Spaulding v. Quincy Trust Co.

• Decision Date: 24 May 1943
• Citation: 313 Mass. 752,49 N.E.2d 251
• Parties: SPAULDING v. QUINCY TRUST CO.
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court

313 Mass. 752

49 N.E.2d 251

SPAULDING

v.QUINCY TRUST CO.

Supreme Judicial Court of Massachusetts, Suffolk.

May 24, 1943.

Action by Donald C. Spaulding against the Quincy Trust Company to recover the surplus proceeds of a mortgage foreclosure sale. The trial judge found for plaintiff, and from an order of the Appellate Division dismissing a report, defendant appeals.

Affirmed.Appeal from Municipal Court of Boston, Appellate Division; Jacob Spiegel, Special Judge.

Before FIELD, C. J., and DONAHUE, LUMMUS, QUA, and RONAN, JJ.

H. J. Booras, of Boston, for plaintiff.

R. F. Barrett, of Boston, for defendant.

LUMMUS, Justice.

One Taylor died in 1931 owning real estate which was subject to four mortgages held by the defendant and given by Taylor to secure his promissory notes. The mortgages were for $5,000, $5,000, $5,000 and $2,000 respectively. By his will he devised 19/20 of his estate to his widow and 1/20 to his niece. His widow was made executrix. On February 11, 1938, the real estate was sold by the defendant under a foreclosure of the fourth mortgage, and was bought in by the defendant for $5,000. The advertisement of sale recited that ‘the premises are subject to three prior mortgages given by me to said Quincy Trust Company, each for $5,000,’ and the deed conveyed to it ‘the premises conveyed by said mortgage’-evidently subject to the three prior mortgages. This the defendant concedes in its brief. Immediately after the foreclosure sale demand was made upon the defendant for the surplus after the sale, amounting to $2,972.16, but nothing was paid. On February 25, 1938, the executrix and devisees of Taylor assigned their rights in the surplus to the plaintiff.

On February 25, 1938, the defendant conveyed the real estate to one Carey. It does not appear that the real estate was conveyed subject to the three earlier mortgages, and that it was not is indicated by the facts that the land was expressly conveyed subject to ‘easements of the Commonwealth of Massachusetts for sewerage purposes' and that Carey gave a mortgage back to the defendant for $19,500. This accords with the finding of the trial judge.

This action was brought by the plaintiff assignee to recover the surplus. The defence is based upon the fact, stated in the answer, that the defendant applied the surplus towards the reduction of the sum of $13,443.28 owed it on the three earlier mortgage notes. In a District Court the trial judge found for the plaintiff, and the Appellate Division dismissed a report. The defendant appealed to this court.

Upon the foreclosure, the surplus stood in the place of the equity of redemption previously existing, and belonged to the devisees of Taylor. Mattel v. Conant, 156 Mass. 418, 422, 31 N. E. 487;Hunneman v. Lowell Institution for Savings, 205 Mass. 441, 445, 91 N.E. 526;Dennett v. Perkins, 214 Mass. 449, 101 N.E. 994. We assume without deciding that the three earlier mortgage debts were not extinguished by merger. Sullivan v. Neary, 186 Mass. 158, 160, 71 N.E. 193. We assume also without deciding that the set-off of the surplus against the earlier mortgage notes was not precluded by the fact that the surplus belonged to the devisees while the notes were owed by the executrix in her representative capacity. But upon the foreclosure deed to the defendant subject to the three mortgages, the land became the primary debtor and the estate of Taylor became only a sort of surety. Pratt v. Buckley, 175 Mass. 115, 116, 55 N.E. 889;North End Savings Bank v. Snow, 197 Mass. 339, 341, 83 N.E. 1099,125...