Gladding v. Warner

36 Vt. 54 | Vt. | 1863

Peck, J.

This is a bill brought .by the orator as assignee of a mortgage, against the defendant Warner as assignee of a prior mortgage. The orator asks that an account be taken of the rents and profits while the defendant Warner has been in possession, and after applying the same on that prior mortgage, that the orator be allowed to redeem. The bill also seeks to foreclose as against those holding the equity of redemption under the mortgagor . No question arises under this latter aspect of the bill. The defendant Warner resisted the right of the orator to redeem, claiming that his, Warner’s, title was -absolute. The case was before this court at a former term, when the coiu’t decided that the orator had a right to redeem Warner’s mortgage, and sent the case back to the court of chancery with a mandate directing that court, among other things, to have the amount due in equity to the defendant Warner on his mortgage ascertained, deducting therefrom the annual rents and profits of the premises since the decree on that mortgage expired, (that mortgage having been foreclosed against the mortgagor without making the subsequent mortgagee a party.) The case now comes here on appeal, after an accounting in the court of chancery under that mandate.

In ascertaining the amount due on Warner’s mortgage, the master takes the amount due on that mortgage, principal and interest, at the expiration of the decree of foreclosure against the mortgagor, and computes interest on that sum from that date,, September 24th, 1855, to September 24th, 1862, and finds the rents and profits to be $80. per year for the same period of time, but computes no interest on the rents and profits, and makes no application of the rents and profits until September 24th, 1862. Exceptions were filed by the orator to the report, which were overruled, the report accepted, and decree accordingly.

The only exception now relied on by the orator’s counsel is, to the effect that the master should have applied the rents and profits annually, first to cancel the interest accruing for the year, and the balance in reduction of the principal of the mortgage debt,. The rule adopted by the master is clearly wrong, and that corn tended for by the orator’s counsel is clearly right. Had the accruing interest upon the mortgage debt been equal to the rents and profits from year to year, the mode adopted by the master would have done no injustice, as in that case the yearly interest not drawing interest, would have been sufficient to have-exhausted' the rents annually if the application had been made at the end of each year. But such was not the fact. The annual rents exceeded the annual interest, and the excess should have been applied each year upon the principal of the mortgage debt. This is not only the common rule in such cases, but it is the fair construction of the mandate to the court of chancery. The direction to deduct the annual rents and profits, is equivalent to a direction to deduct the rents and profits annually. If that is not the necessary import of it, it can not be construed as directing a different mode of compulation.

It is objected by the defendant’s counsel that the master erred on his own ground, since he finds the value of the rents and profits to be $80. per year, and allows $60. for rents and profits from April 24th, 1862, to September 24th, 1862. If the court can not take judicial notice that the use of farming lands are more valuable in summer, including seed time and harvest, than in winter, we can not say that'tho master erred in coming to so sensible a conclusion.

This court is asked to make a decision as to costs. The decree from which this appeal is taken makes no mention of costs on either side. In this respect the decree is-as the orator claims it should be, as in chancery costs do not as matter of course follow in favor of the successful party, except costs in this court, but to entitle either party to costs, costs must be awarded by the decree. But the former mandate referred the question of costs to the court of chancery to be disposed of -according to the principles and practice of courts of chancery. It appears from the letter of the chancellor communicating his decision, that he did not act on the question of costs, but left that, question to be decided after the questions arising upon the master’s report should be decided by this court. This' question must be disposed of by the court of chancery under the former mandate.

The decree, of the court of chancery is reversed with costs in this court to the orator, against the defendant Warner, with directions to the court of .chancery to apply the rents and profits annually, first in payment of the interest, and the balance in reduction of the principal, and in other respects to be' proceeded with in accordance with the former mandate.