Court Opinion

ID: 7045570
Source: CourtListenerOpinion
Date Created: 2022-07-24 06:54:42.485836+00
Date Added: 2024-06-11T16:11:31.004641
License: Public Domain

*559On Petition for a Rehearing.
Elliott, J.
We have given the argument upon the petition for a rehearing that careful consideration which is always due to the work of an able and courteous lawyer. We are not, however, inclined to change the opinion previously expressed by us. The reasoning of appellant’s counsel proceeds, as it seems to us, upon an undue assumption of a controlling proposition. It is assumed that a mortgage confers upon the mortgagee such rights as entitle him to the rents and profits of the land mortgaged, although the mortgagor is in possession. This assumption is grounded in a fundamental error. It is true that early in the history of the law it was held that a mortgage conveyed a conditional estate entitling the mortgagee to the rents and profits of the land, but this doctrine was long since overthrown. It is firmly settled. lav;, settled in our State by statute and by a long and unwavering line of decisions, that a mortgage creates a mere lien, and that the mortgagor in possession is entitled to the rents and profits of the land.
It is said by counsel that the recording of the mortgage is notice, and that no purchaser of crops subsequent to the mortgage can get any greater right to them than the mortgagor had, and this is true; but it does not lead to the conclusion that a purchaser can not acquire title to them; on the contrary, as the mortgagor had a right to sell, a sale by him before some act done by the mortgagee abridging that right, would convey a perfect title. In this case, the judgment creditor, having levied upon the crops, acquired a right which an after-appointed receiver could not divest. He had .not only acquired the right conferred by the levy, but also that of a purchaser at an execution sale.
It is too plain for controversy that a receiver’s appointment-does not confer retrospective authority to divest previously acquired rights. We have seen that a mortgagor in possession 'is entitled to all crops grown upon the land, until the mort*560gagee has in some rightful manner abridged that right, and, this being so, it must follow that if he had sold the crops, prior to an act abridging his right, his vendee would have acquired a good title. The case before us rests upon this principle, for here a creditor had obtained judgment, levied executions and bought the property prior to the time the receiver was appointed, and we know of no principle which will warrant the conclusion that the right vested by such a sale can be defeated by the subsequent appointment of a receiver.
The rule declared in the cases cited in the original opinion is the correct one, for the right of the receiver is an equitable one growing out of the fact that the property is insufficient in value to satisfy the debt, and the fact of the mortgagor’s insolvency ; it is not a right springing from the mortgage itself .and commencing with the date of that instrument. The right only comes into existence with the appointment, as against prior vested rights. It can not have an earlier existence.
There is no conflict between our holding in this case and the doctrine declared in Connelly v. Dickson, 76 Ind. 440; for in that case there was no claim that the appointment of a receiver had a retroactive effect, nor had the rights of any third persons intervened.
Petition overruled.