Boyer v. Chandler

Per Curiam: The complainants below, the Chandlers, by their bill sought to foreclose the deed'of trust given by George R. Allen to them as to the three first coupon or interest notes. It is not sought to affect or lessen the security as to the principal note and the two remaining coupon notes. The holder of a note due is not required to wait until the other notes secured by the same mortgage are due before he takes steps to enforce his security. In Morgenstern v. Klees, 30 Ill. 422, the bill proceeded for a foreclosure for unpaid interest on the mortgage debt. The court said: “The practice is too well settled to require discussion or reference to authority, that where a mortgage is given to secure sums of money falling due at different periods, the creditor may foreclose by bill, as they severally fall due. * * * The mortgage must have been given to secure the interest as well as the principal, and the law will not withhold a remedy until the period elapses for the maturity of the whole debt,”—citing Brinckerhoff v. Thalheimer, 2 Johns. Ch. 486; 2 Hilliard on Mortgages, 108. The creditor, by the terms of the contract, is entitled to the aid of the court and to a decree for the sum due him. To refuse a foreclosure of a mortgage for his debt as it matures, would be to deprive him of his rights without his fault. (Bressler v. Martin, 133 Ill. 278.) The decree in this case found there was due to the complainants the sum of $486.47, and directed that any sale of the premises be made subject to the continuing lien of the trust deed thereon, for the security of said principal note and any and all other coupons and other disbursements made under the provisions of said trust deed, and in addition to the amounts due the complainants, as aforesaid. Such decree is clearly recognized by the courts in cases like the present. (Vansant v. Allmon, 23 Ill. 26; Weiner v. Heintz, 17 id. 259; Mines v. Moore, 41 id. 273; Sargent v. Howe, 21 id. 148; Kinwell v. Willard, 1 Dougl. 217.) Interest coupons are in effect promissory notes. Harper v. Ely, 70 Ill. 581; Morgenstern v. Klees, 30 id. 422. It is said that the holders of the notes which had not matured were necessary parties to the bill. The rule is well established that all persons having an interest in the subject matter which may be affected by the decree of foreclosure of the mortgage should be made parties defendant, if not joined as complainants. (Bonham v. Galloway, 13 Ill. 68.) In this case, the holders of the principal note of $3500 and the seven coupon, notes, neither of which was due at the time, were not made parties to the bill. The complainants sought to foreclose as to the first three coupon notes. They sought no relief at all that might injuriously affect the holders of the notes not due. On the contrary, the course adopted by complainants was beneficial as to the holders of the notes not matured. The effect of the foreclosure was to withdraw from the lien of the mortgage the notes of the complainants, and to make the mortgage a security only for the remaining eight outstanding notes. The complainants had a clear right to take a decree to sell the mortgaged premises subject to the balance due or to become due on the mortgage, and were not bound to exercise the option to declare the whole debt due. The rights of Emily Elliott under her cross-bill remain to be considered. By failing to record her agreement with Allen for the purchase of the lot until after he had procured a loan on the same for §1500, she, in the absence of all notice of her rights, would take the title of the lots subject to the Boyer deed of trust. But at the time Mrs. Boyer loaned Allen §1500, taking as security a mortgage on the property, and for some time before, Mrs. Elliott was in the actual-occupancy and possession of the third flat of the building, and such possession was notice of her rights in relation to the entire building and ground on which it stood. The possession of a party need not be of every part thereof in fact, in order to constitute notice of his rights, both legal and equitable. Possession of a part of a tract of land or lot, under a deed for the whole, may be regarded as possession of the whole. Moreover, when the agent saw the property was occupied, it was his duty to make inquiry of those in possession in regard to the title under which they occupied the property. Had he done this, he might have ascertained that Allen had no title. But the agent made no inquiries of any person occupying the property, but relied solely on the statement of Allen. The agent of Mrs. Boyer had notice of facts sufficient to put him upon inquiry, and as such inquiry would have disclosed the existence of Mrs. Elliott’s title, he is chargeable with notice of such title. Finding no error in the decree of the court it must be affirmed. Decree affirmed.