Opinion
March 8, 1918.
Eben H.P. Squire, for the plaintiff.
George W. Alger [ Richard Steel with him on the brief], for the defendants, appellants.
The conveyance from plaintiff to the defendants Lewis and Putney, Jr., was a mortgage. It was given to secure the payment of plaintiff's debt to Lillian T. Clarke, since deceased. The defeasance was expressed in the collateral so-called declaration of trust, which gave to plaintiff the right to redeem. It was not a conveyance with an option of repurchase, for the debt existed unimpaired by the conveyance. There is nothing in the facts to take it out of the rule so often asserted by the courts and so clearly and cogently stated by Judge VANN in Mooney v. Byrne ( 163 N.Y. 86). (See, also, Real Prop. Law [Consol. Laws, chap. 50; Laws of 1909, chap. 52], § 320.) Under the law of this State, a mortgagee takes no estate in the land, but a lien only, which is personal property. ( Trimm v. Marsh, 54 N.Y. 599.)
The plaintiff, therefore, remained the owner of the legal estate, and the defendants Lewis and Putney, Jr., had a lien or personal interest only. The fact that the deed was not made to the creditor direct, but to her representatives Lewis and Putney, Jr., makes no difference. As it was made to secure the debt, it is none the less a mortgage. ( Nestell v. Hart, 202 N.Y. 280.) And it is not competent for the mortgagor to make any agreement as part of the mortgage transaction which will prevent a court of equity from recognizing and enforcing his right to redeem. ( Mooney v. Byrne, 163 N.Y. 86.) The personal lien of a mortgage cannot be changed into a legal estate by any agreement that such result shall follow default in payment of the debt. So the conveyance by the defendants Lewis and Putney, Jr., as the learned justice properly held, operated solely as an assignment of a mortgage.
But I think the court erred in limiting the plaintiff's right to redeem to thirty days after signing the judgment. The right of redemption can be foreclosed only in the way provided by law, i.e., either by civil action or by advertisement. It has been seen that the agreement to limit the right to redeem to November 1, 1914, is void; but all the court has done by its judgment is to fix a new and later date for the expiration of the right to redeem. The court has practically decreed strict foreclosure in favor of defendants; but this cannot be done. ( Moulton v. Cornish, 138 N.Y. 133.)
The learned justice thought this course justified by the judgment in Nestell v. Hari ( 202 N.Y. 280). But I think that case, although very like this in its facts, may be distinguished. In the Nestell case the court expressly points out that the land was conveyed at its full value, $55,000, and that justice might be done by leaving the title in defendant, whereas in the instant case there is no finding nor evidence that $6,000 was the value of the property on November 1, 1914. I cannot bring myself to think that the Nestell case has destroyed the maxim "once a mortgage, always a mortgage," or the doctrine that an equity of redemption cannot be foreclosed otherwise than by action or advertisement according to law.
The judgment should be modified by reversing and eliminating therefrom the provision limiting the plaintiff's right to redeem the real property to a period of thirty days from the date of signing the judgment, and providing that, on failure so to redeem, the plaintiff's complaint be dismissed on the merits, and plaintiff and all persons claiming under him be forever barred and foreclosed of their equity of redemption; and as so modified affirmed, with costs to the plaintiff against the defendants Luce and Clarke in their representative capacities.
JENKS, P.J., RICH, PUTNAM and KELLY, JJ., concurred.
Judgment modified in accordance with opinion, and as so modified affirmed, with costs to plaintiff against the defendants Luce and Clarke in their representative capacities.