Case ID: conn_28/html/0336-01.html
Source: Caselaw Access Project
Author: {"author": "Hinman J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

HEW HAVEN COUNTY,
    SEPTEMBER TERM, 1859.
    Present, Stores, C. J., Henman, Ellsworth, and Sanford, Js.
    Samuel G. Savage vs. Daniel Dooley.
    A mortgage, though in form a conveyance of the legal title, is, in substance, only a pledge of the land for the mortgage debt, and the mortgagee is to be regarded as holding the legal title only for the purpose of enforcing payment of the debt.
    A second mortgagee can therefore maintain ejectment against the mortgagor, although there is an outstanding unsatisfied prior mortgage.
    [ *412 ] *And it makes no difference that the prior mortgage was expressly excepted from the incumbrances covenanted against in the second mortgage.
    No pavty can avail himself of the legal title conveyed by the prior mortgage, as a defense against an action of ejectment by the second mortgagee, except the prior mortgagee and his assigns.
    Ejectment. The defendant, in 1854, had mortgaged the demanded premises, which he then owned in fee simple, to the Hartford Savings Bank and Building Association, to secure a loan of money. On the 12th of January, 1856, he mortgaged the same premises to the plaintiff, by a warranty deed with the usual covenants, hut excepting from the covenant against incumbrances the prior mortgage to the Savings Bank and Building Association. He also at the same time made another mortgage, with the same covenants and exceptions, to a firm of the name of Foster & Co. Each of these mortgages excepted the other from the incumbrances covenanted against. The plaintiff, and Foster & Co., had foreclosed their mortgages. The condition of the mortgage to the Savings Bank and Building Association had been broken, and the mortgage was outstanding and unsatisfied when the present suit was brought. The defendant set up in defense the legal title thus outstanding. The case on these facts was reserved for the advice of this court.
    
      Lounsbury, for the plaintiff,
    cited Porter v. Seeley, 13 Conn., 564; Burr v. Spencer, 26 id., 159; 1 Swift Dig., 509; Bristow v. Pegge, 1 T. R., 758; Goodtitle v. Morgan, id., 755; Jackson v. Willard, 4 Johns., 42; Hitchcock v. Harrington, 6 id., 294; Jackson v. Bronson, 19 id., 325; Peltz v. Clark, 5 Pet., 483.
    Wright, for the defendant,
    admitted that an outstanding legal title in a prior mortgagee could not be set up by a stranger in defense to an action of ejectment, but claimed that the defendant in the present case was not a stranger, as he had a right to redeem the prior mortgage, and therefore had an interest in the property, (referring to Goodman v. White, 26 Conn., 317,) and that he was not- estopped from denying that a . *legal title passed by his mortgage to the plaintiff, in- [ *413 ] asmuch as that mortgage was made expressly subject to the prior mortgage.
   Hinman J.

We have not been able to distinguish this case from those of Burr v. Spencer, 26 Conn., 159, and Porter v. Seeley, 13 id., 564. It was said that the right of the defendant to redeem the bank mortgage, gives him such an interest in the property as to preclude his being considered as a stranger to it, and that consequently he is authorized to take advantage of the mortgage to defeat the plaintiff’s title ; and is not estopped from loing so, because that mortgage was declared to be outstanding in the plaintiff’s deed, and was specially excepted from the covenant against incumbrances. The case of Porter v. Seeley, was not decided upon the ground that the defendant was such a stranger to the mortgage attempted to be set up that he would not have the right to redeem it. That fact was not alluded to as having any bearing upon the decision, and the idea of the existence of an estoppel was expressly repudiated. On the contrary, the case was put upon the ground that a prior outstanding mortgage in some third person was not inconsistent with a legal title in the plaintiff—in other words, that such a mortgage, though in form a legal title, is, in substance, only a pledge of the land as a security for the debt, and is to be regarded as a legal title in the mortgagee or his assignee only for the purpose of enforcing payment. When used for this purpose it is performing the office for which it was given; but when a third person, who has no interest in the debt, attempts to set it up for his own benefit, he is attempting to use it in fraud of the purpose for which it was given ; and such a use, if allowed, would enable a party in possession to keep possession of property to which he has no title, against the real owner, who has only pledged it as security for a debt. In the case of Burr v. Spencer we intended to recognize and follow the case of Porter v. Seeley. And when it is said that an outstanding mortgage in a stranger can not be set up to defeat a plaintiff, or show that he has no title, what is meant is, that one who has himself no £ *414 J * rights, either as mortgagee or assignee, cannot setup a mortgage that may happen to be outstanding in favor of some third person. And whether he has such an interest in the land as will .enable him to redeem, and .thus acquire the rights of an assignee of the mortgage, can make no difference. Until he does redeem he is as much a stranger to the mortgage as if he had no interest in the land. There is no conflict between the cases of Porter v. Seeley and Burr v. Spencer, and those of Smith v. Vincent, (15 Conn., 1,) and Phelps v. Sage, (2 Day, 151.) In the last named cases the parties claimed directly under mortgages to themselves, and those cases, therefore, merely decide that, as between the mortgagor and mortgagee, the legal title is in the mortgagee, even in the case of satisfied mortgages, provided they were not paid until after the expiration of the law day. This doctrine in respect to satisfied mortgages may operate as a qualification of some of the reasoning of the court in Porter v. Seeley, but is clearly consistent with the decision itself. It follows from what has been said that the defendant, who has no rights under the mortgage to the bank, can not avail himself of that mortgage to defeat the plaintiff’s title.

We therefore advise the superior court that the plaintiff is entitled to judgment.

In this opinion the other judges concurred.

Judgment for plaintiff advised.