Englemann v. Reuse

• Decision Date: 12 May 1886
• Citation: 28 N.W. 149,61 Mich. 395
• Court: Michigan Supreme Court
• Parties: ENGLEMANN v. REUSE.

28 N.W. 149

61 Mich. 395

ENGLEMANN v. REUSE.

Supreme Court of Michigan

May 12, 1886

Appeal from Macomb.

A.L Canfield, for defendant.

CAMPBELL C.J.

The bill in this case was filed to determine the sum due on a mortgage made in February, 1881, by complainant to Desiderius Collaert, for $3,500, and interest, which was assigned by the mortgagee to defendant. It is agreed that the defendant holds it on the same equities as the mortgagee. Complainant claims that it should be reduced by the amount of $556 and interest. A payment reducing the principal by $1,600 is not in controversy. This $556 is the amount of a prior mortgage on the same property held by David Trombley, and was in the hands of Joseph Kuhn to pay to Trombley whenever he would accept it in discharge of his mortgage, which was running at 8 per cent., and which he preferred holding till due. Mr Kuhn failed while the Trombley mortgage was outstanding, and the question is whether the loss falls on complainant or on defendant.

There is some conflict on the facts, arising, probably, more out of the inferences of the witnesses than out of the dealings themselves. We shall only give such an outline as will explain how the difficulty arose. Mr Collaert, who is a priest in the Roman Catholic Church living at Manistee, had some money in his hands to be invested, and Joseph Kuhn, a banker and loan agent in Detroit, was informed of that fact. Complainant owned some land in Macomb county, on which there were four mortgages to different persons, for the aggregate amount of about $2,700. She was anxious to borrow about $800 for building purposes, and applied to Mr. Kuhn to procure it. He communicated with Mr. Collaert, who agreed to make a loan of $3,500, to be made a first security. This was expected to be done by applying as much as should be necessary to extinguishing the existing mortgages, so as to leave not far from $800 beyond them available for such purposes as complainant might choose. On the date of the mortgage the parties met at Mr. Kuhn's office in Detroit. The mortgage and note for $3,500 were drawn up and executed, and Mr. Collaert, who had drawn the money for the purpose from a savings bank in Detroit that morning, produced and paid it over. The note was, as we are satisfied, handed over to him, and the mortgage was recorded and sent to him. Mr. Kuhn promised to have the title cleared. The money, after payment, was left in Kuhn's hands, who paid, or furnished means for paying, all the mortgages but the Trombley...