McCann v. Mortgage, Bank & Investment Co.

• Decision Date: 13 March 1893
• Citation: 54 N.W. 1026,3 N.D. 172
• Court: North Dakota Supreme Court

54 N.W. 1026

3 N.D. 172

WILLIAM MCCANN v. MORTGAGE, BANK & INVESTMENT CO.;

DAVID WILLIAMSON v. MORTGAGE, BANK & INVESTMENT CO.;

THOMAS HALVORSON v. MORTGAGE, BANK & INVESTMENT CO

Supreme Court of North Dakota

March 13, 1893

Appeals from District Court, Bottineau County; Morgan, J.

Affirmed.

A. S Drake, for appellant.

E. A Maglone and Ball & Watson, for respondents.

OPINION

The facts fully appear in the following statement by WALLIN, J.

An appeal to this court is taken in each of the above entitled matters by the Mortgage, Bank & Investment Company, which company is the mortgagee in all of the above mentioned mortgages. The several appeals are from orders of the District Court for Bottineau County, denying appellant's application to set aside previous orders made by the judge of said court. The opinion below is based upon the record in the McCann appeal, but the controlling facts and governing principles of law are common to all of the cases, and hence a single opinion will suffice for all.

WALLIN, J., (after stating the facts as above.) This proceeding originated under the proviso embraced in § 5411, Comp. Laws, regulating foreclosures of mortgages by advertisement. The proviso is as follows: "Provided, that when the mortgagee or his assignee has commenced procedure by advertisement, and it shall be made to appear by affidavit of the mortgagor, his agent or attorney, to the satisfaction of the Judge of the District Court of the county where the mortgaged property is situated, that the mortgagor has a legal counterclaim, or any other valid defense, against the collection of the whole or any part of the amount claimed to be due on such mortgage, such judge may, by an order to that effect, enjoin the mortgagee or his assignee from foreclosing such mortgage by advertisement, and direct that all further proceedings for the foreclosure be had in the District Court properly having jurisdiction of the subject matter; and, for the purpose of carrying out the provisions of this act, service may be had upon the attorney or agent of the mortgagee or assignee." On the 25th day of September A. D. 1891, William McCann, the respondent, presented to the Judge of the Second Judicial District Court of North Dakota his affidavit, which after the title and venue is as follows:

"William McCann, being duly sworn, deposes and says that he is the mortgagor mentioned and described in the annexed notice of mortgage sale, which said notice, hereto annexed, marked 'Exhit A,' and made a part of this affidavit. Deponent further says that he has a legal counterclaim, valid defense, against the collection of the mortgage, and the amount claimed therein to be due thereon; that the sum, $ 86.43, claimed in said notice to be due on said mortgage is, as deponent is informed and verily believes, for interest on the sum of $ 600.00, secured by said mortgage; that deponent on the 10th day of February, 1890, made, executed, and delivered to Mortgage, Bank & Investment Company his promissory note for the sum of $ 600.00, with interest at the rate of 9 per cent. per annum, and to secure the payment of said sum, deponent, at said time and place, executed the mortgage described in said Exhibit A; that deponent received only the sum of $ 335; that the balance of said sum of $ 600.00, to-wit: the sum of $ 265, together with a chattel mortgage for $ 140.00 and note for same; was kept and retained by said Mortgage, Bank & Investment Company as a bonus or usury, and deponent never received any consideration or benefit therefrom, whatever; that said Exhibit A is taken from the North Dakota Eagle, a newspaper printed and published at Willow City, Bottineau County, N. D.; that said Mortgage, Bank & Investment Company threatens to foreclose said mortgage by advertisement, and sell the premises therein described, on October 15th, A. D. 1891, at 2 o'clock P. M., at Willow City, Bottineau County, N. D.; that deponent fears said mortgagee will so sell said premises at said time and place unless restrained therefrom by an order from the Judge of the District Court of Bottineau County, N. D. Deponent further says that he is the owner of the premises in said Exhibit A described. Wherefore, deponent prays that the honorable Judge of the District Court of Bottineau County, N. D., may, by an order to that effect, enjoin the mortgagee, or its assignee, agent, attorney, or servants, from foreclosing said mortgage by advertisement, and direct that all further proceedings for the foreclosure thereof be had in the District Court of Bottineau County, N. D.; the same being the county wherein said premises are situated. Wm. McCann.

