152 P. 883 | Or. | 1915
Lead Opinion
delivered the opinion of the court.
“Seaweard Bros., Ontario, Ore.
“ Gentlemen: Tour notes are all due and some of them bear date of 1911. Please, call at your earliest convenience and make up new notes. We also want to talk over the deal for the Dean land. We now hold a deed for the land and same will be effective June 2nd., if Dean notes are not paid. [Signed by the president of the bank.] ”
One of the Seaweards testifies about the option given to the 'Deans and the successive option given to
“A person who learns of unusual circumstances connected with a transaction in which he is about to be interested, or of such facts as would put a person of ordinary prudence upon inquiry, * * is bound thereby to a knowledge of what could have been discovered by investigation.”
“When cause exists for rescission, the law requires the party seeking to take advantage of it to act without delay, so that the other party to the contract may be placed as nearly in statu quo as possible; and a nonobservance of the rule will generally constitute a waiver of the right to rescind” — citing Foley v. Crow, 37 Md. 51.
“The counterclaim of the defendant shall be one upon which a suit might be maintained by the defendant against the plaintiff in the suit; and in addition to the cases cited, specified in the subdivisions of Sec*580 tion 74, it is sufficient if it be connected with the subject of the suit.”
We cannot conceive that an original suit in equity would lie for the tort of conversion, especially without an allegation that the plaintiff here is insolvent and unable to respond in damages for the wrong alleged.
“The test of the distinction is this: If the relation of debtor and creditor remains, and a debt still subsists, it is a mortgage; but if the debt be extinguished by the agreement of the parties, * * and the grantor has the privilege of refunding, if he pleases, by a given time, and thereby entitle himself to a reconveyance, it is a conditional sale.”
In view of the fact that the Deans did not assert any right to redeem and have in possession their notes, and the mortgage securing the same has been satisfied, the transaction must be held to be a conditional sale as affects them. Under all the circumstances, the substance of the situation is that the form of the security for the Seaweard indebtedness was changed from that of the Dean notes and mortgage to the deed for the land. On the face of the record the plaintiff holds the property; nevertheless not actually as its owner, but subject to redemption on payment of the debt.
If the bank had sued upon the Dean notes and foreclosed the mortgage securing the same, it could have recovered attorney’s fees provided for in those securities; but it has surrendered the only instruments authorizing an attorney fee in a suit to realize upon the collateral. It cannot recover such a charge upon the Seaweard notes, because this suit is not directly upon them. It was necessary to allege the amount and
“A lien upon real or personal property, other than that of a judgment or decree, whether created by mortgage or otherwise, shall be foreclosed, and the property adjudged to be sold to satisfy the debt-secured thereby by a suit. In such suit, in addition to the decree of foreclosure and sale, if it appear that a promissory note or other personal obligation for the payment of the debt has been given by the mortgagor or other lien debtor, or by any other person as princi*583 •pal or otherwise, the court shall also decree a recovery of the amount of such debt against such person or persons, as the case may be, as in the case of an ordinary decree for the recovery of money.”
The debt mentioned there means nothing but the obligation for which the mortgage is directly given. It •does not refer to an obligation for which a mortgage and its principal debt are merely collateral. In other words, the complaint in this suit does not state facts sufficient to authorize the direct recovery of the Seaweard debt to the bank, for there has always existed a plain, speedy and adequate remedy at law for such relief. The complaint is potent only for the purpose of applying the proceeds of the Dean collateral to the payment of the Seaweard notes, and there can be no personal decree against the Seaweards in this suit. We conclude, therefore, that plaintiff cannot recover its alleged compensation for attorneys.
“A tender must not be coupled with any other conditions than those which it is the clear legal duty of the mortgagee to fulfill on receiving payment or satisfaction”: 27 Cyc. 1407.
All this leads to a modification of the decree of the Circuit Court in the following manner: The plaintiff is entitled to a decree of this court to the effect that if, within 90 days after the filing of our mandate in the Circuit Court, the Seaweards shall pay into that court for the plaintiff the balance of principal and interest at 10 per cent per annum of their notes to the date of payment, less the amount of the tender and the balance of $334.24 derived from the farming operations, both to be credited as of June 28, 1915, the date of the decree in the court below, the plaintiff bank and its president, who holds the legal title to the premises, shall convey the same to the Seaweards by good and sufficient deed, duly executed and acknowledged, so as to entitle the same to record, and shall thereupon, and not otherwise, be entitled to the money so paid into court. Further, that if the plaintiff shall fail to execute and deliver the deed to the Seaweards, or to the clerk of the Circuit Court for them, as thus required, the decree shall stand and operate as such deed. If the Seaweards fail so to redeem the land, the same shall be sold in the manner provided by law and the proceeds applied to the payment of the balance so com-
Modified. Rehearing Denied.
Concurrence Opinion
delivered the following opinion, concurring in part.
I concur in the main part of the able opinion of Mr. Justice Burnett. However, the plaintiff bank was compelled to institute this suit against the defendants Seaweard to collect the notes given directly by the latter to plaintiff, and I think the bank is entitled to a reasonable attorney’s fee in this suit, according to the provisions of the several notes.