Barson v. Mulligan

Ingraham, J.: This action was in ejectment, and the appeal presents two serious questions, the facts in relation to which are undisputed, the verdict of the jury having determined the question of the defendants’ joint possession -of- the premises, and the damages which the plaintiffs were entitled to recover. The premises in question were conveyed to one Selena Barson by a warranty deed dated' April 23, 1853, and duly recorded, who mortgaged the same to secure the payment of $1,000 on October 1, 1853.- Selena Barson died on November 2, 1862, intestate, leaving her surviving her husband and three children, her heirs at law. One — 487 — ■of these children (George) disappeared about 1879. He was at that time unmarried and without children. Since that time no news lias been received from him. Upon the death of Selena Barson, her husband, Charles Barson, entered into possession of the premises as tenant by the curtesy and continued in such possession until his death October 2, 1897. On March 26, 1894, the defendant Agnes Mulligan, then Agnes Murphy, obtained a lease of the premises in question from Charles Barson, which purported to lease the premises for a term of five years and four months, from January 1, 1895, the term demised would have expired on May 1, 1900. The right •of the lessee under this lease, however, terminated upon the death •of Charles Barson October 2,1897. The defendant Agnes Mulligan ¡acquired title to the mortgage on June 28, 1898. The subsequent transfer of this mortgage to Steers, having been merely as collateral security for the payment of a note held by a bank of which Steers was president, I do not deem as important. The defendant Agnes Mulligan went into possession of the premises under this lease from Charles Barson, then .tenant by the curtesy, and has continued in the possession of the premises since that time. This action was commenced September 13, 1898, and was to recover possession of the premises occupied by the defendants, who are husband and wife, being a part of the premises leased by Charles Barson to the defend•ant Agnes Mulligan and into the possession of which sho entered under the lease to her before mentioned. It also appeared that the plaintiffs on October 2, 1897, executed a lease of the premises, including those in the occupation of the defendants, to one John J. Cox for a term of two years and six months from October 1, 1897, •at a yearly rent of $2,100.. . Cox entered into the possession of all the premises leased,, except the portion in possession of the defendants, and has continued in such possession down to the present time. There is indorsed upon this, lease the following : “ The within lease is hereby surrendered, and it is hereby mutually agreed that the same is cancelled. Dated December 27, 1897.” But this surrender was not actually executed until April 10, 1899, at which time the plaintiffs made a new lease to Cox leasing the premises demised by the ■former lease, with the exception of that actually occupied by the ■defendants, at a yearly rental of $1,800. The two questions presented upon this appeal are: First, as to the right of the plaintiffs — 488 — do the. possession of the premises at tllfe time the action was commenced ; the premises sought to be . recovered having then been leased to Cox, and, second, whether the defendant Agnes Mulligan was entitled to maintain possession of the premises after .the expiration of the- lease to her as mortgagee in possession. T agree with Mr. Justice Hatch as to the first question discussed by him, but I .am. inclined to think.;.;tha-t. the..defendant.. Agnes. Mulligan is a mortgagee in possession- and that this action of ejectment cannot.be maintained as against her and those holding under her;, She entered, into possession of the premises- under a lease from the life tenant. The validity of the life tenant’s title and the rightfulness of the possession of the defendant Agnes Mulligan under, that lease during the life of the life tenant is not disputed. While-, she held as lessee of the life tenant she was not a tenant of the plaintiffs, in whom the remainder was vested, and it -cannot be disputed but that had she .acquired during the- term demised by that lease a right to possession of the premises superior to :the plaintiffs* right she would have been entitled to maintain such possession as-against them. The rule that a tenant cannqt dispute his landlord’s. •title ¡applies only where the- conventional relation of landlord- and-tenant exists, and that relation not having existed between the plaintiffs and the defendant Agnes Mulligan, the rule ..did not apply. Jn, this action she was clearly entitled to set up any title or right to pos_ session adverse to the plaintiffs that had-vested in her, and if such a. title or right to possession is superior to. that of the plaintiffs she could defeat the plaintiffs’ recovery. After the defendant entered -into possession as .lessee of the life tenant she acquired the title to this mort-. gage upon the premises executed - by the plaintiffs’ ancestor and ¡to¡ which the plaintiffs’ title was subject. After the term of the lease by the life tenant had expired was she entitled to maintain possession of the premises as mortgagee in possession- ? I think she was¡ The relation existing as between mortgagor and mortgagee of real property as-modified by the modern equitable doctrine that a-mortgage is a. mére lien upon the land, the legal title to which remains in the-mortgagor, has been much discussed,, but the. principles I think are-now definitely settled; in this. State (Trimm, v. Marsh, 54 N. Y. 604) where it -is said., “ Here the mortgagor has, both in law ahd equity,. been regarded as the owner of the fee, and the mortgage" — 489 — has been regarded as a mere chose in action, a mere security of a personal nature. * * * It is true, notwithstanding the provision of the Revised Statutes which prohibits an action of ejectment by the mortgagee to obtain the possession of the mortgaged, premises, that after he has lawfully obtained the possession he may retain it until the debt,, secured by the mortgage, has been paid. * * * Before taking possession the mortgagee had a mere lien, upon the real estate pledged for the security of his debt. After-possession he has in his possession the property pledged as his-security, the title remaining as it was before,” quoting with approval what was said in Kortright v. Cady (21 N. Y. 343): “ The mortgagee’s right to bring ejectment or, being in possession, to defend himself against an ejectment by the mortgagor, is but a right to recover or to