Eaton v. Simonds

Wilde J.

delivered the opinion of the Court. This case comes before us on exceptions taken by both parties to the report of the master ; but the principal question depends upon the facts appearing by the bill and answer. The question is* whether the plaintiff is entitled to dower in the estate described in the bill; and if so, upon what terms she may enforce her claim in a court of equity. Ttiat she has an equitable claim of dower is fully settled by the decision in the case of Gibson v. Crehore, 5 Pick. 146. It was decided in that case, and so it had been frequently held before, that a widow is dowable of an equity. And although she cannot maintain an action at law against the mortgagee, or his assignee, after having joined her husband in a mortgage, relinquishing her right of dower* yet if the mortgage is not foreclosed, a court of equity will interpose and allow her to redeem.

The question then is reduced to this, namely, whether the plaintiff, to entitle herself to dower, is obliged to redeem, or to contribute her share to redeem, both of the mortgages mentioned in the bill. The plaintiff admits, in her bill, that she is bound to redeem the mortgage to Lucy Ridgway, that mortgage having been regularly assigned to the defendant. But she denies her liability to redeem the other mortgage, given to William Eaton, because this mortgage, as she avers, has been paid and discharged, and is no longer an. existing *104incumbrance on the premises. The answer admits that this mortgage was assigned to George Blake, Esq., and that the defendant has paid the full amount due thereon to Blake ; and that Blake 'thereupon discharged the mortgage upon the mar gin of the record thereof, for the benefit of the defendant. But this discharge, the defendant’s counsel contend, will operate as an equitable assignment, as it was so intended to operate by the parties ; and that the union of the legal and equitable titles may well exist without producing the effect 01 a merger, or the extinguishment of the mortgage. Perhaps this might be so, if the discharge could be considered as an assignment of the mortgage.

The general principle is, that when the purchaser of a right to redeem takes an assignment, this shall or shall not operate as an extinguishment of the mortgage, according as the interest of the party taking the assignment may be, and according to the real intent of the parties. Gibson v. Crehore, 3 Pick. 482. But Chief Justice Savage remarks, in the case of Coates v. Cheever, 1 Cowen, 460, “ that the spirit of the cases seems to be this ; that where the tenant in possession enters by virtue of a purchase from the mortgager, then the subsequent purchase of the mortgage by him is an extinguish ment.” And that case was decided upon that principle. The same principle is laid down in James v. Morey, 2 Cowen, 301, and in other cases. Forbes v. Moffatt, 18 Ves. 390 ; Gardner v. Astor, 3 Johns. Ch. R. 53. The rule at law is inflexible, that where a greater and a less estate meet and coincide in the same person, in one and the same right, with out any intermediate estate, the less estate is immediately an nihilated or merged ; and the same rule applies to the union of the legal estate with the equitable interest. But this rule is not inflexible with courts of equity, but will depend on the intention and interest of the person in whom the estates unite.

In the present case, however, the doctrine of merger is not applicable, for the estate in the mortgage of William Eaton was never assigned to the defendant, and never vested in him ; so that it could not unite with the equitable title in him, so as to operate as a merger. But this mortgage has been legally discharged, the debt has been paid, and can no longer *105be set up as a subsisting title, either at law or in equity. It makes no difference that the defendant was advised and supposed that a discharge of the mortgage would be equally beneficial to him, as an assignment. This was a mistake, which, however, this Court has no power to correct.

With regard to the exceptions to the master’s report in stating the account, we think two of them are well founded and are to be allowed. *

The plaintiff excepts to the allowance of a commission to the defendant on the rents and profits, he having occupied the premises in person during the whole time. The rule is, fiat a mortgagee in possession, who manages the estate himself, is not to be allowed for his own care and trouble ; otherwise, if he employs a ' bailiff, or lets the estate to a tenant; and so is the rule in England. French v. Baron, 2 Atk. 120 ; Godfrey v. Watson, 3 Atk. 518 ; Bonithon v. Hockmore, 1 Vernon, 316.

We are of opinion also, that the master erred in charging the defendant with the rents and profits during the life of the plaintiff’s husband. He had a right to possession, and to the rents and profits, as against the husband, under his purchase of the equity, and it does not appear that he ever entered under the mortgage in question ; nor had he any right to enter, the same having been discharged. Nor does it appear, that he entered under the other mortgage. The plaintiff in her bill avers, that the defendant entered under his purchase of the equity, and never gave any notice of his entry under the last mentioned mortgage. This case, therefore, on this point, materially differs from that of Gibson v. Crehore.

