in the month of December next, and the £ balance, say about twenty-two hundred dollars, within one £ year from date. George Clayes. ‘Burlington, Sept. 11, 1841. £ Twill endeavor to be at Shelburne and attend to the bu- £ siness on Tuesday next. G. Clayes.” This proposition was, to receive the amount of both mortgages, and Mr. Clayes fixed upon a time, two days after the time fixed in the decree for the payment of the first instalment. It is very obvious that, if Mr. Pierson, after receiving this letter from Clayes, had immediately redeemed the mortgage, on the 12th of September, two days before the time Mr. Clayes had proposed to attend to it, it would have defeated that arrangement, and would have been inconsistent with the negotiation then going on, to pay to Mr. Clayes both of the mortgages. [104] i The answer of Mr. Clayes, stating his conversation with Pierson in relation to receiving an immediate answer, and that he should hold the land, unless his proposition was accepted and complied with, before the expiration of the decree, is not proved, and is not responsive to the bill. It is true the right of a defendant, to have his answer taken as evidence, is co-extensive with his obligation to answer; yet in this case, the proposition in writing, in the letter the defendant, Clayes, wrote to Morse, is very explicit, and these conversations, which are set up to obviate the effect of it, are not called for by the bill, and cannot be considered as proved by the answer, but must be proved by other evidence. If the failure to comply with the proposition of Clayes, had been on the part of the orator, he would not have been entitled to any relief against the decree. A proposition for a settlement, or to give further time, or to substitute any other security, made by a mortgagee who has a decree of foreclosure, will not entitle the mortgagor to open the decree, unless, in order to carry it into effect, something is to be done, at a time after the day fixed for redemption ; and not, in that case, if the failure to perform is on the part of the mortgagor. It appears the parties met on the 14th of September, and Pierson then' refused or neglected to complete the arrangement ; but a further day, to wit, the 21st September, was then agreed on for the parties to meet on this negotiation, at which time all the propositions of Clayes were acceded to, and Clayes refused to ratify and execute the same. Immediately on this, Pierson took all necessary steps to preserve his property from being forfeited, and to tender and pay the amount then due ; but, as the day of redemption had then expired, the clerk was not authorized to receive the amount, and discharge the decree. There appears to have been no negligence on the part of Pierson ; and it is very apparent, that, in consequence of this negotiation, and the expectation of settling both mortgages with Clayes, on the terms proposed by him, he has permitted the time fixed in the decree to expire, and if not relieved, the farm, worth, as estimated, from $2,500 to $5,000, will be taken in satisfaction of the mortgage to Harrington, and [105] leave him liable on the notes given to Clayes, for which the second mortgage was executed. In the case of Williams v. Dale, 3 Johns. Ch. R. 290, the chancellor gave relief in a case, where the equity was not as strong as in this case ; and we think the orator should be relieved from the forfeiture, and the decree of foreclosure opened. With respect to the failure of the orator to pay the second instalment, while this bill was pending, we think it cannot, and ought not to have any effect whatever. In the first place, it is not in evidence before us, that there has been any such failure. Nor is there anything, either in the bill, or answer, which would require taking any proof to that effect. And furthermore, while this bill was pending, the object of which was, to be relieved against the consequence of not paying the first instalment, it would have been neither consonant with equity or justice, that he should pay an additional instalment, while yet uncertain whether he could get any relief from the consequence of not paying the first. The decree of the chancellor, is, therefore, reversed, and it will be remitted to the court of chancery, to ascertain the sum now due on the mortgage to Harrington, deducting the costs of the orator in this court, and to permit the orator to redeem, on the payment of that sum, by a day to be fixed by him.