Court Opinion

ID: 6414352
Source: CourtListenerOpinion
Date Created: 2022-06-25 11:55:02.386608+00
Date Added: 2024-06-11T15:51:29.154055
License: Public Domain

Dewey, J.
The interest of the plaintiff in the property insured by this policy ceased to exist with the sale made by Taylor to Plummer on the 9th of August 1860, if that sale was a valid one. The validity of it depends upon the title of Haynes, the mortgagor. Haynes was himself a purchaser at a sale under a power of sale in a mortgage made by Hunt, the plaintiff at the time being the owner of the equity of redemption. The only objections to that sale are, that the amount bid for the premises was not duly paid in cash, and that a portion of it was not required by the mortgagee to be paid at all.
The sale was for a sum larger than the amount necessary to pay the sum due on the mortgage, and if the plaintiff was the owner of the equity of redemption, and there was in fact a surplus, we do not see any reason why he might not have treated it as a valid sale, and have demanded the surplus to be paid over to him. If the transaction was a bona fide one, and the purchaser an innocent party, the title passed to him, and he, by the terms of the power of sale, was not accountable to the owner of the equity for the proper application of the purchase money.
If the mortgagee elected to give a credit for payment, as between the purchaser and himself he might do so, and the *289mortgagor or his assignee entitled to the surplus would have the right to demand the cash for the same. If this whole proceeding of a sale to Haynes was, as is suggested upon the argument of the case, a fraud in which both parties concurred, this court would have forbidden the transfer of the property upon proper application. A proceeding of this character was at a former period insti tuted, and a proposed sale by an alleged owner of the equity of redemption of the mortgage given by Haynes was enjoined. But no further proceedings were had upon the bill, and subsequently Bailey, the plaintiff, became the owner of the equity of redemption of the Haynes mortgage thus given on the sale made on the 26tlj of January 1860. The effect of this was to place him very much in the position he originally occupied as owner of the equity under Hunt’s mortgage. The Haynes mortgage was for an amount corresponding with the balance due on the mortgage of Hunt.
It was in this state of the title that the plaintiff procured his policy, and the inquiry is, whether it is not to be treated as a policy upon the interest of the plaintiff as owner of the equity of redemption of Haynes’s mortgage to Taylor. It was by its terms made payable to Taylor as mortgagee, in case of loss. Taylor had ceased to be a mortgagee of Hunt. He had sold Hunt’s title and made a conveyance to Haynes, under a power of sale contained in that mortgage. The existence of the mortgage by Haynes to Taylor was recognized by the plaintiff’s purchasing the equity of redeeming it.
It is true that the plaintiff might have taken the release of the equity of redemption of the Haynes mortgage merely to be resorted to, in case his old title did not avail him, and therefore he is not to be estopped for that cause. But such former title, we apprehend from all the facts stated, was not the title and interest for which the plaintiff procured this policy. On the contrary, the policy was understood by all parties as intended to cover the interest of the insured in the equity of redemption of the Haynes mortgage neld by Taymr. That" was a sufficient interest and would have availed the plaintiff, had not that interest ceased prior to the happening of the loss. It seems that, by *290virtue of a power of sale contained in that mortgage, the property was legally sold on the 9th of August 1860 to Plummer and a deed duly executed to him by the mortgagee Taylor, dated the 9th of July 1860. With this transfer all the right of Taylor as mortgagee, and of the plaintiff as owner of the equity of redemption, ceased to exist, and the premises were held solely as the property of Plummer

Judgment for the defendants.