Kennedy v. Brown

• Decision Date: 18 April 1883
• Citation: 50 Mich. 336,15 N.W. 498
• Court: Michigan Supreme Court
• Parties: KENNEDY and others v. BROWN.

15 N.W. 498

50 Mich. 336

KENNEDY and others v. BROWN.

Supreme Court of Michigan

April 18, 1883

Where on appeal from justice's court, the plaintiff is allowed to amend his declaration by adding thereto a count which tenders no new issue, and which is not then objected to, no error is committed to defendant's prejudice.

A mortgagee bid off the premises on foreclosure at a figure exceeding the amount of the debt, costs, taxes, and insurance by about $40. The mortgage provided for an attorney's fee of $50. Held, that the mortgagee was bound to pay over the surplus of $40 to the sheriff for the benefit of the owner of the equity of redemption, and that if he did not do so the latter could sue him as for money had and received to his use.

A mortgagee who, on foreclosure, bids off the premises at a sum exceeding the debt and legal charges, is estopped, at least in the absence of evidence, from claiming that he did not have to bid the surplus sum to obtain the land, and he cannot repudiate that part of his bid as fictitious; nor can he deny that he is liable for the surplus to the owner of the equity of redemption, on the ground that he has not paid it over to the sheriff for the latter's benefit.

Error to Kent.

Kennedy & Thompson, for plaintiffs.

J.W. &amp O.C. Ransom, for defendant and appellant.

GRAVES, C.J.

The plaintiffs recovered judgment before a justice upon oral pleadings. The justice entered the substance of the declaration in these terms. "Plaintiff declared orally on the common counts in assumpsit, also specially for a surplus of money in the hands of defendant arising from the foreclosure of a mortgage executed by Calista Nevius to said defendant, dated April 18, 1879, which surplus has been duly assigned to the plaintiffs in this cause, and which said defendant refuses to pay on request, etc., to plaintiff's damage $300."

An appeal was taken, and on the fifteenth of March, 1882, the case was heard without a jury and held for a decision. But during the time it was so held the circuit judge allowed the plaintiffs to amend by adding a new count; ^[*] and for this error is alleged. This ruling worked no prejudice. No new issue was tendered. The original declaration, as indicated by the substance, entered by the justice must have covered all the material ground stated in the amendment, and it was not objected to. The count added was unnecessary, and whether demurrable or not makes no difference.

The remaining objection is that the judgment is not supported by the findings. The recovery was for $41.82, and interest from the date of the mortgage sale. The facts reported show that Calista Nevius mortgaged certain premises to the defendant for $800, with interest, and that the mortgage contained the usual clauses in regard to insurance and neglect to pay interest, and provided also that as often as the defendant should take proceedings to foreclose, the mortgagor should pay him $50 as a reasonable solicitor or attorney fee, in addition to all other legal costs; that defendant foreclosed under the power of sale and bid off the property. His bid was $974.97, being $41.82 above the debt costs, taxes, and insurance, and this sum of $974.97 he claimed as the amount actually his due by the terms of the mortgage. The same sum was carried into the deed as the true consideration, and as the amount which would have to be paid to effect redemption. No money was passed on the sale except that defendant satisfied the sheriff's fees. At the expiration of the time for redemption the defendant received the deed and took possession. No attempt to redeem had been made. The mortgagor assigned her claim to the $41.82 to the plaintiffs, and they demanded payment, which was refused.

It seems to the court that the facts are sufficient. The defendant bid $41.82 more than he was entitled to claim under the foreclosure, and by bidding that increased amount he was unable to get the property. The effect was to make the sum of $974.97 the actual and only consideration for the land. It is not to be assumed that the property would have been obtained for anything less. It cannot be argued on this record that no others were ready to buy at the same price, or that no bids of nearly equal amount were not made. For all that appears other bidders were within a few cents of him. The smallness of the overplus does not affect the question. The principle is the same that it would be if the difference was a thousand dollars. ...