Kirsch v. Tozier

• Decision Date: 23 October 1894
• Citation: 143 N.Y. 390,38 N.E. 375
• Parties: KIRSCH et al. v. TOZIER et al.
• Court: New York Court of Appeals Court of Appeals

143 N.Y. 390

38 N.E. 375

KIRSCH et al.

v.TOZIER et al.

Court of Appeals of New York.

Oct. 23, 1894.

Appeal from supreme court, general term, fifth department.

Action brought by Theodore Kirsch and another against Orange L. Tozier, the Buffalo Savings Bank, and others, to reinstate a mortgage executed by defendant Lester H. Tozier and wife to defendant Orange L. Tozier, in trust for plaintiffs, to set aside its discharge, and for its foreclosure. The bank held a subsequent mortgage. From a judgment of the general term (18 N. Y. Supp. 334) affirming a judgment for plaintiffs, defendants appeal. Affirmed.

This action was brought to reinstate a mortgage executed by the defendant Lester H. Tozier and his wife to the defendant Orange L. Tozier, which was made in trust for the plaintiffs, Michael Kirsch and Theodore Kirsch, and for Peter Kirsch, now deceased, minor children of John Kirsch, to set aside a discharge of such mortgage executed by Orange L. Tozier, and for foreclosure of the mortgage and sale of the mortgaged premises for the benefit of the persons named, as cestuis que trustent. The lands in question consist of 102 acres, situate in the town of Sheldon, Wyoming county, N. Y., of which John Kirsch died seised in the year 1872. On the 8th day of January, 1873, the defendant Orange L. Tozier was appointed general guardian of the infant children, Michael J., Theodore and Peter Kirsch. At the time of his death John Kirsch owed debts which, with the incumbrances upon his real estate, exceeded the value of both his personal and real property. Orange L. Tozier and Elizabeth Kirsch, the latter the widow of the deceased, were appointed administrators of the estate of John Kirsch. Subsequently to this it was agreed between them and Lester H. Tozier, a son of Orange L. Tozier, that they should purchase the mortgages then existing on the farm, foreclose them, and procure a title to the land, and convey the same to Elizabeth Kirsch, who should, in turn, by mortgage thereon, secure to Lester H. Tozier the amount paid by him, and give a mortgage upon the farm of $1,000 to these three children. This arrangement was carried out, except that upon a sale of the lands, either by direct purchase at the sale or by deed coming immediately from the purchaser, Lester H. Tozier became the owner for the consideration, in all, of $1,131.56. Thereupon it was further arranged between Orange L. Tozier and the widow, Elizabeth Kirsch, that the widow should convey to the then holder of the title, Lester H. Tozier, all her interest in the lands to which she was entitled as widow, and that a mortgage should be executed by Lester H. Tozier to Orange L Tozier, in trust for the three children, in the sum of $1,000, one-third thereof payable to each of the three children when he should arrive at age, with interest in the meantime. Having received the deed from Mrs. Elizabeth Kirsch, Lester H. Tozier and his wife executed to Orange L. Tozier, in trust for Michael Kirsch, Peter Kirsch, and Theodore Kirsch, ‘minor children of John M. Kirsch, deceased,’ the mortgage in question, dated the 15th day of October, 1875, expressing a consideration of $1,000 payable as follows: The sum of $333.33 November 376 13, 1887; the sum of $333.33 March 18, 1891, and the sum of $333.33 October 6, 1892,-with interest, payable annually, from the 1st day of April, 1876. This instrument was delivered to Orange L. Tozier, who caused the same to be recorded in the proper clerk's office on the 23d day of October, 1875. The mortgagee and trustee paid the interest upon this mortgage to Elizabeth Kirsch, the mother of the children, in pursuance of a previous arrangement, until the spring of 1886; since which time no part of the principal or interest has been paid thereon by the trustee for the benefit of either of the children. On the 3d day of September, 1883, Lester H. Tozier and his wife executed and delivered a deed of the farm to Orange L. Tozier, at a consideration, as expressed in the deed, of $4,000, and the record title of such farm has since been in Orange L. Tozier. After acquiring this title, and on the 19th day of February, 1886, Orange L. Tozier executed and acknowledged a discharge of the mortgage, and caused the same to be recorded in the proper clerk's office on the 9th day of March, 1886. On the 27th day of January, 1886, before the execution of such discharge, Orange L. Tozier applied to the defendant the Buffalo Savings Bank for a loan of $2,000 upon his farm, which application was granted on the 1st day of February, 1886; and on an examination of the title of such farm, submitted to the officers of the bank, there was an abstract certified by the proper clerk of Wyoming county to the effect that Orange L. Tozier appeared to be the owner of the farm. On such abstract a memorandum of the mortgage sought by this action to be reinstated described the mortgage simply as being given for $1,000 and interest, ‘in trust for Michael Kirsch, Theodore Kirsch, and Peter Kirsch, minor children of John M. Kirsch, deceased,’ having written across the face of the memorandum as follows: ‘Discharged March 9, 1886. E. M. Jennings, Clerk.’ The defendant the Buffalo Savings Bank, at the time of taking its mortgage and advancing the money thereon, had not, either through any of its officers or attorneys, any knowledge or notice of the existence of this mortgage no sought to be reinstated in this action, except the memorandum on the abstract of title of its discharge, and the constructive notice given by the record of such mortgage.

Adolph Rebadow, for appellants.

F. C. Peck, for respondents.

ANDREWS, C. J. (after stating the facts).

The only serious question presented...