Coursen v. Canfield

The Chancellor. Tin; suit is for the foreclosure of an ordinary mortgage. By the terms of it, both principal and interest are due. The defence is, that the, mortgage was in part payment of the purchase money of the mortgaged promises, and given at the delivery of the deed; and that at the same time the mortgagee, executed a covenant under seal to the purchaser, that lie would immediately procure releases of their title from certain persons named, who were reputed to have some claim on the lands. That this covenant urns part of the transaction of selling the laud, and was in pursuance of the agreement by which the land was purchased, that it would not have; been purchased without such agreement, and that the releases have never boon procured. The, answer sets up that there ivas a verbal agreement, that the mortgage should not- be due or payable until tin; releases were procured. But of this there is no proof whatever; the answer is no proof, as in this particular, it is not responsive to the bill, but sets up now matter in avoidance. The covenant and mortgage must be construed together as part of one transaction, and as if they had boon contained in the same instrument. And then the question is resolved into this, would the breach of a covenant by the mortgagee contained in a mortgage, preclude him from foreclosing it? The covenants in this case are independent. The mortgagee agreed to procure the releases forthwith, abso [100] lately. The mortgagor agreed to pay the money at the stipulated time absolutely, and not on condition that the releases had been procured. These are not dependent covenants. If such had been the agreement or understanding, it would have been easy to have made the payment of the money, conditional on the releases being first procured. The mortgagee has a right to say in hceo fosdera non veni. He might have been willing to bind. himself in a covenant to procure releases, which he knew were of little or no importance, a breach of which, if he should be unable to procure them, would subject him to small damages, but might be unwilling to bind himself to forfeit $2500 of the purchase money, if he could not obtain the releases. The parties could have made the bargain either way. They chose to make, and did make, independent covenants. And there is no principle established in courts of equity, by which an effect will be given to such covenants, different from their legal effect, and independent covenants turned into conditional, because it will give better protection to a party, or will diminish litigation. The failure of the mortgagee to keep his covenant, is no defence to a suit for payment of the mortgage money. The ’ question is not changed by the fact, that the complainant in this suit, is a bona fide purchaser of this mortgage for a valuable and full consideration, without notice of this covenant. He holds it subject to every equity and defence, to which it was subject in the hands of the mortgagee. The defendant does not set up or rely upon any actual defect in the title, as a defence to this foreclosure. The complainant, by the documentary and parol proof which he has produced, insists upon it'that he has shown a good title, and that the releases would be of no value. The. defendant insists, that without regard to this, he is entitled to have the releases delivered before he can be called upon to pay the mortgage debt. The view taken by me of the case renders it unnecessary to examine and determine the validity [101] of the title, but this insistment shows better than any argument, that it would be inequitable to change the covenants of the parties from what they were intended to be. The complainant is entitled to a decree of foreclosure, and to a sale of the premises.