215 P. 646 | Mont. | 1923
delivered the opinion of the court.
This is an action to foreclose a real estate mortgage. The complaint is in usual form, save that a reformation of the description of the lands is sought. The execution of the note and mortgage is admitted by the defendants John and Lillian Daut, but they deny that there is anything due thereon. It appears that at the time of the execution of the note and mortgage, November 13, 1909, the lands mortgaged comprised desert land entries made by the Dauts under Act of Congress. (Act of March 3, 1877, 19 Stat. 377, amended Act of March 3, 1891; 8 Fed. Stats. Ann., p. 692 (U. S. Comp. Stats., secs. 4674 et seq.) The consideration was $12,200 cash paid by the plaintiff to the First National Bank of Miles City on account of the Dauts, for their use and benefit. At the time these entries were respectively made, December 5, 1902, and January 17, 1903, the land comprised a portion of the unsurveyed public domain, and there is no question but that the land covered by the mortgage comprised all of both entries. The subsequent extension of the public survey changed the description as made in the original entries in some particulars; however, we need not stop to explain, as it is of no importance to this decision. Suffice it to say: After various delays and extensions, final proofs were made and patent issued to Lillian Daut for the lands embraced in her entry
In our opinion there is involved but a single question decisive of this appeal, viz.: Is a mortgage upon desert land
Section 8255, Revised Codes of 1921, provides: “Title acquired by the mortgagor subsequent to the execution of the mortgage inures to the mortgagee as security for the debt, in like manner as if acquired before the execution.” The language of the statute is plain and controlling, unless it may be
There is no express prohibition in the Act, supra, either against alienation or mortgaging of the lands covered by desert entry (United States v. Hammers, 221 U. S. 220, 55 L. Ed. 710, 31 Sup. Ct. Rep. 593 [see, also, Eose’s U. S. Notes]), and upon satisfactory proof of reclamation and acreage payment as provided, the entryman is entitled to a patent. Ownership was potentially in existence, for the entryman had actually contracted with the government for the purchase of the particular tract of land. The entryman has an inchoate right to the land, which is propei’ty, and can be defeated only by his failure to perform the conditions imposed.
“Any interest in real property which is capable of being transferred may be mortgaged.” (Sec. 8262, Rev. Codes
The Pre-emption Act (September 4, 1841; secs. 2257-2288, Rev. Stats. U. S.) differed in its provisions from the Desert Act as respects the right of alienation, in that it was therein expressly provided that “All assignments and transfers of the right hereby secured, prior to the issuing of the patent, shall be null and void.” (See. 2263.)
Many decisions of the courts are recorded as to the validity of a mortgage on pre-emption claims, which are correctly summarized in Ruling Case Law, in language better than we can employ, as follows: “The authorities under the pre-emption laws as to the right of a pre-emptor to mortgage his claim have not been uniform. Earlier decisions are to the effect that an outstanding mortgage given by a pre-emptor on the lands embraced in his filing defeated his right of entry, on the ground that such mortgage was a contract or agreement by which title to the lands ‘might’ inure to some other person than himself, contrary to the provisions of the statutes prohibiting alienations of such right. But by later decisions it is held that the mere possibility of a title resulting for the benefit of another person, as in the case of' a mortgage, is not sufficient to prevent the pre-emptor from obtaining patent. And so it is now the general rule that a pre-emptor of public land may, before making final proof, and obtaining a receiver’s certificate or a patent, mortgage the land, or, acting in good
