21 S.E. 955 | N.C. | 1895
Lead Opinion
A makes a promissory note to B for borrowed money payable on a day certain, and to secure it he and his wife give B a mortgage on land, duly registered, and the money is used in improving the mortgaged premises. After maturity of the debt and before any sale or foreclosure proceedings begun, the mortgagor tenders to the mortgagee the amount then due, principal, interest and costs then incurred, and the mortgagee refuses to accept the tender and surrender his note and mortgage. Does this tender discharge the lien on the mortgaged land ? The above statement discloses the only question presented in the record in the present action. It does not appear that the money tendered was deposited anywhere, nor that it was kept ready foi the plaintiff in case of demand, nor that it was tendered at the trial. The plaintiff,instituted this action for possession of the land and to recover a judgment on the note, and for a decree condemning and ordering said land to be sold to satisfy' his judgment. The defendant pleaded his tender among other things and relied on it as a discharge of the
We are not aware that the question now before us has ever been directly presented to this Court. In some of our sister States, either by statute or judicial ruling, the mortgage lien is held to be only a mere security or pledge, with the title remaining in the mortgagor, and that a tender kept intact discharges the lien, and in some that the debt is discharged, because the condition of the mortgage contract is performed and that the title of the mortgagor is complete without reconveyance or other equivalent act. This is the result of the harsh rule of the common law. But in those States, if the mortgagor should call on the Court of Chancery to remove the cloud on his title or to work out any other object, he is required to pay the debt on the principle that he must do equity if he asks for it.
In the State of New York, after several cases much considered, it was finally settled by a divided court in Kartright v. Cady, 21 N. Y., 343, that a tender, although not kept good, made after the law-day at any time before foreclosure, discharges the lien. In a few other States the same doctrine prevails, but they all rest on the holding that the mortgage is a mere security or pledge without any legal title in the mortgagee. The several decisions in siich States present various phases of the question. In New York, in
But it is claimed that the present action is not one for equitable relief. We think this is a misapprehension. It is true that it is an action for possession, for judgment for the amount of the debt “to be discharged upon the surrender of the said land, or the sale thereof under an order of the court, and for costs and any other necessary relief, ” and the defendant after pleading tender and refusal prays the Court “that said land be discharged from any liability for the payment of said note and that said mortgage be declared satisfied.” Here, both parties are asking the Court to do things which a court of law could not do. Before the Constitution of 1868, neither party could get any equitable relief except by a bill in equity, but .under that Constitution and The Code either party can assert and obtain his equitable relief in any action at law by the other party, thus expediting business and 'saving costs. And the moment either party by his pleadings sets out and asks equitable relief, the court of equity acquires jurisdiction, clears the deck, and adjusts all equities between the parties, and this view clearly embraces the present case.
In a much larger number of the States, we think the rule
The mortgagee may at any time take or recover possession of the mortgaged land, unless expressly forbidden by the terms of the deed or by necessary implication. 1 Jones on Mortgages, Sec. 58.
With this view of the m rtgagee’s e-tate and its incidents, what is the effect of the tender relied on in this case ? Does it discharge the lien ? The burden of showing tender and refusal is on the party pleading it. The defendant can derive no benefit from his plea of a tender, because it is not accompanied by a payment into court of the amount admitted to be due. State v. Briggs, 65 N. C., 159. We have also omitted to notice that a plea of tender is incomplete unless accompanied by a payment of the sum tendered into court. Terrell v. Walker, 65 N. C., 91. It was insisted that in the opinion of Pearson, C. J., in Capehart v. Biggs, 77 N. C., 261, the expression, “The plaintiff might invali
In Shields v. Lazear, 31 N. J. Law Reports, 196, it is held, “ but- an unaccepted tender of the mortgage money, made after the day prescribed in the mortgage, will not affect the lien of the mortgage on the land. It is neither performance of the condition nor payment or satisfaction of the debt. Its only effect will be to stop the running of interest and to subject the mortgagee to the costs of a redemption by bill in Equity. In Bilzell v. Hayward, 96 U. S. Rep., 580, it is stated that “ To have the effect of stopping interest or costs, a tender must be kept good; and it ceases to have the effect when the money is used by the debtor for other purposes. ” A plea of te. der, not accompanied \>¶ jwofert in euria, is bad. Saper v. Jones, 56 Md., 503. A tender, after default, does not discharge the lien of a mortgage, although sufficient in amount. When a tender is made after the day, it should be kept good. Crain v. McGoon, 18 Am. Law Register, 178 (Ill.); Merritt v. Lambert, 7 Paige, 344; Maynard v. Hunt, 5 Pick., 240; Matthews v. Lindsay, 20 Fla., 973. A tender, to prevent the running of interest, must be continuing. Using the money after refusal by the creditor to receive it, destroys this attribute of a legal tender. Gray v. Angier, 62 Ga., 596. In te der, where the money is brought into court and deposited and left with the plaintiff, he is entitled to cost only. Shiver v. Johnson, 62 Ala., 37. A tender of payment to be effectual must be kept good and be ready at any
Upon tile weight of current authorities and upon general reasoning and a due regard for fair dealing, we are of opinion that the defendant’s plea of tender was not available, except to stop interest and save him costs after the tender, which was accorded to him at the trial.
To decide otherwise might be to let the defendant keep his money, discharge the security and the plaintiff get nothing-from any quarter. This would be monstrous.
The law contemplates the payment of just debts. We see no error in the judgment below.
'Affirmed.
Dissenting Opinion
(dissenting): The defendant, whose land was advertised for sale under a mortgage, tendered the creditor’s attorney “all that was due and all costs.” The attorney refused to take this unless the mortgagor would in addition pay his fee. This not being done, he sold the land, the plaintiff bought and brings this action for ejectment.
