Gerrity v. Wareham Sav. Bank

• Citation: 202 Mass. 214,88 N.E. 1084
• Parties: GERRITY v. WAREHAM SAVINGS BANK.
• Decision Date: 22 May 1909
• Court: United States State Supreme Judicial Court of Massachusetts

202 Mass. 214

88 N.E. 1084

GERRITY v. WAREHAM SAVINGS BANK.

Supreme Judicial Court of Massachusetts, Plymouth.

May 22, 1909

COUNSEL

David Stoneman, for plaintiff.

Bates Nay & Abbott, for defendant.

OPINION

BRALEY J.

The plaintiff as the purchaser at the sale on execution, having acquired the interest of the judgment debtor at the date of the attachment in the realty described in the bill, the subsequent mortgages given to the defendant were subject to his title. Rev. Laws, c. 167, § 38; Wiggin v Heywood, 118 Mass. 514, 516. But the bank having obtained by assignment from one Rudnick a prior outstanding mortgage, given to secure advances for the purchase price of the land and construction of the buildings, which it is proceeding to foreclose, the plaintiff asks for a decree that either the bank has no valid title, or the mortgage has been discharged and extinguished, or, if still enforceable, he can redeem without being charged with the sum advanced by the mortgagee after the attachment had been recorded. It is manifest, from the agreed statement of the evidence, that before recording the mortgages given to secure the loan obtained from the defendant, the treasurer, upon being notified of the attachment, procured the assignment of the first mortgage for the protection of the bank. If the concurrent agreement with the assignor and the assignment are construed as one instrument, the recitals show there was no intention to depart from the purpose for which it had been obtained. The bank, indeed, stipulated that the assignor's second mortgage should be protected; but the defendant concedes that the stipulation cannot impair the priority of the attachment. The negotiation of the loan and execution of the papers appears to have been intrusted to the treasurer, and his subsequent acts upon ascertaining the condition of the title, being for the benefit of the bank, were, under the circumstances, within his implied powers as an executive officer of the corporation. Bristol County Savings Bank v. Keavey, 128 Mass. 298. Yet if his orginal authority may not have been so broad, the foreclosure by entry and sale, afterwards instituted by vote of the board of investment, was a sufficient ratification. North Brookfield Savings Bank v. Flanders, 161 Mass. 335, 37 N.E. 307; New England Mutual Life Ins. Co. v. Wing, 191 Mass. 192, 77 N.E. 376.

Nor can the defendant's title be successfully attacked because being a savings bank subject to the limitations as to investments found in Rev. Laws, c. 113, § 26, cl. 1, the plaintiff claims it was prohibited from taking the assignment, or under its chartered powers from binding itself by the accompanying agreement. The plaintiff does not charge fraud, and the transaction having been entered into, and performed in good faith solely in the interest of the bank, even if upon discovery of the state of the title the defendant could have refused to complete the negotiations, it cannot be assailed on this ground. Chaffee v. Middlesex R. R. Co., 146 Mass. 224, 16 N.E. 34; New York Bank Note Co. v. Kidder Press Mfg. Co., 192 Mass. 391, 404, 78 N.E. 463, and cases cited; Union National Bank of St. Louis v. Matthews, 98 U.S. 621, 25 L.Ed. 188; National Bank of Genesee v. Whitning, 103 U.S. 99, 26 L.Ed. 443; Force v. Age Herald Co., 136 Ala. 271, 33 So. 866. If instead of lending the money on the mortgages which was to be paid by the mortgagor to Rudnick in discharge of the first mortgage, the defendant had advanced the proceeds directly to him, and then taken an assignment, the transaction would not have operated as a payment, but as a purchase. Bremer v. Columbia National Life Ins. Co., 199 Mass. 344, 85 N.E. 439. It having been the intention of the parties that the mortgage should be kept alive, the indebtedness was not extinguished, or discharged, and the defendant succeeded to...