
    Samuel H. Morgan, Ex'r, Resp't, v. Helen Hills et al., by Guardian, App'lts.
    
      (Supreme Court, General Term, Fifth Department,
    
    
      Filed April 13, 1893.)
    
    Mortgage—Satisfaction—Receipt.
    In a foreclosure action the answer did not deny any of the allegations of the complaint, but alleged that when the mortgage was given it was agreed between the parties that the mortgagor should not be required to pay the mortgage, that it was given to preserve the property from his improvident transactions and should be satisfied during the lifetime or at the death of the mortengee and that it was so satisfied during her lifetime. Witnesses for defendants testified that the mortgagee said: “ There was no mortgage; pa has cancelled the mortgage," and at other times she said she intended to cancel it. The mortgage was found among her papers at her death, and indorsed upon it in the handwriting of her deceased husband was a payment of §2,000, and signed by him. Held, that the receipt, even if authorized, did not operate to satisfy the mortgage; that the evidence failed to establish a gift, and judgment for plainlifE should be sustained.
    Appeal from a judgment of the special term entered in the clerk’s office of Allegany county October 17, 1892.
    
      D. D. Dickson, guardian ad litem and counsel for app'lts; F. M. Todd, for resp't.
   Lewis, J.

This action was brought to foreclose a mortgage upon real estate in the county of Allegany. The complaint was in the ordinary form in foreclosure actions. The answer of the guardian ad litem did not contain a denial of any of the allegations of the complaint, but set up as an affirmative defense that at the time the mortgage described in the complaint was executed, it was distinctly understood and agreed by and between the parties that the mortgagor should not be required to pay the mortgage; that it was given for the purpose of preserving and protecting the real estate mortgaged from unwise speculations and improvident transactions on the part of the mortgagor, and that it was understood and agreed at the time of the making of the mortgage that it should be canceled and satisfied during the lifetime of the mortgagee or at her death, and that it was so satisfied and canceled before the death of the mortgagee. The infants were the only defendants who appeared in the action. The issues were referred to a referee, and at the opening of the trial the plaintiff moved for judgment upon the pleadings, on the ground that the allegations of the complaint were not denied and were, therefore, admitted by the answer of the guardian ad litem. The motion was denied. The plaintiff rested his case without offering any evidence. The defendants thereupon entered upon the defense, and evidence was introduced in behalf of both parties which tended to establish all the material allegations of the complaint. The principal part of the evidence was produced by the defendants, and consisted of the declarations of the mortgagee to the effect that her husband during his lifetime transacted her business ; that .he had canceled the mortgage before he died. Justin Hills, one of the defendants, testified : “I remember of hearing a conversation between Mabel Freeborn and Priscilla Freeborn in relation to this mortgage and property; I don’t remember when it- was; it was as much as four or five years ago; I didn’t take any part in this conversation; Mabel asked grandma 1 why don’t you give up this mortgage ?’ She said that there was no mortgage; she said that pa has canceled the mortgage, so that it can’t make you any trouble.”

Other conversations with the testatrix were testified to, in which she stated that she intended to cancel the mortgage; that she was retaining the mortgage so that if she needed it at any time she could have it to use in her old age, but that she intended to have it cancelled. The mortgage was found among the papers of the testatrix after her death by the executor, and was read in evidence. It was in form an ordinary real estate mortgage under seal. It was executed and acknowledged by the mortgagor, and was duly recorded. It contained a clause to the effect that it was given to secure the payment of the purchase money of the premises mortgaged. There was written on the face of it, immediately following the description of the premises, iri the hand-writing of Rodman Freeborn, the following :

“ $2,000.
“ Received on the within mortgage two thousand dollars. No receipt given.
“ Belfast, Jrnie 24, 1882.
“Rodman Freeborn.”

Rodman Freeborn was the husband of the mortgagee. The mortgagor was her son. They both died before the death of the mortgagee. The referee found that the mortgagee retained possession of the mortgage; that she had never authorized nor ratified the said indorsement to be made upon the mortgage, and that the principal sum secured by the mortgage, with the accrued interest thereon, was due and unpaid, and that the plaintiff was entitled to j udgment of foreclosure and sale of the premises. The evidence failed to show any authority on the part of the testatrix’ husband to satisfy or discharge the mortgage. There was no evidence that there had ever been anything paid upon the mortgage. The receipt written upon it, even if authorized by the plaintiff, did not operate to satisfy or discharge it. The evidence failed to establish a gift of the mortgage, for neither the receipt nor the mortgage was ever delivered to the mortgagor or his representative, but, as we have seen, they were retained by the testatrix and found among her papers after her decease.

The defendants failed to establish any defense, and we fail to find any reason for a reversal of the judgment. It should be affirmed, with costs of the appeal.

Dwight, P. J., Macomber and Haight, JJ., concur.  