Farr v. Dudley

These proceedings are based upon the eighth, ninth, and tenth sections of chapter 131 of the Revised Statutes. The eighth section provides that the mortgagee of real estate, upon a request in writing by the mortgagor, shall make out and deliver to him or his agent, a just and true account of all his demands secured by such mortgage, and all damages and costs incurred by reason of the non-performance of the condition thereof, and of all rents and profits by him received.

The ninth section provides that if he shall unreasonably refuse or neglect to make out and deliver such account, the Court of Common Pleas, upon petition by the mortgagor setting forth the facts in the case, and due notice given, to the parties interested, shall determine the amount justly due after deducting rents and profits received.

And the tenth section provides, that upon such amount being brought into court and lodged with the clerk thereof, the court shall decree that such mortgage be discharged; and a copy of such decree, recorded in the registry of deeds for the county in which such lands lie, shall have the same effect as a release duly executed by the mortgagee.

By the seventeenth section of the same chapter, it is further provided that the word “ mortgagor ” or “ mortgagee,” in this title, shall be construed to include any person claiming under or representing him.

On the 6th of February, 1841, Oelatia Farr was the owner of the premises, and on that day mortgaged them to one Oscar Oooledge. On the 24th of February, 1844, Cooledge sold and transferred his right and interest in the mortgage and premises *378to one Asa Marsh. In 1848, Marsh obtained judgment on the mortgage, and afterwards, on the 12th of December, 1849, sold and transferred to Dudley all his right and interest in the premises and in the judgment. Dudley then, by virtue of said seventeenth section, stands in the position of mortgagee of the premises, holding under the mortgage of Farr to Cooledge, dated February 6th, 1841.

On the 1st day of January, 1847, Celatia Farr conveyed by mortgage the same premises to the petitioner, Kimball Farr. Kimball Farr, claiming under Celatia by virtue of that conveyance, stands in relation to Dudley as mortgagor; and by the sections above referred to, of chapter 131 of the Revised Statutes, has a right to request of Dudley an account of all his demands secured by the mortgage to Cooledge, and all damages and costs incurred by reason of the non-performance of the condition thereof, and of all rents and profits by him received. He has also the right, in case of Dudley’s refusal or neglect to make out and deliver such account, to present such a petition as we now have under consideration, and to have the prayer of that petition granted, unless there is some legal reason for denying it.

On the 14th of August, 1847, some seven months after the mortgage from Celatia Farr to Kimball was executed, and more than two years before Dudley became the owner of the Cooledge mortgage, Dudley, having a valid claim against Celatia, caused a writ to be sued out and an attachment made of all the right of Celatia to the premises. Judgment was recovered in this suit, and the equity of redemption duly sold on execution and bid off by Dudley, and to him conveyed by the officer. This was done on the 25th of November, 1848. On the 4th of October previous, Dudley, being by virtue of this claim, a creditor of said Celatia, and having an attachment upon the property, caused a notice to be served upon Kimball Farr in accordance with the provisions of chapter 184 of the Revised Statutes. The fifth section of this chapter provides, among other things, that, by an attachment of real estate, all the debtor’s interest therein shall be held to satisfy the judgment, though such interest be a right of redeeming the sainé upon a mortgage. By the act of June *37926th, 1845, the sixth section of chapter 184 was repealed; but although repealed in form, its provisions were, by the same act, somewhat extended. By that act, as well as by said sixth section, it is provided, that any creditor attaching the right of redemption, may at any time, while such right exists, as well before as after sale thereof on his execution, pay or tender to the person entitled to the redemption money, the full sum due to him ; and upon such payment or tender, the interest in such real estate derived from such mortgage, shall, as against such attachment and the rights acquired under it, cease. The seventh section of said chapter is then in these words: “ Such creditor, or the officer serving the writ, may demand of the person entitled to the redemption money an account under oath of the amount due him: and if such account be not rendered within fifteen days after, or a false account shall be rendered, his said interest in such real estate shall, as against such attachment and the rights acquired under it, cease.”

