Daniels & Co. v. Bowe

Cole, J. fixtures : removal of; mortgage. We do not stop to discuss the question as to what rights the plaintiffs acquired by their purchase of the fixtures under the execution at law. After _ , they had obtained the possession of them* they leased or hired the same to this defendant for the purpose of having the same again placed in the mill and used as before their removal. • When so replaced they became subject to the school fund mortgage, which was prior to the mortgage or claim of these plaintiffs, certainly so in the absence of actual notice to the mortgagee of either the sale or severance. This prior mortgage was then foreclosed, these plaintiffs being parties defendants to the foreclosure proceedings; under the foreclosure decree the real property was sold to the State for an amount considerably less than the mortgage debt. These fixtures, being then in the mill, passed to the purchaser of the real estate, and thereby the right or title of the plaintiffs therein became extinguished or terminated. The defendant is excused from returning the property, although he had covenanted to do so, by reason of the fact that the right of the plaintiffs to its return had, by virtue of the legal proceedings against them expired and ended. This would be true, even if the contract of lease or hiring had pertained to real estate; for it is a well settled rule, that, although a tenant cannot dispute his landlord’s title, he may nevertheless show that (his title has expired. Jackson v. Rowland, 6 Wend. 670; Despard v. Walbridge, 15 N. Y. 374; Simons v. Marshall, 3 G. Greene, 504. Since, therefore, the plaintiffs have no right to the property, it is clear they have no right to recover its value. The purchase of the real estate by the defendant from the State of Iowa, after the State had bought it at the foreclosure sale, perfected the title to the property in the defendant, and he may protect himself [406] thereunder. By his purchase he acquired all the right the State had as against the plaintiffs. The fact that by the terms of the agreement or understanding, as found by the referee between plaintiffs and defendants, the property in controversy was to be again placed and used in the mill, does not by any means tend to enlarge the obligation of defendant to return the same, though lost to plaintiffs by reason of being so replaced in the mill. But on the contrary, that understanding shows, that the hazard of being so lost was agreed to by plaintiff, and against which they took no express covenant from the defendant. There was also involved in this same contract of hireing certain personal property, for which plaintiff recovered, and as to which the defendant makes no question; as to that portion of the property the judgment is affirmed. As to the fixtures, as found by the referee, the judgment of the District Court is Beversed.