Court Opinion

ID: 6468099
Source: CourtListenerOpinion
Date Created: 2022-06-26 14:08:24.395348+00
Date Added: 2024-06-11T09:11:13.244321
License: Public Domain

ON REHEARING. HANNA, J.  [11] The appellant was granted a rehearing on certain points specified in his motion therefor. Those points are elaborately argued in appellant’s motion for rehearing, and we have had the benefit of an oral argument thereon also. The opinion of the court in this case disposed of 12 general propositions involved in the case, but, believing that numerous other points presented by appellant were not well taken; and rather than discuss them at length, we said that they were not meritorious. The rehearing was granted on the ground that we had overlooked several points contained in the motion, only one of which appeared decisive of the cause in the event that it was well taken. We shall consider but one point in the motion, overruling the remainder. The appellant contends that the power of sale contained in the mortgage was revoked by the death of Mrs. Ovard, who was one of the mortgagors; hence a sale under power did not divest the heirs of Mrs. Ovard’s estate, which interest was subsequently purchased by appellant. The trial court found that the property involved in this suit was the separate estate of the father, George T. Ovard, and that finding would be decisive of the proposition now under discussion, were it supported by any substantial evidence. Our search of the record fails to disclose any substantial evidence to support it. However, the question still remains whether the interest which appellant is alleged to have purchased from the heirs óf Mrs. Ovard was foreclosed, as against Mrs. Ovard, by the foreclosure proceedings, and that depends upon whether her death re-yoked the power of sale. As we have heretofore said in this ease, a mortgage in this state simply constitutes a lien on the property, a security for the debt, and does not pass the legal title to the mortgagee. Decisions of other courts, where the common-law view of mortgages is taken, are much more harmonious as to whether the death of the mortgagor revokes the power of sale contained therein, than in those jurisdictions, like this, where the equitable view of mortgages is taken. In Jones on Mortgages (7th ed.) at section 1792, the author saj^s: “As a general rule, the death of the mortgagor does not revoke a power of sale, even though the mortgage is held merely to give a lien on the property. This, being coupled with an interest in the estate, cannot be revoked or suspended by the mortgagor.” At section 1794 of the same volume and work, the author notes a conflict of authority on the proposition, saying: “In some states, where, by statute or adjudication, a mortgage is regarded as a mere security for debt, passing no title or estate to the mortgagee, a power of sale is regarded as not coupled with an interest, and it is revoked and rendered incapable of execution by the death of the mortgagor. A sale under the power, made after the death of the mortgagor, is void.” In Eeeves on Eeal Property, § 786, the author says: “Since a power of this kind (of sale) is usually coupled with an interest, it is not, as a general rule, extinguished by the death of its creator.” In Tiffany on Eeal Property, § 555, it is said that it is necessary to distinguish between the common-law and equitable theories of mortgages in determining the question, and concludes that, where the common-law view of mortgages is taken, the power is coupled with an interest, whereas, where the equitable view is taken, the power cannot be regarded as coupled with an interest. In Devlin on Eeal Estate (Deeds) at section 383, it is said, in part: “A mere naked power may be revoked at will, but tbe rule is that when a power is coupled with an interest it is irrevocable. As powers of sale in mortgages and trust deeds are of this character, it follows that such powers are irrevocable. The power of sale is an essential and valuable part of the security.” At section 385 of the same volume and work, it is said, in part: “With the exception of Texas and Georgia, there is in the different states a complete unanimity of opinion upon the effect that the death of the mortgagor exercises over a power' of sale. As this power is coupled with an interest, no act of the mortgagor can suspend or revoke it. * * * There can be no reason for making the death of the mortgagor an exception. * * * These are the views taken by the authorities, and it may therefore be asserted, as an established proposition, that the death of the mortgagor does not opera-ate as a revocation of the powers.” MJost of the cases cited by the author are those wherein the common-law view of mortgages is taken. In Johnson v. Johnson, 27 S. C. 309, 3 S. E. 606, 13 Am. St. Rep. 636 (1887), the court held that a power of sale contained in a mortgage was revoked by the death of the mortgagor, because it was not coupled with an interest. In South Carolina, at that time, a mortgage- was regarded as a mere security for the debt, as in this jurisdiction. In Frank v. Colonial & U. S. Mortgage Co., 86 Miss. 103, 38 South. 340, 344, 70 L. R. A. 135, 4 Ann. Cas. 54, the court, after reviewing most of the authority on the question, as well as former decisions of that court, held that, notwithstanding that a mortgage in that state was simply security for a debt, the power of sale contained therein was coupled with an interest, hence was not revoked by the death of the mortgagor. The court, in part, said: “Whether, therefore, the mortgagee or the trustee is esteemed to take, by the conveyance, a legal or equitable estate in the thing conveyed or not, the sounder and better view, manifestly, is the one pointed out by us in the case of Allen v. Alliance Trust Co., [84 Miss. 319, 36 South. 