Wallace v. Hammonds

Hart, J., (after stating the facts). It is well settled in this State that, where a purchaser of mortgaged lands from the mortgagor assumes and agrees to pay the mortgage thereon, he ' becomes personally liable therefor, which liability inures to the benefit of the mortgagee, who may enforce it in an appropriate action. Felker v. Rice, 110 Ark. 70; Walker v. Mathis, 128 Ark. 317; Kirby v. Young, 145 Ark. 507; and Beard v. Beard, 148 Ark. 29. Counsel for the defendants recognized this as the rule laid down by this court, but claim that the personal liability of a grantee asuming the mortgage is sustained under the equitable doctrine of subrogation. It is pointed out that the cases cited in our opinion on the subject are from other States, where it is held that the grantee by his contract assuming the mortgage debt becomes the principal debtor, and his grantor, the mortgagor, 'becomes his surety. Hence the mortgagee is entitled to the benefit of this contract, though he was not a party to it, under th.e familiar doctrine that a creditor is entitled, by equitable subrogation, to all securities held by a surety of the principal debtor. See 21 A. L. R. 451, where our own decisions, the decisions of courts of last resort of other States, and of the Supreme Court of the United States, are cited. Hence they contend that, under these decisions, a contract between a mortgagor and his grantee, whereby the latter assumes and agrees to pay the mortgage debt, may be rescinded at any time before the mortgagee has accepted the agreement or asserted his rights thereunder. See cases cited in note to 21 A. L. R. at p. 462. This doctrine however does not help the case of the defendants any. It is true that L. W. Wallace and Efiie Wallace allege in their answer that they resold and reconveyed said land to the defendants, D. T. Hobbs and E. M. Hobbs, and that, as a part of the consideration, said D. T. and E. M. Hobbs agreed to pay the sum due by them to the plaintiff, but the trouble is they did not allege or prove when this reconveyance was made. The complaint seeking foreclosure of the mortgage was filed on the 24th day of March, 1924, and the answer of the defendants, L. W. and Efiie Wallace, was not filed until December 21, 1924. It may be that the resale by them to D. T. Hobbs and wife occurred after the present action was instituted. This was a matter peculiarly within their own knowledge, and, if they relied upon the release as a defense to the action, it was their duty to plead it. Swan v. Benson, 31 Ark. 728; Burke v. M. E. Leming Lbr. Co., 121 Ark. 194; and 23 R. C. L. § 44, pp. 414 and 415. Section 1194 of Crawford & Moses’ Digest provides that the answer shall contain a statement of any new matter constituting a defense in ordinary and concise language. The plea that L. W. Wallace and Efiie Wallace were released from their assumption of the mortgage debt by their resale of the land to D. T. Hobbs and wife constituted new matter, and the burden of proof was on the pleader. The answer is not evidence of the new matter set up in defense of the action, and, in the absence of any proof to establish it, the chancery court properly entered a decree in favor of the plaintiff, when the defendants elected to stand upon their answer. Therefore the decree will be affirmed.