Omaha Nat. Bank v. West Lawn Mausoleum Ass'n, 33393

• Decision Date: 26 March 1954
• Docket Number: No. 33393,33393
• Citation: 158 Neb. 412,63 N.W.2d 504
• Parties: OMAHA NAT. BANK v. WEST LAWN MAUSOLEUM ASS'N et al.
• Court: Nebraska Supreme Court

Page 504

63 N.W.2d 504

158 Neb. 412

OMAHA NAT. BANK v. WEST LAWN MAUSOLEUM ASS'N et al.

No. 33393.

Supreme Court of Nebraska.

March 26, 1954.

Syllabus by the Court.

1. A mausoleum association in this state is formed and governed by sections 12-601 to 12-605, R.S.1943.

2. The powers of a mausoleum association organized under legislative statutes are such only as the statutes confer.

3. Any powers with which the trustees of a mausoleum association are charged by virtue of the statutes cannot be delegated to others, except under the exceptions noted in such statutes.

4. Section 12-509, R.S.1943, provides and authorizes a mausoleum association to create a perpetual care fund and appoint a trustee of such fund for the purposes as provided for in said section, and that only.

5. Section 12-605, R.S.1943, exempts from taxation, execution, attachment, or any other lien or process whatever, crypts, lots, tombs, niches, or vaults sold by a mausoleum association for the purpose of interment and expenses incident thereto.

6. Crypts, lots, tombs, niches, or vaults that are not sold or contracted for are not exempt from payment of indebtedness as provided for in section 12-604, R.S.1943.

7. Section 12-604, R.S.1943, empowers a mausoleum association to issue bonds and other evidences of indebtedness, to an amount, including all indebtedness of whatever nature, not exceeding ninety percent of the actual value of the realty of the association and improvements thereon or to be placed thereon from the proceeds thereof, not including the parts sold to individual owners, and to pledge the unsold crypts, rights, or lots, and the future receipts of the association, such obligations to be paid out of the future receipts of the association.

8. When it is apparent that the trustees of a mausoleum association have failed to perform their duty with reference to indebtedness as provided for by section 12-604, R.S.1943, the district court may appoint a receiver to operate and manage the business of the association and pay the indebtedness of the association as specified in section 12-604, R.S.1943.

Fraser, Connolly, Crofoot & Wenstrand, Omaha, for appellant.

Silverman & Silverman, Collins & Collins, Tesar & Tesar, Richard A. O'Connor, Omaha, for appellees.

Heard before SIMMONS, C. J., and CARTER, MESSMORE, YEAGER, CHAPPELL, WENKE, and BOSLAUGH, JJ.

MESSMORE, Justice.

The Omaha National Bank, plaintiff, as trustee of the perpetual care fund of the West Lawn Mausoleum Association, brought this action in the district court for Douglas County against the West Lawn Mausoleum Association, a corporation, Anson H. Bigelow, John W. Koutsky, Julia A. Koutsky, and Walter L. Anderson, trustee. The West Lawn Mausoleum Association entered no appearance and was adjudged to be in default. John W. Koutsky, now deceased, had only a marital interest which terminated at his death. Julia A. Koutsky claimed a reversionary interest. Anson H. Bigelow, now deceased, had one sole heir at law, Lucille Paige, who in this appeal claimed a reversionary interest. The purpose of the action was to obtain authority to sell tombs in the mausoleum under the provisions of the perpetual care fund agreement dated July 28, 1930, the funds received from the sale of the tombs to be used to repair the mausoleum and to build up an adequate perpetual care fund, to pay costs and expenses of prosecuting this suit, and to determine the rights of the defendants and to find the same, if any, to be inferior to the rights of this plaintiff.

Walter L. Anderson, the mortgage trustee, denied generally in his answer that the plaintiff's rights or the rights of the other defendants were superior to any right of the mortgage trustee; prayed that such rights be subject to the right of the mortgage trustee; and, by cross-petition, prayed for foreclosure of the mortgage trust deed dated March 1, 1937.

The district court entered a decree finding that the rights and interest of the defendants, with the exception of defendant Walter L. Anderson, trustee, were subject to the rights of plaintiff as provided for in the trust agreement; that the perpetual trust agreement should be amended to broaden the trustee's investment powers; that the rights of the defendant Walter L. Anderson, mortgage trustee, were superior to those of the plaintiff and the other defendants; that the mortgage and deed of trust dated March 1, 1937, constituted a first lien on the real estate here involved and the personal property covdered by the instrument; and that this mortgage was in default.

