Oesterla v. Gaither

Fowler, J., delivered the opinion of the Court. On the 22nd April, 1874, John Eugene Buck and his wife, Josephine Buck, executed a mortgage on his farm in Howard County, to his wife’s mother, Sarah Hood, to secure the payment of a promissory note to her for $2,752.63. This mortgage was duly recorded. Mrs. Hood died in 1887, leaving the mortgage note and mortgage as part of her estate.

As such, her executor, Stephen G. Hood, became possessed of them. On the 20th May, 1887, the mortgage was released by the executor by order of the Orphans’ Court of Howard County upon the petition of Buck and wife. This petition alleges that the petitioners had executed the mortgage in question for the sum therein mentioned; that the said mortgagor, Sarah Hood, in the meantime had died, and that the said mortgage note had re ⁴³ mained unpaid ; that by her last will and testament, the petitioner, Josephine Buck, a daughter of the testatrix, was made one of the residuary legatees and devisees, and that one-fifth of the residue of the estate was by said will given to her for life, and at her death to her children; that the testatrix’s estate was not indebted to any extent, and that one-fifth of the residue thereof, so given to Josephine for life, will amount to the sum of $2,800 ; that the petitioners were indebted to said estate in the further sum of $700, and they are anxious to pay off all liens on their property. The prayer of the petition is that the executor be authorized to release said mortgage and to invest the said mortgage debt in a second mortgage on said mortgaged property, subject to a mortgage for $3,000 to Samuel Gaither, out of which last-named sum the petitioners were to pay the amounts due by them to said estate over and above said first mortgage debt of $2,752.63, which said second mortgage was to be held as security for said sum, according to the provisions of said will, as a portion of the residue bequeathed to the petitioner, Josephine Buck for life, and at her death to her children.

As we have said, the Orphans’ Court so ordered, and the mortgage to Gaither for $3,000, as well as that for $2,752.63 to the executor, were executed and recorded—the former having priority as provided by the order. On the 19th April, 1890, Gaither assigned his mortgage to Georgia A. Talbott, who, with her husband, assigned it to James Mackubin for collection. It was not until the 9th August, 1897, that Mr. Mackubin proceeded to sell under the power of sale contained in the mortgage to Gaither. After some delay, caused by exceptions to the sale, it was finally ratified, the mortgagee, Gaither, being the substituted purchaser.

On the 1st February, 1898, the Circuit Court ordered, all parties assenting by their attorneys, that a previous order staying proceedings in the mortgage sale be rescinded; that all exceptions to the sale reported be overruled, no testimony having been taken to sustain them, and that the sale to him be ratified. It was, ⁴⁴ however, provided by this order that nothing therein should impair any of the interests of any of the parties under the mortgage from Buck and wife to Sarah Hood—and all questions relating thereto and to the operation and effect of the release of said mortgage by her executor, and of said mortgage from said Buck and wife to said Gaither were expressly reserved. Before the passage of this order, the plaintiffs had filed their bill, and, without unduly prolonging this opinion by a further recital of the numerous proceedings which have been taken in connection with these mortgages, it is sufficient to say that the question, and the only question now presented is the one reserved by the learned Judge below in the latter part of the order of ist February, 1898, namely, the effect of the release of the mortgage made to Mrs. Hood, the testatrix, in her life-time, which release it will be remembered was executed under an order of the Orphans’ Court by Stephen G. Hood, as executor of his mother, Sarah Hood. For if the Orphans’ Court had jurisdiction to pass that order the action of the executor in pursuance of it is valid and binds all parties in interest, and the bill which asks the release to be declared void, and the mortgage from Buck to Sarah Hood to be reinstated, will have to be dismissed.

In the first place, it seems proper to remark that Mr. Buck and his wife, two of the plaintiffs who are now attacking the validity of the action of the Orphans’ Court, are the same persons on whose petition its jurisdiction was exercised. Mrs. Buck, the daughter of the testatrix, Sarah Hood, is the life-tenant under the will. By the eighth paragraph of that instrument, all the residue of her estate is bequeathed and