Scott v. Childs , 64 N.H. 566 ( 1888 )

An entry under process of law and continued actual possession for one year, for the purpose of foreclosing, will foreclose a mortgage, and operate as a payment of the mortgage debt to the value of the land taken. In this case the inquiry arises whether Scott complied with these requirements. He entered under process in due form, but he did not do it for the purpose of foreclosing his mortgage and taking the land at the close of the year for redemption unless the debt was paid; neither did he remain in the continued actual possession for one year for that purpose; on the contrary, he entered and left the defendant in possession, under a special agreement which did not require the debt or any part of it to be paid within or at the close of the year of redemption, or surrender the possession with all his rights in the same foreclosed, and such was not Scott's intention when he entered; but he entered under an agreement that created a tenancy, in which the defendant was to continue to occupy under him indefinitely as the equitable owner, paying annual interest on the debt, the taxes, and making the repairs, Scott giving the defendant a bond to reconvey the premises to him when he should pay Scott the mortgage debt. This agreement was made in 1868, before the process was obtained under which the entry was made, with the understanding between the parties that it was to fix the relations between them under any formal foreclosure that should be obtained; and while Scott lived the parties acted substantially in accordance with this understanding.

In 1878 Scott received of the railroad for land damages $2,000, agreeing to apply it to the extinguishment of the debt. On the facts appearing, the better view would seem to be that the statute has not been complied with, either in its letter or its spirit, and that the mortgage was not foreclosed; but however this may be, it is well settled that the receiving of the $2,000 in 1878, on the agreement to apply it on the mortgage debt, operated as a waiver of the foreclosure, if one was ever perfected, so that it becomes, so far as the defendant's rights in the case appear, immaterial whether it was foreclosed or not, as the right to redeem in either event is still open. Deming v. Comings, 11 N.H. 479, 483; McNeil v. Call,19 N.H. 403, 414.

The original note became merged in the judgment, and the rate of interest became changed from annual to simple; but the verbal agreement made before the judgment, which was afterwards reduced to writing, sealed, and executed by the parties, calls for annual interest on the amount of the judgment, which restores the rate; and annual interest should be allowed.

The plaintiff is entitled to recover the cost of the building moved on the premises, less the rents received. The other exceptions taken at the trial are not now insisted upon.

Case discharged.

ALLEN, J., did not sit: the others concurred.