Court Opinion

ID: 6635128
Source: CourtListenerOpinion
Date Created: 2022-07-20 20:39:35.204793+00
Date Added: 2024-06-11T15:59:03.181158
License: Public Domain

Cooley, J.
The object of the bill in this case is to have a certain mortgage, which is described therein, decreed to be satisfied and discharged. The defendant Smith is assignee of the mortgage, and the claim of the complainants is, not that it has been paid to him, but that the mortgagor, in ignorance of the assignment, has made payments and advancements to the mortgagee and his representatives which satisfy it.
The mortgage in question was given by Ephraim Jones to Harvey Jones on the first day of April, 1847, and was conditioned for the payment of two thousand dollars, in seven equal annual payments, with annual interest; the first payment to be made April 1, 1849. Harvey Jonesr *364when the mortgage was given, resided in the State of New York, but he removed soon after to the State of Wisconsin, where he died in November 1849, and the defendant, Loyal H. Jones, was appointed administrator of his estate. Before the death of Harvey Jones, however, he had given the mortgagor an agreement, making the mortgage payable in fifteen annual payments instead of seven,' and the mortgagor had made payments amounting to several hundred dollars.
By an instrument which bears date October 14, 1850, the administrators upon the estate of Harvey Jones assigned the mortgage to the firm of Bossman & McKinstry. The complainants deny that this assignment was made at the time it bears date, and the oral proof on the subject is not very satisfactory or conclusive. We do not regard this, however, as very important. Attached to the assignment, as given in evidence, is'an instrument signed by Bossman & McKinstry, reciting that the assignment is made to secure an indebtedness . of the estate to them of $5,273,31 and interest. This. instrument is dated November 28, 1857.
Rossman & McKinstry assigned the mortgage to the defendant Smith, December 19, 1860, and the two assignments were recorded in the office of the register of deeds of the county where the lands lie, August 19, 1862. It is not claimed that prior to this recording the mortgagor had any actual notice of the assignments.
After the death of Harvey Jones the mortgagor made payments for the estate and advanced moneys to the administrator for the benefit of the estate, amounting in all,. previous to the recording of the assignments, to more than sufficient to satisfy the mortgage. These payments and advances were none of them applied on the mortgage at the time they were made, but the mortgagor had a settlement with the administrator May 15, 1863, at which time a balance was struck against. the estate of $2,500.34. At the time *365of this settlement, the mortgagor was for the first time informed that the mortgage had been assigned, and was not then controlled by the administrator.
■ In view of these circumstances, and of some others which we shall mention further on, the question arises whether the complainants are entitled to the relief prayed.
I. There can be no doubt, we suppose, that until notice of the assignment, either actual or constructive, the mortgagor was entitled to deal with the mortgagee or his personal representative, on the supposition that no transfer had been made; and the assignee is bound by such dealings. This is a. familiar principle of the law, and is only inapplicable in those eases where the mortgage is given to secure negotiable paper, and it is transferred before such paper is due. — Williams v. Sorrell, 4 Ves., 389; Jones v. Witter, 13 Mass., 304; Meghan v. Mills, 9 Johns., 64 ; Muir v. Schenck, 8 Hill, 230; Robinson v. Howes, 20 N. Y., 84; Campbell v. Day, 16 Vt., 558; Ward v. Morrison, 25 Vt., 598; Vanbuskirk v. Insurance Co., 14 Conn., 145. The demand which the mortgage in question was given to secure was not negotiable, so that no question can arise of the applicability of this principle to the case before us.
II. The defendants object, however, that the .bill is in the nature of a bill to quiet title, and that consequently the complainants cannot have the relief prayed unless they show that they were in possession of the land when the bill was filed. The bill avers that complainants are in possession and that the mortgage constitutes a cloud upon their title ; but as regards possession in fact there is no evidence. But we do not regard this as important. The bill, though containing allegations proper for a bill to quiet title, is in fact a bill for the cancelment and surrender of a satisfied security; and possession of the land by complainants is not essential. The *366reason for requiring complainant, in a suit to quiet title, to show his possession, is, that otherwise he does not establish any necessity for resorting to equity at all; and legal titles, should be settled at law whenever practicable. But a case like the present is within a well understood branch of equitable jurisprudence, and is independent of statutory regulations. See Story Eq. Juris., §§ 700-706, Pettit v. Shepherd, 5 Paige, 501; Field v. Holbrook, 6 Duer, 597.
III. The defendants also insist that the facts appearing in evidence do not establish the claim of complainants, that the payments and advances made by the mortgagor were made on the understanding that, so far as needful, they should be applied to satisfy it; but, on the contrary, they tend strongly to disprove any such understanding. We have given the arguments advanced for defendants on this point a good deal of consideration, without being able to reach this conclusion. The testimony on the part of the •complainants is very postive, and the circumstance tending most strongly to throw doubt upon it, is the fact that notes were taken from time -to time by the mortgagor for the moneys which the administrator received from him, which notes were made payable with annual interest. But when we consider that the moneys so received considerably exceeded the amount of the mortgage, and that the mortgagor resided a long distance from the administrator, and might not always find it convenient to enter into the proper calculations for balances, it is not very surprising that the transactions assumed this form. The notes would naturally be regarded as protecting the mortgagor for the time being, and they would 'enable him to obtain, in the final settlement, his proper interest on the excess advanced by him. And when we are considering the probabilities of truthfulness in the account given of the dealings between these parties, it is not an unimportant circumstance that they were *367near relatives, and would be very likely to transact business more loosely and carelessly and to confide in each other more, than would be expected in the case of strangers.
And this remark will apply to what is urged on behalf of defendants, that the facts within'the knowledge of the mortgagor were sufficient to put him upon inquiry concerning an assignment of the mortgage, and therefore should be held constructive notice of the assignments actually made. It appears that the estate was in debt and in want of money; but we see nothing in this circumstance, nor in any other which is proved, that would be calculated very distinctly to apprise the mortgagor, or even to lead him to suspect, that the administrator, who was his near relative, and in whom he had confidence, would be likely to abuse that confidence by disposing of the mortgage. It is not shown that he was cognizant of the fact that the estate was contracting debts with other persons; it is quite likely he supposed that his assistance alone was relied upon; and it is not reasonable to infer that he would have made advances to the extent he did, without security, on any other supposition.
We do not attach importance to the question whether the moneys received by the administrator were understood at the time to be actual payments on the mortgage or not. The testimony satisfies us that they were paid by the mortgagor with distinct reference to the ownership, by the estate, of this mortgage, and in the expectation and undex-standing on both sides that on the settlement they were to be taken into account against the mortgage, either as payment or by way of set off, and in either view the complainants are entitled to the relief prayed. The laches of the assignees has suffered the mortgagor to deal with the administrator of the mortgagee, without notice of the assigxxments, until, as against the administx’ator, the mortgage is *368satisfied; and it must consequently be held satisfied as to the assignees also.
The decree appealed from must be affirmed, with costs.
The other Justices concurred.