Reeves v. Huckins , 80 N.H. 348 ( 1922 )

The questions to be decided in this case concern the rights and liabilities, as between themselves, of parties who each own a part of an equity of redemption. The unquestionable right of the mortgagee to demand the whole mortgage debt, if they or either of them should seek to redeem from him, is not involved. The owner of a part of the equity, having purchased the outstanding mortgage interest, now claims to succeed to all the mortgagee's rights, and to disregard his own liability and duty as between him and the plaintiff. Whether the defendant's purchase of the foreclosing mortgagee's rights should be treated as opening the foreclosure, so that his subsequent possession could not be treated as a continuation of the foreclosing one as against the plaintiff, need not be considered. Upon any possible view of the law the foreclosure was not complete at the time the plaintiff filed his bill. The holder of the mortgage interests had then been in possession less than a year. P. S., c. 139, s. 14. The purchase of the foreclosing mortgagee's rights by the remainderman merely gave him the right, as against the life tenant, to claim contribution. He could not demand the whole mortgage debt, but only such part thereof as was justly due to him as between these parties. Woods v. Wallace, 30 N.H. 384; Norris v. Morrison, 45 N.H. 490. The case relied upon by the defendant (Jewell v. Huckins, 79 N.H. 153) is not in point. There was in that case no question of the effect of the mortgagee's conveyance to one ultimately liable for a part of the mortgage debt, nor of an offer to redeem before the foreclosure became complete.

The plaintiff being a life tenant, it was his duty to pay the taxes upon the property in which he held a life estate (Bodwell v. Nutter,63 N.H. 446, and cases cited) and the interest upon any encumbrance upon the property. Peirce v. Burroughs, 58 N.H. 302. In this case the plaintiff has a life estate in a part only of property which is taxed as a whole, and the whole of which was subject to two mortgages. In such a situation the life tenant is bound to pay according to the percentage of the whole estate that is represented by the part in which he has a life estate. Fellows v. Fellows, 69 N.H. 339, 348. For example: if the farm without the timber and the timber without the farm were each worth $500, the plaintiff would be holden for one-half of the interest and taxes. As to these items, the division is to be made upon this principle.

The costs of the foreclosures should be apportioned ratably to the portion of the judgment for which each party is chargeable. They are incident to the whole proceeding, and this is the recognized rule for their apportionment. Doe v. Thompson, 22 N.H. 217; Hayes v. Morrison, 38 N.H. 90.

The remaining question relates to the sum to be paid by the plaintiff as a present liquidation of his obligation to hereafter keep down a part of the interest during the continuance of his life estate. If the mortgages were to continue as outstanding obligations, the plaintiff would have to pay his portion of the interest each year. In effect, he would be chargeable with an annuity to the defendant to the amount of such part of the interest. The probable duration of such right of the defendant is ordinarily determined by the use of the accepted tables of mortality. Keniston v. Gorrell, 74 N.H. 53. It having been agreed that the plaintiff has an expectancy of life of 17 years, it is unnecessary to consider whether the average expectancy might be found to be inapplicable, or might be modified, because of the state of the plaintiff's health. Fifield's Adm'x v. Rochester, 89 Vt. 329; Hoyt's Pro. Prac. 280.

The annual payment and the length of the term being thus determined, the present value is ascertained by the ordinary rules of discount. The rate per cent. at which the discount is to be made is to be found as a fact. The rule of law to be applied is that the rate should be such as will probably enable the defendant to invest the money as a reasonably prudent person would and receive on the investment the interest which is charged to him by way of discount. The proceeding is an equitable one, and the statutory rule of interest as damages, or upon contracts to pay interest where no rate is specified (P. S., c. 203, s. 1), is not controlling. "The equitable division . . . presented a question of fact for the decision of the superior court." Keniston v. Gorrell, supra, 55.

Case discharged.

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