Perkins v. Stewart

• Citation: 75 Minn. 21,77 N.W. 434
• Parties: PERKINS v. STEWART.
• Decision Date: 29 December 1898
• Court: Supreme Court of Minnesota (US)

75 Minn. 21

77 N.W. 434

PERKINS

v.STEWART.

Supreme Court of Minnesota.

Dec. 29, 1898.

Appeal from district court, Hennepin county; Alex M. Harrison, Judge.

Action by Albert A. Perkins against David D. Stewart. Judgment for plaintiff, and defendant appeals. Affirmed.

Syllabus by the Court

1. Section 6051, Gen. St. 1894, requiring a party foreclosing a mortgage by advertisement to make and file for record, within 10 days after such foreclosure, an affidavit of the amount paid or incurred, and included therein, for disbursements, including attorney's fees, is constitutional.

2. The surplus remaining in the hands of the mortgagee, after the payment of his debt from the proceeds of a foreclosure sale of the mortgaged premises, belongs to the same persons, and is subject to the same liens, as the land belonged to at the time of the sale. If the mortgagor is then the sole owner of the land, subject only to the mortgage, he is entitled to such surplus, although judgments are, thereafter and before it is paid to him, docketed against him, which are a lien on his equity of redemption in the land.

3. It is the duty of a mortgagee foreclosing under a power of sale to promptly ascertain the surplus, if any there be, and pay it over to the party entitled thereto, without any previous demand therefor. If he fails so to do, he is chargeable with interest from the time he received it, except in cases where he could not pay it on account of the absence of the mortgagor, or of adverse claims, or for some other good reason, and the fund remained unproductive in his hands. S. A. Reed, for appellant.

Smith & Smith, for respondent.

START, C. J.

The plaintiff executed a mortgage upon real estate owned by him to the defendant. Default was made in the conditions of the mortgage, and the defendant foreclosed it by advertisement by virtue of the power of sale therein, and became the purchaser of the land at the sale on September 12, 1894. The mortgaged premises sold for the full amount due on the mortgage, and $135 in excess thereof; of which $100 was applied in payment of attorney's fees, and $25 in payment of the costs and disbursements of the foreclosure, and $10 in payment of excessive interest. No money was received by the defendant on such sale, and he paid none to the sheriff making the sale, except his fees, $3. The usual certificate of sale was executed to the defendant by the sheriff. No affidavit of the costs, disbursements, and attorney's fees on the foreclosure of the mortgage was ever made by or on behalf of the defendant. No redemption was made from such foreclosure sale, and the defendant became the absolute owner of the mortgaged premises by virtue thereof. After the foreclosure sale, and on June 28 and August 22, 1895, respectively, judgments were recovered and docketed against the plaintiff, and became a lien on the plaintiff's equity of redemption in the premises. Neither of the judgments has ever been paid. No demand was made on the defendant for the surplus before this action was brought. The defendant is not a resident of this state. This was an action to recover the surplus, and on these facts the trial court ordered judgment for the plaintiff for $135, and interest from the time of the foreclosure sale. The defendant appealed from the judgment so entered.

1. It is claimed by the defendant that the statute (Gen. St. 1894, § 6051) requiring the party foreclosing a mortgage to make and file for record, within 10 days after such foreclosure, an affidavit of the amount absolutely and unconditionally paid for disbursements, including attorney's fees, and included in such foreclosure, is unconstitutional, because the mortgagee's right to retain the stipulated attorney's fees was a contract right, which the legislature could not burden with the conditions of the statute. But the contract was made after the enactment of the statute and with reference to its provisions. It was competent for the legislature to provide for the proof of the amount of costs and attorney's fees paid or incurred by a party foreclosing a mortgage by advertisement, and to require a record thereof. The statute in question is similar to statutes regulating the taxation of disbursements in actions, and it is constitutional. It takes away no contract right from the mortgagee, but simply provides...