Farmers' Union Jobbing Ass'n v. Sullivan
| Citation | 19 P.2d 476,137 Kan. 196 |
| Decision Date | 11 March 1933 |
| Docket Number | 30998. |
| Parties | FARMERS' UNION JOBBING ASS'N v. SULLIVAN (HOMESTEAD BUILDING & LOAN ASS'N, Intervener). [*] |
| Court | United States State Supreme Court of Kansas |
Syllabus by the Court.
Finding that allegations of verified pleading were true, held not error even if they were excessive and unreasonable where they were not denied or modified by pleadings or proof.
Mortgagor's voluntary consent that mortgagee might possess itself of rents duly assigned in note and mortgage avoided necessity of judicial proceeding to acquire possession.
Where mortgagee, to whom rents were assigned in note and mortgage makes demand on tenants therefor and has possessed itself thereof by judicial proceeding or by mortgagor's voluntary consent, mortgagee's lien is prior to lien or claim under garnishment process from date of mortgagee's demand, when immediately followed by such consent or judicial proceeding.
1. It is not error for a trial court to find the allegations of a verified pleading to be true, even if they are excessive and unreasonable, when they are not denied or modified by pleadings or proof.
2. The voluntary consent of the mortgagor or owner of mortgaged property that the mortgagee may possess itself of the rents and profits of the mortgaged property, which rents and profits were duly assigned to the mortgagee in the note and mortgage when executed, is equivalent to and avoids the necessity of a judicial proceeding to acquire such possession.
3. Where a mortgagee has made demand of tenants for the rents and profits of mortgaged property and has possessed itself of such rents and profits by judicial proceeding or by the voluntary consent of the mortgagor or owner in harmony with the assignment provisions contained in the note and mortgage its lien is subject to enforcement and is prior to a lien or claim under a garnishment process from the date of the demand, when immediately followed by such consent or judicial proceeding.
Appeal from District Court, Saline County; Dallas Grover, Judge.
Action by the Farmers' Union Jobbing Association, a corporation against T. F. Sullivan. After obtaining judgment against the defendant, the plaintiff instituted garnishment proceedings in which the Homestead Building & Loan Association intervened. From a judgment for the intervener, the plaintiff appeals.
W. S. Norris and Homer B. Jenkins, both of Salina, for appellant.
John Hamilton Wilson, of Salina, for appellee.
The question here involved is whether a judgment creditor is entitled to the rents and profits of the judgment debtor's property under garnishment proceedings as against a mortgagee to whom the rents and profits had previously and conditionally been assigned in the note and mortgage when executed, where no proceedings had been commenced to foreclose the mortgage or to have a receiver appointed to collect the same. The trial court held in favor of the mortgagee because of the prior assignment of the rents by the owner to the mortgagee, as contained in the note, and the plaintiff, the judgment creditor, appeals.
The plaintiff corporation had regularly obtained in the district court of Saline county a personal judgment against the defendant, T. F. Sullivan, from which no appeal had been taken and on which an execution had been returned unsatisfied. Thereafter, and on or about November 1, 1931, the plaintiff procured the issuance and service of garnishment summons upon certain tenants of the defendant, Sullivan, occupying four different dwellings and business houses in the city of Salina. All this real estate so rented by the defendant, Sullivan, had been by him and wife about five years prior thereto mortgaged to the Homestead Building & Loan Association, and the note secured by this mortgage contained the following conditional assignment of the rents and profits to the mortgagee as a further security:
The building and loan association as an intervener on November 23, 1931, filed in this same case in which the garnishment summons had been issued a verified application, attaching a copy of the note and mortgage and praying that the court discharge the garnishees and adjudge the association to be entitled to the rents and profits. The application contains, among other allegations, the following: "*** Of which note this applicant remains the owner and holder and which note is unpaid and undischarged, true and correct copies of said note and mortgage with all credits and endorsements thereon being hereto attached and made part hereof. ***"
Prior to the filing of the intervener's application two of the garnishees filed answers to the effect that they each owed the defendant, Sullivan, rent in the sum of $50, and on the same day the application was filed all four tenants filed separate answers in garnishment admitting they were tenants of the defendant Sullivan but the Homestead Building & Loan Association had required and demanded of them the rent under what it claims to be a prior right, and they ask that the building and loan association be made a party to the proceedings so that they might be protected from further liability by an order of the court.
On the 1st day of December, 1931, the plaintiff procured the issuance and service of four new garnishment summons which were served on the same tenants to cover the rent then due and payable. No answers were filed to these processes because ...
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