Clement v. Willett

Decision Date07 August 1908
Docket NumberNos. 15,579 - (128).,s. 15,579 - (128).
Citation105 Minn. 267
CourtMinnesota Supreme Court

to be the deficiency due after sale of mortgaged premises upon foreclosure. From an order, Quinn, J., sustaining a demurrer to the complaint, plaintiff appealed. Affirmed.

Harrington & Dickinson and Dean & Palmer, for appellant.

Putnam & Nicholsen, for respondent.


This is an appeal from an order sustaining a demurrer to a complaint which in substance alleges the following facts: In November, 1904, Fred Schaer and wife gave to John Schmitt, a resident of Iowa, a mortgage on eighty acres of land in Kossuth county, Iowa, to secure the payment of three promissory notes, aggregating the sum of $1,300. On July 11, 1905, Schaer and wife conveyed the land to Frank P. Barnes. Barnes did not assume and agree to pay the debt secured by the Schmitt mortgage. Thereafter, on September 28, 1905, Barnes and wife conveyed the land to David Willett by a deed which recited: "That the same are free from all incumbrances, except a lien created by a public drain number three of Kossuth county, Iowa, assessed at $403.20, which lien second party assumes and agrees to pay, also a mortgage of $1,300 in favor of John Schmitt, and a mortgage of $1,500 in favor of Rose M. Bulson. Said second party assumes and agrees to pay these two mortgages." Default was made, and under foreclosure the land realized but $342.30 for the mortgagee. This action was then brought by the administrator of the estate of John Schmitt to obtain a personal judgment for the deficiency against Willett, on the theory that he became liable therefor by virtue of the assumption clause in the deed from Barnes to Willett.

The question is whether the owner of the mortgage can enforce the assumption agreement made with a grantor who had not himself assumed personal liability for the mortgage and owed no duty or obligation to the owner thereof respecting the subject-matter of the promise. It is the settled law of this jurisdiction that there can be no recovery in such a case. If the grantor is personally liable to pay the debt, the mortgagee or his grantee may maintain an action against the assuming grantee (Follansbee v. Johnson, 28 Minn. 311, 9 N. W. 882; Connecticut Mut. Life Ins. Co. v. Knapp, 62 Minn. 405, 64 N. W. 1137; Pinch v. McCulloch, 72 Minn. 71, 74 N. W. 897); but when the immediate grantor is not liable, and owes no duty or obligation to the owner of the mortgage in respect to the subject-matter, no cause of action arises in favor of the owner of the mortgage. Kramer v. Gardner, 104 Minn. 370, 116 N. W. 925, and cases cited. In this instance there was no debt or obligation due from Barnes to Schmitt, which Willett agreed to pay as part of the consideration, and thus made his own debt; and under the decisions in the state no cause of action arose in favor of Schmitt. But in Iowa an action may be maintained by the owner of the mortgage, regardless of whether the immediate grantor was liable to pay the debt secured by the mortgage. Marble v. Mesarvey, 101 Iowa, 285, 70 N. W. 198.

The appellants contend that the validity of this assumption contract should be determined by the laws of Iowa, because (a) such was the intention of the parties; (b) it was to be performed in Iowa; (c) it is a part of the deed, which should be construed as a whole; and (d) it is a part of the covenants of seisin and against incumbrances, and therefore runs with the land.

We cannot agree with the appellant that the contract to assume and pay the mortgage is a part of the covenant of seisin or the covenant against incumbrances. It is true that it is written into the deed in connection with these covenants; but this is not controlling. The question of what covenants in a deed run with the land received such full consideration by Mr. Justice Lewis in the recent case of Sjoblom v. Mark, 103 Minn. 193, 114 N. W. 746, as to render any detailed discussion at this time unnecessary. Covenants of seisin and against incumbrances are real covenants and run with the land (Security Bank of Minnesota v. Holmes, 68 Minn. 538, 71 N. W. 699; McClure v. Dee, 115 Iowa, 546, 88 N. W. 1093, 91 Am. St. 181; Schofield v. Iowa, 32 Iowa, 317, 7 Am. 197) and are, therefore, to be governed by the law of the state where the land is situated (11 Cyc. 1052). Such covenants, whether they impose burdens or confer benefits, pass with the land to the grantees thereof. But, strictly speaking, at law there must be privity of...

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