Court Opinion

ID: 3729573
Source: CourtListenerOpinion
Date Created: 2016-07-06 06:57:42.127905+00
Date Added: 2024-06-11T09:38:16.003262
License: Public Domain

The facts in this case are given in the majority opinion of Judge Lieghley.
The majority members of this court rest their opinion on the fact that as trustee of an express trust, Mogine Craig Burse, under favor of Section 11244, General Code, had authority to institute the action on behalf of the minor James Craig, to set aside the second mortgage of $500 without making the minor a party, and that it follows that the minor was properly represented in the subsequent foreclosure proceedings.
The above statement does not touch on what I believe to be the most important question in this case, namely, the attack on the validity of the two mortgages so far as they attempt to convey the interest of the minor in this property.
The deed of the property recorded in volume 3380, *Page 84 
page 272, of Cuyahoga county records, contains the following provision:
"Whereas, the premises under consideration will be purchased out of money awarded in a lump sum by the Industrial Commission of Ohio, claim No. 993683, to Mogine Craig, widow, and James Craig, age eighteen months, and Leary Craig, age two years, dependent children of the aforenamed decedent, on account of fatal injuries received by him in the course of his employment * * *, now, therefore, this conveyance to the said Mogine Craig, widow of the aforementioned decedent, individually, and as trustee for James Craig and Leary Craig, is made upon the expressed provision that said premises should not be transferred, mortgaged or in any way alienated or encumbered by the said Mogine Craig, individually or as trustee, for a period of six (6) years from the date of this instrument without first having obtained the consent of the Industrial Commission of Ohio."
By this provision Mogine Craig was prevented from transferring or mortgaging her own interest in this property as well as her interest as trustee, for a period of six years, without first securing the consent of the Industrial Commission of Ohio. At the end of the six-year period Mogine Craig, individually, had the right, without restriction, to deed or mortgage her own interest in the property, but there is nothing in the deed to indicate that the trusteeship would end at the end of the six-year period.
Originally the widow had an individual one-third interest in the property and a life interest in another one-third. The minor, James Craig, had a one-third interest and a remainder in another one-third subject to the life estate of his mother, Mogine Craig Burse.
It is conceded that no court proceedings of any kind were had to authorize the trustee to mortgage the interest of James Craig, the minor, in this property. *Page 85 
There is no power to sell or mortgage given to the trustee in the deed of the property; notwithstanding Mogine Burse, after the expiration of the six-year period mentioned in the deed, executed the two mortgages, both in her behalf and as trustee for the surviving minor child.
The power of the trustee to mortgage or pledge trust property is well stated in 1 Restatement of the Law of Trusts, 510, Section 191:
"Except as stated in Section 167, the trustee cannot properly mortgage or pledge trust property, unless a power to mortgage or pledge is conferred by the terms of the trust."
Section 167 of the same volume, at page 415, refers to a case where permission is given to mortgage by some court having jurisdiction of the case, and so can have no bearing on this case.
The above statement in the Restatement of the Law of Trusts states the law as it has always been understood to be. See 26 Ruling Case Law, 1303, Section 156; 65 Corpus Juris, 785, Section 655.
As stated, no express power is given in the deed of the property to the trustee to mortgage the interest of the minor in the property. Likewise, no such power can fairly be implied from the terms of the deed. The mortgagees in this case were put on notice of the terms of the deed and I can find no reason why the general rule denying such a trustee the right of power to mortgage, without express authority or a court order, should be departed from in this case.
I do not question that the trustee in the case had the implied power to make all proper expenditures for the preservation of the property. The contract made by Mogine Burse in this case with Harold, the contractor who is also the owner of the second mortgage, called for the construction of nine additional rooms. It is very doubtful whether the right to make such a substantial *Page 86 
addition to the property can be found in the implied power to expend money for its preservation.
It is not denied that Mogine Burse had the right to mortgage her own interest in the property. The mortgage, however, was for the entire property and the minor's interest was attempted to be sold in the foreclosure proceedings.
In this case it appears that The American Lumber Company, to which the first mortgage had been assigned, delivered lumber and material on this property for which it filed a mechanic's lien. The General Furnace Company furnished a heating furnace for which it also filed a lien.
It is my view that there should be a judgment holding the first and second mortgages invalid insofar as the interest of the minor, James Craig, is concerned and the foreclosure proceedings and foreclosure sale held for naught. The case should be reversed and in a subsequent trial The American Lumber Company, The General Furnace Company, and any other claimant should be given the right to furnish proof that any material furnished by them was reasonably necessary for the use and preservation of the property. To the extent that such proof can be made, the minor's interest in the property would be bound but not beyond such a point. *Page 87