Brighton Five Cents Savings Bank v. Sawyer

132 Mass. 185, 1882 Mass. LEXIS 45

• Court: Massachusetts Supreme Judicial Court
• Decided: January 23, 1882
• Status: Published

Opinion

Morton, C. J.

This is an action upon a promissory note secured by a mortgage of real estate. The answer alleges that the plaintiff corporation sold the land mortgaged, and received a certain sum, which should be applied in part payment; and also that the plaintiff has received a certain sum upon a policy of insurance upon the premises, which should be applied in part payment. Upon this part of the answer no question is raised. The answer further alleges, in substance, that the plaintiff undertook to procure further insurance upon the premises payable to the plaintiff as mortgagee in case of loss; that it did procure two policies of insurance, but negligently misrepresented to the companies which issued the policies that one Holey was the owner of the premises, by reason of which negligence the policies were worthless. To this part of the answer the plaintiff demurred; and the Superior Court sustained the demurrer.

Without considering the objections made to the form of the allegations of the answer, we are of opinion that the agreement upon which the defendant relies, if sufficiently set up, is not the subject of recoupment in this suit. It is not an agreement made at the time the note was given, and was not a part of the same transaction. It was a subsequent independent contract. The answer sets up, therefore, as a defence to the note, that the plaintiff has broken another contract which he entered into with the defendant, by which he has sustained damages. The defendant has no right to recoup such damages, but his remedy, if he has any, is by a cross action. Sawyer v. Wiswell, 9 Allen, 39. Bartlett v. Farrington, 120 Mass. 284.

Judgment affirmed.