Foster v. Wightman

The grantee of a mortgagor of land cannot, because of fraud practised by the mortgagee upon the mortgagor in obtaining the mortgage, maintain a bill in equity against an assignee of the mortgagee to restrain a sale of the mortgaged premises under a power in the mortgage, without paying the entire debt secured by the mortgage, although the mortgage was assigned to the defendant as security for a less amount.

Bill in equity by James Foster and Mary Hersey against Joseph O. Wightman and William I. Goodrich to restrain the sale of a parcel of land under a power contained in a mortgage from Hersey to Wightman, and assigned by him to Goodrich. The bill alleged in substance that Hersey, being the owner of the land, with her husband, made the mortgage to Wightman to secure the payment of a certain note made by them; that Wight-man obtained the mortgage and note by fraud; that Wightman assigned the mortgage and note to Goodrich to secure certain indebtedness; that Hersey had conveyed all her interest in the premises to Foster; that Goodrich took possession of the land for the purpose of foreclosure, and had advertised it for sale; and prayed for an injunction, and that the plaintiffs might redeem on paying what was justly due to Goodrich. It was agreed that Wightman obtained the note and mortgage by fraud, and that the bill be dismissed, without prejudice, as to him; that Goodrich took the assignment without notice of the fraud; that the debt due from Wightman to Goodrich was less than the amount of the mortgage, and that, if the mortgage was valid in his hands, for the full amount of the note, the plaintiffs did not care to redeem. Hearing upon the pleadings and proofs, before Devens, J., who ordered that the bill be dismissed with costs. The plaintiffs appealed.