Moses Shire, Trustee, Respondent, v. George A. Plimpton and Jenny F. Plimpton, his Wife, Appellants.
Purchase-money moi'tgage — a defect of title discovered subsequent to its delivery is not a defense—a breach of a covenant of seizin may be pleaded as a counterclaim — parties holding under a paramount title.
Where the grantee in a warranty deed, who purchased the premises in reliance upon a search furnished in good faith by the vendor, which disclosed but a single defect in the title, gives to the vendor a purchase-money mortgage payable when the vendor should cure such defect, the fact that an additional defect in the title is discovered after the vendor has cured the prior defect, is not a defense to an action to foreclose the mortgage where the vendee has remained in the undisturbed possession of the premises, and there has been no breach of the covenant of warranty contained in his deed.
Spring and Williams, JJ., dissented.
Semble, that if there were a covenant of seizin in such deed, the breach of such covenant might be pleaded in the foreclosure action as a counterclaim. *118Persons claiming an interest in mortgaged premises, under a title paramount to 'the mortgage, are not proper parties to an action for the foreclosure of the mortgage.
Appeal by the defendants, George A. Plimpton and another from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Erie on the 22d day of December, 1898, upon the decision of the court rendered after a trial at the Erie Special Term.
On the 13th day of February, 1892, Adeline 0. Elder, the plaintiff’s assignor, contracted in writing with the defendant George A. Plimpton, to convey to him the premises known as No. 122 on the Avesterly side of Linwood avenue in the city of Buffalo, being fifty Teet front and rear by one hundred and forty feet in depth. The agreement recited that the consideration was $13,000; that $100 thereof had been paid; that the remainder was to be paid as follows : Four hundred dollars on the delivery of the deed, $7,000 by the vendee’s assuming payment of a mortgage then a lien on the premises and the remaining $5,500 by his giving a bond secured by a purchase-money mortgage, conditioned for the payment of $2,000 on or before August 13,1892, and $3,500 on or before February 13, 1894, with interest semi-annually. By the terms of the agreement the vendor was to furnish full tax and title searches and to convey by a "good and sufficient deed containing a covenant of warranty, but no time for performance was specified. The vendor thereafter furnished an abstract of her title, Avhich showed that the four daughters of William Kaene, all of whom are living, had title to an undivided half of tiie frontage of said premises to the depth of forty-five and one-half feet, having derived such title by will from their father, Avho died on the 22d of September, 1852. The xmndee objected to the title upon this ground. The vendor having encountered some difficulty in obtaining title from said dexdsees, and being desirous of receixdng part of the purchase price, suggested that the vendee consummate the purchase upon an agreement that would protect him against such outstanding title. It Avas thereupon agreed that the vendor should execute and deliver a warranty deed; that the purchaser should pay $2,400 in cash and give back a purchase-money mortgage and bond for the balance, being $3,500, not paid in cash or by the assumption of said mortgage; that the bond and mortgage *119should expressly provide that $1,000 was to be paid in two years and the remaining $2,500 as soon thereafter as the grantor should succeed in perfecting title to said Lin wood avenue frontage, which she agreed to do as soon as practicable; that the said $2,500 should not become due and payable until the title was perfected in that regard, but that the grantees should pay interest in the meantime; that if the vendor should not be able to perfect such title within five years, the vendee should be at liberty to do so, the expense to be deducted from the final payment, and that in case suit should be brought by said devisees, or by parties succeeding to their interest, the grantee’s costs, damages or expenses thus incurred or suffered were to be deducted from such final payment. On the 31st day of October, 1892, papers were executed and exchanged in accordance with the original contract as modified by this agreement, and the defendants took possession of the premises under the deed and have ever since been and still remain in the undisturbed possession thereof. It was subsequently discovered by the grantor that said Kaene had conveyed all his right, title and interest in said Linwood avenue frontage, and that such title was then owned by the heirs of George H. Derby. Thereafter, and on the 15 th day of ¡November, 1897, the grantor procured title to be perfected in the grantee as to said frontage, and she also procured to be delivered to him a new and correct search, which, however, showed an additional defect in the title in that Kaene’s said daughters, as his devisees, held title to an undivided half of a rectangular strip of said premises, ten feet in width and extending twenty-two feet along the northerly line of the lot, nearly midway between the front and rear, and upon which part of the dwelling house stands. This rectangular strip comprises less than one-thirtieth of the lot, and has no frontage or outlet upon any street or public way. It appears •that Kaene owned a large tract of land in this vicinity, and in conveying off the Delaware avenue frontage, in 1852, he omitted this rectangular strip in the expectation that Franklin street would be •extended northerly and include the same, and in the deed he bounded the premises on the rear easterly by the westerly line of the proposed extension of Franklin street, which was the westerly line of the premises in question, then owned by him. On the 25th day of August, 1868, David Bell, who then owned and occupied the *120entire premises, extending from Delaware avenue to Linwood avenue, subject to this defect, obtained a deed from Kaene’s widow, purporting to convey the entire interest of said Kaene, for the purpose of correcting the error. Bell supposed that this cured the defect; but it is conceded that it conveyed only an undivided half, that being the grantor’s interest, and did not convey the interest devised to the daughters. Bell and his grantees have apparently in good faith been in possession for upwards of thirty years, claiming the full title, and believing that their record title was perfect. During this time the premises have been inclosed and occupied as a pri-' vate residence, and the daughters of said Kaene, the youngest of whom was seventeen years of age at the time the interest vested in them in 1852, have made no claim of any interest therein, or title thereto.
John L. Romer, for the appellants.
Moses Shire, for the respondent.
