State ex rel. Johnson v. Commercial State Bank
Decision Date | 22 January 1943 |
Docket Number | 31491. |
Citation | 7 N.W.2d 654,142 Neb. 752 |
Parties | STATE ex rel. JOHNSON v. COMMERCIAL STATE BANK. |
Court | Nebraska Supreme Court |
Syllabus by the Court.
1. Sections 72-219 and 72-220, Comp.St.1929, were enacted for the protection of the state in enforcing the remedies therein provided. They create no liabilities other than those contained in the contracts of the parties.
2. A person claiming an interest in a school-land lease under an assignment from a lessee is liable upon the covenant to pay rent only if privity of estate exists between such person and the lessor.
3. Where a lessee assigns his whole estate in the demised premises, the assignee is ordinarily liable to the lessor for the whole of the rent reserved in the lease.
4. But where the lessee assigns a lease as security for a loan only, and the whole estate consequently is not assigned, the assignee is not ordinarily liable for the rents reserved in the lease in the absence of a binding contractual provision to that effect.
5. Whether an assignment of a lessee's interest in school-lands destroys the privity of estate existing between the lessee and the lessor and creates that relation between the assignee and the lessor depends upon the estate demised and the estate assigned being identical.
6. When an assignment of a school-land lease is made to secure a loan, such assignee is not liable to the lessor for the rent reserved until he enters into possession.
7. A school-land lease, absolute in its terms, may be shown by parol evidence to have been given as security for the payment of a loan, and, as between the parties, if established, it will be so construed by the courts.
Walter R. Johnson, Atty. Gen., and Robert A. Nelson, Asst. Atty Gen., for appellant.
G B. Hastings, of Grant, for appellee.
Heard before SIMMONS, C. J., and ROSE, EBERLY, PAINE, CARTER, MESSMORE and YEAGER, JJ.
The state of Nebraska commenced this action to recover the payments and interest due by the terms of a school-land lease. The trial court found for the defendant bank and the state appeals.
The evidence shows that the school-lands in question were leased to one Ben Brinkema on December 31, 1924, for a period of twenty-five years and the lease recorded in the office of the board of educational lands and funds. On June 29, 1927, the lessee assigned his interest in the lease to L. E. Smith, this assignment also appearing of record in the office of the board of educational lands and funds. On March 1, 1928, the lease was assigned to the defendant Commercial State Bank of Elsie and the assignment recorded in the office of the board of educational lands and funds. After the lease was assigned to the bank, the semiannual rentals due under the lease after March 1, 1928, and prior to July 1, 1930, were paid. On or about November 12, 1932, the board of educational lands and funds forfeited the lease for nonpayment of rent, at which time there remained due and unpaid the sum of $949.29. In February, 1934, the improvements on the school-land were sold for $50 and the amount credited on the rentals due, leaving due and unpaid the sum of $899.29. It is for this amount with interest for which this action was commenced.
The defendant bank alleges and the evidence shows that on March 1, 1928, L. E. Smith borrowed $5,500 from the defendant bank and gave a mortgage on a quarter-section of land and the assignment of the school-land lease hereinbefore referred to, as security for the loan. On February 21, 1929, Smith paid off the $5,500 loan and the bank executed and delivered to him an assignment of the lease. This assignment does not appear to have been recorded in the office of the board of educational lands and funds. The evidence is undisputed that Smith lived on the school-land during all the times herein mentioned and that the defendant bank never had actual possession of the leased lands. The president of the bank testifies that the bank had no interest in the school-lands other than the assignment of the lease for security and that the bank never paid any rentals due under the lease. The rentals paid while the bank held the assignment of the lease appear to have been paid by Smith.
Our statute provides that if any lessee of school-lands be in default of the semiannual rental for six months or more, the board of educational lands and funds may, after giving a ninety-day notice, forfeit the lease. For the purpose of this statute the person whose title appears last of record will be recognized as...
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