"Subscribed and sworn to before me this 25th day of September, 1891. Jacob Schroeder, Notary Public. [Seal."]

"Exhibit A. Default existing in a contract and mortgage executed by William McCann on February 10th, 1890, to Mortgage, Bank & Investment Company, on the west 1/2 of northeast 1/4 and east 1/2 of northwest 1/4 of section 15, township 160, range 74, in Bottineau County, North Dakota, now due on said contract and mortgage,--$ 86.43,--therefore, said land will be sold at the front door of the post-office in Willow City, in said county and state, on October 15th, A. D. 1891, at 2 o'clock P. M., under said mortgage. September 1st, 1891, A. S. Drake, Attorney, Fargo, N. D."

Whereupon, on the 30th day of September, A. D. 1891, the Judge of said District Court made an order as follows: "Ordered, that said Mortgage, Bank & Investment Company, and their attorney A. S. Drake, and all their agents, servants, attorneys, and employes, be, and they hereby are, enjoined and restrained from foreclosing said mortgage by advertisement, and they, each and all of them, are further ordered and directed that all further proceedings for the foreclosure of said mortgage be had in the District Court of Bottineau County, N. D., that being the county wherein said premises are situated, and the court properly having jurisdiction thereof,"--which affidavit and order were served upon the Mortgage, Bank & Investment Company prior to the hour of sale, as stated in the published notice of sale. At a term of the District Court for Bottineau County, held in May, 1892, upon due notice, the Mortgage, Bank & Investment Company moved in open court for an order vacating and setting aside the before mentioned order made by the judge of said court. After hearing counsel on both sides, the application to vacate was denied, to which ruling the moving party saved an exception; and the order and exception, together with all of the papers in the proceeding, were brought upon the record, and made a part thereof, by the direction of the District Court. The Mortgage, Bank & Investment Company have appealed to this court from the order of the trial court refusing to vacate the original order made by the judge of said court. The motion to vacate was not supported by affidavits offered by the mortgagee, but was based wholly upon the affidavit of McCann, as presented to the judge on the application for the order, and upon the order made by the judge.

In this court, appellant assigns only the following errors: "First, The judge erred in issuing said injunction. Second, The court erred in overruling appellant's motion to dissolve said injunction, for the reasons (a) that no fact or facts appear in support of said injunction, which could in any manner constitute a valid defense or legal counterclaim against the collection of the whole, or any part, of the amount claimed by appellant to be due in its notice of sale on the mortgage described in the notice of sale mentioned by respondent in his affidavit for the injunction; (b) that it does not appear in support of the said injunction that such proceedings have been begun by appellant, or by any person or persons in its behalf, as would, if carried forward to completion, foreclose the said William McCann of his equity of redemption in the land in question."

We are clear that these assignments of error are untenable, and hence must be overruled. An inspection of the affidavit of McCann, the mortgagor, discloses that it embraces all facts which the statute requires to be stated as a basis for an application for a judge's order of the character in question. It sufficiently appeared by the affidavit that the mortgagee had instituted a mortgage foreclosure proceeding by advertisement, and also that the mortgagor had a "valid defense" against the collection of the whole of the "amount claimed to be due on such mortgage." These general averments, if satisfactory to the judge who made the order, would be alone sufficient to authorize the judge, at his discretion, to make the order. But the affidavit goes into detail, and sets out specific facts which tend to show that the sum claimed to be due upon the mortgage was claimed as interest, and that no interest was due upon the note secured by the mortgage in question, by reason of usury, with which it appeared, prima facie, the transaction was tainted. The proceeding is wholly statutory, and there is no requirement that the affidavit made in behalf of a mortgagor shall be couched in any specific terms, nor that it shall be framed under the strict rules governing the pleader in framing the pleadings in an action. All that is required is that the facts enumerated in the statute shall be set out in the affidavit in such manner and form as will satisfy the judge to whom the affidavit is...