Coleman v. Beck

5 N.W.2d 104, 142 Neb. 13, 1942 Neb. LEXIS 6
CourtNebraska Supreme Court
DecidedJuly 31, 1942
DocketNo. 31349
StatusPublished
Cited by31 cases

This text of 5 N.W.2d 104 (Coleman v. Beck) is published on Counsel Stack Legal Research, covering Nebraska Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Coleman v. Beck, 5 N.W.2d 104, 142 Neb. 13, 1942 Neb. LEXIS 6 (Neb. 1942).

Opinion

Eberly, J.

This is a suit in equity commenced by L. W. Coleman, plaintiff, against Neva C. Beck and Christoph C. Beck, wife and husband, Lyle P. Trumbley and Helen F. Trumbley, husband and wife, et al., defendants, for the foreclosure of a certain real estate mortgage of which plaintiff was assignee, and for the recovery of a deficiency judgment against the defendants “for any amount which may remain unpaid after applying the proceeds of the sale of the mortgaged premises to the payment of the mortgage indebtedness, interests and costs of suit.” The decree of foreclosure and sale of the mortgaged premises in usual form was duly entered. The premises were sold pursuant thereto, but the [15]*15proceeds were insufficient in amount to satisfy the amount due on the decree. Thereupon a deficiency judgment Was, on application, entered in favor of plaintiff and against defendant Lyle P. Trumbley alone, for the sum of $495.28 and interest. The latter is the sole appellant in the instant case.

The appellant states in his brief: “The sole issue tried by the court below is whether the release of two defendants from a deficiency judgment on a mortgage note made by the released defendants releases subsequent grantees assuming payment of the note, and jointly sued in the foreclosure proceedings.”

The petition in this foreclosure case filed by L. W. Coleman, plaintiff and assignee, was in usual form. The appellant herein was made a defendant together with others. Included with other allegations it sets forth that on May 20, 1931, the defendants, Neva C. Beck and Christoph C. Beck, for a valuable consideration, executed and delivered to the Surety Mortgage Company, payee therein named, certain promissory notes in writing, aggregating $3,000; also that as security therefor they executed and delivered to such Surety Mortgage Company, mortgagee, a certain real estate mortgage and thereby mortgaged to the mortgagee therein named certain lands therein described; that certain of the notes therein described had been paid and satisfied and that default had been made by the defendants and certain of such notes remained unpaid and unsatisfied. Copies of these notes so remaining unpaid and of the mortgage were attached to plaintiff’s petition. It was further alleged that on June 4, 1931, for a valuable consideration paid, the mortgage and the notes secured thereby were duly assigned and delivered to plaintiff, who is now the owner thereof. It is not alleged that Lyle P. Trumbley ever executed the promissory notes and mortgage securing the same in suit. His sole liability is alleged to have arisen from the fact that on May 28, 1931, the defendants, Neva C. Beck and Christoph C. Beck, wife and husband, executed and delivered to the defendant Lyle P. Trumbley a warranty deed pursuant to [16]*16which there was conveyed to him all their right, title and interest in and to the real estate described in and covered by the mortgage first hereinbefore mentioned, subject to said mortgage, which warranty deed contained the following statement: “Grantee assumes payment of $3,000 mortgage to Surety Mortgage Company.” It is not alleged that Trumbley thereby became jointly indebted with any of the defendants to the mortgagee named, nor is any fact alleged from which that relation can be assumed.

To this petition the defendants Lyle P. Trumbley and wife filed as their answer a general denial of each and every allegation therein contained. A decree of foreclosure and sale was entered in such foreclosure proceeding on October 23, 1939, in usual form. In this decree it was expressly determined, “That on May 28, 1931, the defendants Neva C. Beck and Christoph C. Beck executed and delivered to the defendant Lyle P. Trumbley a deed of conveyance to said real estate by which they conveyed all their right, title and interest therein subject to said mortgage and which warranty deed contains the following statement: ‘Grantee assumes payment of $3,000 mortgage to Surety Mortgage Company.’ ” The court further found in said decree that there was due plaintiff upon the notes set forth in the petition herein, which said mortgage was given to secure, the sum of $2,942.25. This decree contains no express finding that Trumbley is jointly obligated thereby, but it directed sale of the premises to satisfy the amount due thereon. Such decree further provided: “That if any of the above amount due plaintiff is not satisfied out of the proceeds of the sale the plaintiff will, on motion, be entitled to a deficiency judgment for the amount remaining unsatisfied.” On application of Lyle P. Trumbley, a stay of execution for nine months was entered. On the expiration of the stay, an order of sale was issued and a sale had, which was confirmed on September 16, 1940. Thereupon a motion for deficiency judgment against Lyle P. Trumbley was filed by nlaintiff, L. W. Coleman; and after due service of notice' of' the application and hearing by the court, j udgment was en[17]*17tered in favor of plaintiff and against defendant Lyle P. Trumbley in the sum of $495.28. As the latter’s sole defense, there was introduced in evidence on the hearing of the motion for deficiency the following “Release of Deficiency Judgment,” which, omitting formal parts and notarial acknowledgment, reads as follows:

“For value received, the receipt of which is hereby acknowledged, L. W. Coleman, plaintiff in the above entitled action, does hereby release the defendant, Neva C. Beck, and the defendant, Christoph C. Beck, from any and all liability under the decree heretofore entered in the above entitled action and waives any and all claims for a deficiency judgment against the defendant, Neva C. Beck, and the defendant, Christoph C. Beck, or either of them. Dated July 23, 1940.

“Mary Jane Hendricks.

L. W. Coleman.”

On the basis of the foregoing record, appellant contends that “A negotiable instrument is discharged by any act which will discharge a simple contract for payment of money, or by renunciation,” citing sections 62-801 to 62-804, Comp. St. 1929. And that “Mortgagee’s release of mortgagor from liability for deficiency judgment discharges subsequent grantee assuming mortgage.” He cites to sustain the last contention Lamb v. Gregory, 12 Neb. 506, 11 N. W. 755. The doctrine announced by the Lamb case is strictly limited by the terms of the opinion to the principle that “The voluntary release of one joint judgment debtor operates as a release of his codefendant.” In the record before us Trumbley and Neva C. Beck and Christoph C. Beck do not appear in the capacity of joint debtors. Trumbley, by virtue of his assumption clause, does- not become a party-to the original promissory notes, either expressly or by necessary implication.

“The doctrine has been frequently recognized by this court that, where one buys land encumbered by a mortgage, and covenants to pay the mortgage debt, or as part of the consideration assumes the payment thereof, Ms promise creates a principal obligation which the mortgagee may en[18]*18force against him. Cooper v. Foss, 15 Neb. 515; Keedle v. Flack, 27 Neb. 836; Rockwell v. Blair Savings Bank, 31 Neb. 128; Reynolds v. Dietz, 39 Neb. 180; Grand Island Savings & Loan Ass’n v. Moore, 40 Neb. 686; Meehan v. First Nat. Bank of Fairfield, 44 Neb. 213; Green v. Hall, 45 Neb. 89. It follows, as a logical consequence, that thereupon the vendor becomes in effect a surety, and the vendee the principal debtor, that is between themselves. Paine v. Jones, 76 N. Y.

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Cite This Page — Counsel Stack

Bluebook (online)
5 N.W.2d 104, 142 Neb. 13, 1942 Neb. LEXIS 6, Counsel Stack Legal Research, https://law.counselstack.com/opinion/coleman-v-beck-neb-1942.