The question presented is whether this tender discharged the lien — not the debt — for if it did not discharge the mortgage a purchaser at a sale thus made under it would acquire
If a tender by the mortgagor of the full amount due will not discharge the lien but the acceptance thereof by the mortgagee is necessary to have that effect, then the mortgagor by declining to receive the payment can (as in this case) add to the lien, by his own.wrongful act, the costs of the sale and the commission for selling, unless he is minded to waive an actual sale by receiving payment of the sum the commissions would amount to in addition to the sum justly due. As the parties can stipulate fcr the rate of commission for selling, this would simply repeal the usury law and give the mortgagee a safe and sure mode of collecting his illegal rate of interest.
It is true that in the present case the purchaser at the sale was the holder of the mortgage and recognizing that he could not recover in ejectment under a pirrchase at a sale made under these circumstances, he changed front on the trial and asked for a decree of foreclosure instead of a judgment for possession. But the principle involved is the same, and the single question presented is whether a tender of the full amount due on the mortgage with all cost is a discharge of the lien. The hardship which would result from holding that it would not, is such as must be apparent to a court of equity which looks to all possibilities of oppression. There are no direct precedents in this State, but the overwhelming weight of authority elsewhere is that
So much of the judgment as adjudges recovery against the debtor for the principal money, with interest and costs up to the time of the tender should be affirmed. Neither party excepted to this. But so much of the judgment as
Lead Opinion
(CLARK, J., dissents, arguendo, in which MONTGOMERY, J., concurs.) A makes a promissory note to B for borrowed money payable on a day certain, and to secure it he and his wife give B a mortgage on land, duly registered, and the money is used in improving the mortgaged premises. After maturity of the debt and before any sale or foreclosure proceedings begun, the mortgagor tenders to the mortgagee the amount then due principal, interest and costs then incurred, and the mortgagee refuses to accept the tender and surrender his note and mortgage. Does this tender discharge the lien on the mortgaged land? The above statement discloses the only question presented in the record in the present action. It does not appear that the money tendered was deposited anywhere, nor that it was kept ready for the plaintiff in case *3 of demand, nor that it was tendered at the trial. The plaintiff instituted this action for possession of the land and to recover a judgment on the note, and for a decree condemning and ordering said land to be sold to satisfy his judgment. The defendant pleaded his tender among other things and relied on it as a discharge of the mortgage lien. At the trial the plaintiff had judgment for the principal money and interest and cost, prior to the day of tender, and also in order to sell the (4) land to satisfy the judgment. The defendant Beasley excepted "because the court declined to hold that the tender discharged the lien of the mortgage on the land," and appealed. The effect of a legal tender, in case the security had been wholly personal, is not presented, and we express no opinion on that question, nor is the effect of a tender made before or at maturity, called the law-day, in case of a mortgage security, presented.
We are not aware that the question now before us has ever been directly presented to this Court. In some of our sister states, either by statute or judicial ruling, the mortgage lien is held to be only a mere security or pledge, with the title remaining in the mortgagor, and that a tender kept intact discharges the lien, and in some that the debt is discharged, because the condition of the mortgage contract is performed and that the title of the mortgagor is complete without reconveyance or other equivalent act. This is the result of the harsh rule of the common law. But in those states, if the mortgagor should call on the court of chancery to remove the cloud on his title or to work out any other object, he is required to pay the debt on the principle that he must do equity if he asks for it.
In New York, after several cases much considered, it was finally settled by a divided court in Kortright v. Cady,
But it is claimed that the present action is not one for equitable relief. We think this is a misapprehension. It is true that it is an action for possession, for judgment for the amount of the debt "to be discharged upon the surrender of the said land, or the sale thereof under an order of the court, and for costs and any other necessary relief," and the defendant after pleading tender and refusal prays the court "that said land be discharged from any liability for the payment of said note and that said mortgage be declared satisfied." Here, both parties are asking the court to do things which a court of law could not do. Before the Constitution of 1868, neither party could get any equitable relief except by a bill in equity, but under that Constitution and The Code either party can assert and obtain his equitable relief in any action at law by the other party, thus expediting business and saving costs. And the moment either party by his pleadings sets out and asks equitable relief, the court of Equity acquires jurisdiction, clears the deck, and adjusts all equities between the parties, and this view clearly embraces the present case.
In a much larger number of the states, we think the rule is different from that in New York. In North Carolina the mortgagee has (6) the legal estate and the mortgagor is the equitable owner. Until the day of redemption is past, he may pay the money according to the proviso in the contract and avoid the conveyance at law, and this is termed his legal right of redemption. After the day of redemption is past, he has still an equity of redemption which is a continuance of his old estate. Hemphill v. Ross,
The mortgagee may at any time take or recover possession of the mortgaged land, unless expressly forbidden by the terms of the deed or by necessary implication. 1 Jones on Mortgages, sec. 58.
With this view of the mortgagee's estate and its incidents, what is the effect of the tender relied on in this case? Does it discharge the lien? The burden of showing tender and refusal is on the party pleading it. The defendant can derive no benefit from his plea of a tender, because *5
it is not accompanied by a payment into court of the amount admitted to be due. S. v. Briggs,
In Shields v. Lazear,
Upon the weight of current authorities and upon general reasoning and a due regard for fair dealing, we are of opinion that the defendant's plea of tender was not available, except to stop interest and save him costs after the tender, which was accorded to him at the trial. To decide otherwise might be to let the defendant keep his money, discharge the security and the plaintiff get nothing from any quarter. This would be monstrous.
The law contemplates the payment of just debts. We see no error in the judgment below.
Affirmed.