Polhemus v. Trainer

By the Court, Sanderson, J.: This is an action for money had and received. The plaintiff had judgment in the Court below. The defendant, having first moved for a new trial, which was denied, appeals.

One Godfrey leased to the defendant certain premises for the term of seven years. Thereafter the defendant borrowed of one Schwartz the sum of three hundred dollars, and to secure its payment assigned to him the lease aforesaid. The terms of the assignment were absolute, but Schwartz gave the defendant a written agreement to re-assign the lease to him upon the payment of the three hundred dollars and interest at the rate of two per cent per month. It was expressly agreed between them that the defendant should remain in possession of the premises and collect the rent from the sub-tenants, but nothing seems to have been in terms agreed upon as to the disposition to be made of the rents when collected, whether they were to be turned over to Schwartz or retained by the defendant. The rents were not turned over to Schwartz nor, up to the time this action was commenced, had the defendant [687]paid Schwartz any part of the money due him. The assignment to Schwartz was made on the 9th of April, 1861.

On the 4th of May following, Schwartz borrowed of Alsop & Co. the sum of three hundred dollars, for which he gave bis note payable at three months with interest, at two and one half per cent per month, and assigned to plaintiff, a member of the firm of Alsop & Co., the lease in question with directions to collect the rents and indorse them upon the note, which the plaintiff agreed to do, and to re-transfer the lease when the note should be paid. The assignment by Schwartz was first made to Alsop & Co. on the back of the lease, but by the direction of the plaintiff it was afterward erased and another made to him alone. The defendant was informed of the assignment to the plaintiff and the purpose for.which it was made, and called upon Alsop & Co. in relation to the matter, and was asked if be was prepared to take it up, and, having stated that he was not at present, was told by the plaintiff that'he must keep the interest paid. The defendant paid interest until the 14th of October, 1862, but never rendered any account for the rents eo nomine. Prior to the commencement of this action he had received, according to the evidence, more rents than sufficient to pay off what was due from him to Schwartz, or from Schwartz to the plaintiff.

The assignment to Schwartz and the defeasance back, constituted a mortgage of the defendant’s leasehold to secure the payment of the three hundred dollars and interest loaned by the former to the latter. I Under it Schwartz acquired no right to the rents coming from the sub-tenants. His only remedy was by foreclosure and sale of the leasehold estate of the defendant. The plaintiff, assuming that he took by the assignment to him the debt due to Schwartz from the defendant, acquired no greater rights than his assignor had, and his only remedy was by foreclosing on the debt due to his assignor. But the true state of the case is this : The plaintiff took nothing by the assignment from Schwartz to him, for the debt for which the mortgage was given was not assigned. The debt was the principal thing and the mortgage but an incident.