Court Opinion

ID: 7091075
Source: CourtListenerOpinion
Date Created: 2022-07-24 12:06:06.986292+00
Date Added: 2024-06-11T16:13:05.360593
License: Public Domain

Weight, 0. J.
In determining this case, we shall confine ourselves to the objections urged to the decree rendered by the court below. And in the first place, complainant claims that the decree foreclosing the mortgage, the sheriff’s sale, and the deed made thereon, are void as to him. It is conceded by defendants, that the sale and deed convey no title, and were properly set aside, from the fact that the execution under which the sheriff acted, had no seal.
The only question in this- part of the case, then, relates to the validity of the decree of foreclosure against complainant. No objection was made by defendants below, or here, to the *428right of the complainant to bring this bill, or to its character. We have, then, before us, what we regard as an application, by a party interested in the property, to redeem, the same from, a lien created by a prior mortgage. And without determining whether it was, or was not, necessary to make him a party to the proceeding to foreclose such mortgage, we think, that as he would have a right, before foreclosure, to bring such bill, in order to determine the amount of the incumbrance, so he may, if not made a party, file a like bill, to correct any mistake made in a decree which injuriously affects his rights. The defendants insist, however, that complainant is concluded by tbat decree, from the fact that he made an appearance, when he filed the paper referred to in the statement of the case. In this view, we cannot concur. He was not a party in the first instance, nor by any subsequent order of tbe court. The case, indeed, appears to have been determined without any reference to this paper. If the party foreclosing the mortgage, had made him a party in his petition, prayed process against him, or sought to bring bim in by notice, it would have been different. Here, however, instead of being in court, or so regarded, his right to appear, was not recognized or admitted.
Then, was there any such mistake in this decree of foreclosure, as should have been corrected? We think there was. Granting that complainant was only bound to contribute bis proper proportion, and not to pay the whole of the mortgage (of which we shall speak hereafter), yet he was only boiind to pay his proportion of what was actually owing. And, therefore, while the holder of the mortgage and the mortgagor, might include the sum of $54.36, for interest paid for money borrowed, to purchase the same, and attorney’s fees, yet it was manifestly improper to require complainant to pay any part thereof, before he could hold his property divested of the mortgage lien. When he purchased, he had notice of this mortgage, and the mortgagee, by virtue of bis prior lien, bad tbe right to subject tbe property to tbe payment of bis debt. But he had no right to subject it to the payment of any sum that the mortgagor might con*429sent to include in the decree. Such agreement would bind the mortgagor, or, as in this instance, Coffmdaffer and Griffey, who were not only the holders of the mortgage, but also interested as purchasers, of part of the mortgage premises.
Complainant further insists, that he should not have been required to pay any portion of the costs attending the foreclosure of the mortgage. We see no reason why he should not pay his portion of the costs, up to the time of the decree. These costs were legitimately made in enforcing a lien upon property, which he had purchased, and which he might have avoided, by making payment before suit brought. The costs subsequent to the decree, he should not pay, however. The sale was set aside for an irregularity, for which he should not be responsible, and to avoid the effect of which, was one object of this bill. It would be manifestly inequitable, to require him to pay any portion of costs which accrued under a void writ, which he in no manner procured.
And, finally, it is insisted, that complainant should only have been required to pay two-thirds of this incumbrance, in proportion to the quantity that he purchased, instead of three-fourths, or in proportion to its value. In this respect, we think the decree is correct. Here was a mortgage on three distinct parcels of real estate. Subsequent to the lien, one party purchases one parcel, and another two. When required to contribute, shall it be in proportion to the quantity or palu& of the premises, by them respectively purchased.We clearly think in proportion to the value. The other position, has no one equitable consideration to sustain it, while the rule followed by the court below, is fully sustained by reason, as well as authority. It would be an unconscionable doctrine, that would require A. who bought a ten acre tract, of no more value than the one acre that B. might purchase, to pay in such cases, ten times as much as B. The value of the several parcels, is what is presumed to have governed the mortgagee in taking this mortgage, and by this value, should the respective liabilities of the purchasers be measured. This view is sustained by the following, among other, authorities: Story’s Eq. Jur. §§ 477, 478, 483; Al*430drich v. Corper, 8 Ves. 391; Dickey v. Thompson, 8 B. Mon. 312; Cheesebrough v. Willard, 1 John. Ch. 415.
Indeed, upon this subject, we do not think there can be found any conflict — the authorities uniformly holding that value, and not quantity, should be the measure of contribution. Whether that value is to be determined with reference to the time of the mortgage, or subsequently, we are-not called upon now to determine, as no such question is raised. We may say, however, that such value is in no case to be affected by improvements made by either purchaser.
