Kingsley v. Anderson

JAGGARE, J. The plaintiff, the owner of a mortgage, brought suit for its foreclosure. Defendant, a purchaser of the land subsequent to the execution of the mortgage, set up by way of answer that he had discharged the lien of the mortgage by a tender of the amount due the plaintiff, and prayed that the plaintiff take nothing. The reply denied the tender. The case was tried by the court without a jury. The conclusion of law was for the plaintiff. This appeal was from the judgment entered thereon. [511] The only question in this case is whether the defendant made a tender sufficient to discharge the lien of the mortgage afterward foreclosed. The original mortgage covenanted to pay $500 according .to the tenor and effect of a mortgage note, with seven per cent, interest; the instalments of interest on each being further evidenced by five coupon notes. The mortgage on its face did not promise to pay exchange. The notes and coupons contained such promise. The reference in the mortgage to the notes was sufficient to incorporate this additional term into the mortgage lien. The effect was to give a lien for the exchange. See Scheibe v. Kennedy, 64 Wis. 564, 25 N. W. 646; Pike v. Collins, 33 Me. 38; Michigan v. Brown, 11 Mich. 265; Montague v. Stelts, 37 S. C. 200, 15 S. E. 968, 34 Am. St. 736-743; Security v. Mattern, 131 Cal. 326, 63 Pac. 482; Bangs v. Fallon, 179 Mass. 77, 60 N. E. 403. And see Lee v. Fletcher, 46 Minn. 49, 53, 48 N. W. 456, 12 L. R. A. 171. There is no necessary inconsistency between this conclusion and the principle that a mortgage securing a note stated to be for a definite sum, when in fact the note is for a larger sum, is security only for the smaller sum stated in the mortgage. Jones, Mort. § 357. And see Stoddard v. Hart, 23 N. Y. 556. While the effect of the addition of the exchange is to increase the amount secured by the mortgage, that increase is of an incidental charge only. It is like the addition to the purchase price of merchandise of a charge of freight for delivery, of costs incurred, or of charges for care of property properly incurred under particular circumstances, or like the additional charge for collection, for example, of checks deposited. An agreement was subsequently executed between the parties which, construed as a whole, operated to postpone the date of payment, but did not, by any natural construction, relinquish any right to the payment of exchange under the original note or obligation. The renewal sum was for $500, with interest at seven per cent. That the original coupon notes were payable to one party, and that under the renewal agreement $25 coupons went to one person and $10 coupons to another, “or bearer,” altered the condition of payment only as to the payee. Thirty-five dollars interest was secured by lien on the property. Moreover, an overdue coupon was produced on trial and introduced in evidence. [512] The amount tendered was not made insufficient by the fact that the fee charged for the foreclosure of a mortgage and included in the amount to be paid on redemption was $50. The argument is made that, inasmuch as the mortgage was for $500 only, under the statute only $25 could have been legally inserted as the fee for foreclosure. In point of fact, the mortgage was for $500 and for exchange. The mortgagee was entitled to charge $50 for the foreclosure of that mortgage. Defendant tendered $535.10. The amount due, including exchange, was $535.55. If this had been an action to redeem, brought by the mortgagor or his successor in interest, and this deficiency had been the only basis of objection to redemption, the court would readily have afforded the mortgagor relief. In fact, however, the result of defendant’s position is that the mortgage is discharged of record and that the mortgagee is left with the personal obligation of the mortgagor only. Under such circumstances, the law properly requires an exact tender. Hunt, Tender, p. 197, § 195. The tender here was not sufficient. The defendant, the purchaser, has his remedy by way of redemption. Judgment affirmed. On April 24, 1908, the following opinion was filed: