Thurber v. Detroit Fire & Marine Ins.

*347 Butzel, J. The trial judge did not abuse his discretion in ordering a moratorium. Plaintiff showed that she owned an undivided one-third interest in the mortgaged property consisting of a substantial five-story building at 244 — 248 west Congress street, not far from the center of the downtown section of- Detroit ; that the mortgage of $40,000 was given to defendant by plaintiff and her sister, the sole beneficiaries of the estate of Lavinia B. Crowley, but subject to two certain annuities, the annuitants each being over 88 years of age. It further appeared that there remains undistributed in the estate, on account of the annuities, securities of approximately the value of $35,000. Defendant’s mortgage ledger shows that the time of payment of the mortgage was extended to December 30,1935, that the interest of $600 per quarter was paid until several months before the proceedings were instituted; that later on $1,305.78 was credited on the mortgage, payment being made through another mortgage; that the property was insured for the sum of $65,000. Defendant concedes that the property has a rental value of $575 per month or $6,900 per year. The mortagors, however, defaulted in the payment of taxes and defendant was obliged to pay certain taxes in full and instalments on others, brought under the five-year plan. On October 15, 1935, the date of the foreclosure sale, there was due defendant for principal and interest, taxes and legal expenses, $43,241.49, the amount of defendant’s bid at the sale. Plaintiff did not ask for moratorium until October 6,1936, but nine days prior to the expiration of the year of redemption. Testimony was taken as to the value of the property. It was shown that at the time of the execution of the mortgage in 1929, the land was appraised at $110,000 and the building at $75,000. Subsequently, *348 the land was appraised at $61,000 and the building at $60,000. Realtors were called to give expert testimony. Defendant’s witness, an employee in its mortgage department, sought to place a valuation on the property by deducting taxes and necessary repairs from the annual income leaving a net annual return of $4,100, which sum he multiplied by ten and thus set the value of the property at $41,000. A letter written to defendant by another realtor placed the value of the property on October 16,1936, at $65,000, and the rental value at approximately $8,000 per year. This Avas practically all the testimony given as to the present value of the property. It was, liOAvever, shown that the property was assessed at $70,930 for the city taxes for 1937. The mortgagors failed to pay taxes against the property so that in addition to the amount advanced by defendant for the purpose, taxes still unpaid amounted to $10,516.16, and if defendant were to pay this amount and add it to the balance due it for interest and payment of taxes since the mortgage sale, it would require the sum of $57,024.66 to redeem the property. It Avas, however, shoAvn that if the taxes and annual interest charges were divided by twelve, the monthly current taxes would amount to $177.53, and the monthly interest charges to $285.12, or a total of $5,551.80 for the year. At a rental value of $575 per month, or $6,900 per year, there would still be a surplus left over from which to make repairs and apply a small sum in reduction of defendant’s claim. It is true that there are íavo annuitants, on whose account the Crowley estate is tied up so that the assets of the estate cannot be used to refinance the mortgage. However, the very advanced years of these annuitants cannot be overlooked. The judge may have taken into consideration local conditions and rising values of real estate in coming to his con *349 elusion, but this is not shown by the record. The property brought in less than $575 per month for a considerable period. Plaintiff is not a mere interloper or speculator. The mortgagors, however, have not been entirely without fault, and we would come to a different conclusion Avere it not that under the order of the court, all the rents must, be turned over to the receiver, who, after payment of necessary expenses, is ordered to pay over the net proceeds to defendant to be credited by it upon the sums due or to become due it or to be paid on taxes theretofore or thereafter to become due, and also to pay insurance premiums. The defendant’s debt thus will not grow any larger during the moratorium period, and there appears to be an equity that plaintiff may possibly save. Each moratorium case depends upon its particular facts. Unless there is an abuse of discretion by the court in granting a moratorium, we decline to set it aside. There ivas no such abuse in the instant case. The order is affirmed, with costs to plaintiff. Fead, C. J., and Bushnell, Sharpe, Potter, and Chandler, JJ., concurred with Butzel, J.