Court Opinion

ID: 8630207
Source: CourtListenerOpinion
Date Created: 2022-11-24 19:36:25.385315+00
Date Added: 2024-06-11T16:55:44.466533
License: Public Domain

NELSON, Circuit Justice.
The fee of the property was mortgaged, and no contract lien was given upon the rents and income. A receiver of rents and income was appointed, on account of the insufficiency of the fee to satisfy the debt and interests and costs and the inability of the mortgagor in possession, personally liable for the debt, to answer for the deficiency. When the mortgage became due and payable, an equitable right to the rents was created, growing out of the fact of the insolvency of the mortgagor, and the inadequate security. A sale of the property under the decree demonstrates the justice of the order appointing a receiver, for a large deficiency exists. The special equity subjecting the rents to apply upon the deficiency arising upon the sale of the mortgage security, authorizes the receiver to collect the rents and income until possession is delivered over to the purchaser. True the law of Minnesota gives the mortgagor the possession of mortgaged property after sale as before, and until the time for redemption expires; but this does not restrict the power of a court of chancery to take charge of the rents and income and enforce a superior equity. The special equity growing out of the facts, as above stated, is superior to the legal right claimed. Let an order be entered as prayed for.