Court Opinion

ID: 5548668
Source: CourtListenerOpinion
Date Created: 2022-01-10 21:23:40.923564+00
Date Added: 2024-06-11T08:34:59.915509
License: Public Domain

The Chancellor.
The counsel for C. Webb insists that inasmuch as his client succeeded in showing that he had a subsequent mortgage, which was a lien upon the *621equity of redemption, and which was due and unpaid at the time of the foreclosure, he had not failed to establish his claim, so as to render him liable for costs under the provisions of the 136th rule of this court. Such, however, is not the fair construction of the last clause of that rule. To exempt the claimant from liability for costs, he must establish his claim to the surplus moneys or to some part thereof. And if a junior incumbrancer of the mortgaged premises, knowing or having reason to believe there are older incumbrances upon the equity of redemption sufficient to exhaust the whole of the surplus moneys raised upon the master’s sale, puts in a claim to such surplus or any part of it, and thereby subjects others who are equitably entitled to the whole surplus to unnecessary costs, he may be compelled to pay the extra expense to which they have been put by reason of his false claim. The costs in cases arising under this rule, however, are in the discretion of the court. And the affidavit of C. Webb shows that his claim was made in good faith, on gr'ounds from which he had reason to suppose the claims of these petitioners upon the surplus moneys could not be sustained ; and consequently that he, as the next incumbrancer, would be entitled to the residue of the fund after satisfying the lien of Millard, the first incumbrancer. The fact that a jury had pronounced Hayden’s judgment usurious, upon a feigned issue awarded for that purpose, was of itself a sufficient ground for resisting that claim before the master ; although a new trial of that issue had been awarded. Under the circumstances of this case, therefore, and considering the fact that Webb will have to pay the costs of the order of reference, and of so much of the proceedings as have been carried on for his benefit or at his request, I do not think he ought to be charged with any of the extra costs to which the petitioners have been subjected in establishing their claims upon the surplus moneys. But neither party is to have costs as against the other on this application.