Opinion
No. 44/353.
11-22-1918
AHERN v. LJTTL. et al.
Edmund A. Hayes of New Brunswick, for mortgagee. George E. Pace, of East Millsteon, for mortgagor.
Foreclosure proceedings by Jeremiah Ahern against John Littl and others. On motion for directions to receiver. Directions given.
Edmund A. Hayes of New Brunswick, for mortgagee.
George E. Pace, of East Millsteon, for mortgagor.
BACKES, V. C. In this foreclosure suit of the first mortgage on a farm a receiver was appointed to take the growing crops of wheat and rye, and also grain then cut but not gathered. The farm was in the possession of the mortgagor and the crops were raised by him. The mortgaged premises have been sold, and there is a large deficiency on the second mortgage. The holder of this mortgage now moves that the receiver be directed to deliver to him all of the crops or the proceeds thereof when sold.
The rule is that the mortgagee is entitled to the standing crops, and the mortgagor to those severed, at the time the mortgagee, or the receiver in his stead, takes possession, or when possession is lawfully demanded by the mortgagee and refused. The mortgagor, until foreclosure or possession taken by the mortgagee, is entitled to the emblements, and, when they are severed, has an absolute right to them without any liability to account for them. They are covered by the mortgage until severance, but belong to the mortgagor afterwards. Jones on Mortgages, § 697.
The mortgagee, however, claims that his mortgage gives him a lien on the cut crops, and for this he relies upon the usual set form, in print type, immediately following the description of the land, viz.: "Together with all and singular the profits, privileges, and advantages, with the appurtenances to the same belonging, or in any wise appertaining."
To entitle a mortgagee to the emblements after severance, or an accounting for their value, they must be pledged expressly and specifically. Wiltsie on Mortgage Foreclosure, § 806. Manifestly the formula quoted does not import such an undertaking. In legal effect the terms add nothing to the mortgage security. They mean no more than the law implies in such instruments, that, after default and upon entry, only the growing crops pass with the land. Similar provisions in mortgages, and some more explicit, have frequently been the subject of judicial consideration. Jones on Mortgages, § 771. Mr. Justice Harlan, speaking for the United States Supreme Court in Freedman's Saving Co. v. Shepherd, 127 U. S. 494, 8 Sup. Ct. 1250, 32 L. Ed. 163, says of them:
"It is, of course, competent for the parties to provide in the mortgage for the payment of rents and profits to the mortgagee while the mortgagor remains in possession. But when the mortgage contains no such provision, and even where the income is expressly pledged as security for the mortgage debt, with the right in the mortgagee to take possession upon the failure of the mortgagor to perform the conditions of the mortgage, the general rule is that the mortgagee is not entitled to the rents and profits of the mortgaged premises until he takes actual possession, or until possession is taken, in his behalf, by a receiver (Teal v. Walker, 111 U. S. 242 [4 Sup. Ct. 420, 28 L. Ed. 415]; Grant v. Phoenix Life Ins. Co., 121 U. S. 105, 117 [7 Sup. Ct. 841, 30 L. Ed. 905]); or until, in proper form, he demands and is refused possession (Dow v. Memphis Railroad Co., 124 U. S. 652, 654 [8 Sup. Ct. 673, 31 L. Ed. 565]). See, also, Sage v. Memphis & Little Rock Railroad Co., 125 U. S. 361 [8 Sup. Ct. 887, 31 L. Ed. 694]."
The receiver will be directed to deliver the harvest of the growing crops to the mortgagee, and those that were cut when he took possession to the mortgagor.