Malone v. Roy
Before: Haynes
Synopsis
Mortgage—Deed with Defeasance—Allowance of Interest.—Where a mortgage is given by a deed with a defeasance, to secure the payment of a certain sum of money due at a specified time, which sum is the amount of a sum of money loaned with interest thereon for one year at fifteen per cent, without any agreement as to a rate of interest beyond the date at which the money is to become due, only the statutory rate of seven per cent per annum can be recovered after the date of maturity of the obligation secured.
Id.—Estoppel of Mortgagor—Interest Included in Amount Stated in Defeasance—Absence of Wp.itten Promise.—The mortgagor cannot claim that the deed and defeasance constitutes a mortgage, and at the same time deny that it fixes the amount to be paid at the maturity of the obligation, or object that more than seven per cent per annum on the money loaned was 'included in the amount secured, without any written promise on the part of the mortgagor to pay any rate of interest.
Id.—Improvements bv Mortgagee—Wrongful Possession.—Where the mortgagee wrongfully takes possession of the premises mortgaged, without the consent of the mortgagor, and makes improvements thereon, which are not made with the consent or approbation of the mortgagor, no allowance can be made for such improvements.
Id.—Conflicting Claims of Ownership—Action to Quiet Title.—The fact that the mortgagee holding under the deed claimed title to the mortgaged property, and brought an action to quiet title, does not aid him as to money expended for improvements, where he was informed by the proceedings in the action that the mortgagor denied his ownership, and insisted that the deed was given as security only, and any money expended for repairs and improvements as though he were owner, in the face of the appeal of the mortgagor from a judgment quieting title in favor of the mortgagee, cannot he allowed to him after a reversal of the judgment in a subsequent action to foreclose the mortgage.
Id.—Rights of Mortgagee in Possession—Repairs and Improvements. To constitute a mortgagee in possession who can be allowed for repairs and improvements, the mortgagee must be in possession by reason of the agreement or assent of the mortgagor.
Haynes, C. This action was brought by Malone against Roy to foreclose a mortgage. The plaintiff had judgment, and defendant appealed therefrom and from an order denying a new trial.
On January 4, 1888, the defendant was the owner of 360 acres of land, under a contract of purchase, upon which he owed $6,550, and on that day he obtained that sum from the plaintiff, applied it to the payment of the balance due upon the land, obtained a conveyance to himself, and, to secure the plaintiff for the moneys so obtained, executed to the plaintiff a deed, absolute in form, for the expressed consideration of $7,532.50, and [520]the plaintiff at the same time executed and delivered to the defendant his agreement to reconvey the premises to the defendant upon payment of said sum of $7,532.50 on January 4,1889.
In March or April, 1889, Malone, claiming said deed to be an absolute conveyance and not a mortgage, brought an action against Roy to quiet his title to said land, and on appeal -this court held that the transaction constituted a mortgage. (Malone v. Roy, 94 Cal. 341.) Malone thereupon brought this action to foreclose said mortgage.
Nearly all the findings are attacked, and numerous errors of law occurring on .the trial are specified. The case involves two principal questions, which are covered by the specifications, and the findings affecting these questions are in substance as follows: That the sum secured by the mortgage is $6,550, and interest thereon from January 4, 1888, at the rate of 15 per centum per annum; that Malone entered into possession of said premises under the deed from Roy, with his consent, on ®r about January 4, 1888, with the understanding that, if Roy should fail to purchase the property within the time limited in the paper executed by Malone, his title would become indefeasible; that Malone, being in possession, in good faith, after January 4, 1889, made valuable repairs and improvements to the amount of $2,232.
1. The court erred in its allowance of interest. The deed and defeasance constituted a mortgage to secure the payment of $7,532.50, due January 4, 1889. That sum was made up of $6,550, the money loaned, and interest thereon for one year at 15 per cent. But there was no agreement as to the rate of interest beyond the date at which the money became due, and therefore the statutory rate of 7 per centum per annum is all that can be recovered after that date. If Malone had lent the same amount and taken Roy’s note for $7,532.50, payable one year after date, without interest, thus including the interest at the rate of 15 per cent, and made no provision- as to the rate after maturity, no one would
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