First National Bank v. Hallquist

S tatement. Bronson, J. This is an action to foreclose a real estate mortgage. The record discloses the following: The defendant is the owner of 160 acres of farm land in Eddy comm ty. He is a married man with a family of six children. For many years he has occupied this land as his homestead. In 1915 the defendant to-gether with his wife gave a mortgage upon the land to the Minneapolis Loan & Trust Company to secure a note for $2,300 and interest. There is now unpaid upon this mortgage with interest $2,650. There are also un-* paid taxes for 1919 and 1920 amounting to $213. In 1916 the defendant alone gave a mortgage to the plaintiff upon this land to secure $1,675 and interest. There is due and unpaid upon this mortgage including interest [265] over $2,000. Witnesses variously testified that the value of the land including improvements was from $45 to $65 per acre. The defendant testified that the value was $40 per acre. The trial court upon findings determined the value of the land to be $7,200; that, after deducting the prior liens thereupon, the homestead did not exceed in value the homstead exemption; that, accordingly, plaintiff’s mortgage signed by the husband alone, being a lien only for the amount above the statutory exemption, did •not attach to the land. Judgment was ordered and entered in favor of the •plaintiff for the amount of the note with interest and, further, that the •mortgage be cancelled of record. The plaintiff has appealed from the judgment. Decision. Did the trial court err in deducting the prior existing incumbrance to .determine the value of the homestead? It is to be noted that this prior ■mortgage to the trust company was made by both husband and wife so that it operated to create a lien upon the homestead. When this mortgage so signed by husband and wife was executed, there then existed, following •the findings of the trial court, the sum of $2,200 over and above the value .of the homestead estate in the land. To deduct this mortgage out of the excess value above homestead estate would simply serve to place such mortgage in the position of a mortgage that did not cover the homestead estate. This court has heretofore held that in determining the value of the 'homestead estate existing incumbrances should not be deducted. Calmer v. Calmer, 15 N. D. 120, 127, 106 N. W. 684. That a conveyance by the husband without his wife joining, of lands •including the homestead,, is valid as to the excess of value of the land above the homestead exemption. Severtson v. Peoples, 28 N. D. 372, 384, 148 N. W. 1054. These cases, upon the question herein involved support the clear weight of the authorities. 21 Cyc. 551; 13 R. C. L. 635; 15 A. & E. Enc. Law (2d ed.) 684; Thompson on Homesteads and Exemptions, § 477. It follows that the trial court erred in deducting prior existing incumbrances. It is true that .a conveyance of a mortgage of a homestead in this state must be executed and acknowledged by both husband and wife. However, plaintiff’s mortgage, so far as it covers the excess above the homestead estate, is not a mortgage upon the homestead and is therefor valid to such extent. [266] The judgment of the trial court is reversed, and the case remanded for further proceedings consonant with this opinion. The appellant will recover costs. Robinson, C. J., and Christianson and Birdzell, JJ., concur.