Tarbell v. Page , 155 Mass. 256 ( 1892 )

Knowlton, J.

The plaintiff, as mortgagee in possession under a certificate of entry for a breach of the condition, had a sufficient title to the real estate to give him a right of action against the defendant for entering on the premises and tearing down and carrying away the dwelling-house standing thereon.

The license given the defendant by the owner of the equity of redemption to enter on the land and remove the house erected by him in case the owner of the equity should fail to pay him the amount of his indebtedness, was invalid as against the holder of the prior mortgage. Clary v. Owen, 15 Gray, 522. Hunt v. Bay State Iron Co. 97 Mass. 279. Thompson v. Vinton, 121 Mass. 139.

The plaintiff can, therefore, recover as damages in this action the amount which the property was diminished in value by the removal of the dwelling-house, unless he" is precluded by the foreclosure of his mortgage under the power of sale, and by the defendant’s ownership of the equity of redemption at the time of the foreclosure.

His title under the first mortgage was not affected by the release which he gave before acquiring it. His covenant in the release related only to the title which he had previously acquired, and was not intended to preclude him from obtaining and holding a new and independent title then outstanding. Comstock v. Smith, 13 Pick. 116. Doane v. Willcutt, 5 Gray, 328. Huzzey v. Heffernan, 143 Mass. 232.

As holder of the second mortgage, the plaintiff had a right to have a proper proportional part of the first mortgage satisfied out of that part of the land which was not covered by the second mortgage, so that the security of the second mortgage might not be impaired by paying a disproportionate part of the first mortgage from the proceeds of the land covered only by the second mortgage. As holder of the first mortgage, it was his duty to collect the damages caused by the removal of the building, and, upon satisfaction of the first mortgage, to hold the remainder of the money for those who were equitably entitled to it. If it were not for the second mortgage, the defendant, being the holder- of the equity of redemption, would take it; and inasmuch as the first mortgage was paid in full from the proceeds of the foreclosure sale, the defendant’s interest might be availed of to avoid circuity of action, and the damages recoverable in this case would be merely nominal. But the ownership of the defendant cannot avail against the plaintiff’s right under the second mortgage to have the first mortgage paid in proper proportion from the real estate, not included in the second mortgage, as it was before its value was diminished by the removal of the house. Unler the agreement, the plaintiff is entitled to recover $225. Judgment affirmed.