Court Opinion

ID: 6424234
Source: CourtListenerOpinion
Date Created: 2022-06-25 12:02:32.995172+00
Date Added: 2024-06-11T15:51:54.798246
License: Public Domain

Barker, J.
The defendant is sued for money remaining in his hands from a sale of lands made by him under a power contained in a mortgage. He has satisfied his mortgage debt, and admits that he holds money so acquired, and not belonging to himself, but contends that the plaintiffs cannot recover it because he has made no contract with them for its payment. The plaintiffs did not give the mortgage, and the mortgagor died before breach of condition, and the sale was made after his death. The plaintiffs are no doubt strangers to the contract which the defendant, by accepting the mortgage, made with the mortgagor to pay the surplus of any sale to him or his assigns. But they do not sue upon that contract. When one sells the *422property of another by virtue of a power, the law implies an obligation that he shall account for and pay over the proceeds of the sale. The mortgagee obtains his power to sell from the mortgagor; but if before the sale the mortgagor has parted with his title to another person, who at the time of the sale stands in the relation of owner, the law, independently of any contract in the power, makes it the duty of the seller to pay the surplus to such owner. This obligation is consistent with, but does not spring from, the contract made with the mortgagor by accepting the power. It is immaterial that the owner is a stranger to the contract between the original mortgagor and the holder of the power, and it is of no importance whether that contract is a simple contract or a contract under seal. The defendant has sold by lawful authority the property of another, and it is his duty to account for and pay over the proceeds of the sale, so far as they do not belong to himself. Gardner v. Barnes, 106 Mass. 505. Wiggin v. Heywood, 118 Mass. 514. Cook v. Basley, 123 Mass. 396. Converse v. Ware Savings Bank, 152 Mass. 407.
This action is suitable to enforce such a liability. If, therefore, the plaintiffs at the time of the sale were owners of the property sold, they can maintain the action to the extent of their ownership, whether conditional or absolute, and the fact that the defendant has contracted with the original mortgagor for the disposition of the proceeds of the sale is not a defence.
The defendant’s mortgage was made on July 19, 1881, and immediately thereafter the mortgagor conveyed the land to the plaintiffs and their heirs, subject to the defendant’s mortgage. This deed was upon condition that it should be void if the grantor should during his lifetime pay to each of the plaintiffs or their respective heirs, the sum of five hundred dollars; and the grantor died between April 24 and May 22,1882, without making any of the payments. Whether the deed to the plaintiffs was given to secure loans, and so is to be considered as a mortgage, or is to be construed as conveying a determinable fee, which by the grantor’s death without making the payments stated in the condition has become absolute, is immaterial to the decision of the present case. Under the deed, the plaintiffs were at the time of the defendant’s sale the owners of the land, *423either absolutely or in mortgage, and if in mortgage, the amount of their claim apparently exceeded the amount for which the defendant is liable in this action. The plaintiffs thus show a right to call upon the defendant to account for the proceeds of his sale, and to recover of him all the surplus in fact remaining in his hands.
The defendant asked a ruling that the validity and legal effect of the deed to the plaintiffs cannot be determined in this action, but only in an action between the plaintiffs and the persons entitled to the estate of the grantor under his will; and he now argues that he cannot be heard to dispute the validity of the deed, and may hereafter be held to answer to an action by an administrator or executor who would not be bound by the decision in this cause. The ruling was properly refused. The conveyance of the estate by the mortgagor to the plaintiffs was alleged in their declaration, and denied in the defendant’s answer, which also submits to the court the legal construction of the deed. As the plaintiffs founded their action upon rights claimed under the deed, it was open to the defendant to contest either its validity or its construction, as well as the amount due upon it, if a mortgage ; and the fact that, in some possible controversy between himself and other parties, such parties may make claims with reference to it as to which the decision in this case will have no effect, is immaterial.
