Ellens v. Lind

• Decision Date: 30 December 1937
• Docket Number: 8061.
• Citation: 277 N.W. 40,65 S.D. 620
• Parties: ELLENS et al. v. LIND et al.
• Court: South Dakota Supreme Court

277 N.W. 40

65 S.D. 620

ELLENS et al. v. LIND et al.

No. 8061.

Supreme Court of South Dakota

December 30, 1937

Appeal from Circuit Court, Lincoln County; Lucius J. Wall, Judge.

Action by F. H. Ellens and others against Mary Lind, William H Wasem, and others. From an adverse judgment, William H. Wasem appeals.

Judgment reversed and cause remanded, with directions.

Bailey Voorhees, Woods & Bottom, of Sioux Falls, for appellant.

Doyle & Mahoney and B. O. Stordahl, all of Sioux Falls, for respondents.

ROBERTS Judge.

On January 6, 1923, Mary Lind and husband executed and delivered to Theresa Ellens their promissory note for $7,000 and to secure payment they executed a mortgage upon a tract of land in Lincoln county. The appellant, William H. Wasem, purchased the mortgaged property and title was conveyed to him by warranty deed, dated April 16, 1923. The mortgagee and appellant entered into a contract, dated December 19, 1927 which in part reads as follows "Whereas, Theresa Ellens has been requested to extend the time of payment of said note and mortgage as hereinafter stated, which she has consented to do in consideration of the payments to be made as hereinafter provided;

"Now therefore, the said William H. Wasem hereby agrees to pay the principal sum remaining unpaid as aforesaid, at the times and in the manner as hereinafter stated, to wit: the sum of $1,000 on the first day of March, 1928, the further sum of $1,000 on the first day of March, 1929, and the balance of $5,000 on the first day of March, 1933, with the privilege of paying $500 or multiples thereof on any interest paying date upon the principal sum."

Theresa Ellens died intestate and respondents, plaintiffs below, are the distributees of her estate. They brought this action to foreclose the mortgage and for a personal judgment against William H. Wasem. Plaintiffs allege in their complaint that by the terms of the aforesaid agreement the defendant William H. Wasem assumed and agreed to pay the mortgage debt. Appellant sets forth the defenses that this agreement was made for the sole purpose of extending the time of payment and that after its execution and delivery for the purpose of expressing and clarifying the intention of the parties thereto, Theresa Ellens executed and delivered to appellant on March 1, 1929, an instrument reading as follows:

"I, Theresa Ellens, the undersigned being the owner and holder of a certain note and mortgage originally for $7,000.00 made and executed by Mary Lind and Louis Lind, her husband, dated January 6, 1923, and filed for record January 15, 1923, and recorded in the office of the Register of Deeds office in Lincoln County, S. Dak., in Book 62 of Mortgages, on page 309 thereof, do hereby acknowledge receipt this day and date from W. H. Wasem, the sum of One Thousand dollars ($1,000.00) upon the principal sum of the said note and mortgage, and also the sum of Three hundred thirty dollars ($330.00), as interest up to date on said note and mortgage, leaving a balance due and unpaid of Five thousand dollars to mature March 1st, 1933 as per terms of a certain extension agreement between said parties dated December 19th, 1927, and in consideration of the above payments and a like amount paid on the principal sum March 1st, 1928, and a material reduction made on the first mortgage, I hereby release W. H. Wasem and Mary A. Wasem, his wife, from any and all personal liability that may have been created under the terms of the said extension agreement."

The trial court found that by the terms of the extension agreement the appellant assumed and agreed to pay to Theresa Ellens the mortgage debt and that she at no time released the appellant from any personal liability thereunder, and entered judgment against him in favor of the plaintiffs for the amount of the unpaid principal and interest.

It is a well-recognized rule of law that when land is purchased subject to an encumbrance and the purchaser assumes the encumbrance, he becomes personally liable. Zastrow v Knight, 56 S.D. 554, 229 N.W. 925, 72 A.L.R. 379; Wright v. Anderson, 62 S.D. 444, 253 N.W. 484, 95 A.L.R. 81. The contract of assumption is usually evidenced by the insertion of a recital in the deed, stating that the grantee assumes and agrees to pay the mortgage, but such an agreement may be contained in a separate instrument. Leach v. Nelson, 50 N.D. 538, 196 N.W. 755; Hopkins v. Warner, 109 Cal. 133, 41 P. 868. Appellant contends that whenever it is sought to charge a grantee with the obligation to pay a mortgage the language which it is claimed imposes the obligation must show a clear and unequivocal assumption of the mortgage. There was no assumption of the mortgage in the deed conveying the land to the appellant, but subsequent to delivery of the deed and...