Keyser v. Kemper

• Decision Date: 24 May 1929
• Docket Number: 23.
• Parties: KEYSER ET AL. v. KEMPER ET AL.
• Court: Maryland Court of Appeals

146 A. 275

157 Md. 437

KEYSER ET AL. v. KEMPER ET AL.

No. 23.

Court of Appeals of Maryland

May 24, 1929

Appeal from Superior Court of Baltimore City; Walter I. Dawkins Judge.

Suit by Isaac Keyser and another against Abraham Kemper and others. From a judgment in favor of some of defendants, plaintiffs appeal. Reversed, and new trial granted.

Argued before BOND, C.J., and URNER, ADKINS, OFFUTT, DIGGES, PARKE and SLOAN, JJ.

Edwin T. Dickerson and Solomon Hirschhorn, both of Baltimore, for appellants.

Louis Samuels, of Baltimore (Ben Weintraub, Howard L. Aaron and Samuel J. Aaron, all of Baltimore, on the brief), for appellees.

DIGGES J.

The appellants brought suit in the superior court of Baltimore city on a written agreement under which they claim indemnity from eight of the signers of said agreement; the appellants having also signed this agreement. Judgment by default for want of a plea was entered against the defendants Abraham Kemper and Jennie Kemper, and thereafter the case proceeded to trial against the remaining defendants, resulting in a verdict and judgment for the said defendants. From such judgment the appeal here is prosecuted. The agreement upon which the claim of the appellants is based is as follows:

"Baltimore, Md., September 24th, 1923.

We, the undersigned, for and in consideration of the sum of one dollar, and for other good and valuable considerations, the receipt of all of which is hereby acknowledged, do hereby agree that we will indemnify and reimburse, according to the conditions hereinafter stated, Isaac Keyser and Harry Sachs who have united in a certain mortgage executed by them together with Isaac Herman and wife for $6,032.00, to the David Reus Permanent Loan and Savings Co. of Baltimore City on properties Nos. 619 and 621 N. Mount Street, Baltimore City, Maryland, namely:

1. If the said Isaac Keyser and Harry Sachs, or either of them, shall suffer a loss by virtue of having entered into the said mortgage, then, and in that event, we agree to indemnify and reimburse them or him in an amount proportioned according to the number of persons signing this agreement, inclusive of the said Keyser and Sachs, to the end and intent that the said loss shall be borne equally by all of the parties entering into these presents.

2. If any of the parties entering into these presents be insolvent, or shall not be financially able to pay his or her share, then the loss shall be divided equally among such of said parties hereto as are solvent and financially able to pay.

3. The obligation of the parties hereto shall be in like manner as if they were mortgagors entering into the execution of the said mortgage.

Witness the hands and seals of the parties hereto."

The mortgage referred to in this agreement was signed by Isaac Herman and Helen Herman his wife, together with Sachs and Keyser, the appellants. It was given to the David Reus Permanent Loan & Savings Company of Baltimore City in the amount of $6,032 and conveyed by way of mortgage three lots or parcels of ground lying in Baltimore city, each improved by a dwelling house, and known as Nos. 619 and 621 North Mount street and 1009 West Saratoga street, respectively; each of these parcels of ground is separately described by metes and bounds in separate paragraphs in the mortgage. Immediately following the description, the mortgage says: "And all of the parties who unite in the execution of this mortgage do hereby covenant and agree to pay the said mortgage debt and perform all the covenants herein contained as original mortgagors and not as sureties." The mortgage contained a consent for the passage of a decree for the sale of the property after default in any of the conditions shall have continued for eight weeks, under the provisions of section 720 to 732, inclusive, of chapter 123 of the Acts of 1898, being the statutes applicable to foreclosures under a consent decree in Baltimore city. The date of the mortgage was September 24, 1923, the same as that of the agreement, and the evidence shows that the two instruments were executed on that day, and practically simultaneously. Default having occurred under the terms of the mortgage a decree for foreclosure was passed and the property sold on or about October 5, 1926. The property did not sell for enough to satisfy the mortgage debt, interest and costs, the deficiency, as shown by the auditor's report which was finally ratified on December 13, 1926, being $1,986.50; whereupon a deficiency decree was entered against the mortgagors, Herman and wife and Sachs and Keyser, for the sum of $2,005.08, being the amount of the deficiency as shown by the auditor's report, with interest to the date of the deficiency decree.

The facts as disclosed by the record, which led up to and culminated in the execution of the mortgage and the indemnity agreement, are substantially these: It appears that one King prior to September, 1923, was the owner of the Mount street property, and agreed with the appellants to sell that property for a certain amount, and this contract was subsequently transferred to various parties, until finally the property was sold to Herman and wife and a deed executed by King conveying it to them; that each one of the parties through whom the contract passed sold it for varying amounts over and above what they had paid for it, none of them, however, having received in cash their profits, which were to be accounted for and distributed upon the consummation of the sale to Herman; that the appellants, at the time they disposed of the contract, represented that a loan to the purchaser would be secured by a mortgage on the property to the amount of $6,000; that each holder thereafter of the contract made a similar representation to his successor; that none of the holders of the contract intended to become bona fide purchasers of the property, but bought the contract for the purpose of reselling at a profit; that when Herman and wife finally purchased the property for the sum of $7,400, it became necessary for the appellants to make good their promise to obtain a loan on the property secured by a mortgage of about $6,000; that they applied to the building association for a loan of that amount, which was granted on the security of a mortgage on the Mount street property, and, in addition thereto, on the Saratoga street property, which was the individual property of the appellant Sachs. There is a sharp conflict in the testimony as to why the Saratoga street property was included in the mortgage, the appellants testifying that it was in compliance with a demand made by the building association for additional security; to the same effect is the testimony of Mr. Albrecht, the attorney for the association, who prepared the mortgage and the agreement of indemnity; while the defendants' testimony is that they were induced to sign the agreement of indemnity by reason of the representation made to them by the appellants that the Saratoga street property, in addition to the Mount street property, which were both included in the mortgage, would in all likelihood be sufficient to satisfy the mortgage upon foreclosure, and that signing the indemnity agreement, by which all of the parties thereto were to share equally any loss sustained by the appellants by reason of a deficiency growing out of a foreclosure, would subject them to slight or no liability. That at first it was the intention and purpose of...