Epitomized Opinion

Hall owned a farm which he sold to Rofe. Rofe paid a part of the purchase price and gave Hall a mortgage for the balance, and went into possession. Sutliff recovered a judgment against Rofe which he was in possession, which became a lien unon the property by operation of law. Later Rofe, unable to pay his mortgage, entered into an agreement with Hall by which Rofe transferred the farm back to Hall and gave to Hall certain personal property belonging to Rofe, in consideration of which Hall surrendered to Rofe the promissory note secured by the mortgage and duly cancelled the mortgage of record.

Thereafter Sutliff brought suit to marshall liens upon the property and for a sale of the premises for the satisfaction of his judgment Hall claims a vendor’s lien upon the premises for the unpaid portion of the purchase price and also claims that at the time Hall received his deed from Rofe and cancelled his note, Rofe had no equity in the farm. The trial court found that Sutliff had a first lien on the premises. Oh appeal the decree of the lower court was affirmed, holding:

1. A purchaser of mortgaged premises who pays the mortgage extinguishes the lien and cannot claim subrogation of the mortgagee’s lien to the prejudice of a junior lien claimant.

2. The application of the above rule applies when the purchaser is also the person to whom such mortgage was given.

3. The taking of a mortgage upon the land sold is not in and of itself a waiver of the vendor’s lien.

4. The taking of additional security for the balance due of the purchase price waives the vendor’s lien.

5. The equitable lien of the vendor of land for unpaid purchase money is waived by an act of the parties showing that the lien is not intended to be retained.