5 A.2d 1 | Conn. | 1939
Lead Opinion
This action was brought to foreclose a mortgage given March 31, 1927, by Albert Wax of Hartford to secure two notes of $3584.26 each, one payable to Isidor Glotzer, described in the mortgage as of the city of New York, and the other to Isadore Glotzer of Hartford. Each note was payable $125 every six months for three and one-half years with specified increased semi-annual payments thereafter, and with provision for acceleration upon default. The mortgage stated that the premises were subject to a prior mortgage for $14,500 to The Hartford-Connecticut Trust Company. The complaint alleged that the Trust Company now has two mortgages for $6000 and $4000 respectively, both subsequent to the plaintiffs' mortgage, and made it a party defendant. The named defendant is the present owner of the premises. Both defendants filed answers and cross-complaints alleging facts which, so far as are now material, are included *229 in the finding, and making claims for relief which include that accorded by the judgment rendered. The finding, with minor corrections within the assignments of error, includes the following facts.
In September, 1925, the property described in the complaint was owned by The Hartford Construction Corporation which gave The Hartford-Connecticut Trust Company a mortgage thereon for $14,500, which was duly recorded and still remains unreleased of record. In March, 1927, title to the property was transferred to Wax, who on March 31, 1927, executed a second mortgage which is the one now sought to be foreclosed. No Isidor Glotzer was present at the time of execution of this mortgage or at any subsequent transactions connected with the property or at the trial. Wax paid three semi-annual instalments of principal and interest to Isadore Glotzer, who signed receipts for the full amounts in his own name. In December, 1928, the plaintiffs started foreclosure proceedings against Wax but the action was not pursued. On September 18, 1929, Helene Schumann brought suit against Wax and attached the property. On October 29, 1929, the plaintiffs withdrew their first foreclosure action and on October 30th started another foreclosure suit, naming Wax and Helene Schumann defendants. On January 17, 1930, Helene Schumann obtained a judgment against Wax and on January 31st filed a judgment lien in the Hartford land records. On October 14, 1930, Isadore Glotzer called on Wax and negotiated for a transfer of the property. He brought with him a quitclaim deed in which he was named as grantee with Wax as grantor, and paid Wax $50 to execute it. Wax did so with the understanding that he was conveying all his interest in the property to the holder of the second mortgage and that the mortgage was thereby discharged. Wax had never met or *230 seen Isidor Glotzer, did not know that he had or claimed to have an interest in the second mortgage and Isadore neither said nor did anything to so indicate. In taking title Isadore intended to and did act in behalf and for the benefit of both plaintiffs. No demand for payment has been made on Wax since the conveyance from him, and Isadore has since done nothing about learning the identity of the owner of the property, the amount of the incumbrances or any other fact important to a mortgagee.
On October 28, 1930, Helene Schumann started an action for foreclosure of her judgment lien, naming Isadore Glotzer defendant as owner of the property, and obtained judgment and recorded a certificate of foreclosure on December 30, 1930. On January 7, 1931, she quitclaimed the property to the defendant Trust Company and the deed was duly recorded. The Trust Company was represented by a competent lawyer who apparently was misled by the similarity of names of the Glotzers and advised that the title was free and clear of incumbrances; it would not have accepted the conveyance if it had known that the plaintiffs claimed an interest under their mortgage. Isadore Glotzer, who had borrowed money from the defendant Trust Company, gave it a financial statement on March 4, 1930, in which he listed as an asset his interest in the mortgage he now seeks to foreclose, but on May 29, 1931, he gave that bank another financial statement in which he did not so list it as an asset. The bank owned the property between January 7, 1931, and June 20, 1931, but neither plaintiff made any demand on it for payment. On June 20, 1931, the Trust Company sold the premises, free of all incumbrances, to the defendant Keyes for $12,000, $2000 of which was paid in cash and the balance was evidenced by two purchase money mortgages, one for *231 $6000 and the other for $4000, the latter being reduced to $1500 at the time of the trial. At the time of his purchase of the premises, Keyes was represented by a competent lawyer who searched the title and Keyes was advised, and believed, that the premises were free and clear of all incumbrances. He would not have purchased or made any of the payments had he known that the plaintiffs claimed an interest under their original second mortgage or the bank a $14,500 first mortgage. Neither of the plaintiffs has ever made demand on him for payment. On September 29, 1937, Keyes entered into an agreement for the sale of the premises. Thereafter the fact that the plaintiffs' mortgage was unreleased of record was discovered and called to the attention of Isadore Glotzer, and this action was brought October 21, 1937. The trial court concluded that the mortgage from The Hartford Construction Corporation to the Trust Company was merged in the title by the conveyance to the latter from Helene Schumann, that the plaintiffs' mortgage was merged by the conveyance from Wax to Isadore Glotzer, that they have abandoned their security and that they are estopped from now asserting any rights under their mortgage, and rendered judgment that both mortgages be discharged of record as invalid liens and incumbrances. The assignments of error pertaining to the conclusion that the plaintiffs abandoned their security and the supporting facts found are decisive of the issues on this appeal.
An action of foreclosure is peculiarly equitable and the court may entertain all questions which are necessary to be determined in order that complete justice may be done between the parties. Beach v. Isacs,
To constitute an abandonment there must be an intention to abandon or relinquish accompanied by some act or omission to act by which such intention is manifested. Stevens v. Norfolk,
It is conceded that, so far as concerns the purported interest of Isidor Glotzer, in all of the transactions pertaining to the plaintiffs' mortgage Isadore acted as agent for him, and the finding that in taking title to the property he intended to and did act in behalf and for the benefit of both, was warranted. Although the deed from Wax was to Isadore alone, the circumstances would be sufficient to raise a constructive trust in favor of Isidor as to his interest therein. Kievman v. Grevers,
The general rule is that where a mortgagee acquires the fee or equity of redemption in the mortgaged premises, and there is no intermediate estate so that the whole title becomes vested in him, merger of the mortgage interest into the fee occurs in the absence of evidence of a contrary intention or prejudice resulting *236
to the mortgagee-grantee. Simpson v. Hall,
There is no error.
In this opinion MALTBIE, C.J., AVERY and BROWN, Js., concurred.
Dissenting Opinion
The trial court found for the defendants on the ground of merger, estoppel and abandonment. There was no merger because when Isadore Glotzer purchased the equity of redemption from Wax, the judgment lien of Schumann intervened between the Glotzer mortgage and Wax's equity. To have a merger the greater and lesser estate must coincide in the same person and the same right without any intermediate estate. 2 Jones, Mortgages (8th Ed.) 1080. "A merger is not caused by the holder of part of a mortgage buying the equity of redemption." 19 R. C. L., p. 486. Carpenter v. Gleason,
Abandonment is defined in the majority opinion. The determinative element is the intent. Kievman v. Grevers,
Peck v. Lee, cited in the majority opinion, appears to stand alone, not only in Connecticut but in this country. That aside, it differs from the present case in that the mortgagee destroyed the mortgage and note with the intention of abandoning his lien. Idem, p. 377. The facts here much more nearly resemble those in Ensign v. Batterson,
Assuming that a mortgage can be abandoned, there was, in my opinion, no evidence whatever of an intent to abandon by the New York Glotzer and insufficient evidence on the part of the Hartford Glotzer. I think the judgment should be reversed. *238