Fed. Land Bank Of D.C. v. Jones

• Decision Date: 17 March 1937
• Docket Number: No. 17.,17.
• Citation: 190 S.E. 479,211 N.C. 317
• Parties: FEDERAL LAND BANK OF COLUMBIA. v. JONES et al.
• Court: North Carolina Supreme Court

190 S.E. 479

211 N.C. 317

FEDERAL LAND BANK OF COLUMBIA.

v.JONES et al.

No. 17.

Supreme Court of North Carolina.

March 17, 1937

.

Appeal from Superior Court, Macon County; W. F. Harding, Judge.

Suit by the Federal Land Bank of Columbia against Maude E. Jones, administratrix, and others, to foreclose a mortgage, and for injury to the mortgaged premises. Judgment by default and order of foreclosure were entered on the first cause of action, from which no appeal was taken, and plaintiff suffered a nonsuit as to its second cause of action, and appeals.

Reversed.

Civil action to foreclose mortgage and to recover damages for injury to mortgaged premises.

The plaintiff holds a mortgage on 35¹/₄ acres of land in Macon county, the same having been taken in 1921 as security for a loan of $1,000.

In 1928, during the existence and continuance of plaintiff's lien, the mortgagor, Nannie E. Jacobs, conveyed to the Town of Franklin an easement of said tract of land to flood and pond water thereon to the extent necessary for the construction of a dam and municipal electric light plant, which said easement was conveyed to Nantahala Power & Light Company in 1933. The Power Company is now in possession under said easement, and has greatly lessened plaintiff's security by ponding water on a portion of the mortgaged premises.

Two causes of action are set out in the complaint: One to foreclose said mortgage; and the other to recover damages for injury to the mortgaged premises.

There was judgment by default and order of foreclosure on the first cause of action, from which no appeal has been taken.

During the trial, upon intimation from the court that the cause of action for damages against the Town of Franklin and the Nantahala Power & Light Company had not accrued and would not accrue prior to foreclosure with resultant deficiency, plaintiff suffered a nonsuit as to its second cause of action, and appeals.

Gray & Christopher, of Murphy, for appellant.

J. Frank Ray, of Franklin, for appellee Town of Franklin.

Black & Whitaker, of Bryson City, for appellee Power & Light Co.

STACY, Chief Justice.

Can a mortgagee, after default and before foreclosure, maintain an action fortrespass against one who has tortiously injured the mortgaged estate? The answer is, "Yes."

At the time of ponding water on the mortgaged premises, the plaintiff, as mortgagee after default, was entitled to possession. Weathersbee v. Goodwin, 175 N.C. 234, 95 S.E. 491; Kiser v. Combs, 114 N.C. 640, 19 S.E. 664; Coor v. Smith, 101 N.C. 261, 7 S.E. 669; Capehart v. Dettrick, 91 N.C. 344; Bruner v. Threadgill, 88 N.C. 361; Wittkowski v. Watkins, 84 N.C. 456, 457; Cunningham v. Davis, 42 N.C. 5; Linscott v. Weeks, 72 Me. 506; 2 Jones on Mortgages, § 684 et seq. It is the holding in this jurisdiction that the legal title to mortgaged premises, for purposes of security, is vested in the mortgagee. Gorrell v. Alspaugh, 120 N.C. 362, 27 S.E. 85; Weil & Bros. v. Davis, 168 N. C. 298, 84 S.E. 395; Duplin County v. Harrell, 195 N.C. 445, 142 S.E. 481; Mitchell v. Shuford, 200 N.C. 321, 156 S. E. 513. And where there is no agreement to the contrary, certainly after default, the mortgagee, in order to protect his security, is entitled to enter and to hold the land until redeemed. Stevens v. Turlington, 186 N.C. 191, 119 S.E. 210, 32 A.L.R. 870. To this end, he may maintain an action in ejectment, even against the mortgagor himself (Weathersbee v. Goodwin, supra); file a suit in equity to restrain waste (Linscott v. Weeks, supra; 41 C.J. 649); institute an action in trespass quare clausum fregit against any one tortiously injuring the estate. Stevens v. Smathers, 124 N.C. 571, 32 S.E. 959; Beck v. Zimmerman, 75 N.C. 60; Edwards v. Meadows, 195 N.C. 255, 141 S.E. 595; Walker v. Fawcett, 29 N.C. 44; Leavitt v. Eastman, 77 Me. 117; 1 Perry on Trusts (6th Ed.) § 328. Such rights of action are grounded on the mortgagee's interest in the land. Stewart v. Munger & Bennett, 174 N.C. 402, 93 S.E. 927; Byrom v. Chapin, 113 Mass. 308; 2 Jones on Mortgages § 695a; 41 C.J. 648.

Nothing was said in Watkins v. Kaolin Mfg. Co., 131 N.C. 536, 42 S.E. 983, 60 L. R.A. 617, or in Livermon v. Roanoke & T. R. R. Co., 109 N.C. 52, 13 S.E. 734, which militates against our present position. On the other hand, the cases...