Court Opinion

ID: 3491017
Source: CourtListenerOpinion
Date Created: 2016-07-05 21:59:28.714664+00
Date Added: 2024-06-11T14:05:05.975891
License: Public Domain

I concur, as before, with the result reached by Mr. Justice BUSHNELL, but think the dicta in Detroit Trust Co. v.Stormfeltz-Loveley Co., 257 Mich. 655 (88 A.L.R. 1263), does not state a correct rule of law. The point decided, the invalidity of the statute there under consideration as applied by the trial court, was correct.
  Notwithstanding the language in Kollen v. Sooy, 172 Mich. 214;  Union Trust Co. v. Detroit Trust Co., 243 Mich. 451;Janower v. F. M. Sibley Lumber Co., 245 Mich. 571; andWurzer v. Geraldine, 268 Mich. 286, was applicable in each case to what was being attempted to be done therein, the rule is that courts of equity have inherent original jurisdiction of suits to foreclose mortgages, and authority to render such decree as substantial justice may require. 3 Jones on Mortgages (8th Ed.), § 1840; 1 Wiltsie on Mortgage Foreclosure (4th Ed.), § 35; 42 C. J. p. 19; Michigan Ins. Co. of Detroit v. Brown,11 Mich. 265; Johnson v. Shepard, 35 Mich. 115; McCrickett v.Wilson, 50 Mich. 513; Kelly v. Gaukler, 164 Mich. 519; 3 Comp. Laws 1929, § 13944.
Trustees are governed by courts of equity (Watkins v. Holman, 16 Pet. [41 U.S.] 25) which may remove them for a violation of trust, appoint new *Page 733 
trustees, or cause the execution of the trust by their own officers. 3 Comp. Laws 1929, § 12993. Trustees in trust mortgages have both the legal and equitable title thereto vested in them, subject only to the execution of the trust. 3 Comp. Laws 1929, § 12982.
It is the trustee's duty to protect the beneficiaries of the trust, to sell the property in the most advantageous way if that becomes necessary, and, even though there is no express power in the trust mortgage authorizing the trustee to purchase the same at foreclosure sale, the trustee has the implied power so to do for the protection of the beneficiaries of the trust. 42 C. J. p. 206; 3 Pomeroy's Equity Jurisprudence (4th Ed.), § 1062; 3 Cook on Corporations (6th Ed.), § 885; Jones on Corporate Bonds  Mortgages (2d Ed.), §§ 289, 290; 3 Bogert on Trusts and Trustees, § 484; 1 Restatement of the Law of Trusts, § 231 (h); Commonwealth v. Railroad Co., 122 Pa. 306
(15 A. 448, 1 L.R.A. 225); Yerkes v. Richards, 170 Pa. 346
(32 A. 1089); Nay Aug Lumber Co. v. Scranton Trust Co., 240 Pa. 500
(87 A. 843, Ann. Cas. 1915A, 235); Hoffman v. First Bond Mortgage Co., Inc., 116 Conn. 320 (164 A. 656); Silver v.Wickfield Farms, Inc., 209 Iowa, 856 (227 N.W. 97); Straus
v. Chicago Title  Trust Co., 273 Ill. App. 63. Such purchase must be in the interest of all the holders of bonds secured by such trust mortgage and substitutes the ownership of the property for the mortgage lien thereon. Richter v. Jerome,123 U.S. 233 (8 Sup. Ct. 106).
With these reservations, I concur in the result reached by Mr. Justice BUSHNELL.