American Trust Co. v. Casselman

The bill for foreclosure prayed for a personal decree against the defendant Casselman for any deficiency which might arise upon the sale of the mortgaged premises. There cannot be any question but that he would be liable therefor. The mortgage, subject to which the appealing defendants purchased, provided that the mortgagor should deposit with the mortgagee $1,100 each month to pay the interest on the bonds as it fell due and certain taxes. By its terms the rents, issues, and profits of the business were mortgaged, and the mortgagee on default was authorized to have a receiver appointed to collect the same, "to which appointment the mortgagors irrevocably consent." The bill prayed for an order to show cause why a receiver should not be appointed. The defendant Funk, in answer thereto, filed an affidavit in which he averred that the property mortgaged was worth upwards of $160,000; that *Page 83 he and the defendant Weiss had offered to pay all interest then due and would be able to meet the $1,100 payments required to be made by the terms of the mortgage. It does not appear that Casselman was represented at this hearing. On request therefor in his answer and cross-bill, a second order to show cause was granted. After a full hearing thereon, in which considerable testimony was taken, the order appealed from was duly made. The attorney for the trust company was there present, and stated as a witness: "Mr. Casselman told me that he was advised to file the petition and we approved of the action, and still approve of it. I do not know that I discussed the filing of this petition with Mr. Casselman, but I discussed it with you and Judge Connolly, and we did encourage the filing of this petition for the same reason that we applied for it." If Casselman was financially responsible it mattered little to the plaintiff, as mortgagee, whether its petition was granted or denied. But in insisting that a receiver should be appointed, as provided for in the mortgage, Casselman was but seeking to protect himself from liability under a deficiency decree should the property sell for less than the amount found due. While he was paid in full for his interest in the property, and while there was no assumption of the mortgage debt by his vendees or the present owners, he had a right to rely upon the provisions in the mortgage as a security to him against his personal liability for any part of the mortgage debt. The petition of the mortgagee for the appointment of a receiver was denied on the showing made by defendant Funk. Casselman renewed it with the approval of the mortgagee, and in my opinion the *Page 84 appeal from the order made should be dismissed, with costs to Casselman. It appearing that the operation of the order appointing the receiver has been stayed by the filing of a bond by said appellants, conditioned on their performing and satisfying the decree or final order of this court on such appeal, the decree here entered should require said appellants to pay to the receiver such sums as it would have received under such order of appointment from the date thereof to the entry of the decree or order dismissing the appeal in this court. Should counsel be unable to agree on such amount, the cause will be remanded to the trial court to determine the same. FEAD, CLARK, and McDONALD, JJ., concurred with SHARPE, J. The late Justice FELLOWS took no part in this decision.