Chelsea Exchange Bank v. Weinstein (226 A.D. 601, 1929)

Young, J.

The action was brought to foreclose two mortgages, aggregating $67,500, covering twenty-seven lots at Long Beach. The complaint is the usual one for foreclosure. The default alleged is in the failure to pay all installments of interest due beginning May 18, 1927, and semi-annually thereafter, and it is alleged that there is due the principal sums on the two mortgages, with interest from November 18, 1926. The answer of the appellant is in substance, so far as material on this appeal, a general denial and a separate defense in which is set up an agreement between appellant arid one Louis Kopple on August 12, 1925, and it is alleged in substance that the mortgages in question were given by Kopple without the appellant’s knowledge or consent and in violation of the agreement; that plaintiff, at the time of and before the execution of said mortgages, had full and complete knowledge of the agreement, and further, that no part of the moneys or property received from plaintiff in connection with the mortgages was received by or used for the appellant or in her interest.

On August 12, 1925, appellant was the owner of property at Long Beach, including that covered by plaintiff’s mortgages. On that day she made an agreement with the defendant Kopple which recites her ownership of the property; that it is subject to various mortgages and liens, the second mortgage being a blanket mortgage to secure approximately $80,000 of promissory notes given by Louis Weinstein