Bush v. Froelich

Citations

• 14 S.D. 62
• 84 N.W. 230
• 1900 S.D. LEXIS 8

Syllabus

<p>1. The president of a loan company was trustee in a trust deed owned by the company which it assigned to plaintiff according to its custom in making loans, and plaintiff sent the interest coupons to the company for collection as they matured, but, instead of collecting them, the company paid them from its own funds, and held them against the mortgagor, who failed to pay the same. The mortgagor also failed to pay the taxes on the property, which were paid by the president of the company as trustee, as authorized by the deed, but no notice of the mortgagor’s failure to pay either the interest or taxes was ever given to plaintiff, so as to enable her to have foreclosed the deed, as provided therein. Held, that since the company and its officers, under such facts, occupied .a confidential relation towards plaintiff, and as such were required by Comp. Laws, § 3915, to act with the highest good faith towards her, the company'was not entitled to claim priority out of the proceeds of a sale of the property on foreclosure for the taxes and interest paid by it before the foreclosure proceedings were instituted.</p> <p>2. Where a loan company collected interest- on loans secured by mortgage assigned by it to plaintiff, and acted as her agent with reference thereto, it had no right to purchase the land at tax sale, and hold the title so acquired as against plaintiff, though it had not guarantied the loan.</p> <p>3. Where a loan company acted as the agent of plaintiff, to whom it had assigned a mortgage loan, in collecting interest, etc., and, after foreclosure proceedings had been brought, paid taxes due, which were a lien on the land, the company was entitled to be reimbursed by plaintiff for the amount so paid.</p> <p>4. Where a loan company had paid taxes due on mortgaged land after the institution of proceedings to foreclose a mortgage which it had assigned to its principal, but which it had not guarantied, and claimed a lien therefor, plaintiff was not entitled to a dec