Gillett v. Balcom

6 Barb. 370

• Court: New York Supreme Court
• Decided: May 7, 1849
• Status: Published

Opinion

By the Court, Welles, J.

Under the decree, declaring Uri Balcom a bankrupt, which bears date Feb. 9, 1843, and the 3d section of the bankrupt act of August 19, 1841, the title to the wheat in question, as well as to the land on which it was growing, vested in the assignee in bankruptcy. Such title, however, came to the assignee charged with the incumbrance of the mortgage to the defendant, which held, not only the land, but the crops thereon, while growing, and until they were severed therefrom. (Shepard v. Philbrick, 2 Denio, 174, and authorities there cited.)

The mortgage was regularly foreclosed under the statute, and the mortgaged premises sold under the foreclosure to the defendant, before the sale by the assignee in bankruptcy, and the mortgagor, before the sale by the assignee to the plaintiffs, surrendered possession to the defendant. The plaintiffs’ counsel, however, insists that as the money, to secure the payment of which the mortgage was given, was payable on demand, and that as no demand Was proved, the .money was not due, and the mortgage not forfeited, and that' therefore the foreclosure was of no avail to vest the title in the defendant.

It has been long settled, that where a note is payable on demand, no other demand need be made except by bringing a suit thereon. (Story on Prom. Notes, § 29, and authorities there cited. 3 Wend. 21, per Savage, Ch. J.) The rule is founded upon the assumption that the debt, in such a case, is due, generally, as soon as the note is given, and that by the contract between the parties, a demand is not made a condition to the maker’s liability; and that the commencement of the suit is a sufficient demand in a case where a party has agreed to pay his own debt on demand.

I am not able to discover why the same rule should not apply to a debt secured by a mortgage, payable on demand. In this case the debt was due generally, and the mortgagee had the right to foreclose at any time. The foreclosure under the statute was, in my opinion, equivalent, as far as this point is concerned, to a suit on the bond, or to a foreclosure in chancery.

In Nelson v. Bostwick, (5 Hill, 39,) Bronson, J. says, “ Where a party agrees to pay his own debt on request, it is regarded as an undertaking to pay generally, and no special request need be alledged. But it is otherwise where he undertakes, for collateral matter or as surety for a third person. There, if the agreement be that he will pay on request, the request is parcel of the contract, and must be specially alledged and proved.”

The rule would probably be the same in a case where the debt was payable in property, or otherwise than in money, upon request or on demand; and would require the plaintiff to aver and prove the request or demand.

My opinion is that the nonsuit was proper and should not be set aside.

Motion denied.