McCarthy v. Benedict

• Decision Date: 23 May 1911
• Docket Number: 16,421
• Citation: 131 N.W. 598,89 Neb. 293
• Parties: MICHAEL H. MCCARTHY, APPELLEE, v. EDMOND H. BENEDICT ET AL., APPELLANTS
• Court: Nebraska Supreme Court

131 N.W. 598

89 Neb. 293

MICHAEL H. MCCARTHY, APPELLEE, v. EDMOND H. BENEDICT ET AL., APPELLANTS

No. 16,421

Supreme Court of Nebraska

May 23, 1911

APPEAL from the district court for Holt county: WILLIAM H. WESTOVER JUDGE. Reversed with directions.

REVERSED.

E. H Benedict and Flansburg & Williams, for appellants.

M. F Harrington, contra.

OPINION

REESE, C. J.

This is an action to enjoin the sale of real estate under a decree foreclosing a mortgage. From a rather imperfect record before us, it is made to appear that on September 25, 1888, one Searl, the then owner of the real estate involved, executed a mortgage to the Nebraska Mortgage & Investment Company to secure a debt for $ 800 due October 1, 1893. The interest was payable semiannually. The mortgage contains a clause that, if there was a default in the payment of interest as it accrued, the debt should thereby be matured. The interest due March 1, 1890, was not paid, and no further payment of interest has been made. The mortgage was duly recorded on the 27th day of September, 1888. Through mesne conveyances plaintiff became the owner of the legal title to the property on the 5th day of May, 1902. On th 20th day of September, of the same year, he conveyed the property to Edwin S. Eves by warranty deed, but the conveyance was only in trust to enable Eves to make some kind of a trade for plaintiff. There was nothing placed of record to show the trust character of the conveyance, nor the interest retained by plaintiff. On the 1st day of November, of the same year, Eves reconveyed the land to plaintiff by warranty deed, but the deed was never recorded, and was finally lost. On the 21st day of December, 1906, Eves and wife executed to plaintiff a quitclaim deed, which was recorded on the 9th day of February, 1907. We are unable to find any direct proof that the deed from plaintiff to Eves was recorded, but from various recitals contained in the record we assume that it was. It was stipulated upon the trial in the district court that "plaintiff never took the actual possession of said land, except that between four and five years ago he rented it one season to a Mr. Friend, so that he might cut hay thereon, and outside of that the actual (only?) possession the plaintiff has had of the land would be constructive possession by reason of his ownership." On the 7th day of May, 1902, plaintiff commenced a suit in the district court for Holt county to quiet his title as against said mortgage, alleging that, by the failure to pay the interest as it became due the mortgage debt was matured and became due and payable on the 1st day of May, 1890; that the 10 years' statute of limitations had elapsed, and the mortgage was no longer a lien, but remained a cloud upon his title. The parties named as defendants in that action were: "John Doe, real name unknown; the southeast quarter of section 23, in township 33, range 15 west in Holt county, Nebraska; the Nebraska Mortgage & Investment Company; and Charles K. Collins, as receiver of the Nebraska Mortgage & Investment Company." Notice of the pendency of the action was given by publication alone. It is alleged in the petition in this case, and admitted, that the mortgage was given to the Nebraska Mortgage & Investment Company of "Fremont, Dodge county, Nebraska." If that company, or the receiver, were domiciled in this state it is not apparent that jurisdiction could be acquired by publication. It is stipulated that the defendant in this case "had no notice of actual entry of the decree, or the pendency of the suit, until after the decree was entered." He was not a party to it.

On the 18th day of September, 1902, a decree was entered finding that, by reason of the nonpayment of interest, the debt had been matured, and that more than 10 years had elapsed prior to the commencement of the suit, and the mortgage was barred and was no lien on the land. The title was quieted and the mortgage was canceled. It cannot be doubted that that decree was at best erroneous. Lowenstein v. Phelan, 17 Neb 429, 22 N.W. 561; Richardson v. Warner, 28 F. 343. An appeal was taken from the decree to the supreme court, and was here affirmed "for want of briefs," so stipulated on the trial. In taking...