It has been said in the argument, that the requirements of this seventh section are unconstitutional and void, because no provision is made for compensating the mortgagee for his time and expenses; and that, therefore, no rights can be affected by such a notice and demand. It has also been said, that the judgment of Dudley v. Farr was founded upon a copy of a writ; that the judgment was illegally obtained; and that therefore no rights were acquired under it.

The view which the Court have taken of the case renders it unnecessary to settle those points. We might, however, suggest a quaere, whether inasmuch as this mortgage of Celatia to Kim-ball bears date subsequent to the provisions of the statute referred to, the party did not take it subject to all the general provisions of law relating to mortgages as laid down in our statutes. And whether the copy used in entering up the judgment having been used by order of the Court, that judgment can be impeached by any collateral proceedings.

But the settlement of these questions is not necessary for the decision of this case. The notice which Dudley caused to be served on Kimball Farr was insufficient. It did not require the *380amount due at the time of the demand, nor did it state the time of the attachment. The rights which a mortgagee has to the land mortgaged are oftentimes his only reliable security for the payment of his debt; the personal security may be entirely worthless. Our statutes require much formality in the execution and recording of mortgages of real estate, and if the rights of an individual thus acquired are to be taken away by the simple act of an attaching creditor’s giving a notice for an account of the claim, and a failure to comply with the requirements of that notice, we think the attaching creditor should also be held to comply strictly with all the substantial requisitions of the statute. The account is to be rendered within fifteen days of the time of giving the notice. It may often be no ordinary labor to render this account. Payments may have been made, rents and profits may have been received, and the situation of the parties may be such, as to residence or otherwise, as to require the greatest industry in order to comply with the demand. In some instances where the mortgagee resides in another State or government, it might be impossible. To add to this, then, the necessity of ascertaining the time of the attachment, as in this case, and to compel a party to go to the town-clerk’s office, that no error might be committed in this respect, would be unreasonable, and what we‘ think the Legislature never intended. Had the notice stated the day of the attachment, and requested the account up to that time, it might, perhaps, have been sufficient.

The object of the statute appears to be, to enable creditors to ascertain the situation of the real estate of their debtors, and to hold the same upon payment of the debts secured by the mortgages, if they shall elect so to do. And by the provisions of said seventh section of chapter 184, the Legislature seem to have contemplated that after an attachment made, the creditor might elect not to enter his action upon ascertaining the amount of the incumbrances. Hence the section provides that the creditor or officer serving the writ may make the demand, and that the account shall be rendered within fifteen days. The attaching creditor having the right upon paying the sum due the mortgagee to have that incumbrance removed, whether before or after sale *381on his execution, the account which it becomes necessary for him to have is the amount due at the time of the demand. It is then that he proposes to pay the money and remove the incumbrance. The amount of the claims may have been much reduced after the attachment. Rents and profits may have been received and moneys paid by the debtor. This would form a good reason why the demand should relate to the time of the notice and not to the time of the attachment. But, independent of any particular reason for such a construction, the statute itself, it seems to us, refers to no other time. And any other construction might lead to much embarrassment in carrying out the intention of the Legislature.

Holding the notice to be bad, the petitioner’s mortgage is not thereby invalidated, and he will be entitled to have the prayer of his petition granted, if he is himself in the situation to make the application. In order to do that, he must be either the mortgagor or some one claiming under or representing him ; and this claim should be a valid, hond fide, subsisting demand. The question, then, of the validity of the mortgage by virtue of which this petition is made, is one to be settled, if it is disputed, before this petition can be granted. The person making the demand must have some valid rights before he is authorized to make it. Without those rights he has no more authority in the matter than an entire stranger to the whole transaction. The conveyance between him and the grantee may be good even without consideration, but when the rights of third parties come to be affected it presents a different aspect; and, should it be made to appear that the mortgage from Celatia Farr to Kim-ball was without consideration, then this petition cannot be maintained. According to the provisions of the case the validity of the mortgage must be tried in the court below, and upon that question being decided, the petition will be disposed of upon the principles here settled.