But the defendants (Coffmdaffer and Griffey) insist that complainant, having made his purchase after theirs, should be required to pay the whole incumbrance, or at least, that the lots purchased by him, should be sold, before they should be called upon to pay any part of the mortgage debt. On this subject, we are aware that the authorities are conflicting ; and in this state the question has never, so far as we are aware, been decided. At one time, in New York, it was held, that such purchasers were bound to contribute in proportion to the value of their respective purchases. Cheesebrough v. Willard et al., 1 John. Ch. 403; Stevens v. Cooper, Ib. 425. But these cases were regarded as shaken by the subsequent one of Gill v. Lyon et al., Ib. 446, and still later, in the case of Clowes v. Dickenson, 5 Ib. 235, to have been entirely overruled. See, also, James v. Hubbard, 1 Paige, 228; Gouverneur v. Lynch, 2 Ib. 300; Guion v. Knapp, 6 Ib. 35. So that the rule in New York, now is, that the property purchased, is liable in the inverse order of its alienation. Such is the doctrine in Maine, South Carolina, and some other states. In Massachusetts, Ohio, Kentucky, and Tennessee, and other courts, it is held that the subsequent purchasers, shall contribute in proportion to the value of their respective estates, such value not to be appreciated, however, by any improvements placed thereon by the purchaser. Parkman v. Welch, 19 Pickg. 241; Green v. Ranage, 18 Ohio, 428; Dickey v. Thompson, 8 B. Monroe, 312; Jobe v. O'Brien, 2 Humph. 34; see, also, Story’s Eq. Jur. § 1233, *431where this latter doctrine is approved by the learned author, who states, also, that it is that maintained by the ancient, as well as modern, English cases on the subject; and such we believe to be the most equitable rule. Where a portion of the premises mortgaged, are subsequently sold, the mortgagor retaining the remaining part, it is uniformly held, that the portion unsold, should, in equity, first be subjected to the payment of the mortgage debt. For while the mortgage covers, and is a lien on, all the estate alike, yet the mortgagor, in addition to his legal obligation, arising, as well from the mortgage, as his covenants in his deed to the subsequent grantee, is morally bound to pay the debt, and divest that which he has sold, of any incumbrance. And in like manner, on his death, the heir, occupying his place, setting in the seat of the ancestor, or original grantor, is bound to discharge the debt to the extent of the assets descending; for there is no more equality of right between them, in such a case, than between the grantee and the ancestor, while living. When we come to settle the question, however, as between two grantees, purchasing different parcels of the incumbered premises, at different times, there is no more moral obligation on the one to pay, than the other. Both of them have purchased premises that are alike affected by a lien, which neither created, or undertook to pay. The purchased premises are liable to be sold, because of the failure of their grantor to discharge his .undertaking, and not because of an3r failure on their part. In such cases, their interest is common — -their rights are equal- — and there should be equality of burden. It is difficult for us to see why the last purchaser, any more than the first, sits in the seat of the grantor; and yet this would appear to have been the reasoning used, and the ground of the decision, in Clowes v. Dickenson, 5 John. Ch. 240. And in those cases, where the question arises between the grantor and a subsequent purchaser, the grantor, or the land still held by him, is liable, because the debt is the personal obligation of the debtor, and not of the grantee. But where is the personal obligation resting on the last grantor, more than on the first ?
*432It is urged that the grantor, by aliening the unsold portion of the estate, cannot throw the burden of the mortgage» or a ratable part of it, back upon the first purchaser. It should be remembered, hoAvever, that we are not determining the relative equities of the grantor and purchaser, but of two purchasers. The personal obligation of the debtor remains the same, after, as before, the second sale.
The debtor is not inhibited from making a further sale, by reason of the covenants in his first deed. This power to sell, is as well known to the first purchaser, as any other fact connected with the transaction. It is the inability of the debtor to pay his debt, that creates the necessity for enforcing the lien, and not any failure on the part of the last purchaser! The junior, as well as the senior, purchaser, makes an absolute purchase; each pay a full consideration, and have a like reason to suppose, that the mortgage debt will be paid, and their estates held alike divested of the incumbrance. While each has purchased absolutely, yet, if the mortgage should not be discharged, they acquire no more than the right to redeem the parcel held by each, and neither should complain, if, by the decree which settles their respective rights, &c., he is secured the equity thus acquired, upon equal terms. We therefore conclude, that the decree of the court below was correct, in charging the purchasers with the payment^ of the mortgage debt, in proportion to the respective values of each parcel.
But as complainant should not have been charged with any part of the sum of $54.36, included in the decree of foreclosure, nor yet with the costs attending the mortgage sale, the decree will be so far reversed, and in every other respect affirmed.
A procedendo will issue, directing a decree to be entered, in accordance with this opinion.