Miller v. Savage

• Decision Date: 20 June 1900
• Citation: 46 A. 632,60 N.J.E. 204
• Parties: MILLER et al. v. SAVAGE.
• Court: New Jersey Court of Chancery

46 A. 632

60 N.J.E. 204

MILLER et al.

v. SAVAGE.

Court of Chancery of New Jersey.

June 20, 1900.

Bill by George W. Miller, trustee, and another, against Edward S. Savage, receiver of the Johnson Railroad Signal Company. Decree for complainants.

Wall & Green, for complainants. John Griffin and P. H. Gilhooley, for defendant.

REED, V. C.This is a suit brought by the complainant trustee to have reformed a mortgage given to him by the Johnson Railroad-Signal Company, of which company the defendant is the receiver. The mortgage was made to secure debts then due by the mortgagor amounting to about $50,000. The mortgage covered real estate, and was made to George W. Miller and his successors in the said trust for the equal security of a number of creditors of the Johnson Railroad-Signal Company. The corporation mortgagors were insolvent at the time of the execution of the mortgage, and subsequent to its execution were so declared, and the defending receiver was appointed. The mortgage, as drawn, failed to convey a fee in the real-estate mortgage to the trustee, and the trustee now asks that it be reformed by inserting words of inheritance in the place of and in addition to the word "successors." It is entirely clear that, if the suit were against the original debtor and mortgagor, a reformation would be. decreed; for it is transparent from the instrument itself, as well as from the circumstances attending its execution, that the parties intended to mortgage all the interests of the corporation, and that the use of the word "successors" was an error of the draftsman, who was an attorney of the state of New York, in which state a mortgage drawn with the same phraseology would convey a fee. All the circumstances in this case bring it within the determination reached in the court of errors in the case of McMillan v. Paper Co., 20 N. J. Eq. 610, and the subsequent case in the court of chancery of Bunker v. Anderson, 32 N. J, Eq. 36. The important question is whether, assuming that the instrument would be reformed against the original party, the johnson Railroad-Signal Company, it will be reformed as against the receiver of that corporation.

It is urged that the influence which induced the execution of the mortgage (It being made to secure a wife's debt, by the vote of the husband, who was a director of the mortgagor, and to secure other debts by similar influence) should prevent a reformation of the instrument. But it has been decided by the court of...