Attwood v. Warner

Barnes, J. This action, when it was commenced in the district court for Dundy county, was a suit in chancery for the foreclosure of a mortgage upon 474- acres of land situated in that county and known as the Warner ranch. The mortgage iras executed by the Warners, who were the owners of the land, to the Western Farm Mortgage Trust Com [371] pany, for the sum of $2,500. It was sold and assigned by tliat company to one Garwood H. Attwood, wlio vais the plaintiff in the foreclosure suit, and in which the mortgagors and others were the defendants. On the 9 th day of April, 1894, the plaintiff obtained a decree of foreclosure as prayed. Thereafter there was a sale of the mortgaged premises, while there was on file a request for a'stay, as provided by law. On an appeal by the Jenkins Land & Live Stock Company, which had become the owner of the equity of redemption, from an order of confirmation, the sale was set aside. Jenkins Land & Live Stock Co. v. Attwood, 80 Neb. 806. Meanwhile Attwood, by his agent, went into possession of the premises, and collected the rents and profits thereof from the date of the decree to the 27th day of April, 1908, when the Jenkins Land & Live, Stock Company filed its petition for intervention in the original foreclosure suit, praying for an accounting of the rents and profits, and an application thereof to the satisfaction of the decree of foreclosure. To this petition Attwood filed an answer, and upon a trial of the issues joined the district court found that at the time of the trial there was due Attwood, on his original mortgage decree, the sum of $6,474.12; that the rents and profits, while he had been in possession of the premises as mortgagee, amounted to the sum of $2,474, which should be applied in part satisfaction of the mortgage debt; that the balance due on the decree of foreclosure, after deducting the rents and profits, was $3,999.12, and from a judgment rendered upon such findings the Jenkins Land & Live Stock Company has prosecuted this appeal. 1. It is contended by the appellant that the district court erred in his finding as to the amount of rents and profits which should have been credited on the foreclosure decree, and he insists that Attwood should be charged with such an amount of rent as the land ought to or would have produced, if prudently managed; while, on the other hand, Attwood contends that he is only liable for the amount of rent actually obtained by him while he was in [372] possession of the premises. This court is committed to the rule for which the appellant contends. In White v. Atlas Lumber Co., 49 Neb. 82, it was held that a mortgagee in possession is liable for the net rents and profits which he has received or which he might have received by the exercise of reasonable care. This rule was followed in Hatch v. Falconer, 67 Neb. 249, and is supported by Huston v. Stringham, 21 Ia. 36. It appears that this rule was adopted by the trial court, and his conclusion on this point should be affirmed. 2. It appears that one Alma E. Jewett, who was the owner of the equity of redemption, together with her husband, conveyed the land in question to the appellant, the Jenkins Land & Live Stock Company, by quitclaim deed, which contains the following provision: “By these presents do, for themselves, their heirs, executors, and administrators, remise, release, and forever quitclaim unto the said party of the second part, and to its heirs and assigns forever, all their right, title, interest, estate, claim and demand, both at law and in equity, of, in, and to all the southwest quarter (describing the mortgaged premises), together with all and singular the hereditaments and appurtenances thereunto belonging. To have and to hold-the above described premises unto the said Jenkins Land & Live Stock Company, its heirs and assigns, so that neither we, the said Alma E. Jewett and Ed. Jewett, nor any person in our name and behalf, shall or will hereafter claim or demand any right or title to said premises or any part thereof, but they and every of them shall by these presents be excluded and forever barred.” That afterwards Attwood, through the intervention of one Wilhelm, obtained from the Jewetts a purported assignment of the rents and profits in question; and it is argued that, by reason of that fact, the appellant is not entitled to have them applied on the foreclosure decree. We are of opinion, however, that, by the quitclaim deed above mentioned the appellant obtained the right to the rents and profits, and that thereafter, when the Jewetts attempted [373] to assign them to Attwood, they liad no interest therein. Such was the finding of the district court upon that question, and it should be affirmed. 3. It follows that the only question which remains for our determination is the one relating to the value of the rents and profits to be applied upon the mortgage debt. Upon this question the evidence is widely conflicting. Some testimony was produced by the appellant tending to show that the reasonable rental value of the premises was from $300 to $500 a year. But this, in view of the existing conditions, is in our judgment quite excessive. On the other hand, some evidence was introduced by the appellee fixing the rental value at from $75 to $125 a year. As we view the evidence, this is much less than the true rental value; and, after carefully considering all of the testimony, Ave find that by reasonably prudent management the ranch of 474 acres, covered by the mortgage, could have been rented for $200 a year for the 11 years of AttAvood’s possession. This, Avith interest properly computed, amounts to $2,872, which should have been applied, in part satisfaction of the amount due AttAVood on the foreclosure decree, and upon this question the judgment of the district court is reversed, but in all other things the decree appealed from is affirmed. The cause, is therefore remanded to the district court for Dundy county, with directions to enter a decree in conformity with this opinion. Judgment accordingly.