83 Mich. 231 | Mich. | 1890
The bill was filed in this cause to foreclose a mortgage upon real estate given by Mary L. Moore to the complainant.
The history of the transaction out of which this proceeding grows is, as set forth in the bill, that on May 9, 1874, complainant sold and conveyed 10 acres of land to defendant Mary L. Moore for the sum of $3,000, and.she and her husband, Orrin E. Moore, gave complainant their notes for that amount. One note was for the sum of $500, due in one year, and there were two other ..notes, for the sum of $1,250 each, due in tavo and three years
• Soon after the execution of this mortgage and the notes, Abram Smith, the other defendant herein, sold to complainant his farm, and took towards the purchase price thereof the two notes first to fall due given by .Mrs. Moore, that is, the $500 and one of the $1,250 notes, Jennings retaining the other note. At the time of this purchase, Jennings made an assignment' in writing to Smith of that part of the Moore mortgage represented by the two notes so transferred to him. This assignment specifically sets forth the interest in the mortgage which Jennings transferred to Smith, as that part of said mortgage represented by said first two notes. None of the notes were ever paid.
In December, 1875, Smith began foreclosure proceedings by advertisement, and on March 22, 1876, the premises consisting of said 10 acres were sold to Smith at sheriff’s sale for the hmount of the $500 note, interest, and costs. When the year for redemption expired, Smith took possession under the sheriff’s deed, and has ever since been in possession of the premises, claiming title through the sheriff’s deed. Jennings has never made any claim to the premises, or attempted to assert any rights under his note and remaining interest in said mortgage, until the commencement of this suit.
Defendant Smith in his answer substantially admits the facts set up in the bill, but avers that at the time he took the notes from Jennings, and received the assignment of such part of the mortgage, it-was expressly agreed and understood that he was to have a lien under his two
Testimony was taken in the cause, and Smith testified substantially to the facts set up in his answer. Complainant testified and claimed on the hearing that the purpose of the assignment was to sell to Smith only so much of the mortgage as secured the payment of the two notes sold to him, and that he (Jennings) still holds and owns an interest in the mortgage in the same proportion that his note bears to the whole debt; that is, that he holds and owns 5-12, and Smith 7-12, of the mortgage, and that his rights were in no manner affected by the foreclosure made by Smith. Mrs. Moore did not appear, and the bill .was taken as confessed as to her.
On the hearing, the court below decreed that the foreclosure proceedings had by Smith by advertisement be set aside, and the premises be sold, the moneys arising from the sale to be divided between Jennings and Smith in proportion to their respective interests, that is, to Jennings five-twelfths and to Smith seven-twelfths. From this decree defendant Smith appeals.
The assignment does not state that Smith’s two notes were to be held as prior liens over the note retained by Jennings. It does not purport to assign the whole interest which Jennings had in the mortgage, but only that part represented by the two notes given over to Smith. Whatever the understanding was as to which should have priority of lien c cannot be shown except by the assignment itself. That was the agreement between the parties, and it cannot be changed or varied by parol evidence. *Taking the assignment, then, as the agreement, it appears that Jennings was to and did retain five-twelfths of the mortgage, and only transferred to Smith seven-twelfths. This was an installment mortgage, and under the statute each installment must be taken and
The foreclosure made by Smith in no manner, however, affected the rights of Jennings- in the security. Neither had any preference over the other before such foreclosure, and no such preference was acquired by the proceedings to foreclose. It undoubtedly took away the rights of Mrs. Moore to the possession if the foreclosure proceedings were valid, but it in no manner adjusted the rights between Jennings and Smith. By the proceedings, Smith did not become the owner of the whole land, or any definite undivided interest therein, freed from the lien of Jennings’ part of the mortgage. Though it operated as a foreclosure of the rights of Mrs. Moore, or any person claiming through or under her, yet Jennings’ rights and interests were not changed under his mortgage lien, as his rights were in no way subordinate to those of Smith. But Smith having purchased Mrs. Moore’s equity of redemption, he has the right to redeem from the lien under the Jennings portion of the mortgage. Failing in this within six months from this date, the premises will be advertised and sold as in ordinary foreclosure proceedings, and the moneys arising from the sale be- brought into court and be distributed, under order of the court, between Smith and Jennings in proportion as the notes held by each bear to the whole amount secured by the mortgage.
The decree of the court below setting aside the mortgage foreclosure made by Smith will be reversed, and
