Sec. Trust Co. v. Sloman

• Decision Date: 02 December 1930
• Docket Number: No. 69.,69.
• Citation: 233 N.W. 216,252 Mich. 266
• Parties: SECURITY TRUST CO. v. SLOMAN.
• Court: Michigan Supreme Court

252 Mich. 266

233 N.W. 216

SECURITY TRUST CO.

v.SLOMAN.

No. 69.

Supreme Court of Michigan.

Dec. 2, 1930.

Appeal from Circuit Court, Wayne County, in Chancery; Parm C. Gilbert, Judge.

Suit by the Security Trust Company, trustee, against Pauline H. Sloman, individually and as executrix of the estate of Eugene H. Sloman, deceased. Foreclosure of trust mortgage was decreed, and from the order confirming the sale, both parties appeal.

Affirmed.

See, also, 248 Mich. 419, 227 N. W. 698.

Argued before the Entire Bench except BUTZEL, J. Stevenson, Butzel, Eaman & Long, of Detroit, for plaintiff.

George E. Brand, of Detroit, for defendant.

FEAD, J.

Under decree of foreclosure of a trust mortgage, affirmed by this court in 248 Mich. 419, 227 N. W. 698, sale was had of the whole premises described therein as one parcel. Defendant had demanded that the commissioner offer it in four parcels. Counsel agree that the sale was governed by the statute covering executions, which provides:

‘When any real estate offered for sale by virtue of any execution, shall consist of several known lots, tracts, or parcels, such lots, tracts, or parcels, shall be separately exposed for sale, and the defendant may direct which piece or parcel shall be first exposed for sale; and no more of such tracts or parcels shall be exposed for sale then shall appear necessary to satisfy the execution, with the costs and expenses of such sale.’ Comp. Laws 1915, § 12907.

The property was bid in by plaintiff at some $70,000 less then the amount due on the mortgage. The mortgagor is dead and claim for deficiency made to his estate.

The premises were described in the mortgage and decree as three parcels.

Parcel No. 1 was described as lots in a subdivision and is part of a private land claim. It is rectangular, and consists of five tiers of seven lots each, once separated by streets and alleys which since have been vacated. The four northern tiers contain buildings which disregard lot lines. The north alley is vacant. The former street next south, Burrell place, has a water tower and elevator on it. The next alley contains part of a one-story frame building, built also upon the tier next south and connected with a brick building on the tier next north by a bridge. The lower tier of lots has a dilapidated one-story frame building on its southern portion, and on the north a fenced in lumber yard, extending over the lot lines and connected with a lumber office on what was Merrick avenue, the street north.

Parcel No. 2 adjoins parcel No. 1 immediately on the east and continues its north boundary. It is irregular in form, runs east 138 feet, then diagonally southeast for a distance, then is 226 feet wide south to about the middle of parcel No. 1, then 100 feet wide to about 200 feet south of parcel No. 1, then narrows to 20 feet, and runs 460 feet south to Warren avenue. This parcel was described by metes and bounds and is part of a different private land claim than parcel No. 1. Buildings are packed into the wide portion of the parcel.

Parcel No. 3 is 20-foot strip from Warren avenue south to the Grand Trunk Railway tracks and was described by metes and bounds.

The property is used for manufacturing and storage, and contains ten brick, one stucco, and five frame buildings. They are occupied by twenty-five tenants, several using the same building in some cases. Railroad tracks run north on parcel No. 3 from a freight line and cross Warren avenue. One track runs straight north on parcel 2 between the buildings. Another track bears to the west and, at Merrick avenue, strikes the boundary between parcels 1 and 2 and straddles it to a point close to the northern limits of the property. Loading docks are connected with various buildings, some to reach both sets of tracks. The tracks serve no other property.

Defendant demanded that the lower tier of seven lots in parcel 1 be sold, then the balance of parcel 1 and then parcels 2 and 3, each separately. The question is whether the commissioner was justified in making sale of the whole as ‘one known parcel.’

The statute contemplates sale by described lots or government divisions, when no intervening cause changes the nature of the parcel, Holton v. Moody, 117 Mich. 321, 75 N. W. 762, or when parcels are distinct and independent in description, occupancy and use, O'Connor v. Keenan, 132 Mich. 646, 94 N. W. 186. But the owner, by use, may convert two or more lots into one known parcel, as by erecting a building covering a lot and part of another lot. Geney v. Maynard, 44 Mich. 578, 7 N. W. 173. A parcel may be single although divided by a highway or street. Thomas v. Thomas, 44 Mont. 102, 119 P. 283, Ann. Cas. 1913B, 616.

The question is a practical one. The premises at bar constituted one parcel by location, use, and interdependence. Lot, street, and alley lines had been obliterated in building so that parcels 1 and 2 together constitute, in fact, a single tract. Railroad transportation is an integral part of their scheme and value. The sole purpose of parcel 3 and the lower part of parcel 2 is to serve the other property with tracks. The service would fail as to parcels 1 and 2 by a separate sale of parcel 3 and as to parcel 1 by sale of parcel 2. The railroad connects all three, both physically and for the purpose for which the land is used. Without devotion to an entirely different use than that made by defendant, there appears no reasonable or logical method of dividing the property, and it is not conceivable that sale in the parcels demanded by defendant, or in accordance with legal description, could do otherwise than result in material loss. While a mortgagor's right of redemption of part of the premises is to be safeguarded, it is not superior to the right of the mortgagee to collect the debt. We think the premises constituted one known parcel and the sale as such was proper.

In the mortgage, following the description of the real estate building, etc., appeared the clause, ‘and the rents, issues and profits to be derived therefrom, which are hereby specifically assigned as hereinafter more fully set forth.’ Later the mortgage provided for collection of the rents under the machinery provided in Act No. 228, Pub. Acts 1925. The foreclosure decree provided for sale of the rents and they were sold with the premises. The court held they could not be sold, that the purchaser acquired no right in them, and refused confirmation of the sale in this respect. This raises the question of first impression, who, the mortgagor, mortgagee, or purchaser, is entitled to the rents and profits of the premises covered by a trust mortgage, between sale on foreclosure and redemption or expiration of...