Goodale v. Patterson
Goodale v. Patterson
Opinion of the Court
In 1868 Norman Foster was the owner of forty acres of land in Eaton county, subject to a mortgage given to one Adams for $225. He was living on bad terms with his wife and they agreed to separate, and by advice of counsel they united in a conveyance of the land to John O’Neil, who executed to each a mortgage thereon, without covenants. The mortgage to Mrs. Foster was for $500, and that to her husband was for $725. It was orally
Mrs. Foster recorded her mortgage on the 16th of April. According to the verbal arrangement, and in point of substance, O’Neil was made the custodian of the title, in order .to divide the interest between Mr. and Mrs. Foster. His .actual position was rather that of a trustee than that of an absolute purchaser.
March 11, 1870, Mrs. Foster made an absolute assignment of her mortgage to the defendant, and the assignment was placed on record on the 3d day of May following. Just' prior to that date Mr. Sagendorph, who had control of Foster’s interests and also liad interests of his own, negotiated a sale of the farm to complainant, but the agreement was not in writing. May 7th, being four days after the record ,of the assignment from Mrs. Foster to defendant, Mr. Sagen-dorph concerted with Mrs. Foster for a disposition of the mortgage. He paid her a sum of money, but how much is not explained, and agreed to give her certain professional assistance ; and in return she gave him an assignment of the mortgage and also a discharge of it. His purpose was to be able to treat the mortgage as satisfied in case the oral trade to complainant should be carried out, and ou the other hand, if that was not done, to regard the instrument as a purchased •security remaining in full force. The money paid was his •own; but he appeared to O’Neil as the representative of Foster. It is not intended to intimate, in saying this, that
Complainant was not informed of the assignment to Sag-endorph and the latter destroyed it; and neither complainant nor Sagendorph had any actual notice of the assignment to defendant. They both supposed that the discharge by Mrs. Foster was authorized and regular, and that the record of it would operate to cancel the mortgage. .
After the lapse of some little time the complainant ascertained the existence of the assignment to the defendant, and a request was made upon him for a discharge, accompanied by a tender of five dollars, but he refused. A proceeding by petition was likewise instituted to enforce a discharge, but nothing seems to'have been affected by it. Finally, in 1881, this bill was filed. It alleges that the mortgage-title claimed by the defendant constitutes a cloud on the title of complainant, which equity requires to be removed. It also prefers a demand for damages under the provision relating to the compulsory discharge of mortgages.
The circuit judge decided that the mortgage should be-discharged, but he based his decision wholly on the ground that as Mrs. Foster was a married woman, and her assignment to the defendant was in consideration of future legal services, it was a disposition she was not competent to make.
We are notable to uphold the decree on this ground. If the theory were sound, the bill would not authorize it. But the principle does not appear to be tenable. At the time she made her assignment to the defendant, Mrs. Foster was-the absolute owner of the mortgage in her own right, and she had all the power of a feme sole to dispose of it as she pleased. She could grant it as she chose, or even give it away at her election.
It is objected that this provision cannot apply, because the payment here was not by O’Neil, the mortgagor. This is true; but it is true rather in form than in substance. When O’Neil received the title and executed the mortgage it was made, as we have seen, an alternative that he should thereafter convey as Foster should appoint, provided the mortgages should be satisfied; and that condition did not contemplate that he should pay the mortgages out of pocket. The arrangement meditated that the means to get rid of the mortgages, in that event, should proceed from some other source. But the effect as respected him was to be the same as though he paid “the money. His mortgages were to be got rid of, but by means of his deeding the land on payment by another, and in lieu of such payment. His conveyance was to stand in the place of payment, so far as he was concerned, and a third party was to make the payment. This was only another way of payment by himself, and we think the transaction, as carried out, was within the spirit and equity of the statute.
The equities of Sagendorph are not in question. The in quiry relates to the rights of complainant and defendant. The complainant took his title from O’Neil, the mortgagor, who had no notice of any sort of the assignment to the defendant, and was not chargeable with any, and complainant had no notice and acted in good faith. He was not aware of the nature of the dealing between Sagendorph and Mrs. Foster. He was the privy of O’Neil, the mortgagor, and not of Mrs. Foster, the mortgagee. Mrs. Foster, was a party to the original arrangement, and was in equity subject to its conditions. She knew in what way the property was held by O’Neil, and in what way and on what terms he was
"We think the decree should be affirmed with costs.
Reference
- Full Case Name
- Hiram K. Goodale v. Ansil R. Patterson
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