Gibbs v. Parsons , 64 N.H. 66 ( 1886 )

Two of the plaintiff's mortgages were executed before a justice of the peace in Massachusetts, and the defendant objected because the oath was not administered by a justice in this state. The mortgagor and mortgagee must both make and subscribe the affidavit (G. L., c. 137, s. 6); but the statute does not in terms require the affidavit to be signed, or the oath administered, within the state. A deed of land in this state may be executed and acknowledged in another before a justice of that jurisdiction. The statutory affidavit in a personal property mortgage comes within the same rule if executed according to the provisions of our statute. Southerin v. Mendum, 5 N.H. 420, 428.

It is not apparent that the answers to interrogatories 279, 280, and 281 in the plaintiff's deposition were material. They neither admit or deny, nor tend to prove or disprove, anything material to the questions in issue, nor do they contradict the plaintiff, or show that in declining to answer she refused to do anything that the court would have required of her (Carter v. Beals, 44 N.H. 408, 412), but were offered rather as cross-examination to discredit the plaintiff. How far justice, depending upon the discovery of truth, requires that evidence of this character, not infringing upon a privilege, should be admitted, is a question of fact to be determined at the trial in view of all the circumstances of the case. Gutterson v. Morse, 58 N.H. 165, 166.

The exception to the charge, the motions that the court order a verdict for the defendant, as well before as after the special verdicts of the jury, raise two questions: First, was the property included in the plaintiff's mortgages discharged therefrom because the plaintiff rendered to the defendant, on his demand as an officer, a false account of the amount due on the debts secured by them? Section 18, c. 224, Gen. Laws, requires a mortgagee, on the demand of an attaching officer for an account on oath of the amount due on the debt secured by his mortgage, to render the same; and if a false account is rendered, the property is discharged. The defendant made such a demand. The plaintiff rendered her account in good faith, making all reasonable efforts on her part to make it just and correct; but it appeared at the trial that the mortgagors, without the knowledge or consent of the plaintiff, and without her negligence in not knowing, appropriated to their use some money received for mortgaged property that should have been applied in reduction of her mortgage debts, or that of the prior Welch mortgage. Was this a false account within the meaning of the statute? In Putnam v. Osgood,51 N.H. 192, 208, it was held that an attaching creditor is entitled to an account rendered by the mortgagee in good faith, and with all reasonable effort to make it just and correct; and if the account is rendered for more than is justly due, and the error is wilful, or caused by bad faith, or by culpable negligence or carelessness which would imply bad faith, then his lien would be discharged. On the contrary, if the error is unintentional, the result of pure accident or mistake, and without culpable negligence, the mortgage security is not lost. This is a practical and just construction of this highly penal statute, and the one that was given at the trial. Putnam v. Osgood, 52 N.H. 148.

Second. Were the plaintiff's mortgages void in law because the mortgagors appropriated a part of the avails of the mortgaged property to their use, without the knowledge, consent, or culpable neglect of the plaintiff? At the time the first mortgage was executed it was agreed that the mortgagors should finish the boxes in process of manufacture, and sell them with those then on hand, and with the avails pay the prior claim of Mrs. Welch and apply the balance on the plaintiff's mortgage note. This constituted the mortgagors the plaintiff's agents to sell the mortgage property for her, the avails to be applied on the mortgage debts, according to their priority, and being made in good faith was a valid agreement; but the plaintiff having made the mortgagors her agents, she is bound to account for the avails of the sales of the mortgaged property, whatever they may be, as against the defendant, according to the agreement, and they must be regarded as thus applied whether actually paid to the plaintiff or not. The transaction being an honest one, no secret trust existing or found by the jury, the plaintiff's mortgages were not void in law. Wilson v. Sullivan,58 N.H. 260. The case at bar differs from Putnam v. Osgood, supra, in this, that the mortgagor was allowed to sell the mortgaged property in that case for his own benefit regardless of the legitimate objects of the mortgage, while in this the agreement bound the plaintiff to account for the entire avails of it on the mortgage debt in entire harmony with the legal purposes of a mortgage security.

No other question is mentioned in the defendant's brief.

Judgment on the verdict.

SMITH, J., did not sit: the others concurred.