Morisey v. Swinson

• Decision Date: 14 January 1890
• Citation: 10 S.E. 754,104 N.C. 555
• Parties: MORISEY v. SWINSON. [1]
• Court: North Carolina Supreme Court

10 S.E. 754

104 N.C. 555

MORISEY v. SWINSON. ^[1]

Supreme Court of North Carolina

January 14, 1890

Appeal from superior court, Duplin county; BYNUM, Judge.

Foreclosure suit by D. G. Morisey against J. E. Swinson. From a judgment for defendant, both parties appeal.

A mortgagee who seeks to have a mortgage "for $700, due by bond or note," corrected on the ground of mutual mistake as to a recital that the debt was due "by bond or note," cannot object to the correctness of the amount due on the ground that the parties had full opportunity to ascertain the same when the mortgage was executed.

W. R Allen, for plaintiff.

Kornegay & Stevens, (H. L. Stevens, of counsel,) for defendant.

MERRIMON C.J.

This action was brought to foreclose a mortgage of land executed by the defendant to the plaintiff on the 29th day of November, 1867, to secure the payment by the former to the latter of "seven hundred dollars, due by bond or note with interest from some time in the year 1857, as on reference to said bond will more fully appear," etc., as recited therein. Among other things, the plaintiff alleged in his complaint that the recital in the mortgage as to the "bond or note" "was inserted therein by mistake and inadvertence of both parties" thereto; and he demanded judgment that the mortgage be corrected so as to recite simply an indebtedness in the amount specified, no such bond or note having been executed or intended; that the mortgage as corrected be foreclosed, the land sold, etc.; and he asked for general relief, etc. The defendant, in his answer, denied that he owed the debt specified in the mortgage, and alleged that the debt intended to be secured by it was a judgment specified for $209.61, balance of a note sued upon. He alleged facts explanatory of how the false recital in the mortgage came to be made, and that it "was caused as above set forth, and by inadvertence and mistake of both parties to the deed, and that no such indebtedness of $700 existed from defendant to plaintiff at the time, by note or otherwise; and he further alleged that long before that time he had fully paid to the plaintiff the mortgage debt intended, etc. The pleadings having been completed, an order of reference was entered, whereof the following is a copy "By consent of parties it is ordered that the above action be referred to F A. Daniels, under the Code." Under this order the referee took much evidence found facts, and the law applicable, stated certain of his rulings, and made and filed his report, to which divers exceptions were filed by the defendant. Upon consideration of the same, the court made an order, of which the following is a copy: "This cause coming on to be heard, and it fully appearing that the indebtedness existing at the time of the execution of the mortgage was only the balance due upon the judgment mentioned in the report; that the same was given under an agreement to indulge the defendant, and also to secure the balance then due, and for advances to be thereafter made; and the court being of the opinion that the plaintiff should not have his mortgage corrected, as prayed for, unless he is willing to do equity by having it also corrected so as to show the actual amount of the debt due at the time of its execution; and the court being of the opinion that the equities of the case will be met by allowing this to be done, and treating the said mortgage as security for the amount actually due at the time of its execution and the advances thereafter made,--it is adjudged that this cause be remanded to the referee, and that he report what amount, if anything, is due the plaintiff upon a statement of account based upon the rulings herein. The referee has leave to take further testimony." To this order the plaintiff excepted, and assigned divers grounds of error therein; but these are not necessary to a proper understanding of the opinion of the court, and need not be repeated. Afterwards the referee heard further evidence, found the facts and the law applicable, and made and filed his second report. The following are copies of material parts thereof:

"I find the following facts: (1) On the 29th day of November, 1867, the defendant executed and delivered to plaintiff a mortgage upon the real estate described in the complaint, which recited an indebtedness of $700, with interest from some time in 1857, which was recited in said mortgage to be done by note or bond, which mortgage purported to secure the payment to plaintiff of said note or bond; that no note or bond was ever executed for said sum of $700; that the recital in said mortgage that said indebtedness was due by note or bond was inserted therein by the inadvertence and mistake of both parties, and that said recited indebtedness is evidenced in no other manner than by the recital in said mortgage; that the said mortgage was executed for the purpose of securing to the plaintiff the balance due on a certain judgment held by plaintiff against defendant, which at the time of the execution of said mortgage amounted to $207.61, some other small indebtedness due by account, and to secure such advances as the plaintiff might from time to time make defendant, and for no other purpose. (2) That at the time of the execution of said mortgage the plaintiff, at the request of the defendant, went into possession of the lot described in the complaint as to the town lot in the town of Warsaw, under an agreement entered into with defendant to the effect that plaintiff was to take possession of the property, and do the best he could with it, applying the rents received therefrom to the payment of defendant's indebtedness; that he has remained in possession, except one year,--1877 or 1878,--when defendant was in possession of the store on said lot, though the plaintiff has not been himself the actual occupant of said property, except the vacant lot, which he has cultivated; that the property was of such a character that the class of tenants to whom it could be rented was utterly insolvent, and the plaintiff was compelled to rely upon their honor, rather than upon their financial responsibility for the payment of rent; that the tenants were frequently changing, and the plaintiff was sometimes able to procure tenants, and sometimes not; that the store was sometimes rented, for a month or two at a time, to persons who desired it for special seasons, and for special and temporary purposes, and who would vacate after a month or two of occupancy; that the houses upon said premises have been gradually falling into decay, and, during the possession of plaintiff, business has moved largely to another part of the town; that the plaintiff has done the best he could with the property; and that he has received rents therefrom to the sum of $759.97, as in referee's statement of rent account filed herewith as a part of this report, which, considering all the circumstances and surroundings, is, for the time plaintiff has been in possession, a fair rent for the same.

"Conclusions of law: (1) That the insertion of the recital in said mortgage that $700 was due by note or bond was made by the inadvertence and mistake of both parties, and that the said mortgage was executed to secure the balance due upon said judgment, to-wit, the sum of $209.61, some small items of account due by defendant to plaintiff, and to secure further advances made by plaintiff from time to time by defendant; and it is ordered that said mortgage be corrected so as to show its real intent and purpose to be to secure the said balance, and the amount of advances made by plaintiff to defendant, and the plaintiff held the same only as a security for said sums. (2) That the sum with which plaintiff is charged in the account herewith filed, $759.97, is, all things considered, a fair rent for said property. (3) That defendant is not indebted to the plaintiff, but plaintiff is indebted to defendant in the sum of $77.03. (4) It is ordered, adjudged, and decreed that defendant recover of plaintiff the sum of $77.03, and the costs of this action."

The plaintiff and defendant respectively filed numerous exceptions to this report. These are sufficiently referred to in the opinion, to be understood. The court below overruled all the exceptions of the parties, confirmed the report, and gave judgment in favor of the defendant. Each of the parties, having excepted, appealed to this court.

The purpose of this action is to correct the deed of mortgage in question, in certain respects, on account of mistake, to foreclose the same, and, to that end, to have an account taken. The cause of action is wholly equitable in its nature and hence the court must exercise its authority and jurisdictional functions as a court of equity, applying such statutory provisions as may be applicable. Indeed, the jurisdiction is so extensive that the court may administer the rights of the parties, as to the matter in litigation, to the extent they come properly within the scope of the action, whether the same be legal or equitable, or both. There exists directness and thoroughness in the prevailing method of civil procedure. One of its distinctive and leading features is to avoid circuity of action and method, and to administer the rights of parties, whether...