It appears that the mortgagor left an instrument purporting to be his last will and testament, by which nothing was bequeathed to either of the plaintiffs, which instrument has never been offered for probate, and that no administration has been granted on his estate. The mortgage sale was on November 7, 1882. After the sale, the defendant filed a bill of interpleader in this court, admitting that he had a surplus, and asking that the plaintiffs in this action, and the persons named as the executor and as devisees and legatees in the testamentary instrument might inter-plead and determine to whom the balance in his hands belonged. One of the plaintiffs in this action was never served with process in the suit in equity, and has never appeared therein. The others appeared in that suit, and as to them the bill was dismissed without prejudice, before the commencement of this action. The defendant has set up in his answer that his bill in equity is still *424¿ending, and contends that for that reason the Superior Court has no jurisdiction of this action. This defence must fail for several reasons. In the first place, the pendency of another action must be pleaded in abatement, and not in bar. Moore v. Spiegel, 143 Mass. 413. In the next place, as the logic of the defence is that the matter in controversy is already the subject of a litigation, in which the rights of the parties may be adjudicated by a competent tribunal, it is essential that the plea shall show that the parties are before that tribunal, and that their rights may be there determined. But although the defendant’s bill in equity may in a sense be pending, none of the plaintiffs are so related to it that its decision will conclude their rights. Newell v. Newton, 10 Pick. 470, 472. Finally, the pendency of a bill in equity is not usually a sufficient ground for sustaining a plea in abatement to an action at law; Colt v. Partridge, 7 Met. 570, 576 ; and if the defendant is entitled to any advantage from the pendency of the bill, it is only by injunction from the equity court to stay proceedings at law. 2 Story Eq. Jur. § 889.
The remaining question is whether the plaintiffs should be allowed interest, and, if so, from what date. The mortgagor died in the spring of 1882. The next instalment of interest on the defendant’s mortgage fell due on July 19, 1882, and thereupon the plaintiffs notified him that they would not pay it, and he in reply notified them that he should foreclose. The first foreclosure sale was on September 19,1882, and when the purchasers refused to complete it, the defendant notified the plaintiffs, and offered them the purchaser’s contract of sale so that they might enforce it if they chose, and also notified them that he should make another sale, which he advertised in an unusual way at their request. The final sale was on November 7,1882. On December 9, 1882, the defendant rendered to the plaintiff’s attorney an account of the sale, showing a surplus, and filed bis bill of inter-pleader. The plaintiffs’ writ in this action was sued out on September 30, 1887, and there was no other evidence of demand. The court instructed the jury that they might compute interest from December 9, 1882. The defendant contends that he was not chargeable with interest, or, if chargeable, that interest should not be allowed until the date of the writ in this action.
*425We think that the ruling given was sufficiently favorable to the defendant. His implied obligation was to pay within a reasonable time after the sale, and the filing of his bill in equity showed that he was aware that a reasonable time had elapsed. He had in his hands from the time of the sale money of which he did not claim the ownership, and which he was aware that the plaintiffs claimed, although he received no formal demand. He was also aware of all the circumstances upon which the plaintiffs founded their claim. That he was doubtful of its validity gave him no right to retain the fund. It was his duty to pay it over to some one, and, as between himself and the plaintiffs, it is established that it was his duty to pay it to them. The delay was a breach of his obligation, and interest is the measure of damages which the law raises a promise to pay for the detention of the money after the breach of an express or implied contract for payment, if no demand is necessary. Dodge v. Perkins, 9 Pick. 368. Foote v. Blanchard, 6 Allen, 221. Thomas v. Beals, 154 Mass. 51, 54.
Before the fund came into his hands, he knew that the plaintiffs were interested in the proceeds of the sale which he proposed to make, and by his course of dealing with them in respect to the foreclosure and in bringing his bill in equity he so recognized their claim as to make a demand upon their part unnecessary. Instead of paying the money into court when he brought his bill of interpleader; he has kept it in his own hands; and now that the plaintiffs’ claim has been established, it is just that he shall pay interest from the time when he acknowledged that the money was due to others than himself.

Exceptions overruled.