285], supra, to-wit, that the trustee or mortgagee in such instruments is not a mere ordinary agent at all; that the power to sell is based on the consideration on which the contract is bottomed, is part of that security and that contract, and is hence stipulated for and bought by the beneficiary in the instrument, whether trust deed or mortgage, and is a power coupled with an interest, and hence not revocable by death.” In Keilly v. Phillips, 4 S. D. 604, 57 N. W. 780, 781, the court held, independent of certain statutes of that state which had a bearing on the question, that the power of sale contained in a mortgage was one coupled with an interest, and that the death of the mortgagor did not revoke it. The court said: “Appellants insist that the rule of these cases (eases cited in support of the rule that the power is coupled with an interest) is not applicable in this jurisdiction, because, under our law, the mortgagor retains the title to the estate mortgaged, contrary to the law prevailing in most of the states whence these decisions come; but we apprehend that, upon principle, that fact ought not to make any difference in respect to the survival of the power. Even in the states where the mortgage is held to convey the legal title to the mortgagee, the transfer is only nominal. It is more of a fiction than a reality. If the mortgagee, who is said to hold the legal title, die, his interest does not pass to his heirs, as real estate. * * * In New York the mortgage does not convey the legal title, and has not, since a very early day; and yet Chancellor Walworth, in Jencks v. Alexander, 11 Paige [N. Y.] 624, says that a power of sale in such a mortgage is a beneficial power; that it is a power coupled with an interest, ‘to the extent of the interest of the mortgagee in the-premises.’ In Wilson v. Troup, 2 Cow. [N. Y.] 236 [14 Am. Dec. 458] the court says: ‘The power of the mortgagee to sell the mortgaged premises is undoubtedly a power coupled with an interest.’ The power of sale in that state is constantly treated as a power coupled with an interest, and the cases are frequent in which it has been executed after the death of the mortgagor. * * ® The quality of the power does not depend upon the general character or legal effect of the instrument in which it is granted, but upon whether or not the power itself is coupled with an interest in the subject concerning which the parties are contracting. It would be difficult to justify the conclusion that in one case the mortgagee had an interest in the subject of the mortgage, and in the other case did not. The purpose of the mortgage, and the rights of the parties as mortgagor and mortgagee, are the same in both cases. « * * We think, both under our statute or without it, the power of sale is one so coupled with an interest that it survives the death of the grantor.” In the ease last mentioned, the case of Johnson v. Johnson, cited supra, was distinguished principally on the ground that there no statute recognized or declared the effect of, or provided a method for the execution of, the-power; but we do not deem that fact of sufficient importance to say that the power, therefore, is not one coupled with an interest. In Grandin v. Emmons, 10 N. D. 223, 86 N. W. 723, 725, 54 L. R. A. 610, 88 Am. St. Rep. 684, the identical question involved here was discussed. The court said that, notwithstanding the holding in Johnson v. Johnson, supra, “the almost unanimous voice of authority is the other way,’’ and approved the conclusion reached by the court in Reilly v. Phillips,, cited supra. See, also, First National Bank of Butte v. Belle Silver & Copper Mining Co., 8 Mont. 32, 19 Pac. 403, 411, where-the court said that— “the mortgagee has an interest in the land mortgaged. He has a lien upon it for the security of his debt, and this will' support the power of sale, and so couple it with an interest in the land that it becomes a part of the security, and irrevocable.” In Goldwater v. Hibernia S. & L. Society, 19 Cal. App. 511, 126 Pac. 861, 862, the court said that the power to-sell is a part of the.security for the payment of the debt; it conveys no estate or title to the land, simply being a lien upon the property affected by the power, and, “by the execution of the power, the mortgagor has placed the property under the power of the mortgagee to sell to secure the payment of his debt.’5 In White v. Rittenmyer, 30 Iowa, 268, 270, 271, the court, said: “The interest, which the mortgagee holds, is a lien upon-, the land for the debt, which may, by certain proceedings, ripen into a title, or rather, may divest the title of the mortgagor; if the condition of the mortgage be broken some act of the mortgagee is necessary, that he may acquire an indefeasible title — a title which the mortgagor will not be able-to defeat by redemption.” In Porter v. Green, 4 Iowa, 573, 574, the court said: “We have no difficulty, from these authorities, in concluding that, while the mortgage does create a lien upon the-property mortgaged, yet that it also operates to transfer to the mortgagee a qualified or conditional estate, which becomes void on tbe payment of tbe debt, or tbe performance of the covenant.” From these authorities, we conclude that, the mortgage in the case at bar created a lien upon the property described therein; that the power of sale was coupled with an interest and therefore did not become revoked upon the death of the mortgagor; hence appellant, on this theory, cannot be held to possess any estate in the premises by virtue of a conveyance to him by the heirs of the deceased mortgagor. Our former opinion will therefore be adhered to; and it is so ordered. Roberts, C. J., and Parker, J., concur.