retain the possession of the pledge for the purpose of paying the debt. * * * Such a right is but the incident of the debt, and has no relation to a title or estate in the lands. * * * The notion that a mortgagee’s possession, whether before or after-default-, enlarges 1ns estate, or in any respect changes the simple relation of debtor and creditor between him and his mortgagee,* rests upon no foundation. We may call it a just and lawful possession, like the possession of any other pledge, but when its. object is accomplished it is neither just nor lawful for an instant, longer.” The only question, therefore, that can arise as to the right of a, mortgagee in possession to hold the premises until the mortgage, debt is paid depends upon the method by which he obtained possession, and it is claimed that that possession must be with the assent, of the mortgagor, but I can find no authority limiting the right of a mortgagee to hold property, of which he is in lawful possession, to-a case where such possession was with the consent of the mortgagor. As was said by Judge Earl in Madison Ave. Bapt. Ch. v. Oliver St. Bapt. Ch. (73 N. Y. 94): “ While under our present law a-mortgagee cannot bring ejectment to obtain possession of the mortgaged premises, being lawfully in possession under a mortgage upon which some amount is due, he can retain such possession against the mortgagor until such amount has been paid (citing cases). — 490 — It is ordinarily sufficient that a mortgagee is lawfully in possession after default upon the mortgage. The court will not then deprive him of the possession until his mortgage has been paid. The possession need not be given under the mortgage, nor with a view thereto.” In Hubbell v. Sibley (50 N. Y. 470) the defendant, holding a mortgage upon real property, attempted to foreclose his mortgage by a strict foreclosure. Upon a sale upon that foreclosure the premises were bid off by the defendant, who entered immediately into possession. The possession thus acquired was certainly not with the consen t of the mortgagor, and yet it was held that the- purchaser was entitled to hold the premises as mortgagée in possession; that the only remedy that the mortgagor had was a bill to redeem to which the ten years’ Statute of Limitation applied, and that the-ten years’ statute in such an action was a good defense. In Van Duyne v. Thayre (14 Wend. 233) the action was ejectment'for dower in certain mortgaged premises of which the plaintiff’s husband was the owner subject to a mortgage given to one Stewart. The mortgagor remained in possession of the premises by himself or bis "tenants until 1829 or 1830, when he left declaring that he would pay no more for the premises, and complaining'that Stewart had "ruined him. On his leaving the premises the guardians of the minor heirs of Stewart entered, and the premises were thereafter occupied by the heirs. There was here no evidence of a consent by the mdrtgagor, but it was held that the mortgagee, being in possession, was entitled to hold the property until his mortgage was paid, and that the widow had no right in this respect beyond what would belong to her husband if the mortgagor was living. In Phyfe v. Riley (15 Wend. 254) it was held that “ by the revised statutes "the mortgagee must, complete his title by other proceedings before he brings his suit; but if the mortgagee, after forfeiture, obtains possession in some legal mode other than by an action, why should the mortgagor or those claiming under him recover the possession from the mortgagee without paying the money secured by it ? * * * It cannot be denied that the mortgagee has an interest in the mortgaged premises, and .that interest after forfeiture is a legal interest; it is, indeed, inchoate until foreclosure, but it has heretofore been considered sufficient to protect him in the possession of the mortgaged premises when legally obtained.” Winslow v. Clark (47 N. Y. 263) was a — 491 — case where.a mortgagee made an ineffectual attempt to foreclose a mortgage. The foreclosure,, however, was of no effect, as the owner ■of the equity of redemption was not made a party, bnt the -mortgagee was held entitled to retain possession. In Townshend v. Thomson (139 N. Y. 152) the same principle was applied. There a mortgagee who had foreclosed his mortgage, but who had failed to make the owner of the equity of redemption a party, obtained a deed from the master and went into possession of the property. It Avas not suggested that his possession Avas with the consent of the mortgagor, but it was clearly adverse .to him under a deed which purported to convey his title to the mortgagee. In that case Judge Earl says: “ A mortgagee avIio has lawfully taken possession of the mortgaged premises cannot be ousted or deprived of his rights as such by the mere intrusion of the oAvner of the equity of redemption against his will or without his knowledge. There must be some act or omission on his part indicating a change in his position. The mortgagee who has taken laAvfid possession of the land pledged for his debt is not obliged to stand upon the land Avith a club to keep off intruders; nor need his continued possession be of such a character as is required by the statute to create a title by adverse possession.” What is essential to entitle a mortgagee to hold possession of the premises until his mortgage debts is paid is that his possession should have been lawfully acquired. ' If, under a deed which purports to convey title, a mortgagee enters into possession, although that deed is void, lie is entitled to maintain possession until his mortgage debt is paid. This folloAvs from the decisions in the cases in which a mortgagee has entered under a deed in a foreclosure proceeding, either statutory or by action of foreclosure, and it has been expressly and repeatedly held that the possession of the mortgagee need not be given under the mortgage, nor Avith a víbav thereto. (Madison Ave. Bapt. Ch. v. Oliver St. Bapt. Ch., supra ; Winslow v. McCall, 32 Barb. 241.) I can see no escape, therefore, from the proposition that this defendant, being rightfully in possession, and being the OAvner of the mortgage upon the premises, Avás entitled to retain possession of the premises until the payment of her mortgage, and that the plaintiffs could not maintain ejectment to recover possession of the premises. — 492 — .It follows that the judgment appealed from should be- reversed and a new trial ordered, with costs to,the appellant .to .abide the , event. Patterson, J.,' concurred; Laúghlin, J.,. concurred in result;. Van Brunt, P. J., and Hatch, J., dissented.