This ivas an action by the appellee, who was the plaintiff, against the appellants, to foreclose a mortgage on lot No. 71, in block No. 40, in Woods' addition to the city of Indianapolis. The mortgage bears date, May 2, 1856; was executed by Sarah Bishop, now Sarah Oressey — and her then husband, John Bishop, to one Aaron W. Banghart, to secure the payment of $400, with interest, on or before May 2, 1857, and was assigned by the mortgagee to John IIoss, who assigned it to the plaintiff. It is averred in the complaint, that on JJovemher 10, 1856, John Bishop died, leaving Sarah Bishop; his widow, and Lewis Bishop, his heir at law; that Geo. Durham was duly appointed administrator of the decedent’s estate, and that Sarah, the widow of the deceased, is now intermarried with William, Oresscy. And further, it is averred that Sarah had, at the date of the mortgage, and still has, the legal title, in fee simple, to the mortgaged premises. Plaintiff demands judgment for $500, also a decree of foreclosure, &c.? and an order to sell the lands described in the mortgage, for tbe payment of such judgment, &c.
The answer of Sarah Cressey contains a general denial, and three special defenses. To the 2d, 3d and 4th defenses, demurrers were sustained. Geo. Durham, administrator of the estate of John Bishop, also filed Ins answer, which, upon demurrer, aves adjudged insufficient; and Lewis Bishop, being a minor, answered by his guardian ad litem. The issues Avere submitted to tbe Court, Avho, upon final bearing, rendered a judgment and decree in accordance with the prayer of tlie complaint. As the facts set forth in the second defense are mainly relied on, as an effective bar to the action, they alone Avill be noticed. They are these: On June, 22, 1856, John Bishop, the then husband of Sarah Cressey, and Aaron W. Banghart, tbe mortgagee, entered into an agreement, in writing, whereby he, Bishop, sold to Banghart lot No. 70, in block No. 40, in Woods' addition *16to the city of Indianapolis, for $800; of which, $400 was to be paid on March 1, 1856, and the residue on March 1 1857. Upon full payment of the first installment, Bishop was to make and deliver to Banghart, a deed in fee simple, and the residue of the purchase money was to be secured by a mortgage on the premises. Pursuant to the sale thus made, Banghart took possession of the property, but did not pay, or offer to pay, on March 1, 1856, as stipulated in the agreement; nor did Bishop, at that time, deliver or tender to him a deed for the premises. Banghart continued in such possession until May 2, 1856, when he paid on the agreement $400. At that date, the agreement was so. modified as to extend the time of making said deed, to May 2, 1857, but in all other respects, it was to remain unaltered. And to secure the making of such deed, the mortgage in suit, was, at its date, made to Banghart/ but, at the same time, he, Banghart, executed a written instrument, which is, in effect, as follows:
“Whereas, Sarah Bishop, and John Bishop, her husband, have this day executed to me a mortgage on lot No. 71, in block No. 40, in Woods’ addition, &c., to secure the payment of $400, with interest, on the 2d of May, 1857. Now, if the said Sarah and John Bishop shall make, or cause to be made and delivered to me, a good and sufficient deed for lot Ho. 70, in block No. 40, in Woods’ addition, &c., on or before the 2d of May, 1857, then I agree, and am bound, to deliver up said mortgage to be canceled. But, if the deed for lot No. 70 shall not be given, as above specified, then the right to foreclose said mortgage shall be complete, and this instrument is to be void, &c. And if said Sarah and John Bishop shall pay the $400, with interest, as in the mortgage specified, and fail to make the deed, as before stipulated, then they are to pay me the value of the improvements which I may make on said lot, now occupied by me, to be determined by disinterested persons.”
“DatedMay 2,1856. Signed, “AaronW. Banohart.”
It is averred that Bishop and his wife were not, nor was either of them indebted to Banghart, at the date of the *17mortgage, $400, or any other sum; but that the money so paid to Bishop, was paid on account of the original agreement for the sale of lot No. 70. And further, it is averred that Bishop, prior to March 2, 1857, the day on winch the deed for said lot was to be made, died intestate, leaving Ms wife and cMld, as in the complaint stated; and that Bmghart did not at that date rescind the contract of sale, but still continues to hold the lot under and by virtue of said agreement; nor has he paid or offered to pay the balance of the purchase money.
The answer prays that Banghari be made a party, &c., and that the Court will appoint a commissioner, and direct Mm to make to the party entitled thereto a deed for the premises sold, &c.
These facts are admitted by the demurrer, and the question to settle is, are they sufficient to defeat a recovery on the mortgage? It must be conceded that the mortgage and written instrument, over the signature of Banghari, have relation to the same subject matter, and having been executed cotemporaneously, must be held as one contract. Fellows v. Kress, 5 Blackf. 536; Chitty on Cont. 40, note 1. And being thus construed, they have direct reference to the agreement for the- sale of lot No. 70. The mortgage and written instrument do not, however, vacate the original agreement, but continue it in force, except so far as they extend the time of executing the deed, and secure the title by the pledge of another lot. That they were simply intended to modify, and not annul, the prior agreement of sale, may be noted from the fact that in them, nothing is said in relation to the payment of the second installment, due March, 1857. True, the written mstrument and mortgage, when construed together, distinctly say that “If the deed for lot 70 shall not be made by May 2, 1857, then the right to foreclose the mortgage shall be complete.” Still, the defendants have an interest, growing out of the transaction between the parties to the agreement, which they have a right to enforce. And it is believed to be the intention of the code, to allow such matters as are stated in the pleading in question, to be set up in defense; “so that the whole controversy between the parties may be settled in one action, and that either the *18plaintiff or defendant should have such relief fs the nature of the case requires.” Van Santvoord’s Pl., p. 546, et seq.
W. Wallace and Benjamin Ilavrison, for the appellants.
D. McDonald and J. Milner, for the appellee.
The suit in this case, though the demand upon which it is ^ased ^ Sjecm'e(í hy mortgage, is really a suit to recover purchase money advanced upon a contract for the sale of real estate; and the plaintiff obviously can not recover, unless the vendee of the estate sold has placed himself in a position to rescind the contract. This, it seems to us, he has not done, because he still holds possession of the premises, under the contract of sale. Evidently, “a party can not retain .the subject of the contract, and refuse to pay for it.” Gaar v. Lockridge, 9 Ind. 96. Moreover, the vendee himself was in default, in failing to pay, or tender, an installment .of the purchase money which fell due March 1, 1857, and prior to the time agreed on for making the deed. But the contract of • sale still remains in force; has not been rescinded, nor has any attempt to rescind it been made. Hie result is, the plaintiff is not entitled to recover the purchase money advanced. • There are other points of error made by the appellant, but the ground assumed in this opinion renders a notice of them unimportant.
Per Curiam. — The judgment is reversed, with costs Cause remanded, &c.