Court Opinion

ID: 8188846
Source: CourtListenerOpinion
Date Created: 2022-09-09 23:11:42.417552+00
Date Added: 2024-06-11T16:40:31.785910
License: Public Domain

*275The following’ opinion was filed April 30, 1907:
Wietslow, J.
The appellant makes a number of minor contentions, which we find it unnecessary to consider in consequence of the conclusion which we have reached upon the merits .of the case.
After careful consideration of the evidence we are unable to agree with the conclusion that the plaintiff’s equity of redemption in the lands in question was extinguished by the deed from Slattery to the defendant Ryan, and we shall briefly state the reasons for this conclusion. Where the relation of mortgagor and mortgagee of real estate has been once established between two parties, and it is claimed that by a subsequent deed of the premises by the mortgagor to the mortgagee the equity of redemption has been extinguished and the mortgagee has become the absolute owner of the premises, it must be clearly shown that the conveyance or release was voluntary on the part of the mortgagor, was based on an adequate consideration, was untainted by fraud, and that no advantage was taken of the debtor’s necessities to drive a hard bargain. Such transactions will be closely scrutinized, and if the proof be clear and satisfactory that the requirements above named have been observed the transaction will be sustained, otherwise not. In doubtful cases the courts incline to hold that the mortgage relation still exists. These propositions are very well established. Rockwell v. Humphrey, 57 Wis. 410, 15 N. W. 394; Kunert v. Strong, 103 Wis. 70, 79 N. W. 32. It is manifest that, where no part of the debt is discharged at the time of the conveyance or release, the change in the relationship' of the parties is one in name only and not in substance. A mortgagor cannot gratuitously release his right to redeem or bar himself from exercising it by any agreement, whether made contemporaneously with the mortgage or subsequently thereto. 2 Jones, Mortg. (5th ed.) §§ 1038 — 1046.
In the present case the court found that the consideration *276for tlie transfer by Slattery to J oseph A. Byan. was the assumption by Byan of the prior mortgages on the lands and the discharge of Joseph A. Byan’s claim against Lynch for payment of the judgment on the administration bond. We have searched the evidence in vain to find any basis for these findings. Byan did not assume the payment of the prior mortgages by any stipulation in the deed, nor do we find any evidence of-any agreement so to do either oral or written outside of the deed. There Was no discharge of the indebtedness from Lynch to Byan made nor any delivery of the bond. Doubtless a formal discharge would not be necessary, but it must at least appear that the parties agreed that the debt should .be considered paid, and there is no evidence of such ah agreement or even of any conversation concerning the ■matter. All the'evidence tends strongly to the conclusion that the idea was simply to put the title into Byarís name, in order that a good deed might be made to a purchaser at any time without the necessity of a foreclosure. If there were any doubt about this as a conclusion of fact from the acts of the parties, it would seem to be removed by a very significant clause in the written agreement which J oseph A. Byan gave to E. H.- Ryan at the time of the execution of the deed giving E. H. Ryan the exclusive right of sale of the lauds until March 1, 1899. This clause is the final one in the agreement and reads,as follows:
“On the first day of March, 1899, this appointment of Edward H. Ryan as agent of Joseph A. Byan to sell the lands herein described, and all rights, privileges, and authority hereby conferred, shall cease and terminate and become null and void, and said Edward H. Ryan hereby agrees to surrender this evidence of authority to said Joseph A. Ryan, who upon said day Iasi named shall become the owner thereof
The final words of this clause expressly negative the idea that the deed itself transferred or was intended to transfer the absolute title. They are only consistent with the idea *277that the real ownership was still to remain in Lynch (or in Slattery for the benefit of Lynch) nntil the 1st of March, 1899. In other words, they recognize in no uncertain terms the continued existence of the mortgage relation. Many other facts in evidence reinforce this conclusion. In view of the requirement of law that the release of the equity of redemption must he clearly proven to have been voluntarily made without fraud or overreaching and must he based on an adequate consideration, we are forced to the conclusion that the proof in this case was insufficient to justify the finding made. The mortgage relation was not extinguished by the deed from Slattery to Joseph A. By an. The plaintiff was entitled to a decree adjudging said deed to be a. mortgage, that he has the right to redeem therefrom, and that an accounting must be had before the court or a referee, and for this purpose all necessary additional evidence may be taken.
By the Court. — Judgment reversed, and action remanded for further proceedings and final judgment in accordance with this opinion.