The trial court further decreed that the defendant, West Lawn Mausoleum Association, was indebted to the defendant Walter L. Anderson, mortgage trustee, in the sum of $15,900, together with interest in the aggregate amount of $12,204.25; that the West Lawn Mausoleum Association be required to pay to such defendant $5,206 in cash in possession of the designated mausoleum association; that from this fund the defendant Walter L. Anderson, trustee as aforesaid, and his attorney should be paid reasonable compensation, and the balance of the fund paid to Walter L. Anderson, trustee, should be held by him to apply on any deficiencies that might be due the bondholders after a sale of the property; that upon default of payment for a period of 20 days from and after the entry of the decree, the mortgaged premises be sold; and that the plaintiff and defendants be foreclosed of all right, title, interest, or equity in or to the mortgaged premises.

The plaintiff filed a motion for a new trial which was overruled. From this order, the plaintiff appeals.

Walter L. Anderson, trustee for the bondholders, made application to be appointed receiver of the West Lawn Mausoleum Association property. He was appointed receiver of the property, both real and personal, and authorized to enter upon the duties of looking after and supervising the care of the mausoleum, to take charge of the mausoleum and operate it, and to report to the court the need for repairs. In addition, the West Lawn Mausoleum Association was required to turn over funds in its possession in the amount of $5,206 to the receiver. The receiver gave a bond of $4,000 and qualified.

The trustee receiver filed an application for an allowance to be paid out of funds of the West Lawn Mausoleum Association for attorney's fees and court costs in defending this appeal to the Supreme Court for the benefit of the bondholders. The trial court entered an order on the application granting the request made therein. The plaintiff moved to vacate and set aside this order. This motion to vacate and set aside the order was overruled. The plaintiff predicates error on the part of the trial court in appointing the receiver and also in awarding fees to Walter L. Anderson, mortgage trustee and receiver, and his attorney, but does not discuss or argue this assignment of error. Under rule 8a 2(4), Revised Rules of the Supreme Court of the State of Nebraska, 1951, errors assigned but not argued will be considered as waived. See Mason v. State, 132 Neb. 7, 270 N.W. 661; Maher v. State, 144 Neb. 463, 13 N.W.2d 641. This assignment of error needs no further discussion.

Primarily this appeal involves the question as to whether or not the rights of the plaintiff under the perpetual care fund trust agreement are superior to the rights of receiver trustee appointed by the trial court for the benefit of the bondholders to pay the obligation created by bonds issued and sold by the West Lawn Mausoleum Association.

The plaintiff will hereinafter be referred to as the appellant, the West Lawn Mausoleum Association as the Association, and the receiver trustee for the bondholders as the appellee.

The appellant assigns as error that the trial court erred in finding the lien of the mortgage dated March 1, 1937, was a first lien, in entering a decree of foreclosure, and in ordering the mausoleum property sold.

We set forth the substance of the stipulation of facts by the parties and other evidence adduced at the trial. The parties stipulated that the Omaha National Bank is a corporation organized under the banking laws of the United States with its principal place of business in Omaha, Nebraska; that the West Lawn Mausoleum Association is a nonprofit corporation organized under the laws of this state with its principal place of business in Omaha, Nebraska; that Walter L. Anderson is the successor trustee under a certain mortgage and trust deed dated March 1, 1937, filed of record with the register of deeds of Douglas County; and that this mortgage and trust deed were given by the West Lawn Mausoleum Association, John F. Kincaid president of the association, Anson H. Bigelow, now deceased, beneficiary under covenants contained therein, Julia A. Koutsky also beneficiary under covenants contained therein, and John W. Koutsky husband of Julia A. Koutsky, to the Conservative Securities Company for the purpose of securing payment of the principal of first mortgage bonds of the West Lawn Mausoleum Association of the face value of $35,000. This mortgage sets forth that the West Lawn Mausoleum Association is a corporation organized and existing under sections 13-601 to 13-605, Comp.St.1929, now known as sections 12-601 through 12-605, R.S.1943, and is now the equitable owner of the West Lawn Mausoleum situated approximately in the center of West Lawn Cemetery.

The property here involved and as set forth in the several instruments appearing in this litigation including the mortgage, may be described as follows: 'A certain parcel of land in Section 5 of the Plat of West Lawn Cemetery, on file in the office of said Cemetery, more fully described as follows: Commencing at a point 4 feet Northerly along the west line of Lot 48 in Section 5, thence 10 feet easterly at right angles with said line, thence North 68 degrees West 100 feet; thence Northerly at right angles 150 feet; thence Easterly and at right angles 100...