Heighe v. Evans

Offutt, J., delivered the opinion of the Court. In 1916 John A. Evans owned a lot of land binding on the Susquehanna River in Havre de Grace, Maryland, which was subsequently transferred to- one Philip Eckells, and by him to J. M. Stengel. In October, 1930, John A. Evans, his son, John C. Evans, and Norah Bouldin bought it from Stengel; but for reasons not disclosed, John A. Evans had the title conveyed to James J. Richardson and his wife, who was Evans’ daughter. The property cost $4,800, of which John A. Evans paid in cash $1,500, John C. Evans' $250 or $300, Norah Bouldin, $1,000, and the balance of $2,000 was raised by a mortgage on the property executed by James J. Richardson and his wife.

Subsequently John O. Evans applied to Mrs. Anne McE. Heighe for a loan of $480, and offered to secure it by a mortgage on the property then standing in the name .of the Richardsons. She loaned the money upon that assurance, and on May 11th, 1932, the Richardsons executed the mortgage, which recited that it was to secure a loan to them, so that they occupied the position of being bound by mortgages aggregating $2,480 on land in which they had no beneficial ownership, and which was occupied by John C. Evans. After repeated fruitless attempts to collect the $480 loan, Mrs. Heighe foreclosed .the mortgage which secured its re ²⁶¹ payment, and at the sale bought the property in for $900 subject to the first mortgage of $2,000.

The sale was in due course reported, objections were filed by John A. and John C. Evans, and Martha Richardson, which, after evidence and a hearing, were sustained and a resale ordered. This appeal was-taken from that order. The objections to the ratification of the sale were: (1) Inadequacy of price; (2) that the purchaser “practiced fraud and deceit upon these objeetants and their agents, in order to suppress bidding at said sale, so that the said property could be purchased at the lowest possible figure, to the damage and injury of these objeetants”; and (3) “the said purchaser of the property and James J. Richardson conspired together to' prevent these objeetants from paying the mortgage debt on said property, which debt these objeetants were ready and willing to pay for several days before said sale.” It appears from the evidence taken in connection with these objections that throughout the negotiation for the payi ment of the mortgage debt, John A. Evans, John 0. Evans, and Martha G. Richardson were interested in having the Richardson mortgage assigned to a Mr. Thompson of York, Pennsylvania, who had agreed to advance the money to pay Mrs. Heighe what was due here under it, but that Mrs. Heighe and James E. Richardson, the husband of Martha, were unwilling that the mortgage be assigned: While not directly so stated, the reason for that conflict was that, if the mortgage were assigned, Richardson would still be bound as a mortgagor, while if it were released he would be discharged from liability, and Mrs. Heighe, to protect him, insisted on a release, and refused to assign.

The Evanses, however, wanted it assigned and not released, because they could not get the money to repay Mrs. Heighe’s loan to John O. Evans unless they could secure the lender by a mortgage on the property, but if the mortgage were released, the title to the property would still be in Mr. and Mrs. Richardson, and the Evanses knew that James J. Richardson would not execute another mortgage for their benefit. ²⁶² It is contended by appellant that John A. Evans made an unconditional tender of the money due on the Richardson mortgage, but that contention is not supported by the record. John A. Evans, who conducted all the negotiations preceding the sale, when asked why he could not “take a plain release,” said: “Then I wouldn’t have anything to- give to Mr. Thompson, because Mr. Richardson would not assign or sign a new obligation. I think I can tell you something that will show some connection there. Here we were caught with Jim not inclined to do a thing but let the property go to a sale.

T had raised the money but had to get collateral for that, — I was going to have a deed to Mr. Thompson prepared, but they would not do a thing. The whole thing was between the two Richardsons,- — Jim and John, — and Mrs. Heighe. There T was caught and that was after she had assured mé that she didn’t want the property.” If that testimony left any doubt as to the character of the tender, it is removed by the following testimony of the same witness: “Are you in a position today, if the court should so decree, to take over the liens on this property, — pay Mrs. Heighe and relieve Mr. Richardson of his responsibility? A. Just as soon as I can get Mr. Thompson here.

I can’t get off the stand and write you a check, but hé has agreed to- p-ut up- the money and take over the property. (The Court) : With a release of the mortgage? (The Witness) : By a deed to the property or an assignment of the mortgage, — either one. (The Court) : There is no way that I know of that you can make a mortgagee assign a mortgage.

(Mr. Cobourn) : I understand that, if Mr. and Mrs. Richardson will sign the deed, the mortgage will be paid off and that will relieve them, and the title will be taken out of them. (The Court) : If anything can be done about the mortgage. I don’t know of any way except by a release. (Mr. Ooboum): That can be done by having a deed to the property.

Q. All that you have said is based upon a deed being executed to Mr. Thompson ? A. Yes, sir; or an assignment of the mortgage. (The Court) : The execution of a deed by the Richardsons ? (The Witness) : Yes, sir. * * * Q. Did you ever tender either to ²⁶³ Mrs. Heighe or me any money, or the money necessary to pay off the mortgage, without the proviso that the mortgage would have to be signed?

A. No, sir. I tendered it to you as legal tender without you compelling me to go to the bank and get the cash. Q. But there was always the proviso that the mortgage was to be assigned ? A. I couldn’t see why the mortgage could not be assigned, — Martha has offered to assign it to Mr. George Thompson, and you refused to do that on the Friday before the sale.