In Hafemann v. Gross, supra, the supreme court of the United States, through Mr. Justice Brewer, said: “There has been some division in the courts upon the question. In Brewster v. Madden, 15 Kan. 249, the supreme court of that state, in an opinion delivered by the writer of this, held that a mortgage given by a pre-emptor prior to the entry of the lands, was void, reaching this conclusion largely on the proposition that at the time the pre-emption Act was passed (1841), mortgages always in form conveyances were then regarded by the profession generally as conditional alienations. To like effect were the early rulings of the supreme court of Minnesota (McCue v. Smith, 9 Minn. 252 [86 Am. Dec. 100]; Woodbury v. Dorman, 15 Minn. 338), though these rulings were subsequently distinctly overruled by the. same court. (Jones v. Tainter, 15 Minn. 512; Lang v. Morey, 40 Minn. 396 [12 Am. St. Rep. 748, 42 N. W. 88].) Bass v. Buker, 6 Mont. 442 [12 Pac. 922], deciding the same way, was also overruled in Norris v. Heald, supra. The large majority of state decisions follow these later rulings. (See, in case of pre-emptions, Wilcox v. John, 21 Colo. 367 [52 Am. St. Rep. 246, 40 Pac. 880]; Christy v. Dana, 34 Cal. 548 [73 Am. Dec. 470]; Christy v. Dana, 42 Cal. 174; Camp v. Grider, 62 Cal. 20; and in reference to homesteads, Fuller v. Hunt, 48 Iowa, 163; Dickerson v. Bridges, 147 Mo. 235 [48 S. W. 825]; Weber v. Laidler, 26 Wash. 144 [90 Am. St. Rep. 726, 66 Pac. 400]; Spiess v. Neuberg, 71 Wis. 279 [5 Am. St. Rep. 211, 37 N. W. 417]; Kirkaldie v. Larrabee, 31 Cal. 456 [89 Am. Dec. 205];
In Weber v. Laidler, supra, after citing many of the cases holding to this doctrine, it is said: “The above cases proceed upon the theory that the exemption provided by the statute is meant to be a protection to the settler against a sale of the land involuntarily under execution, but that it does not prevent him from borrowing money, and voluntarily creating a lien by way of mortgage to secure the same.”
In Whitney v. Buckman, 13 Cal. 536, which involved ai mortgage upon a pre-emption entry, the court said: “The mortgage does not pretend to transfer to the mortgagee the right to a pre-emption; this is not assignable, but the possession of public land, whether taken for the purpose of getting a pre-emption right, or any other purpose, may be mortgaged, or the land itself; and if the mortgagee gets no title through the mortgage, this is not an objection to be raised by the man who makes it.” See, also, Stewart v. Powers, 98 Cal. 514, 33 Pac. 486.
In Orr v. Stewart, supra, the court said: “It is also well settled that when a mortgage of land is made, purporting to convey the land in fee, any title afterwards acquired by the mortgagor will feed the mortgage and inure to the benefit of the mortgagee [citing cases] ; and this is so though the title when the mortgage was made was in the government and was afterwards acquired by patent from the government.”
From a review of the authorities, we are of the opinion that an ordinary mortgage executed by a desert land entryman in good faith and for value prior to the time of making final proofs, or patent issued, is enforceable after title has become vested in the mortgagor.
To insure good faith and fair dealing, the mortgagor is precluded from denying a lien which he has attempted to create or defeating its enforcement against the property upon which he has placed it. The defendants cannot deny the validity of their mortgage, -both by reason of estoppel from the covenants
Equity considers as done that which the mortgagor has distinctly agreed to do, and is in consequence bound to do. Equity treats the mortgage as already attaching to such property in fulfillment of the contract. (Sec. 153, Jones on Mortgages, 7th ed.)
In this ease it clearly appears that the entrymen were in undisputed possession and right of possession of the land embraced in their respective entries at the time of the execution of the mortgage, and title was to become vested in them upon compliance with the terms imposed by the government. Therefore it appears plain that the defendants were possessed of such a property interest in esse as was subject to mortgage (Isbell v. Slette, 52 Mont. 156, 155 Pac. 503; Hackney v. Birely, ante, p. 155. 215 Pac. 642), and that after-acquired title vested in the entrymen, inured to the benefit of the mortgagee.
Since the lien of the mortgage is valid and enforceable,
The real estate security is not released from liability for the debt by a discharge of the debtor in bankruptcy, although he is thereby relieved from further personal liability. (Sec. 1 (12), Bankruptcy Act (U. S. Comp. Stats., sec. 9585);
The judgment is affirmed.
Affirmed.
