Misener v. Gould

By the Court McMillan, J. -It is admitted by the appellants, that upon the facts found by the Court, the plaintiff stood in the relation of surety for Yan Brunt, as to the'indebtedness of the firm of Misener & Yan Brunt, and that the defendants, Goulds, had full notice of that fact, and by their own action in delivering to Yan Brunt, property of the firm, which they held in trust to pay the debts, the plaintiff was discharged from all liability as such surety, and his property released from the mortgage given to secure the Goulds’ debt. But it is urged that the time for the plaintiff to have asserted his equities, was during the pendency of the foreclosure of the Gould mortgage, and not having done so, it is now too late. The defendants in support of their position, rely upon the cases of Bidwell v. Whitney, 4 Minn., 76, and Johnson v. Williams, Ib., 260. Bidwell v. Whitney was an action at law, to recover the surplus bid by a mortgagee on a foreclosure by advertisement, over and above the amount actually due upon the obligation, but within the amount stipulated to be paid in case of non-payment after maturity. The Court 172 in that case held, that the mortgagor could have enjoined the sale, in equity, until the amount actually due could be ascertained, and had the mortgage cancelled as to the balance claimed to be due in the notice of sale, or could have had other appropriate equitable relief, depending upon the condition of the parties, and the securities; but that the action at law would not he. * Johnson v. WillÁams was an action to set aside a sale by advertisement under a mortgage, where subsequent to the mortgage, the mortgagor conveyed to the plaintiff and one Eastman, separate parcels of the. mortgaged premises, the deeds to which were recorded prior to the publication of the notice of sale. The jilaintiff alleged that the balance of the mortgaged premises remaining in the mortgagor, with either of the parcels sold to Eastman, were sufficient to pay the debt, and if sold in the order they were primarily liable, it would not be necessary to sell the plaintiff’s portion of the property. The whole tract was sold together. No demand was made for plaintiff on the day of sale, that the land should be sold in any -particular manner, or that he claimed any equities; the plaintiff excusing the want of appearance at the day of sale, on the ground that he was an officer in the United States navy and had been for the year previous on duty on a foreign cruise, and that until within a few days he had no notice of the proceedings of foreclosure. Neither of these cases is in point in'this instance. It will be observed, that in both of these cases there were valid mortgages, and that the foreclosure proceedings were under valid existing powers, and within the letter of the instrument, and were therefore regular. But in this case the mortgage is can-celled and the power extinguished, and as between these fa/rties at least, the foreclosure is without authority, and the proceedings are not irregular, but void. In speaking of a foreclosure by advertisement, Cowen, J., says: “There must be a power. Payment extinguishes it, and the case becomes the same as if none had ever been inserted in the mortgage. By payment, 173 the whole mortgage is extinct, as much so as if released or paid and cancelled of record.” Cameron v. Irwin, 5 Hill, 276, and authorities cited. Jackson v. Dominick, 14 Johns., 441. So far as these parties are concerned, Yan Brunt and Goulds, being the actors in the proceedings which effected the cancellation of the mortgage, and the actors chargeable with notice, it is immaterial whether the cancellation of the mortgage was effected by paylnent or by the acts of the parties. “It had ceased to exist, and in legal contemplation was extinguished as effectually as if it had been paid or released by the party under hand and seal.” Deyo v. Van Valkenburgh et als., 5 Hill, 244. In Bennett et al. v. Healy, 6 Minn., 240, Justice Flandrau says: “ It is true in the case of Bidwell v. Whitney, we treat the foreclosure, by way of illustration, upon the same terms as a suit at law or in equity, and so far as the mortgagee keeps within the terms of his power, such illustration and position are strictly correct. But where the mortgagee acts entirely outside the power conferred upon him, his acts can bar no one, and no waiver can accrue.” The decision in the case, in the light of the facts reported, would seem to be analagous in principle with the case at bar. It is unnecessary in this view of the case, to consider either of the other points raised by the defendants. The sale being void as to Misener, Goulds took no title to his portion of the premises, and Yan Brunt having notice, could take no greater title than Goulds had. The defendant Draper, having purchased after the commencement of the action, and after the filing and recording of the notice of the pendency thereof, and purchasing also on behalf, and as the agent of, the defendant, Yan Brunt, acquired no title to the property as against the plaintiff.