I offered you the money then to assign the mortgage to Martha. Q. The proposition that you made a few minutes ago was that you will pay off this mortgage and the Martin mortgage, but that is also qualified with the provision that the title to the property be made to Mr. George Thompson? A. No, sir; I won’t say that. I think that we can do all that by the assignment of the mortgages.

(The Court): Did you insist upon an assignment of this mortgage ? (The Witness) : I first endeavored to get an assignment to Mr. George Thompson, — no, first I tried to get a deed to him and then I tried to get an assignment. Mrs. Heighe said that she would not make the assignment to Mr. George Thompson, and then I tendered the money on behalf of Martha, — to have the assignment made to her. * * * It was at a later date that they refused to assign the mortgage to Mr. Thompson. Then I had some advice on it and was told that one of the parties in interest would have to tender the money, and that she was compelled to take it, — that the law would make her take it.

Then on Friday before the sale I went to Mr. Harlan and offered him the money for an assignment to Martha. Q. And all of those propositions were made after the property had been offered for sale? A. No, the first one. (The Court) : The equity of redemption exists up to the time of sale.

Q. At no time was there ever a tender made that didn’t contain the provision of a deed or assignment to Mr. Thompson or Mrs. Richardson, was there? A. Yes, sir. Q. Weren’t you always told, Mr. Evans, that Mrs. Heighe would accept the mortgage, interest and costs and execute a release? A. Yes, sir..

Q. She was always willing to do that? A. You told me that, — yes, sir. In fact ²⁶⁴ all she told me she wanted was her money, — that was my understanding until I found out that she bought it.” There was also evidence tending to prove that Mrs. Heighe had at one time agreed to assign the mortgage, but subsequently changed her mind. But because of its vagueness that testimony was unsatisfactory, not corroborated, was contradicted by Mrs. Heighe, and cannot be accepted as sufficient to establish as a fact the hypothesis that she did make such an agreement.

It does appear, however, without contradiction, that when Evans was told that Mrs. Heighe would not assign the mortgage to Thompson, he then tendered the money due on behalf of his daughter and requested that the assignment be made to her. Mrs. Heighe, in explaining why she insisted on a release instead of an assignment, said: “Mr. John Richardson came to me, said that he was awfully sorry about this and told me that he would bid enough to protect Jim,- — he said, G will see that you get your money.’ When it came to the details of the transfer of the mortgage, I said to Hed, G don’t have to assign this mortgage, but I must release it; and, as I understand it, Jim would still be in the same position if I assigned it, and that I didn’t think that that would be fair to John Richardson, as he was the only person who had showed the slightest interest in me or my money, and I did not think it fair to leave him in the lurch.’ I also told him that I was going to see Jim Richardson and ask him if he wanted me to assign the mortgage to some one else, and that day— Q. That was the reason why you saw Mr. James J. Richardson before saying whether an assignment would be made? A. Yes, sir; absolutely. John Richardson wanted to protect Jim.” From this testimony it appears that while the legal title to the property was in the Richardsons, the Evanses and Uorah Bouldin actually owned it; that the Richardsons, for purposes of the Evanses, took the title to it, and executed two mortgages on it, one for the purchase money, one to secure a loan of John 0.

Evans; that they were able to secure the money to repay that loan, but could only secure it by ²⁶⁵ borrowing it from a third person and giving him a lien on the property; that Martha Richardson, apparently interested in protecting her father, desired to have the mortgage assigned to the lender, bnt that her hnsband to protect himself wished to have it released; that the mortgagee, although without personal interest in that domestic impasse, voluntarily undertook to force a solution which would protect the husband Richardson at the expense of his wife and her father by insisting upon a release, and although tendered through her attorney and agent the money due, with a request that she assign the mortgage to Mrs. Richardson, refused the tender. The question is whether, upon those facts, she was entitled after that refusal to proceed with the foreclosure. ■ The general rule in this state is that a mortgagee cannot be required to assign a mortgage (Shirk v. Cornell, 136 Md. 397 , 111 A. 217 ; Dircks v. Logsdon, 59 Md. 173 ), but that he is bound to accept such amount as may be due under it, including principal, interest, and expenses, when properly tendered (Parsons v. Urie, 104 Md. 248 , 64 A. 927 ; Kent Bldg. & Loan Assn. v. Middleton, 112 Md. 17 , 75 A. 967 ), without annexing any condition whatever to such acceptance (Ibid.), and where the person making the payment has an interest in the equity of redemption, or as a lien creditor, and the payment inures to the benefit of others jointly liable with him under the mortgage, he is ordinarily subrogated to the rights of the mortgagee against such persons. Ibid; Jones on Mortgages, secs. 1086, 792. But while the mortgagee has no right to impose any conditions upon an acceptance of a legal tender of the amount due thereunder, the tender will not be legal if the mortgagor annexes to it the condition that the mortgagee assign the mortgage, for, as said in Shirk v. Cornell, 136 Md. 397 , 111 A. 217 , 219: “The appellant seems to assume that he had the absolute right to require the mortgagees to assign the mortgage to Mr. Tippett, upon payment or tender of the amount, costs, etc.; but such is not the law in this state, in the absence of an agreement.

The case of Dircks v. Logsdon, 59 Md. 173 , referred to by the appellant, does not sustain his position. In that case the controversy ²⁶⁶ was as to whether