Weber v. Huerstel

Beekman, J.

' This action is brought to foreclose a mort-, g-age upon real property in the city of Rew York.

The mortgage and accompanying bond were given to secure the payment of the principal sum of $12,000 on or before -the 17th day of December, 1890, and interest'thereon, 'which "was to be paid semi-annuailly. The bond and mortgage provided, among other things, that if any tax or assessment should be' imposed upon the premises after the date of the execution, and delivery of the same, and remain unpaid for six' months, the said principal sum, and all arrearages ■ of interest thereon, should, at the option of the mortgagee or his- legal representatives, become (and be due and payable' immediately thereafter, although the period limited in the bond and mortgage for the payment thereof may not then have expired:

On February 18, 1891, by agreement under seal, duly executed by the parties in interest, the time for the payment of the principal sum was extended to the 17th day of December,. 1895, upon the express condition and agreement that “nothing therein contained should in anywise impair the security then held for the said debt.” The complaint then alleges that “taxes and assessments to the amount of $1,500, or thereabouts, have been levied upon the said property, * * . *• and have remained unpaid for the period of five years or thereabouts, and that more than six months have elapsed since the greater portion of the same became due, and that the defendant, the said mortgagor, has failed and neglected to pay the same, and that the plaintiffs elect to deem the whole principal sum of the mortgage to be immediately due and payable,” etc.

The defendant Fuller, who is made a party defendant, under the general clause charging defendants not parties to the mortgage, has demurred to the complaint, on the ground that it does not set forth facts sufficient to constitute a cause of action against him, and in support of his demurrer contended upon the trial that the. allegation of default should have specifically stated when the taxes and assessments came due; that the averment is that the taxes and assessments were due five years or thereabouts before the action was commenced, which would make the default occur before the extension of the mortgage, and that the mortgage cannot be foreclosed for any such default so occurring.

I am unable to agree with the learned counsel for defendant if by this he means that a mortgagee cannot, after simply extending the time of the payment of the mortgage debt, exercise the right, under the option clause above mentioned, of considering the principal sum immediately due and payable, by reason of a failure on the part of the mortgagor to pay taxes which were liens on the mortgaged premises prior to the extension. The plaintiff is not bound to exercise his option, at any particular time; the clause is for his protection, and whenever the conditions exist which bring the case within the purview of the provision he is at liberty to exercise his privilege, without regard to the fact that he might have done so before, premising that he has not been guilty of any act

which has operated as a waiver of his right. It is entirely optional with him, and with him alone, whether .the mortgage debt shall be deemed payable under such circumstances. It is certainly to the advantage of the mortgagor .that he should not so elect, and his forbearance is not to be urged as a waiver of his privilege, unless associated with acts which indicate an intelligent purpose to renounce it, or which make it inequitable, or unconscionable for him to enforce it.

The complaint does not disclose any such purpose or acts on the part of ¡the mortgagee. The extension of time for the payment of the mortgage debt was in terms given “ upon the express condition that nothing therein contained should in anywise impair the security then held for the said debt.” It did not operate as a waiver of the right which the plaintiff has exercised. The extension agreement is to be read in connection 'with and as a part of the bond and mortgage, and the legal effect of ¡the papers thus read together is precisely the same as if the time originally stipulated' for the payment'of the principal had been the 17th day of December, 1895, instead of the 17th day of December, 1890. Every other stipulation and agreement contained in the bond and mortgage continued operative and unimpaired, and the extended time for payment still continued subject to an earlier maturity of the debt, at the election of the mortgagee, whenever conditions existed which, under the option clausej made the election exercisable. ■ The mortgagee had a right to assume, .down , to the time that the option was exercised, that the mortgagor would perform the duty he owed him and pay the taxes. He was entitled to re$t on this assumption when he extended the mortgage, and it comes with ill grace from those who benefited by his leniency to urge his forbearance as a waiver on his part of so important an element of his security.

Furthermore, there is nothing in the complaint which shows - that the mortgagee knew that any taxes were in arrears at. the time the extension was given, and there is no presumption of . law that he had such knowledge. He cannot be said to have waived a right where he had no knowledge of - the facts in which it rested. Clauses similar to the one in question have for years been of universal use in bonds and mortgages. They are eminently reasonable and have been found necessary for the proper protection of the security upon which loans of money so made rest. They are not in the nature of forfeitures in any obnoxious sense, and should be sustained by the courts under the same rules of construction ordinarily applied to contracts in general. The drift of all adjudicated •cases upon the subject has been in that direction, and mortgagors have been relieved from such apparent defaults only where it has been made to appear that the mortgagee has been guilty of some act, or is responsible for conditions, rendering it inequitable and unjust upon the facts of the case that the privilege should be exercised.

The case under consideration fails to present any. such features. But assuming, for the sake of argument, that the defendant’s position is correct — that, if the taxes in. question were due and payable at the time the extension was granted, the plaintiff could not thereafter elect to call the whole mortgage debt by reason thereof—still the construction he puts upon the complaint that the taxes were so due and payable is •entirely too narrow. The allegation is “ that taxes and assessments to the amount of $1,500, or thereabouts, have been levied upon the said property hereinabove described, and have remained unpaid for the period of five years or thereabouts, and that more than six months have elapsed since the greater portion of the same became due,” etc. The allegation may, and more properly does, bear the construction that during the' period of five years, and from time to time within such period, taxes and assessments were imposed and became due and payable, which, of course, would cover several years subseqent to the extension. And this construction is further reinforced by the fact, of which judicial notice will be taken, that the statutes of the state require taxes to be levied from year to year. I am of the opinion that this allegation of the complaint should be so construed, especially as the rule of law is that where a matter is capable of different meanings that should he adopted which will support the pleading. Code Civ. Prop. § 519 ; Olcott v. Carroll, 39 N. Y. 436 ; Marie v. Garrison, 83 id. 14; Lorillard v. Clyde, 86 id. 384. If there is ambiguity in the allegation, the defendant’s remedy was to move for an order requiring the plaintiff to make his-complaint more definite and certain. He cannot successfully demur, for although the pleading may he indefinite and uncertain, it states a cause of action within the rules.

The demurrer is overruled, but with leave to the defendant-Fuller to answer within twenty days on payment of costs j otherwise, judgment absolute is awarded to the plaintiff upon, the demurrer, with, costs.

Ordered accordingly.