Suffern v. Johnson — 1 Paige Ch. 451

Majority

p. 451

Suffern v. Johnson and Peterson.

March 17th.

Headnote

After a decree for the foreclosure and sale of mortgaged premises, the court will control and regulate the proceedings and manner of sale, so that no injustice shall be done to either party.

Where mortgaged premises are an inadequate security for the debt, and the mortgagor is irresponsible, the court, although the entire mortgaged debt is not due, will order the whole of the premises to be sold, or so much as is necessary to pay the whole debt and costs, unless the defendant pays to the complainant the sum which will become due before the sale, or gives ample security for payment of the residue, when it becomes due.

Mortgaged premises should be sold either together or in parcels, as will be best calculated to produce the highest sum.

This was a bill of foreclosure. At the last term of this court a regular decree was entered in this cause, referring it to a master to compute the amount due to the complainant on his bond and mortgage, and for a sale of the premises on the coming in and confirmation of the master’s report. W. S. Johnson, who had appeared in the cause, had regular notice of the proceedings before the master, and the report was confirmed. He afterwards presented his petition, setting forth that only a part of the mortgage money had become due; that he was the purchaser of the mortgaged premises, which were so situated that they might be sold in parcels. And he prayed that only so much of the premises might be sold *as would be sufficient to pay the amount now due, with costs.

The application was opposed on affidavit, showing that the premises were insufficient to pay the whole amount of the mortgage; that the defendants had committed waste thereon; and that the property would sell for a higher sum if sold together.

W. A. Seeley, for the complainant.

S. M. Fitch, for the defendant Johnson.

The Chancellor :—In cases of mortgage sales, this court will control and regulate the proceedings so that no injustice shall be done to either party. And the court may order the whole or a part of the mortgaged premises to be sold, as shall be most conducive to that end. It is not a matter of course to order the whole property to be sold where only part of the mortgage money is due; but it may frequently be necessary, to prevent injustice. If the person in possession is not responsible for the debt, and the premises are not a sufficient security, the sale of two-thirds of the property might be necessary to pay a moiety of the debt which had fallen due. And the defendant would retain possession of the residue of the property and put the rents and profits in his own pocket until the other instalments fell due, leaving the complainant remediless as to a great part of the remainder of his debt. In such cases, the whole of the premises, or so much as is necessary to pay the whole debt and costs, should be sold, unless the defendants choose to pay the amount of the instalment which is due, before the sale, or will give security that the residue of the mortgage money shall be paid when it falls due.^[1]

In Campbell v. Macomb, (4 John. Ch. Rep. 534,) all the money which had become due was paid before the application to this court to stay the proceedings.

The defendant Johnson may have an order directing the master not to proceed and sell, if the amount now due and the costs are paid before the day of sale, or to sell only so much of the property as will satisfy that amount, provided

[1] [1] See 2 R. S. (4th ed.) 357, 358, secs. 69, 70, 71.

p. 452

the "^defendants, or either of them, give to the complainant sufficient security, to be approved of by the master, that the sums yet to fall due shall be paid. But as the proceedings on the part of the complainant have been perfectly regular, the defendant Johnson must pay the costs of resisting his application.

It is the duty of the master in all cases, unless otherwise specially directed, to sell the premises either together, or in parcels, as he shall think best calculated to produce competition and enhance the value on the sale.