323 Mass. 1 | Mass. | 1948
This is a bill in equity originally brought by Samuel Zeichick and now prosecuted by the administrator of his estate, Raphael P. Boruchoff, to foreclose a cooperative bank real estate mortgage. The principal defendant is Camp Hayastian, Inc., a corporation, which is the present owner of the equity in the land. Joined as defendants are former owners of the equitable title, United Workers Association of Massachusetts, Inc., a corporation, and Mihran H. Ayvasian. After pleas in abatement filed by Ayvasian and Camp Hayastian, Inc., and a demurrer filed by Ayvasian had been overruled, the case was referred to a master, from whose findings and from admissions in the pleadings the following facts are established.
On August 8, 1924, George 0. Gaudette and Marie L. Gaudette, having borrowed $3,000 from Dean Co-operative Bank, gave to the bank a mortgage in cooperative bank form, G. L. c. 183, §§ 22, 23, 24, as amended, of certain registered land in Franklin. The mortgage deed recited a “grant . . . with mortgage covenants to secure the payment of Three Thousand (3000) dollars, and interest and fines as provided in a note of even date, the land in said
The accompanying note provided for the payment of monthly dues of $15 and monthly interest of $15. On its back appear two credit notations of amounts received on account of principal and a statement of the balance remaining due.
On May 12, 1927, the land was conveyed subject to the mortgage to the defendant United Workers Association of Massachusetts, Inc., and simultaneously a second mortgage was given (presumably by the grantee) for $3,554.10 to Elizabeth S. Metcalfe. The corporation being in arrears on its payments to the bank, the latter in November, 1936, advertised a foreclosure sale. On November 27 the bank declared the fifteen shares pledged by the borrowers forfeited, G. L. c. 170, § 32,
Meanwhile, on May 10, 1940, Metcalfe, the second mortgagee, had foreclosed her mortgage, had bought in the land at the foreclosure sale and, on August 30, 1940, had conveyed the land to the defendant Ayvasian. On August 19, 1941, Ayvasian conveyed the land to the defendant Camp Hayastian, Inc., which took title with knowledge of the pendency of the present suit. The assignment of the mortgage by the bank to the finance company of November 28, 1936, had been registered by the plaintiff on December 4, 1940. No person within the meaning of the soldiers’ and sailors’ civil relief act of 1940, as amended, has any interest in the land conveyed by the mortgage.
A final decree was entered on December 9, 1946, authorizing a foreclosure of the mortgage for the benefit of Zeichick by a special master to be appointed by the court, provided the defendants failed to pay the amount then due on the mortgage within thirty days. From this decree the defendants Ayvasian and Camp Hayastian, Inc., have appealed. These defendants have also appealed from the
The defendants contend that the loan to the bank secured by the mortgage has been paid and that the plaintiff has no enforceable right of foreclosure.
While a copy of the mortgage in question appears in the record, there is no copy of the note accompanying the same. We, therefore, assume that the form of the note was in compliance with the provisions of G. L. c. 170.
The statutory cooperative bank power of sale, G. L. c. 183, § 24, is as follows: “. . . in case of non-payment of the aforesaid monthly dues, interest or fines . . . for more than four months after any payment thereof shall be due, or upon any other default in the performance or observance of the foregoing or other condition, the mortgagee or its successors or assigns may sell the mortgaged premises.”
Section 32 of c. 170 provides: “If a borrower is in arrears for dues, interest, ... or fines for more than four months, or commits any other breach of the conditions of a mortgage, the directors may . . . declare the shares forfeited .... The account of such borrower shall then be debited with the arrears . . . and the shares shall be credited upon the loan at their withdrawal value. The balance of the account shall immediately become due and payable, and may, and after six months shall, be enforced against the security, and be recovered, together with interest thereon, as all debts are recovered at law.”
After the shares were forfeited by the bank the note of the original borrowers was extinguished so far as any duties of payment in accordance with its terms were concerned. No further obligation remained to pay dues on shares which no longer existed. C. 170, § 13.
