Desot v. Ross

Montgomery, J.

Complainant is- 0the father of the *82 defendant. In March, 1881, complainant mortgaged certain premises owned and occupied by him to Oliver Chapaton for $1,022. This. mortgage was assigned to defendant in 1888. December 26, 1891, complainant tendered to the defendant $1,341.12, and demanded a discharge of the mortgage. The defendant refused to discharge the mortgage unless she was repaid the further sum of $150 and interest, which she had advanced to complainant to pay the installments of interest falling due upon the same mortgage ■ before she became the purchaser of it. The bill prays a discharge of the mortgage on payment of the amount of the tender.

It appears by the testimony that the defendant in June, 1882, and in February, 1884, advanced in the aggregate $150 to pay the installments of interest before referred to, 1 taking an agreement in writing in the following form, signed by the complainant and his wife:

“ $80. One day after date we promise to pay Octavia Eoss or bearer eighty dollars, with use, value received. The design of this paper is to secure the payment of the above sum of money, it being for money paid by said Octavia Eoss to Oliver Oliapaton for interest due on a real-estate mortgage •given by us to him.

“Mount Glemens, JuneYi, 1882.”

The circuit judge found as a fact that there was no independent agreement that the defendant was to be subrogated to the lien of the mortgage to the amount of these payments, and this finding is fully justified by the proofs. Indeed, it is not seriously contended that there was such an agreement, but it is strenuously insisted that the written instrument itself is sufficient evidence of an intent that the defendant should retain a lien on the land for the money advanced. We think the instrument cannot be construed as creating a lien on specific property. It amounts to no more than a promise to pay the sum advanced, with interest. *83 It is true, it recites that the paper is to’ secure the payment of the amount, and it is also recited that the money was paid on the mortgage in question; but the recital cannot perform the office of an agreement that the mortgage shall remain a security for the money.

No such relation of defendant to this property existed as entitled her to subrogation without an express agreement. She was a stranger to the title, and as such could not, by payment of the whole or any portion of the mortgage, become subrogated to the rights of the mortgagee. In Kelly v. Kelly, 54 Mich. 47 , it was said:

“In order to lay the foundation for an equitable lien upon real estate there must exist — First, a contract in writing out of which the equity springs, sufficiently indicating an intention to make some particular property, therein identified, a security for the debt or obligation, or whereby the party promises to convey or assign or transfer the property as security; * * • * or, second, in the absence of such contract, where, from the relations of the parties, • equity will declare a lien out of considerations of right and justice, based upon those maxims which lie at the foundation of equity jurisprudence. Such are the cases when one joint owner, acting in good faith and for the joint benefit, makes permanent improvements upon the property which add a permanent value to the estate; or when a party,' innocently and in good faith, supposing himself to be the owner, makes permanent improvements, or repairs which permanently enhance the value of the property, — the real owner, when he seeks the aid of equity to establish or enforce some equitable right or claim to the property, upon the principle, that he who asks equity must do equity, will be required to pay' the amount exjDended.”

See, also, Shinn v. Budd, 14 N. J. Eq. 237; Brice v. Watkins, 30 La. Ann. 21 ; Sandford v. McLean, 3 Paige, 122 . In the last-mentioned case it was said:

“It is only in cases where the person advancing money to pay the debt of a third party stands in the situation of a surety, or is compelled to pay it to protect his own rights, that a court of equity substitutes him in the place of the *84 creditor as a matter of course, without any agreement to-that effect. In other cases the demand of a creditor which is paid with the money of a third person, and without any agreement that the security shall be assigned or kept on foot for the benefit of such third person, is absolutely extinguished."

The decree, which was in accordance with these views,, will be affirmed, with costs. .

Hooker, C. J., McGrath and Long, JJ., concurred. Grant, J., did not sit.