Dircks v. Logsdon

Miller, J., delivered the opinion of the Court. This appeal is from an order overruling exceptions to, and ratifying, a sale made under a power in a mortgage. It appears that on the 26th of March, 1874, John B. Smissing mortgaged sixty acres of land near Cumberland, to Hathan Wilson, to secure a debt of $850. The appellee, Henry Logsdon, claiming to be assignee of this mortgage under an assignment from Wilson, dated the 29th of May, 1879, sold the land on the 5th of February, 1881, and purchased the same himself for $775.

Smissing had executed a subsequent mortgage of this, and other parcels of land, to Humbird to secure the sum of $1400, and at the sale under this mortgage, which took place on the 27th of May, 1879, Logsdon also became the purchaser, but this sale was afterwards, on exceptions thereto, set aside. Paul Dircks, the appellant, had purchased for $25 the equity of redemption in all the property, on the 7th of September, 1878, at sheriff's sale, under a judgment against Smissing, subsequent to both mortgages. These facts are gathered from the record and the admissions of counsel on both sides at bar. The exceptions to the present sale, several in number, were filed by Dircks. 1st.

The first, and the one mainly relied on in argument, is to the effect that Logsdon was not the assignee of the mortgage, but that the same was discharged by his payment in full, to Wilson, of the mortgage debt, before ¹⁷⁶ the pretended assignment was executed. It appears, that on the 29th of May, 1879, two days after he became the purchaser of the property at the. sale under the Humbird mortgage, Logsdon went to Wilson to get his prior mortgage on this portion of the land. .He paid to Wilson $630, the full amount, principal and interest, then due on the mortgage, and something was then written on the original mortgage which was signed hy Wilson, and the instrument was then delivered to Logsdon. The latter in his testimony states that after what was thus written and signed, and which he calls an “assignment,” he took the mortgage to Mr. Widener to see if it was in legal form, and Widener said it was not, that it was not under seal and would not do ; that witness then asked him if he could correct it, and he said he could, and did so hy scratching out what was there written, and writing the formal assignment as it now appears on the paper ; that witness then, on the same day, took the mortgage again to Wilson; told him what had been done, and Wilson then signed the formal assignment. Widener says he wrote the assignment hut has no recollection as to the erasure.

The original instrument has been submitted to us for inspection, and while it is evident there has been an erasure we yet find it impossible to ascertain what the writing thus erased actually was. We are satisfied however, not only from the testimony of Logsdon, but also from that of Miss Ellen Eeaga, who was present at the time, that it was not a formal release of the mortgage. The most that can be made out of her testimony is that her grandfather, Wilson, when the money was paid to him, signed a receipt upon the mortgage to the effect that he had received from Logsdon the full amount of the mortgage debt. This is most probably what actually occurred, and it is the most favorable view of the case, for the appellant, that the testimony and the paper itself will warrant us in taking.

Such a receipt is mere evidence of the payment of the money and has no ¹⁷⁷ other force or effect. The question then is did the payment of this money, under the circumstances of the case, operate a discharge, or extinguishment of the lien of the mortgage ? If it did, the subsequent assignment, whether made on the same day or afterwards, cannot avail against Dircks, who was then the owner of the equity of redemption, and if it did not, the assignment is clearly valid. As a general rule payment of an incumbrance by a party whose duty or obligation it is, by contract or otherwise, to pay, extinguishes it, but whether this effect follows in other cases depends upon the intention of the parties, and as to the question of intent in such cases the interest of the party making the payment has a strong, if not controlling influence.

Walker vs. Stone, 20 Md., 195 ; Brawner vs. Watkins, et al., 28 Md., 217 ; Brown vs. Lapham, 3 Cush., 551 . In Walker vs. Stone this Court adopted the opinion of the Judge of the Circuit Court who said: “It is settled in numerous cases that a payment made to a mortgagee by a third party who is under no obligation by contract to pay the debt, will not operate as a satisfaction of it, unless it be manifestly the intention or interest of the party making the payment that it should so operate.” Row in this case Logsdon was no party to the mortgage, and was under no duty or obligation to have it paid, and cancelled. It is also clear from his testimony that his intention when he paid the money, was to obtain an assignment of the mortgage and not to have it extinguished as a lien upon the land. Such also was manifestly his interest at the time he made the payment.

It is true he had just purchased at the sale