Sayler v. Simpson
Sayler v. Simpson
Opinion of the Court
Tbe mortgagees having appeared and filed tbeir applications in tbe probate court for tbe payment of tbeir mortgages, tbe assignee answered; and tbe unsecured creditors named also intervened to contest them, and for that purpose filed appropriate pleadings. These admitted tbe execution and deposit of tbe mortgages as required by statute, before the filing of tbe deed of assignment, whereby they became and were at that time prima facie statutory liens on tbe property. Tbe real ground of attack upon them was, that notwithstanding their apparent priority over tbe assignment, they were, under tbe circumstances of tbeir execution, a part of it; and did not, for that reason, constitute incumbrances. After a decision adverse to tbe assignee and unsecured creditors, appeals were perfected by them to tbe court of common pleas.
There was no want of jurisdiction in either court over the persons of tbe parties thus voluntarily invoking and submitting themselves to such jurisdiction. Tbis is conceded. And, tbe assignee having, under tbe orders of tbe probate court, sold tbe mortgaged property, and. being in possession of tbe proceeds, it cannot be doubted that whatever liens existed, by virtue of tbe mortgages on tbe property, were transferred to
Section 6351, Rev. Stats., as amended January 30, 1885 (82 Ohio L. 14), provides that: “ The probate court shall order the payment of all incumbrances and liens upon any of the property sold, or rights and credits collected, out of the proceeds thereof according to priority; provided, that the assignee may, in all cases where the real estate to be sold is incumbered with liens, or where any questions in regard to the title require a decree to settle the same, commence a civil action, for the sale of such real estate, in the court of common pleas of the proper county, making all persons in interest, including the wife of the assignor, parties to such proceedings; and, upon hearing, such court shall order a sale of the premises, the payment of incumbrances, and the contingent dower interest of said wife. * * * all the provisions of said section 6350 in relation to the wife of the assignor as a party to proceedings thereunder, and her rights by virtue thereof; also, the provisions of said section as to ordering proprety sold at private sale,
The part of section 6350, quoted 'above, was added by the amendment of April 13, 18$0. Before it was so amended, it was contended that where a mortgagor, whose wife had joined in the execution of the mortgage on his real estate, subsequently assigned for the benefit of creditors, the probate court had exclusive jurisdiction to order . the sale of the land, and the mortgagee could not in any other tribunal enforce such sale; upon the principle that where a court of competent jurisdiction acquires possession of the subject-matter of litigation, and the right of a party to prosecute his action once attaches, the right of the court to retain the case, and of the party to prosecute it, can not be
Not all asserted liens are necessarily entitled to share in the fund. There may be disability of parties, defect in execution, partial or total discharge, or other infirmity excluding, or limiting their participation; nor do their relations in time always fix the order of their legal precedence. The duty of the court in the execution of its powers, is to order the' payment only of incumbrances and liens entitled to be paid; and those in the order of their rightful priority; which necessarily implies the power to decide what asserted liens are so entitled, and to determine the'order of payment. And neither court exhausts its powers, or performs its duty, by entering an order in general terms to pay the incumbrances and contingent dower interest of the wife; thus casting upon the assignee the hazards of making a distribution that will conform thereto. This power is'neither limited by the nature of the incumbrances, nor the character of the questions involved; and while it is in the first instance conferred upon the probate court, the means of correcting its abuse are carefully provided. By section 6407, of the Revised Statutes, an appeal to the court of common pleas is authorized, from any order, decision or judgment of the probate court, in the administration of insolvent estates, and the “ cause so appealed shall bo tried, heard and decided in the court of common pleas in the same manner as though that court had original jurisdiction thereof.”
It is urged by the plaintiffs in error that the intention to deny probate courts the jurisdiction contended for, is to be
The act of March 14, 1853, “defining the jurisdiction and regulating the practice of probate courts,” provided that court should have “jurisdiction to enforce the payment of the debts and legacies of deceased persons and the distribution of the estates of intestates.” In McLaughlin v. McLaughlin, 4 Ohio St. 508, it was held, that under this statute probate courts had jurisdiction to determine every disputed question of fact which might become necessary to ascertain the amount justly due to each legatee or distributee,. and order the payment thereof; and yet no more adequate provision was then made for pleadings or process, by that act or otherwise, than is to be now found in Chap. 7, Title II, part Third, of the Eevised Statutes.
The insolvent debtors’ statute contemplates that the creditors who desire to share in the estate assigned, shall authenticate, and file their claims with the assignee. These are reported to the court by him. Mortgagees whose mortgages include any of the assigned property sold by the assignee, must work out their rights in the fund through the probate court. They all thus become parties to the proceeding. “The unsecured creditors are parties in interest adverse to such mortgage claimants, and although the assignee may defend in their behalf, there is no good reason why they may not themselves do so. If pleadings and process were necessary, it is by no means certain they are not afforded by sections 6406 and 6411 of the Eevised Statutes. However this may be, the claims of creditors so authenticated and presented to the assignee, and by him allowed, or legally established if disputed, constitute the basis for declaring the dividends and distributing the same, after the payment of the incumbrances. Lahm v. Johnston, 32 Ohio St. 590.
Section 6356 requires the assignee to file his accounts “ containing a full exhibit of his doings as such,” and when, on the settlement, there is a balance remaining in his hands subject to distribution among the general creditors, a dividend shall be declared by the probate court. Of course, there can be no
In Lindemann v. Ingham, 36 Ohio St. 1, this statute was considered at length, and with care. The questions there, presented and disposed of were not essentially different from those under discussion. The property had been mortgaged before the assignment was executed. The assignee sold it, and held the fund for distribution. The mortgagee brought his action against the assignee in a court of general jurisdiction. It was held that the action could not be maintained; that the lien was transferred to the fund, and the rights of the mortgagee must be worked out through the probate court. It was not denied that, the condition of the mortgage being broken, the legal title to the property was in the mortgagee, and all that was left in the mortgagor, and therefore all that passed to his assignee, was ah equity. of redemption, or an equitable interest to the extent of what remained after the payment of the mortgage. The question naturally arises, how could the rights of the mortgagee be worked out through the probate court, otherwise than upon application to that court, for so much of the proceeds of the sale, as was necessary to satisfy the mortgage; the balance was the equitable interest of the assignee subject to distribution among the general creditors. Upon.such application the court must determine the amount due on the mortgage, and order it paid- This necessarily involves the inquiry whether anything is due, whether the mortgage is a lien, and to what extent it is such. To work out his rights through the probate court, these questions must be determined by that court, and substantially the same questions are involved in the case now under consideration. It might have been said in that case with as much pro- ' priety and force as in this, that no pleadings and process
The conclusion of the court, announced by the learned judge in Lindemann v. Ingham, supra, that the provisions of the statute, “ show, very clearly that the legislature intended to vest in the probate court full and complete jurisdiction over the whole subject of assignments of this character,” was not hastily reached, or incautiously stated; but was the result of careful consideration and deliberate judgment. It has been accepted and followed .in practice since. Blandy v. Benedict, 42 Ohio St. 295; Kemper v. Campbell, 44 Ohio St. 210.
Gilliland v. Sellers, 2 Ohio St. 223, is cited by counsel, as establishing, by analogy, the absence of such jurisdiction.
That was a proceeding by an administrator, to sell lands incumbered by mortgage, for the payment of debts, to which the mortgagee was a party. The court of common pleas (then a court of probate) assigned dower to the widow, found the amount due on the mortgage, and ordered it paid out of the proceeds of the sale.; and further decreed that the mortgage be cancelled. The decree of cancellation was held to be without authority and void. ¥e do not question the correctness 'of that holding, or perceive 'wherein it is in conflict with Lindemann v. Ingham, supra.
It was, when the court went beyond the distribution of the fund under its control, and adjudicated upon rights not involved in, or necessary to such distribution, that it exceeded the measure of its jurisdiction.
Judgment affirmed.
Case-law data current through December 31, 2025. Source: CourtListener bulk data.