Willcox v. Foster

The plaintiff Hawes is entitled to have the discharge of his mortgage cancelled, and the mortgage restored to the record as an existing incumbrance on the estate. It *323sufficiently appears from the evidence and from the findings of the master that this mortgage, which was a second mortgage, was by mistake discharged by Willcox, after it had been assigned by him to Hawes, and before the assignment had been recorded. He intended to discharge only the first mortgage, which had been paid, but discharged the second also. As against the mortgagor, who has not paid the debt secured by the mortgage, no reason can be urged against its restoration. A discharge of a mortgage by accident or mistake does not prove an actual payment of the mortgage debt, but is inoperative and void, and the mortgage has the same force and effect as before. Bruce v. Bonney, 12 Gray, 107.

Nor have any rights of third parties intervened to defeat the right of Hawes to have his mortgage stand as the first mortgage on the premises. Follett took the third mortgage while the mortgage assigned to Hawes was on the record undischarged, and his mortgage is in terms made subject to the second mortgage. He therefore has lost no rights by the discharge made by Willcox. Barnes v. Camack, 1 Barb. 392.

After the discharge, the Providence County Savings Bank duly attached the estate as the property of the mortgagor; but whatever rights the bank acquired by the attachment were lost by the dismissal of the action for want of prosecution.

The only other mortgage placed on the premises after the assignment to Hawes was given to Herbert E. Foster, the brother and agent of the mortgagor. He knew that no part of the sum secured by the second mortgage had been paid. He had requested Willcox to discharge the first mortgage; but, finding that he had discharged the second also, consulted counsel to learn if the second could be reinstated. He was put upon inquiry, and had reason to suppose that there was some mistake in the discharge. He had no rights, therefore, as against the second mortgage. His mortgage, however, he assigned to Perry, who took it after the note which it secured was overdue, and as collateral security in part for a preexisting debt, and in part for money lent at the time of the assignment. Perry therefore took it subject to all the defences to which it was open in Foster’s hands. Fish v. French, 15 Gray, 520. Howard v. Gresham, 27 Ga. 347. Davies v. Austen, 1 Ves. Jr. 247. Clute v. Robison, *3242 Johns. 595. Union College v. Wheeler, 61 N. Y. 88. Greene v. Warnick, 64 N. Y. 220. Andrews v. Torrey, 1 McCarter, 355. Twitchell v. McMurtrie, 77 Penn. St. 383.

The failure of Hawes to record his assignment could only be availed of by subsequent assignees of the same mortgage. Registry of an assignment is not necessary as against the mortgagor or his subsequent grantees. Clute v. Robison, supra. Greene v. Warnick, ubi supra. Union College v. Wheeler, ubi supra. Campbell v. Vedder, 3 Keyes, 174. Gillig v. Maass, 28 N. Y. 191, 209. Purdy v. Huntington, 42 N. Y. 334. Wilson v. Kimball, 7 Foster, 300. Decree for the plaintiff Hawes.