Drury v. Hayden

111 U.S. 223 (1884)

DRURY
v.
HAYDEN.

Supreme Court of United States.

Submitted March 25th, 1884. Decided April 7th, 1884. APPEAL FROM THE CIRCUIT COURT OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF ILLINOIS.

Mr. J.M.H. Burgett for appellant.

MR. JUSTICE GRAY delivered the opinion of the court. He stated the facts in the foregoing language, and continued:

The case presented by the pleadings and proofs appears to us a plain one.

It is unnecessary, for the purpose of deciding it, to consider any of those questions, suggested at the argument, upon which there have been varying decisions in different States; such as, whether an agreement of the grantee, in a deed poll of land, to assume and pay an existing mortgage, is in the nature of an assumpsit, implied from the acceptance of the deed, or is in the nature of a covenant, being in an instrument sealed by the other party; whether a suit upon such an agreement must be brought by the grantor, from whom alone the consideration moves, or may be brought by the mortgagee, as a person to whose benefit the agreement inures; how far the mortgagee is entitled, by way of subrogation, to avail himself in equity of the rights of the grantor; and whether or not the mortgagee has any rights under such an agreement in a deed from one who is not himself personally liable to pay the mortgage debt.

The appellee, by her purchase of the notes secured by the second mortgage, doubtless acquired all the rights of the mortgagee. New Orleans Canal Company v. Montgomery, 95 U.S. 16; Swift v. Smith, 102 U.S. 442. But having purchased in ignorance of the supposed agreement of Drury in the deed of conveyance from Daggett to him, and having done nothing upon the faith of that agreement, she has no greater right by estoppel against Drury than the mortgagee had. The mortgagee had no part in obtaining, and paid no consideration for, that agreement, and, upon the most favorable construction, had no greater right under it than Daggett, with whom it purported to have been made.

On the facts of this case, Daggett, in a court of equity at least, never had any right to enforce that agreement against Drury. The payment of interest on the mortgage notes would naturally be made by Drury to prevent a foreclosure of the mortgage on his land, and cannot be held to be an affirmance of an agreement of which he had no actual knowledge. The clause containing the agreement being conclusively proved to have been inserted in the deed by mistake of the scrivener, without the knowledge and against the intention of the parties, a court of equity, upon a bill filed by Drury for the purpose, would have decreed a reformation of the deed by striking out that clause. Elliott v. Sackett, 108 U.S. 133. The release executed by Daggett to Drury has the same effect, and no more.

It follows that the appellee has no equity against the appellant, and

The decree of the Circuit Court must be reversed, and the case remanded with directions to dismiss the bill.