3 N.E.2d 412 | Ohio | 1936
Many of the questions decided in the case of City of Toledo
v. Brown,
Under the facts found by the trial court, the property rights of the Gronefelds were seriously lessened in value, and the mortgage security was seriously impaired. The mortgage record was notice to everyone, and at the time when the mortgagee filed its intervening petition in the Common Pleas Court, its mortgage was in default for the payment of both interest and principal. The fund was in the hands of the court; and had the Gronefelds asked for its payment to them, the trial court, in its broad equity powers, and especially in view of its finding that the mortgagee's interest had been seriously impaired, should have applied its payment not to the mortgagors, but to the mortgagee in partial satisfaction of its security. The lien of the mortgagee's security will be treated as having been transferred to the fund in the hands of the court.
While the following decided cases are somewhat different in their aspect from this, the equitable principle herein announced has been adhered to in the following cases:Sherwood, Admr., v. City of Lafayette,
What has been said applies especially to the rights of the mortgagors and the mortgagees. Had Spiegel been an innocent purchaser for value, it might be possible, as intimated by his counsel, for this court to order foreclosure proceedings in the hope that the mortgage might be satisfied by sale of the premises and that Spiegel might eventually obtain the money from the fund held by the court. But the trial court found that Spiegel was not an innocent purchaser; but, with "full notice of the pending litigation, and with the idea of making a substantial profit at the expense of one of the litigants, bought a chose in action, * * * this circumstance clearly indicating that he knew that others were asserting claims to the money when he purchased Gronefelds' rights."
In view of this finding, Spiegel does not come to the court with clean hands. The trial court's judgment awarding the fund to the mortgagee was proper. The judgment of the Court of Appeals is reversed and that of the Common Pleas Court affirmed.
Judgment reversed.
WEYGANDT, C.J., STEPHENSON, WILLIAMS, JONES, MATTHIAS, DAY and ZIMMERMAN, JJ., concur. *493