Court Opinion

ID: 4723279
Source: CourtListenerOpinion
Date Created: 2021-08-12 02:39:26.317547+00
Date Added: 2024-06-11T08:07:43.462131
License: Public Domain

Dunbar, J.
(dissenting). — I am unable to agree with the conclusion reached by the majority in this case, and, while conceding that probably the weight of authority sustains that conclusion, it seems to me to be illogical and wrong. There is no privity between the mortgagor and the grantee. They are strangers to each other, and under what principle of law or by what legal deduction the mortgagor has a right to claim a judgment against the grantee I am at a loss to understand, even from a perusal of the cases sustaining the doctrine, and from the case decided by the United States Supreme Court, cited by the majority. It cannot, it must be conceded, be based on the theory of privity. The clause in the deed providing for the payment by the grantee is purely for the benefit of the mortgagor, if it can be construed for the benefit of any one. It is in reality only a recital in the deed which is unsigned by the grantee, and if it can be construed to be a promise at all it is a promise not in writing and therefore falls within the statute of frauds. But, conceding it to be a binding promise on the grantee so far as the mortgagor is concerned, how can it be possible that the security, which the mortgagee saw fit in his original contract and in fact the only contract he has made, to take for the payment of his debt, can be increased by the subsequent action of the mortgagee, at least so as to bind a stranger to the original contract? It must be conceded that no action of the mortgagee could lessen or destroy the security *510of the mortgagor, and it is'just as illogical to conclude that the action of the mortgagor .by transfer to a third party can increase said security.
The court in Keller v. Ashford, supra, admits the general doctrine that in equity as at law the contract of the purchaser to pay the mortgage, being made with the mortgagor.and for his benefit only, creates no direct obligation of the purchaser to the mortgagee; but states that—
“ It has been held by many state courts of high authority, - in accordance with the suggestion of Lord Hakdwicke in Parsons v. Freeman, Ambler, 116, that in a court of equity the mortgagee ma}1, avail himself of the right of the mortgagor against the purchaser.”
This suggestion, it seems to me, is exactly in conflict with the rule above stated, but the court says:
“ This result has been attained by a development and application of the ancient and familiar doctrine in equity that a creditor shall have the benefit of any obligation or security given by the principal to the surety for the payment of the debt.”
To my mind there has been no development here at all, but one doctrine is squarely opposed to the other, both in reason and effect. To allow a mortgagee to bring an action against a stranger to the contract and obtain against him a deficiency judgment, thereby increasing the security which he was entitled to under his contract, is opposed to every well established principle of law, and I cannot consent to it until it becomes the established rule of law in this state.