Ranney v. Bading

• Decision Date: 21 April 1885
• Citation: 43 Ohio St. 157,1 N.E. 523
• Parties: RANNEY v. HARDY. ZELLER v. BADING.
• Court: Ohio Supreme Court

43 Ohio St. 157

1 N.E. 523

RANNEY

v.HARDY.

ZELLER

v.BADING.

Supreme Court of Ohio.

Filed April 21, 1885.

Error to the district court of Cuyahoga county.

April 23, 1872, J. H. Hardy, owner in fee of real estate in the city of Cleveland, known as lot 17, entered into a contract in writing with J. C. McKinnon for the sale of it to him for $1,300, payable $20 in hand, and the balance in monthly installments of $20. McKinnon made the advance payment and was placed in possession of the premises. In the month following (May 9, 1872) Hardy borrowed of David Ranney $1,500, and gave him a promissory note for the amount, payable in one year. He also executed and delivered to him a mortgage on three parcels of real estate, one of which was lot 17; but before accepting the mortgage Ranney went upon the various parcels of real estate embraced in it, and saw McKinnon's wife and children occupying the dwelling-house upon lot 17. The mortgage was entered for record on the day of its execution, and was recorded the same month. McKinnon remained in possession with his family until November 23, 1874, paying Hardy, in the mean time, on the contract, $620, at which time he sold and assigned all his right, title, and interest in the premises to Michael Scanton, and placed him in possession. Scanlon, having remained in possession until June 3, 1875, and in the mean time paid to Hardy $120 of the purchase money, sold and assigned all his right, title, and interest in the premises to John Caldwell, and placed him in possession, and, on the same day, Hardy, his wife joining, executed to Caldwell a deed in feesimple for the premises, with covenants of warranty and seizen and against incumbrances, which deed was recorded the same month. In the mean time, on February 19, 1875, David Ranney assigned and transferred the note and mortgage to C. W. Ranney.

January 3, 1877, C. W. Ranney brought suit in the court of common pleas of Cuyahoga county to foreclose the mortgage. Among the defendants were Hardy, Scanlon, and Caldwell. After a trial in the court of common pleas, the cause was appealed to and tried in the district court. There it appeared that neither McKinnon, Scanlon, nor Caldwell had ever heard of the existence of the mortgage to Ranney until at a time subsequent to the execution and delivery of such deed to Caldwell. There is no express finding that all the purchase money had been paid, but, in the answer of Scanloan and Caldwell, it is averred that it was all paid before the execution of such deed, though this is denied in the reply; and the only proof as to payments, except that above stated, is the deed, in which it is recited that the consideration of $1,300 had been paid by Caldwell. All the lands embraced in the mortgage would not sell for sufficient to satisfy the mortgage debt. The district court held that Ranney was not entitled to enforce his mortgage against lot 17 for any sum whatever, and this petition in error is filed to reverse that judgment.

Zeller v. Bading is a case which was prosecuted in the court of common pleas, and carried to the district court of the same county. In its material facts it is not distinguishable from Ranney v. Hardy, except that the mortgagee, Zeller, when he accepted the mortgage, did not know that Bading, the purchaser, was in possession of and resided upon the premises. In both courts the judgment was in favor of Bading, and this petition in error is prosecuted by Zeller to reverse the judgment.[Ohio St. 159]L. H. Ware & Mix, Noble & White, and Burke & Sanders, for plaintiffs in error.

Adams & Bishop, Wilson & Sykora, and Robinson & White, for defendants in error.

OKEY, J.

Upon the facts appearing in the foregoing statements, we are of opinion--

1. As David Ranney, when he loaned the money to Hardy and accepted from him a mortgage on lot 17, knew that McKinnon was residing on the lot with his family, he was charged with knowledge of the terms and conditions upon which such possession was held. Lessee of Cunningham v. Buckingham, 1 Ohio, 264;House v. Beatty, 7 Ohio, pt. 2, 84; Kelley v. Stanberry, 13 Ohio, 408;Willams v. Sprigg, 6 Ohio St. 585;McKinzie v. Perrill, 15 Ohio St. 162;Bank v. Sawyer, 38 Ohio St. 339, 343. And the other case, ( Zeller v. Bading,) presenting the question whether knowledge by the mortgagee, at the time he accepted the mortgage, that the purchaser was in possession, was material, we answer the question in the negative. True, in some of the cases above cited expressions may be found which seem to support the claim that such knowledge is important, but in neither of them was the fact material to the decision; and where, as in the case now before us, the premises are occupied by a man with his family as a homestead, no well-considered case can be found, aside from those controlled by statutory provision, in which it was held that such possession was not notice to subsequent purchasers and mortgagees of the rights and interests of such occupant, although such purchaser[Ohio St. 160]or mortgagee did not know the premises were occupied. Le Neve v. Le Neve, Amb. 436; S. C. 2 Lead. Cas. Eq. *35, *63, (4th Amer. Ed.) 180; Wade, Notice, §§ 273-306; Holmes v. Powell, 8 De. G., M. & G. 572; Hottenstein v. Lerch, 104 Pa. St. 454; Noyes v. Hall, 97 U. S. 34;Coari v. Oslen, 91 Ill. 273;Brunson v. Brooks, 68 Ala. 248; Pique v. Arendale, 71 Ala. 91. If the possession is not exclusive, or is not of a character to fairly give information that the occupant is asserting dominion over the property under some claim of right or authority, it will not operate as notice. Williams v. Sprigg, supra; Pope v. Allen, 90 N. Y. 298;Lincoln v. Thompson, 75 Mo. 613;Jeffersonville, etc., R. Co. v. Oyler, 82 Ind. 394;White v. White, 105 Ill. 313. But neither of the cases before us is within cases of that class.

2. As the note to David Ranney, secured by mortgage, was overdue at the time he indorsed it to C. W. Ranney, the latter occupies no better position than the indorser; and, according to the law of this state, (and in Illinois, Minnesota, Oregon, and Louisiana, the rule seems to be the same,) the fact that the note was overdue is not material. Baily v. Smith, 14 Ohio St. 396. Indeed, with us a mortgage is, both at law and in equity, a mere security for a debt, and the remedies to which the mortgagee or his assignee may resort are only afforded with a view to enforce payment of the debt. Harkrader v. Leiby, 4 Ohio St. 602;Williams v. Englebrecht, 37 Ohio St. 383; Rev. St. § 5782, as amended in 1883...