129 Ill. 72 | Ill. | 1889
delivered the opinion of the Court:
We have given careful consideration to the questions discussed upon this record, and we find no reason to disagree with the conclusions reached by the Appellate Court. We hold:
First—This transaction was a mortgage, and not an absolute sale and re-sale. It differs from the cases cited and relied upon by counsel for plaintiffs in error in these material respects : The original indebtedness is not extinguished, but it is put in the form of a promissory note, payable two years after date, with interest at the rate of ten per cent per annum. This note Jackson may sue upon and collect at anytime after maturity, notwithstanding anything that appears in the contract between them. Jackson is required to account for rents and profits, and, after payment for repairs and taxes, to apply the amount due on account thereof in liquidation of the note. He has no discretion in this respect, and should the amount ultimately equal or exceed the amount due upon the note, he would be compelled at once to reconvey to Lynch, thus occupying the relation to Lynch of a mortgagee in possession.
Second—The plaintiff in error D. B. J ackson is not a purchaser for value. He is the mere recipient of a voluntary gift, —a devisee for no other consideration than that of natural love and affection,—and as respects this property, therefore, he occupies precisely the same position as would the devisor, were he, instead of the devisee, the party to this suit.
Third—The doctrine of laches has no application to a case like the present. As between these parties, this is a mortgage, in nowise different from any other mortgage; and the same rule of limitation is alike applicable, in such case, in equity as at law. (2 Story’s Eq. sec. 1520.) The plaintiff in error D. B. Jackson, as mortgagee in possession, exercises a trust, and the defendant in error was authorized to rely upon his performance of the trust until he did some act unequivocally disavowing it. And the defendant in error, therefore, can not be guilty of laches, under the facts here in evidence, by merely delaying the bringing of suit, for acquiescence in a course of conduct inconsistent with the duties of a trustee, as is well said in Perry on Trusts, (2d ed.) sec. 850, can not “be inferred until the cestui que trust has actual knowledge of the breach, for the reason that it is the duty of the trustee to execute the trust, and it is not the duty of the cestui que trust to make any inquiry.” See, also, 1 Pomeroy’s Eq., concluding part of sec. 418, and authorities cited in note 1, on page 460.
Fourth—We do not think the cross-error well assigned. We understand the direction to be, in substance, that an account be taken of the amount due J ackson on his loan, and of the rents and profits which have been received since the mortgagee has been in possession, after deducting taxes and necessary repairs. There is nothing in the direction which recognizes that the account shall not include rents received by Samuel L. Jackson, or that will limit it to rents actually received, if it shall be shown that by reasonable diligence more could have been realized, as held in Mosier v. Norton, 83 Ill. 524, as counsel seem to suppose.
The judgment is' affirmed.
Judgment affirmed.
Subsequently, on the 7th day of October, 1889, upon an application for rehearing, the following additional opinion was filed:
A petition has been presented to us, praying for a rehearing upon this point, contended for by plaintiffs in error in their original argument, and of which no notice is taken in the foregoing opinion, namely: Conceding that the relations between Jackson and Lynch were those of mortgagor and mortgagee, yet inasmuch as they expressly agreed, in the instrument witnessing the continuance of that relation, that in the case of the failure of Lynch to make payments at the time therein stipulated, Jackson was authorized to declare the right of Lynch to redeem forfeited, and Jackson did declare such forfeiture by devising the property to plaintiff in error D. B. Jackson, a court of equity can not relieve Lynch from the consequences of such declaration of forfeiture. Authorities were cited in the argument, and are repeated in the petition, to the effect that where the parties to a contract for the conveyance of real estate make time of the essence of the contract, a failure to perform at the time will absolutely preclude the party so failing, from having a performance of the contract,— that in such case such parties’ rights are forfeited and incapable of being enforced, in equity as well as at law.
The point was not noticed in the opinion, because it was not supposed it was intended to be contended that this doctrine is applicable to the case, save upon the hypothesis that it was found that the transaction was an absolute conveyance and a contract of re-sale. That, if such had been found to be the fact, the doctrine contended for would have been applicable, there can be no question. But it was found that the transaction was not an absolute conveyance and a contract of re-sale, but a mortgage of the property; and the fact of mortgage being established, it was assumed that it is elementary that the mortgagor can not be deprived of his equity of redemption by any form of contract, however comprehensive and unmistakable its terms showing that such was intended to be its effect. A court of chancery, when it ascertains t^at the object of a transaction is to give security for a debt, “will always relieve the mortgagor from the consequences of his failure to perform the condition.” 2 Jones on Mortgages, (2d ed.) sec. 1039; Bispham’s Bq. secs. 153, 154; 3 Pomeroy’s Bq. secs. 1193, 1219.
It is said in Jones on Mortgages, ubi supra: “The right of redemption is the creature of the law. It is not in terms expressed by the parties in the mortgage. But whatever be the form of the transaction, if intended as a security for money it is a mortgage, and the right of redemption attaches to it. Although a deed contain a condition that it shall be absolute and without redemption if a certain sum be not paid by the grantor at a fixed time, and the condition is not punctually performed, there is a right of redemption.”
It is said in note 1 to section 1193 of 3 Pomeroy’s Bq.: “This doctrine is based upon the relative situation of the debtor and the creditor. It recognizes the fact that the creditor necessarily has a power over his debtor which may be exercised inequitably,—that the debtor is liable to yield to the exertion of such power; and it protects the debtor absolutely from the consequences of his inferiority, and of his own acts done through infirmity of will. The doctrine is universal in its application, and underlies many special rules of equity. It extends to stipulations limiting the time of redemption, or the parties who may redeem. Notwithstanding all such stipulations, the time to redeem is general.” See the numerous cases there cited.
The prayer of the petition must be denied.
Rehearing denied.