Moulton v. Haskell

Vanderburoh, J. The questions to be determined on this appeal arise upon the demurrer of the defendant Haskell to the complaint for insufficiency and a defect of parties. 1. The complaint shows that the defendant, Peter Rauen, on the 28th day of April, 1886, executed to plaintiffs, as trustees for certain creditors, a certain deed of trust upon the land described in the complaint for the purpose of securing the payment of certain notes executed or to be executed by Peter Rauen to such creditors. A subsequent agreement, dated August 13, 1886, entered into between the trustees named as the grantees in the trust deed and defendant Rauen, in pursuance of an express stipulation in the deed, was by them duly executed, sealed, and acknowledged, wherein, as is alleged, “said parties did refer to said mortgage and the record thereof, and did further recite that said Peter Rauen and Christina Rauen were, at the time of the execution and delivery of said mortgage, unable to state the amounts of the notes intended to be secured thereby, or the [369] dates thereof, or the names of the payees therein, but have since determined and agreed with said trustees upon the same, and have executed said notes; that in said agreement, dated August 13,1886, it is expressly agreed that the notes referred to in said mortgage, and intended to be secured thereby, bear date August 13, 1886, and are executed by said Peter Eauen to the respective persons thereinafter named, and for the amounts set opposite said respective names, with interest thereon, payable annually, at the rate of four per cent. (4%) per annum, both principal and interest thereon being payable at the Farmers’ & Mechanics’ Savings Bank in Minneapolis, Minnesota, and that said notes have printed across the face thereof, and of each of the same, a statement signed by said Eder H. Moulton, under the name of E. H. Moulton, and, by George Huhn, that said note is secured by mortgage; that said agreement dated August 13, A. D. 1886, contained the names of said payees and the amounts of said notes.” This supplemental agreement must be read and construed in connection with the trust deed, and removes all uncertainty and indefiniteness in respect to the debts secured thereby, and there can be no doubt that the trust deed, which must be treated as a mortgage, became operative as a valid security for the payment of the notes described in the agreement, and the trustees, Moulton and Huhn, were fully authorized, upon default in the payment thereof, to proceed to foreclose the same by an action in the district court. The trust is not one forbidden by our statute of uses and trusts. A mortgage is a mere chose in action. If assigned in trust it would be deemed a trust in personal property, and it is none the less so when executed to a mortgagee in trust to collect and apply the proceeds. The nature of the security would be the same in either case, and it would be enforced in the same way. Bucklin v. Bucklin, 1 Abb. Dec. 242; Bunn v. Vaughan, Id. 253. But if it were otherwise, it is a valid trust under 1878 G. S. ch. 43, § 11, subd. 2. It is a mortgage in trust to satisfy a charge upon the land mortgaged, and it is not material that the charge is created by the same instrument, that is, by the mortgage. It is not neces [370] sary that the charge should be a pre-existing one. Bucklin v. Buck-lin, supra. (Opinion published 52 N. W. Kep. 960.) We have no doubt that the complaint, on its face, shows a sufficient consideration for the mortgage and notes. 2. But the defendant Haskell, long before the commencement of this action, purchased the mortgaged premises expressly subject to the mortgage, and assumed the payment of the mortgage debt, which had previously been defined and fixed by the agreement of August 13, 1886, above referred to. As he has taken title to the premises subject to the mortgage, and agreed to pay the amount of the indebtedness as a part of the consideration of. the deed, he cannot now be heard to raise any question as. to the validity or sufficiency of the original consideration for the mortgage security. Alt v. Banholzer, 36 Minn. 57, (29 N. W. Rep. 674.) 3. There is no defect of parties. The plaintiffs are trustees of an express trust, and entitled to maintain the action. Besides, the trust is an active one, and the plaintiffs are entitled to collect the debts or enforce the security in discharge of the trust. Any question as to the claimants of the funds or the ownership of the notes must be settled detween the trustees and the cestui qae trust, and do not concern the defendant. Order affirmed.