Brewer v. Hyndman

| Superior Court of New Hampshire | Dec 15, 1845

Parker, C. J.

The property which the plaintiff seeks to redeem was mortgaged by Blodgett to the defendant, to secure the payment of two promissory notes. Blodgett became a bankrupt, and this property was inserted in his schedule as subject to this mortgage.,

Under these circumstances the assignee appears to have sold it. There is nothing to show that there was, on the part of the assignee, any allegation of fraud, or any sale of any thing else but the right of redemption. The assignee sold the right of the bankrupt; that is, the right to redeem. The plaintiff purchased a right to redeem, and he brings this petition under the statute, to enforce a redemption.

The statute authorizes a petition to the court of common pleas for the discharge of a mortgage and other relief, where the mortgagor, or person having his title, has paid or tendered the amount due, or otherwise performed the condition. And where the mortgagee, or person having his interest, unreasonably refuses, upon request in writing, to make out and deliver to the mortgagor, or his agent, a just and true account of all sums secured by the mortgage, with the damages and costs occasioned by the non-performance of the condition, and also of all rents and profits received, the court of common pleas, upon petition by the mortgagor, are to determine the amount justly due, after deducting the rents and profits, and, upon the amount being brought into court, shall decree that the mortgage be discharged.

The reason of the matter shows that the term mortgagor is used, in this connection, to denote and include any one having his title, or right to redeem.

The account to be rendered is a just and true account, and a remedy may be sought under this branch of the statute in cases where the mortgagee, or the assignee of the mortgage, professes to render an account, but does not render a correct one. The petitioner seeks to redeem under this clause of the statute. He does not allege any payment or tender, or any performance of the condition. He sets forth the execution of the mortgage, and that he, on the 19th of August, 1848, had the right of redemption, and requested the respondent to deliver to him a true account, which the respondent refused to do. He then prays that an account may be taken, and that he may be permitted to redeem, on payment of the amount.

But the auditor reports, that on the hearing before him it was admitted that the respondent rendered an account in due season, and this seems to have been conceded on the trial before the jury.

The petitioner failed, therefore, to support his allegations ; but he attempted to sustain a right to redeem upon the ground that the mortgage was fraudulent, and that there is, therefore, no cause for redemption. In other words, he claimed in effect to have the absolute title, because the mortgage was fraudulent as to the creditors of Blodgett, and thus void; and because he, under the sale of Blodgett’s assignee, stood with the rights of the creditors. If this were so, a petition that an account might be taken, and that he might be permitted to redeem upon payment of the sum due, was not his remedy. Such a petition admits a valid mortgage, although perhaps nothing may be due, by reason of payments and the reception of rents and profits.

If the petitioner relied upon facts rendering the mortgage void ab initio, he should have filed a bill in equity to set aside the mortgage, or have brought a suit at law.

On the facts before stated, the petitioner is not entitled to allege that the mortgage was fraudulent as to creditors, or to place his case upon that ground. lie does not appear to be a creditor, or to have the rights of a creditor in this respect. It was not, as we have seen, on an allegation of fraud, and upon the rights of creditors, that the sale was made under which he purchased and holds whatever title ho has. He purchased the right of the mortgagor, and the mortgagor cannot allege against his mortgagee that the mortgage was made to defraud creditors, and thereupon bring a petition to redeem, under the statute, upon the payment of nothing.

Nor could he, in a process of this character, allege a fraud upon himself, rendering the mortgage void, for then he would not ask to redeem.

The mortgagor may allege, in equity, on a proceeding to foreclose, that there has been a failure of the consideration for the note he has given; so he may sot up a want of consideration, as he might do at law in an action upon the note; and if the failure or want of consideration be partial, he may claim to redeem, on the payment of the sum actually due. The petitioner may do the same.

But there are other objections to the course of proceeding in this case.

The statute in relation to petitions to redeem provides that if, upon the hearing, any issue of fact shall arise, such issue, if either party elects, may be determined by a jury. There is no provision for the appointment of an auditor. There is, however, a general statute authorizing the courts to appoint auditors in cases where an examination of accounts or an investigation of vouchers shall be found necessary; and one may be appointed on a petition to redeem, for such purposes. But it is evident that the parties had not found an examination of accounts nor any investigation of vouchers necessary, when they procured the appointment of the auditor in this case; for the matters tried before him seem to have related principally to the alleged fraud, upon which he reports divers facts, and a conclusion that the parties did not intend fraud. And although of opinion that the notes were made for a greater amount than-the value of the land, and the indebtedness of Blodgett to the defendant, he does not feel authorized to reduce the amount, and he states no account. ,

Where an auditor is appointed under the statute, if either party is dissatisfied with his report the ease may be tried by the jury, and the report shall be given in evidence to the jury, subject to be impeached by evidence offered by either party. This provision is as well applicable to petitions for the redemption of land, as to other legal proceedings. If no issue has been previously made up, the court, ascertaining the matters of fact in controversy, should direct such issues to be framed as will regularly present those matters for trial. The proper mode of making up an issue is for the party having the affirmative to file an allegation of the fact which he asserts, and for the other to traverse it, concluding with an issue to the country. But here, if any issues have been framed, it would seem that most of them are not upon something alleged by one party and traversed by the other, but upon facts found by the auditor. The issues are raised between the auditor and the petitioner.

The auditor’s report was not evidence of the facts found relative to fraud, and it seems not to have been competent evidence of any matter to be submitted to the jury, for it states no account. Stevens v. Thompson, 17 N.H. 103" court="None" date_filed="1845-07-15" href="https://app.midpage.ai/document/stevens-v-thompson-8504939?utm_source=webapp" opinion_id="8504939">17 N. H. Rep. 103. It sets forth that the value of the house and the indebtedness of Blodgett were considerably less than the amount of the notes, but does not find how much; the auditor deeming the defendant, under the circumstances, entitled to receive the full amount of them.

The ruling of the court, admitting the deposition of the respondent taken in another case, and containing his admissions, was correct. The petitioner was entitled to the benefit of those admissions.

The ruling, excluding the evidence of the declaration of the petitioner, that he commenced the petition from hostility, was right also. He had a right to redeem, whether he proceeded from good or bad motives, and his expression of hostility does not prove that either more or less is due to the defendant.

The amount due, if the transaction was fair, was not to be ascertained by inquiring into the mere inadequacy of the consideration. If Blodgett‘agreed to give a certain sum for the land, and for an agreement, by the respondent, to assist in building a house upon it, the transaction being fair, it is no defence against the note, that the land, and what was furnished by the defendant toward the house, were not worth so much. That would be a case of mere inadequacy, of which he could not avail himself in the absence of fraud. But if it were agreed that Blodgett should give a note large enough to cover the value of the land and the buildings to be built upon it, because the respondent agreed to furnish materials for them, and so much of the labor as Blodgett was unable to furnish, it being the intention to include and secure to the respondent, by means of the note, all that he should do towards the buildings, then Blodgett received as a consideration only the land and the amount of the labor and materials, if any, actually furnished, and beyond that there is a want or failure of the consideration for the notes, of which the petitioner may avail himself, as the mortgagor might have done.

The result of our. investigation is, that the verdict, and also the report of the auditor, should be set aside, and the case stand for a

New trial.