We perceive no reason why this claim and mortgage were not assignable. No payment of the loan had been made by the Gaudettes or by United Workers Association of Massachusetts, Inc., presumably the transferee of the bank shares. The statutory cooperative bank conditions of the mortgage pertaining to payments on the shares had been annulled by the forfeiture of the shares. It had become substantially a mortgage in common form to secure payment of the balance of the loan. The bank received by way of consideration for its assignment the amount of this balance. It was for the interest of its shareholders to obtain payment in this manner and thus avoid the uncertainties and expenses of a foreclosure and possible action at law.
General Laws (Ter. Ed.) c. 170, § 9, as appearing in St. 1933, c. 144, provides that "The treasurer shall . . . dispose of and secure the safe-keeping of all money, securities and property of the corporation, in the manner designated by the by-laws.” The by-laws do not appear in the record. By this statute the care of the bank's property was given to the treasurer; but merely by virtue of his office he had no implied power to transfer to a purchaser the claim and mortgage which we have under consideration. Bradlee v. Warren Five Cents Savings Bank, 127 Mass. 107, 109. Holden v. Upton, 134 Mass. 177, 179. "There is no reason
By the decree in the Zeichick’s previous suit, the finance company was ordered to assign to him the mortgage and note “in the form hereto annexed.” In the annexed form to which reference was made the language employed was “assigns said mortgage and the note and claim secured thereby.” It seems clear, therefore, that, although the claim was not specifically mentioned in the decree itself, the court intended to order the assignment of the entire obligation for which the mortgage was given as security and of which the legal title was held by the finance company in trust for Zeichick. Such intention should be given effect. A “decree itself is to be construed reasonably with reference to the pleadings, the facts proved and the grievance to be remedied.” Billerica v. Quinn, 320 Mass. 687, 690. Attorney General v. New York, New Haven & Hartford Railroad, 201 Mass. 370, 372. Yankee Network, Inc. v. Gibbs, 295 Mass. 56, 61. We construe the decree as ordering the finance company to assign to Zeichick the claim and mortgage.
By virtue of G. L. (Ter. Ed.) c.183, §§ 43 and 44, as
The appeals of the defendants Ayvasian and Camp Hayastian, Inc., from interlocutory decrees overruling the demurrer of Ayvasian and the pleas in abatement of both defendants have not been argued and are treated as waived. Boston v. Dolan, 298 Mass. 346, 355, 356.
.A demurrer of Camp Hayastian, Inc., filed with its plea in abatement, and identical in language with the demurrer of Ayvasian, remains without a ruling by the judge. The
In the final decree the word "claim” is substituted for the word "note” wherever the latter word appears. The second paragraph of the final decree is amended by substituting for the word "defendants” the words "defendant Camp Hayastian, Inc.” In this paragraph necessary changes should be made as to the time in which that defendant may make payment to the plaintiff. The third paragraph is amended by omitting the words “to exercise the power of sale contained in the said mortgage” and by providing that upon confirmation of the sale by the court the plaintiff and the defendant Camp Hayastian, Inc., shall within thirty days thereafter execute and deliver to the purchaser or purchasers at the sale proper instruments conveying all their title, right and interest in the premises. Russell v. Burke, 180 Mass. 543. As so modified the final decree is affirmed with costs.
So ordered.
See now G. L. (Ter. Ed.) c. 170, § 36, as appearing in St. 1933, c. 144.
A copy of a note held to be in the usual cooperative bank form is to be found in the record of Lowell Co-operative Bank v. Dafis, 276 Mass. 3. See Cosmopolitan Trust Co. v. Suffolk Knitting Mills, 247 Mass. 530, 532.
See now G. L. (Ter. Ed.) c. 170, § 27, as appearing in St. 1933, c. 144, as amended by St. 1945, c, 176, § 1.
See now G. L. (Ter. Ed.) c. 170, § 13, as appearing in St. 1933, c. 144, as amended by St. 1947, c. 88, § 3.
See now G. L. (Ter. Ed.) c. 170, § 30, as appearing in St. 1933, c. 144.
See now G. L. (Ter. Ed.) c. 170, § 38, as appearing in St. 1933, c. 144. See also 2 Op. Atty. Gen. 286.