Rand v. Fort Scott, Wichita & Western Railway Co.

Opinion by Simpson, C.: This is an action by Raud against Sterling and wife and the St. Louis, Fort Scott & Wichita Railway Company, to obtain a judgment for balance due on a promissory note, and to foreclose a mortgage securing said note on certain lots in Castle’s addition to the city of McPherson. It appearing that the St. Louis, Fort Scott & Wichita Railway Company had sold all its franchises to the Fort Scott, Wichita & Western Railway Company, the latter corporation was made a party, and filed an answer alleging that in September, 1886, the St. Louis, Fort Scott & Wichita Company condemned the right-of-way across the mortgaged lots, and paid the condemnation money as required by law, aud immediately thereafter constructed and operated its line of road; that in October, 1887, it purchased from John Sterling and wife, who conveyed by warranty deed, the fee to the right-of-way referred to. The ease was tried on the issues joined between the plaintiff in error and the St. Louis, Fort Scott & Western Railway Company, and the trial court found for the defendant, that it was the owner of the right-of-way across said lots, being a part of the mortgaged premises. Judgment was entered barring the plaintiff in error, or any purchaser under the foreclosure proceedings, from any .interest in said right-of-way across the lots. The mortgagee brings the case here for review. [117] The principal reasons given for reversal are, that the condemnation proceedings are invalid; that the mortgagee is an owner within the meaning of the provisions respecting condemnation, and that damages should be assessed upon his interest in the land as an owner; that the condemnation proceedings were abandoned and the railroad company took a warranty deed from Sterling and wife, and that this title was necessarily subject to the mortgage. The history of the condemnation proceedings is as follows: The St. Louis, Fort Scott & Wichita Railway Company presented a petition to the judge of the district court for the appointment of commissioners to lay off its right-of-way for the proposed railroad through McPherson county, and on June 25,1886, the judge appointed commissioners. Thes'é commissioners were sworn to honestly and faithfully discharge their duties and give notice “ to whom it may concern ” .of the time and place of their first meeting, when they would commence to lay off the right-of-way of the proposed railroad. Proof of the publication of this notice is shown. The report' of the commissioners-shows that they met at the time and place stated in the notice and proceeded with their duties; adjourning from time to time until Saturday, October 9, 1886,-and on the day last mentioned the commissioners say, “We, the commissioners met according to the adjournment of ihe previous day, and fully completed our duties as such commissioners in the condemnation of right-of-way, from, the-south line of section 31, township 21, range 1 west, to a point on the east line of section 30, township 19 south, of range 3 west,” and then adjourned to meet at McPherson October 25,1886. The report filed by the commissioners awarded John Sterling the sum of $1,000, and contained this marginal'nótei “The total award of $1,000 to John Sterling being an error, we, the commissioners, have awarded him an additional $1,000, and caused the same to be placed on our supplemental report filed October 26, 1886, making total award on Nos. 62, 63, 64, of $2,000.” Of the award, $1,000 was paid to the county treas [118] urer. Sterling appealed from the award to the district court, and subsequently the railway company paid him $1,200, and Sterling received the $1,000 that had been deposited with the county treasurer and dismissed his appeal, and then Sterling and wife executed a deed to the railway company for the right-of-way. I. Whatever may be said about the marginal note of the right-of-way commissioners and their subsequent failure to file a supplemental report, it is very clear that the award of $1,000 (this sum having been deposited with the county treasurer) is a valid one. The validity of the award is established by the fact that Sterling appealed to the district court, in addition to the regularity of the proceedings so far as the original report is concerned. It cannot be claimed that the commissioners acted without jurisdiction. At most, the-award was irregular, but not void. Any previous irregularity not jurisdictional was cured by the appeal. II. The claim that the mortgagee is an owner within the meaning of the statutes regulating condemnation proceedings has been adjudicated against this view by this court in the very recent case of Goodrich v. Comm’rs of Atchison Co., 47 Kas. 355, wherein it is expressly held that the mortgagor in possession is the owner within the meaning of our statutes. The resulting logic of that case is, that after the condemnation money is deposited with the county treasurer, and possibly before, the mortgagee may take legal steps to protect his interest in the fund created out of the land subject to his mortgage. III. It may well be doubted whether the plaintiff in error can challenge the regularity of the condemnation proceedings in this collateral way. If the amount of land appropriated was so large as to impair his security, or if for any other reason his interests were endangered, even under these circumstances he could not intervene in the proceedings themselves, but must enforce his rights by proceedings to have all or a part of the damages awarded held and finally appropriated to [119] the satisfaction of his mortgage lien. It would seem, therefore, that in this collateral way he has no right to attack even the regularity of the condemnation proceedings. Of course, if they are absolutely void another question arises. IY. The claim of the plaintiff in error, that if the condemnation proceedings are valid they were merged in the warranty deed made by Sterling and wife to the railroad company, cannot be sustained. Mergers are not favored, either in courts of law or equity. (Simonton v. Gray, 34 Me. 50.) As a rule, at law, when a greater and a lesser, or a legal and equitable estate coincide in the same person, the lesser merges in the greater or becomes annihilated. But this rule is not inflexible in equity; whether or not the merger takes place depends upon the intention of the parties and a variety of other circumstances. Equity will permit or prevent a merger, as will best subserve the purposes of justice and the actual and just intention of the parties. Applying these well-settled rules to the facts recited in this record, and having in mind the conduct and intention of the parties, we think it would be grossly inequitable to hold that the easement resulting from the condemnation proceedings was merged in the estate created by the deed from Sterling and wife to the railroad company, for the reason that we- have already held, in accordance with adjudicated cases, that the interest lien or right to damages of the mortgagee is transferred from the .condemned right-of-way to the fund deposited with the county treasurer; and to now hold that the easement is merged in the deed is to restore to the mortgagee his right to enforce his lien against the strip of land condemned for a right-of-way. This would violate legal rights, and outrage all equitable considerations. Merger is very largely a question of intention, and the court will always presume against it whenever it will operate to the disadvantage of a party. (Andrus v. Vreeland, 29 N. J. Eq. 394, and authorities cited in that case.) This disposition of the more important and controlling [120] questions leaves little else to be said. We are satisfied that the judgment rendered below gives substantial justice, and recommend that it be affirmed. By the Court: It is so ordered. All the Justices concurring.