Jones v. Tainter, 15 Minn. 512

Jones v. Tainter

15 Minn. 512 | Minn. | 1870

Lead Opinion

Berry, J.

By the Court Tainter furnished Jones a land warrant, which was used by the latter in paying the United States for certain land applied for and purchased by him under the pre-emption act of September 4, 1841. To secure the payment of one hundred and seventy dollars, being part of the price of the warrant, Jones, on the same day he entered the land, and after entering it, executed a mortgage upon the pre-empted premises in Tainter’s favor, it being expressed in the mortgage that it was given to secure the purchase money of the land. The mortgage was executed in pursuance of an agreement to execute the same, made before Jones proved up and entered the land, and for this reason the court below held the mortgage to be void in the hands of Tainter : but as it appeared that Tainter had assigned the mortgage to one Kelly, who foreclosed the same by advertisement, himself becoming purchaser at the foreclosure sale, and as it was found that Kelly was a Vona ■fide purchaser, the court held that he (Kelly) and Piper, his grantee, were protected by a provision of the pre-emption law in reference to grants and conveyances to bona fide purchasers, and that therefore, as to them (Kelly & Piper) the mortgage was valid.

The majority of the court are of opinion that the mortgage was valid in favor of Tainter, the original mortgagee, and therefore of course valid as to Kelly and Piper, who claim through Tainter. So far then as the judgment rendered in favor of Kelly and Piper in this case depends upon the validity of the mortgage as to them, we think it right, though upon grounds differing from those upon which it was placed by the court below. It is true, that in McCue vs. Smith, 9 Minn., 259, and in Woodbury vs. Dorman, ante 338, it was held that a mortgage made in pursuance of an agreement such as appears in this case was void in the *515hands of the original mortgagee, and as against persons claiming under the mortgagee not being bona, fide purchasers, and unquestionably the court below was justified by those cases in holding the mortgage here void in the hands of Tainter. In the ease of Woodbury vs. Dorman, (in which one member of the court dissented) an application was made immediately after the filing of the opinion for a re-argument by the appellant, who claimed that this court had fallen into error iu holding a mortgage, given under circumstances similar to those presented by this case, void; arid although a re-argument was denied for reasons peculiar to that case, the majority of the court in denying the same took occasion to express their dissent from the holding in that case, and to announce that they should feel at liberty in future to re-examine the question there determined. The majority of the court think that the question ought not to be passed over in the case at bar, regarding it as one which affects interests of too much importance and extent, to permit them to sanction by silence, or acquiescence, what they deem a mistaken view of the law. In McCue vs. Smith, which was followed in Woodbury vs. Dorman, it was held that such mortgage was void under the 13th section of the pre-emption act of September 4,1841. This section provides that before any person claiming the benefit of the act shall be allowed to enter lands, he “ shall make oath * * that he has not directly, or indirectly, made any agreement or.contract in any way or manner, with any person or persons whatsoever, by which the title he might acquire from the government of the United States, should inure in whole or in part to the benefit of any person except himself. ”

In the opinion of the majority of this court, a simple agreement, by a person proposing to apply for, and enter *516land under the act of September 4, 1841, to execute a mortgage to secure the payment of money furnished him. with which to pay for such land, is not such an agreement as is referred to in the provision just quoted from the pre-emption act. It is not an agreement by which the title to be acquired, that is to say, the fee should inure, in whole, or in part, to the benefit of any person other than the preemptor ; on the contrary, the presumption is that a mortgagor intends to pay the mortgage debt, and discharge his land from the incumbrance of the. mortgage, so that his title shall not inure to the benefit of the mortgagee. The result may be that the mortgagee through the mortgagor’s default will acquire the title, and the same result might have followed if the pre-emptor had given his note only for the warrant, or purchase money, or for any other indebtedness, and such note having been put into judgment the holder of it had acquired title to the land pre-empted through sale upon execution. But the result is not important. The question is, was there any contract or agreement by which the pre-emptor fixed this result. Did the pre-emptor contract or agree that the title to be acquired, that is to say, the fee, should inure to the benefit of another? In other words, did the pre-emptor contract, or agree to do anything, which, when done, would pass the title, in whole or in part, to another, so that the pre-emption would, as to such whole, or part, be a mere conduit of the title ? We are clear that no such contract or agreement is fairly to be inferred from a simple agreement, made before pre-emption, to secure the whole or a part of the purchase money by a mortgage upon the premises to be pre-empted. The mortgage contemplated, by such contract, or agreement, is but a security, (as this court has often held) and its execution doe's not have the effect of making the title acquired by the pre-emptor, *517to-wit, the fee, inure, in whole, or in part, to the benefit of another. If we are right, it follows, that the mortgage in the case at bar must be held valid, so far as the pre-emption law is concerned, in favor of Tainter the original pre-emptor, as well as in favor of Kelly and Piper. The warrant in this case was furnished, not by the United States, the grantor of Jones, but by Tainter, a third person, and the question is raised whether it is to be regarded as purchase money, so that a mortgage made to secure it will take precedence of a widow’s claim of dower, or homestead right in the premises mortgaged. As it is that with which the land is purchased, it is in fact the purchase money, and must be held to be such within the meaning of sec. 4, ch. 36, & sec. 93, ch. 61, Pub. St., (1858) which gave the precedence spoken of, to a mortgage so securing purchase money, at the time when the mortgage in this case was executed. Jackson vs. Austin, 15 Johns., 477; Clark vs. Munroe, 14 Mass., 351; 4 Kent Com., 39; Washburn R. Prop., 176, and cases cited in note.

The plaintiffs insist that the testimony offered to show that A. C. Smith was agent of the heirs of Jones, the mortgagor, and resided in the county where the premises in controversy were situated, was improperly rejected. The testimony was offered only for the purpose of attacking the foreclosure, upon the ground that Smith as such agent, was “a personal representative,” and notice of the sale should have been served upon him under Sec. 32, Ch. 63, Pub. St. This point was considered in Atkinson vs. Duffey, (July Term 1870) where we held that an agent was not a personal representative within the meaning of the statute. The testimony was therefore properly excluded as immaterial.

It is further urged in behalf of the plaintiffs, that as the estate of Jones the-mortgagor, deceased, was administered upon, and commissioners were appointed before the foreclo*518sure, and the debt secured by the mortgage was not presented to such commissioners for allowance, it was barred, and no longer constituted a charge on the estate real or personal. As to this point, upon which no authorities are cited, we agree with the learned judge below, but this state of things in no way affected the lien of the mortgage, or the right to foreclose, whatever effect it may have had upon the liability of the estate to pay the indebtedness evidenced by the note, in a personal action. These views dispose of the case. The opinion which we have expressed in refei’ence to the validity of the mortgage, renders it altogether unnecessary for ns to consider many of the points presented in the briefs of counsel.

Judgment affirmed.

Dissenting Opinion

McMillan, J.,

dissenting. — Upon the point of the validity of the mortgage in this case as between the mortgagor and mortgagee, under the act of Congress, I am unable to concur with the reasoning of the other members of the court, and dissent from the decision of the court upon that question. I think under the provisions of the act of Congress the mortgage was valid in the hands of a bona fide assignee for value and without notice, and upon these questions adhere to the cases of McCue vs. Smith, and Woodbury vs. Dorman, heretofore decided by this court. Upon the other questions involved in the case, and determined by the court, I concur with my brethren.