We think, however, the defendant is liable to be charged with the rents and profits from and after the death of the husband, for he could not hold under the purchase of the equity against the plaintiff, and he is to be presumed to hold under his legal title. The defendant’s charge for repairs is also to be limited to the time since the death of the husband.

These two exceptions are to be allowed, and the others are disallowed, and the account is to be corrected accordingly.

The Court having made a decree in conformity with this opinion a motion was now made on the part of the respond*106ent, to vary and rectify the minutes of the decree, on the following grounds: 1. because the decree supposes, that the mortgage to Eaton, which was allowed by the master as a just charge upon the estate, was tp be considered as extinguished ; 2. because no exception was taken by the complainant to the allowance of such mortgage by the master ; but on the contrary, the complainant having excepted to the allowance by the master to the respondent, of a commission for collecting rents, prayed that the residue of the master’s report might be confirmed.

Wilde J.

delivered the opinion of the Court. Since an opinion was given in this case, the defendant has moved Ae Court to rectify the minutes of the decree, on the s ggestion, that no exception was taken to the report of the master, in which the mortgage to William Eaton is stated as a subsisting and valid mortgage.

We were somewhat surprised at this suggestion, because not only was there such an exception in the copy furnished to the Court, but it appears from the plaintiff’s bill, that she denied, in the outset, that this mortgage was a subsisting mortgage, which she was bound to redeem ; and it hardly can be supposed, that her counsel would waive so important an exception. How the fact was, however, does not appear, for the counsel do not agree, and we do not think it important to inquire further, for if the plaintiff’s counsel did omit to file the exception to the master’s report in season, we think the question as to the discharge of the mortgage, and whethei or not it could be considered as assigned to the defendant, was open for the consideration of the Court upon the bill and answer.

The answer expressly admits all the facts which have any beanng upon that question ; and although the master was au tlionzed to examine and state the facts and circumstances appearing on record or otherwise, in relation to the discharge or assignment of the mortgages mentioned in the bill, yet he was not empowered to decide upon those facts, except incidentally by stating an account of the sum due on the mortgages, ■with an account of the rents and profits and the repairs, &c The reference was made out of the ordinary course, and be *107fore tne answer was filed, for the purpose of expediting the final decision of the cause ; but it was not intended to authorize the master to decide the question whether the first mortgage was discharged or not, but to report facts. This then, we think, was an open question, and was, as it still seems to us, rightly decided. We have, however, examined the cases cited by the defendant, but do not find that they impugn, in any respect, our former decision, excepting perhaps the case of Popkin v. Bumstead, 8 Mass. R. 491 ; and that is distilguished from this, in an important particular. The defendant in that case had purchased of the administrator of the mortgager, and thereby acquired the same rights which the administrator would have had if he had paid off the mortgage for the benefit of the heirs. The mortgage was paid off after the death of the mortgager, when the widow’s right of dower had become perfect, and it might therefore be supposed, that she was not entitled to dower without contributing her share of the redemption money, and that the case came within the principle laid down in Gibson v. Crehore, that where several are interested in an equity of redemption, and one only is willing to redeem, he must pay the whole mortgage debt; and in such case he is, in a court of equity, considered as assignee of the mortgage, and as standing, after such redemption, in the place of the mortgagee, in relation to the other owners of the equity.

Unless the case of Popkin v. Bumstead can be supported on some such distinction, it is difficult to perceive any legal or equitable ground on which it can stand. It is difficult also to say how that case could be decided on rules of equity, it being an action at law ; but unless the principle of contribution does apply, the case seems opposed to the whole current of the authorities.

In the present case, the plaintiff clearly was not bound to contribute to the redemption of the first mortgage when it was paid off and discharged. That was done during the life of the husband, and clearly the wife then was not bound to contribute, and the husband was not bound to repay the mortgage debt, unless he saw fit to redeem the equity. The defendant therefore redeemed in his own right. He bought the equity -sub*108ject to these mortgages, and there seems to be nothing inequitable in holding him bound to redeem them.

In the case of Swaine v. Ferine, 5 Johns. Ch. R. 482, it is decided by Chancellor Kent, that if the heirs pay a mortgage, the wife shall contribute as to the amount paid by the heirs, but that as far as the husband had reduced the mortgage in his life time, that was doubtless so far a reduction for the benefit of the wife as well as himself. The same rule will hold where payment is made by the assignee of the husband during his life time ; and this is decisive in the present case.

Motion to vary the minutes overruled.