Bouton v. Doty

Tobbance, J. The errors assigned may be grouped as follows: (1) those relating to the extent and validity of the power reserved by Orrin A. Doty in Exhibit A; (2) those relating to the validity of the mortgage sued upon; (3) those relating to the admission of evidence and the question of variance. They will be considered in the order stated. One of the important questions in the case relates to the construction of that part of the deed to the nephew which purports to reserve to the grantor the power to mortgage. The reservation of this power occurs in a part of the deed which reads as follows: “ Saving and reserving the right to occupy and use the premises ... as fully and freely as I might do if the fee and title was to remain in myself; with full power to mortgage said premises to raise money for my own personal benefit, at any time I may desire for and during my natural life.” A power of this kind can be created by deed as well as by will, and in a deed it can be reserved to the grantor as well as granted to another; 2 Washburn’s Real Prop. (2d ed.) p. 314; and no question is made in this case as to the right [541] of the grantor to reserve a power of some kind over the land, but only as to the extent of the power reserved. The defendant contends that the power reserved is only a power to mortgage the premises during the life of the grant- or ; in other words a power to mortgage his own life estate; and one of the grounds, perhaps the principal one, on which this claim is based, is the phrase “ for and during my natural life.” The defendant says this phrase qualifies and limits the clause, “ with full power to mortgage said premises to raise money for my own personal benefit, at any time I may desire.” On the contrary we think it qualifies the preceding clause, “saving and reserving the right to occupy and use the premises ... as fully aud freely as I might do if the fee and title was to remain in myself.” In the first place such a qualification of this clause seems to be necessary and natural, as the use and occupancy therein reserved are not otherwise expressly limited; but it is not necessary in the other clause, at least not to limit the time within which the power must be exercised, for that clearly, by other parts of the clause, is limited to the life of the grantor. In the next place, if the phrase in question is construed as qualifying the extent of the power reserved, so as to leave in the grantor authority to mortgage his life estate only, then there was no reason whatever for making the reservation, for he could have done that without any reservation. Such a power was clearly not what the parties intended, because it would not have accomplished the purpose for which the power to mortgage was reserved,—for no one would have advanced any considerable sum, or such as the grantor might need before he died, on the frail security of his life estate; and because the exception in the covenant of warranty clearly contemplates incumbrances made under the power, upon the estate of the grantee and not merely upon that of the grantor. On the whole we are of opinion that the intention of both parties to this deed was that the grantor should have the power to mortgage the “premises,” including the estate of the grantor and grantee; and that this intention clearly appears, [542] is expressed in apt words, and should be carried out unless some rule of law forbids it. But the defendant says that “ if the reservation includes the power to mortgage the fee, such reservation is void,” because (1) it is repugnant to the deed; (2) it is in effect a reservation for the benefit of a stranger to the deed; (8) because it is in effect a reservation of a power to create a freehold to commence in futuro ; and (4) because “ as a reservation or as an exception the power reserved lacks words of inheritance, and so is simply of the life estate.” The first objection is not tenable. The estate conveyed to the grantee was a fee, subject to the life estate and the power reserved. That was merely a power to incumber in a certain way the fee and the life estate, and not to destroy the estate of the grantee. Its exercise gave him, at all events, the right to redeem; it might not be exercised at all, or to a slight extent, and he was willing to take his chances in this respect. But all these objections proceed, we think, upon a misapprehension as to the nature and effect of a power of this kind. A power is a method “ of causing a use, with its accompanying estate, to spring up at the will of a given person.” Wms. on Real Prop. (4th ed.) 282. It is an authority conferred upon one person to dispose of property vested in himself or in another person. It is a mode of disposing of property which operates under the statute of uses or wills, and it vests in the donee of the power a present indefeasible executory interest in such property. Tiedeman, Real Prop. §§ 558,559. In the present case the deed in question, in this aspect of it, operates under the statute of uses, the “principles ” of which, says the court in Bryan v. Bradley, 16 Conn. 474-483, are “ a part of our common law.” Under this statute it is no objection to the validity of a power, that its exercise may wholly defeat the estate conveyed to the grantee in the deed conferring it, nor that it is created for the benefit of a stranger to that deed or estate, nor that its exercise may create a freehold in futuro. For these reasons we think the power reserved was a valid power to mortgage the fee of the land. [543] The next questions relate to the validity of the mortgage given under the exercise of this power. Was the power properly exercised? It is true, undoubtedly, “that the law is exceedingly strict in requiring a precise compliance ” with all the conditions and restrictions imposed by the instrument creating or reserving the power, both as to the manner and the time of execution, and other matters of like nature. 2 Washburn, Real Prop. p. 317; Tiedeman, Real Prop. § 567. In the case at bar the power is to be exercised only “ to raise money for my (the grantor’s) own personal benefit at any time I may desire.” As we understand it the only claim made by the defendant, upon this part of the case, is that the money found to be due upon the mortgage was not money raised for the grantor’s personal benefit, within the meaning of the above clause; he does not claim that in any other respect the power was not properly exercised, assuming that the grantor could mortgage the fee at all. Under the circumstances out of which the deed in question grew, and for the reasons given in Imlay v. Huntington, 20 Conn. 146, 169, 170, we think the above clause ought to receive a liberal construction in favor of the grantor. The court below has found that the defendant utterly failed to carry out the terms of the deed on his part to be performed, and refused to do so; that the grantor would have suffered for want of the necessities of life, if the plaintiff had not done work and expended money-in his behalf; and further, that the entire amount found due was “for moneys raised, or their equivalent, for the personal benefit of Orrin D. Doty, with his knowledge and at his request, and to provide him with the necessities of life.” Upon the facts found we are satisfied that the mortgage was given to raise money for the grantor’s personal benefit, within the meaning of the reservation. The defendant further claims that the mortgage ought not to be held valid as to him, because it “ did not set forth truly or fairly the character of the indebtedness.” It is undoubtedly true as a rule that a mortgage, to be valid against subsequent bona fide purchasers and incumbrances, must be so drawn that the record of it will give notice, with [544] reasonable certainty, of the nature and amount of the incumbrance upon the property; but the rule has no application to this case in favor of the defendant, for he is not a subsequent purchaser, nor attaching creditor, nor a subsequent incumbrancer of any kind. The note and mortgage were given in good faith to secure a debt then existing, and future advances which the plaintiff had bound herself to make; and all the defendant is called upon to pay in order to redeem is the amount found to be actually due upon the note. There is nothing here of which he can justly complain. We think the mortgage was a valid mortgage for the amount found to be due. We are also of opinion that the court did not err in admitting the testimony objected to; that there is no foundation for the claimed variance between the complaint and testimony, and that there is nothing in these matters to justify or deserve further discussion. There is no error. In this opinion the other judges concurred.