Bank of Ogdensburgh v. Arnold

5 Paige Ch. 38 | New York Court of Chancery | 1835

The Chancellor.

Previous to the revised statutes, this court, up on a bill of foreclusure, could direct the whole mortgaged premises to be sold, or a part thereof only, as should be most conducive to the ends of justice, in reference to the equitable rights of all parties; although a part only of the mortgage money had become due. But the power of the court in this respect has been somewhat restricted by the revised statutes. The 163d section of the title of the revised statutes relative to the court of chancery, (2 R. S. 193,) directs a reference to a master to ascertain and report the situation of the mortgaged premises; and if it appears from his report that the premises can be sold in parcels, without injury to the interest of the parties, then so much only of the premises are to be sold as will be sufficient to pay the amount then due, with costs; and the decree is to remain as a security for any subsequent -default in the payment of sums thereafter to become due. This provision of the statute appears to be imperative upon the court: and it certainly cannot be departed from, except in cases where the complainant has some equitable claim upon the rents and profits of the premises which will accrue before the mortgage debt becomes payable. In this case Mrs. Arnold joined with her husband in the mortgage; and of course her dower interest in the premises is pledged for the payment •of his debt, so far as the same can be reached and applied for ■that purpose under a decree of foreclosure, made in conformity to the statute. Beyond that, the complainants have no equitable claim whatever against her dower interest in the premises, or against her personally. When she joined with her husband in this mortgage, payable at the expiration of ten years, she impliedly reserved to herself the right, in case of Ms death, to receive so much of the rents of the premises, remaining unsold from time to time, as belonged to her for her dower. And until the complainants have entitled themselves to a sale of the land pledged by her as a security for the debt of her husband, they have no lien, either at law or in equity, upon that portion of the rents and profits which belong to her.

The rights of the infant defendants depend upon a different principle. As it is alleged that their father died insolvent, they are of course liable to his creditors, in equity, for whatever comes to them by descent from him, as his heirs at law, whether in the shape of rents, or otherwise. But the mortgagees have no specific lien upon the rents of the mortgaged premises until the mortgage money becomes due, so as to entitle them to a foreclosure of the mortgage. In the mean time the mother, as guardian by nature of the infants, is entitled to receive their share of the rents and profits; (1 R. S, 718, § 5;) which rents and profits belong to the creditors oí' their father, according to the priority prescribed in the statute. And if there are any judgment creditors, they will be entitled in preference to the complainants, who are mere specialty creditors. If the whole mortgage money was now due, and the premises were not of sufficient value to pay the debt and costs, the court might consider the complainants in equity, as immediately entitled to the whole estate pledged as a security for the payment of such debt and costs; so as to authorize the appointment of a receiver of the rents and profits, in anticipation of a decree, at any time after the filing of the complainants5 bill. But no such equity can arise where the debt is not yet due; and where the mortgagee has neglected to take a pledge of the rents and profits of the whole premises to keep down the accruing interest in the mean time. This decree óf sale, which has been made in conformity with the directions of the statute, has already provided for the payment of what is now due; and I can see no valid reason for depriving the widow of her dower in that part of the premises which is not necessary to be sold until further payments become due. The offer made by the widow to" relinquish to the complainants the rents of all the mortgaged premises, except the one house and lot, and to permit them to receive such rents and profits to keep down the accruing interest until the debt becomes due, appears to me to have been reasonble, under all the circumstances of this case; as she could not be expected to relinquish a temporary provision for the support of herself and children, which the statute had secured to her, without receiving any equivalent therefor.

Petition dismissed,