Laughlin, J.:
This action was brought to foreclose the mortgage. It is alleged in the answer that the vendee relied on the original search in thus cónsummating the contract, and that if this defect had been shown in the original search it would have been provided for in the agreement-under which defendant took title. The court is asked to decide that it is included in such agreement, or to reform the bond and mortgage by including it. The defendants do not interpose a counterclaim for damages for breach of contract, and they make no allegation of claim of fraud, but they seek to prevent the foreclosure of the mortgage until plaintiff removes this alleged defect in title, which they say in their answer, and gave evidence tending to show, depreciates the market value of the premises at least $500, and probably more.
The court doubtless intended to find good title by adverse possession, under a claim of title, and the uncontradicted testimony would have warranted such finding, but the finding on that subject, as made, is not sufficient to constitute a finding of adverse possession. If it were material we might, for the purpose of sustaining the judgment, presume that the court found the facts essential to con*121stitnte adverse possession, there being ample evidence to warrant such finding. (Bennett v. Agricultural Ins. Co., 15 Abb. N. C. 239 ; Meyer v. Lathrop, 73 N. Y. 316; Smith v. Wetmore, 41 App. Div. 290, 292.)
Over forty years having elapsed since the youngest of these devisees became of age, and no claim having been made by any of them, we deem it exceedingly improbable that defendants will ever he disturbed in their possession.
If this were an action for specific performance of the contract, it may be that specific performance would not be decreed on the evidence presented, although specific performance of such contracts may be decreed where the title depends wholly on adverse possession, provided it is established to a moral certainty that the title is good and marketable. (Simis v. McElroy, 160 N. Y. 156; Ottinger v. Strasburger, 33 Hun, 468; affd., 102 N. Y. 692; Baker v. Oakwood, 123 id. 26 ; Hamershlag v. Duryea, 38 App. Div. 130 ; Culver v. Rhodes, 87 N. Y. 348.) In this case, however, the contract has been executed, the defendant is in possession, and the rule applicable to specific performance does not govern our determination of the case.
The agreement contained .in the bond and mortgage is limited, in definite and specific terms, to the Linwood avenue frontage defect. We cannot extend it by construction to include the rectangular-strip defect, which was not known to or considered by the parties at the time. Courts cannot make contracts. How can we say what agreement the parties would have made with reference to this defect, which is' insignificant compared with the frontage defect, to which alone their agreement relates ? Would they have regarded it of sufficient importance to justify withholding any of the purchase price ? If so, how much ? These are questions which it is not the function of a court to answer. The case, therefore, must be decided the same as if such agreement had not been made. The question then resolves itself into this: Is it a defense to the foreclosure of a purchase-money mortgage that the mortgagor in executing it relied on a search furnished in good faith by the mortgagee, which purported to show good title, when, in fact, there was a partial defect of record title % A long line of well-considered decisions enable us *122to readily answer the question in the negative. The mortgagor, having suffered no damages and being in undisturbed possession, there has not been a breach of the covenant of warranty by eviction or otherwise, and no defense to the foreclosure of the mortgage is established. (Wilt. Mort. forecl. §§ 431-437; 2 Jones Mort. §§ 1500-1507; .Edwards v. Bodine, 26 Wend. 109 ; Parkinson v. Sherman, 74 N. Y. 93; Seidman v. Geib, 16 Daly, 434 ; McConihe v. Fales, 107.N. Y. 408, 412; Kirtz v. Peck, 113 id. 222, 231; Ryerson v. Willis, 81 id. 280, 281; Farnham v. Hotchkiss, 2 Abb. Ct. App. Dec. 94, 99; Banks v. Walker, 2 Sandf. Ch. 344; Platt v. Gilchrist, 3 Sandf. 118, 125; Miller v. Avery, 2 Barb. Ch. 583, 595.)
If there had been a covenant of seizin, the breach of such covenant might have been properly pleaded as a counterclaim, and the validity of the title would then have been directly in issue, for the covenant of seizin is broken at once if the title be defective. (Wilt. Mort. Forecl. §§ 435, 436; Merritt v. Gouley, 58 Hun, 372; Edwards v. Bodine, 26 Wend. 109 ; Bingham v. Weiderwax, 1 N. Y. 509 ; York v. Allen, 30 id. 104 ; Kent v. Welch, 7 Johns. 258 ; Blydenburgh v. Cotheal, 1 Duer, 176; 8 Am. & Eng. Ency. of Law [2d ed.], 186, 187; Rawle Cov.. [5th ed.] § 176 ; Mead v. Stackpole, 40 Hun, 473.)
If these devisees have any interest at all, they claim by title paramount to the mortgage, and could not be brought into this suit to litigate their rights. (Cromwell v. Maclean, 123 N. Y. 474 ; Helck v. Beimheimer, 105 id. 470; Jacobie v. Mickle, 144 id. 237.)
Plaintiff could not bring an action against Kaene’s daughters to determine a claim to this property, even if they made a claim, for he is not in possession, and his assignor has not been in possession for upwards of eight years. Plaintiff being the assignee of the mortgage and having neither title nor possession it is difficult to perceive what form of action he could bring to have it determined that adverse possession has run against the interest of the devisees. If he is deprived of the right to enforce the mortgage until he perfects record title as to this defect, he will be placed at the mercy of said devisees w'ho, while not asserting any claim, may decline, as they apparently have declined, to execute deeds without being compensated liberally.
*123The co.urt cannot upon principle decline to grant a foreclosure of this mortgage, nor would such course be warranted by precedents. It would have been more in accordance with the justice of the case to have withheld the award of costs, but we would scarcely be justified in modifying the judgment in that regard. The judgment appealed from should be affirmed, but without costs.
Adams, P. J., and McLennan, J., concurred; Spring and Williams, JJ., dissented.
Judgment affirmed, without costs.