Tuite v. Stevens

Wells, J.

The first question to be determined is, whether the bill of sale to the plaintiff, from Pratt, the assignee of Daily & Worthen, conveyed to him the whole property that was upon the premises, No. 143 Federal Street, or only so much of it as was in fact subject to the mortgages to Stevens. The body oí the instrument is ambiguous, capable of either construction. But the final clause, which declares the intent of the parties clearly makes it apply to the whole property in said premises. It is the duty of the court to give it that construction which *307 appears upon the whole instrument to have been the real contract and intent of the parties.

It is urged that the assignee had no power to sell otherwise than at public auction, and that the plaintiff failed to show a good title in himself by the bill of sale merely, without proof of the proceedings requisite to make the sale comply with St. 1861, c. 104, § 2. But we are of opinion that the defendant is not entitled to avail himself of such an objection. The statute seems to be intended to secure a proper accountability on the part of assignees in insolvency; and we think is to be construed as'directory merely, and not as rendering the title of bond fide purchasers void for any failure of the assignee to comply with its provisions.

The most important question is, as to the right of the purchaser from the assignee to avoid the mortgages that had been placed upon the property by the insolvent debtor, upon the ground of fraud in their inception. If the mortgages were voidable for such fraud, the assignee undoubtedly had the right to elect whether to avoid or affirm them. If he elected to affirm them, — as he would appear to have done by his bill of sale describing the property as “ subject to two mortgages,” and declaring that it had been purchased by Tuite “ subject to said mortgages,” — the purchaser is concluded by such election. Indeed it is questionable whether the assignee could sell to another party the right to contest, by action merely, a mortgage title to personal property in the hands of the mortgagee; whether he must not himself avoid the mortgage, at least so far as to regain possession of the property, before he can make a transfer which will be operative as against the mortgagee. If he does not do this, the statute authorizes him to redeem the mortgage or sell the property “ subject to such mortgage.” Gen. Sts. c. 118 §44.

The assignee in this case has sold “subject to the mortgages ; ” and, so far as the mortgages were voidable merely, they have now ceased to be so, by the affirmance of the assignee. The plaintiff is therefore not entitled to hold any part of the property covered by the mortgages, until he shall have *308 redeemed; and the rulings of the court below were correct to that extent. But, as to any property embraced in the bill of sale, (construed as above,) which was not covered by either mortgage, the plaintiff should have been permitted to establish his title, by such evidence as he might be able to adduce to show a valid sale from the assignee to himself. To that extent and for that purpose the exceptions are sustained and a new trial is granted.