Summary
In Gaffney, v. Wm. E. Wright Sons Co., 112 N.J.L. 191, the liability of the defendants was predicated upon an extension agreement of a bond and mortgage executed by them.
Summary of this case from Chodosh v. SchlesingerOpinion
Argued October 25, 1933 —
Decided January 12, 1934.
1. The bond and extension agreement upon which the action was predicated created primary and not secondary liability.
2. A mortgagee who does not take possession of mortgaged premises and receives no rent therefor is not liable to account for a use not had or rents not received.
On appeal from the Supreme Court, Essex County.
For the defendants-appellants, Joseph Steiner.
For the plaintiffs-appellees, Simon P. Northrup.
The defendants appeal from an order striking an answer and counter-claim. The appeal presents no merit. The present action was brought to recover the deficiency after foreclosure of a mortgage. The liability of the defendants was predicated upon an extension agreement and a bond executed by them. The agreement contained a covenant "that the party of the second part will pay the indebtedness as hereinbefore provided."
Counsel argues that until the plaintiff exhausted his remedy, if any, against the original mortgagor no action would lie on the extension agreement or on the bond contemporaneously executed therewith for the reason that one of the conditions of the bond recites that "if any bondsman aforesaid neglects, c." From our reading of the entire instrument, and particularly the conditions and covenants, it is manifest that the defendants were primarily liable. The action of the court in striking the second and third defenses, which raised the issue that defendants were only secondarily liable, was proper.
The counter-claim struck sought to charge the plaintiffs with the reasonable rental value of the mortgaged premises. A notice was served that the mortgagee would enter into possession. The property, however, being tenantless there was no entry. No rents were received. The mortgagee, as trustee, cannot be charged for a use not had nor a rent not received. There is neither allegation nor suggestion in the record that the mortgagee by the exercise of reasonable care could have procured a tenant for the premises.
The judgment is affirmed.
For affirmance — THE CHANCELLOR, CHIEF JUSTICE, TRENCHARD, PARKER, LLOYD, CASE, BODINE, HEHER, PERSKIE, VAN BUSKIRK, KAYS, HETFIELD, DEAR, WELLS, DILL, JJ. 15.
For reversal — None.