Willson v. Binford, Administrator. and interest, until in April, 1874, and did not bring the mortgaged premises to sale until in July, 1874; that in the mean time, the mortgaged premises depreciated in value in the sum of $1,500, and that by means of the delay, laches and want of diligence of the appellee's intestate, the appellant was injured and had sustained damages in the sum of $2,000, which he set up, by way of counter-claim, against any sum that might be found due from him, as the assignor of the notes in the complaint mentioned. The court committed no error, we think, in sustaining the appellee's demurrer to this paragraph of answer. It is true, that, under the code, the holder of a mortgage may proceed to foreclose the same whenever any part of the mortgage debt, or any interest thereon, is due and unpaid. It is true, also, that if the holder by endorsement of the mortgage debt, not payable to order or bearer in a bank in this State, would have his action against his immediate or any remote endorser, for the balance due, or to become due, on the mortgage, which may remain unsatisfied after the sale of the mortgaged premises, he must have used due diligence in the premises, or he must show that such diligence would have been unavailing. But we know of no rule of law, and the appellant's counsel have referred us to none, which would render the assignee of the mortgage debt liable in damages to the assignor, for the mere depreciation in value of the mortgaged premises, between the time when the assignee might have enforced the sale of said premises, and the time when he did enforce such sale. The appellant did not allege that the mortgaged premises were depreciated in value by any act of appellee's intestate, or that such depreciation was, or even might have been, foreseen or anticipated by said intestate. Indeed, it seems to us, that the appellant has alleged no fact, in the second paragraph of his answer, which constitutes any defence to appellee's action. In the third paragraph of his answer, the appellant alleged Willson v. Binford, Administrator. in substance, that by the laches and want of diligence of appellee's intestate, in commencing suit for the foreclosure of said mortgage, and in bringing the mortgaged premises to sale, until in July, 1874, the appellant was released and discharged from liability, as the assignor thereof, on the first four of the said notes maturing on and before March 10th, 1874, and on the interest then due on all said notes, amounting in the aggregate, of principal and interest, to the sum of $1,980; that at the date of the sale of the mortgaged premises, there only remained due, for principal and interest, on all of said notes, for which the appellant could, in any event, be made liable as such assignor, the sum of $1,380 with the interest thereon from March 10th, 1874, until the day of said sale in July, 1874; that, between the time when the mortgage might have been foreclosed, and the date at which it was foreclosed, the mortgaged premises depreciated in value to the amount of $1,500; and the appellee and his intestate knew all the time that said property was depreciating in value and being damaged by said waste, and took no steps to foreclose said mortgage or stop such waste, and the mortgage debt was drawing ten per cent. interest during all that time; that the appellee bid in the mortgaged premises at and for $1,500, and made by levy and sale of the property of said Cornelius Blair, other than the mortgaged premises, the sum of $106, making an aggregate sum of $1,606, which the appellee applied on said first four notes, but which sum, the appellant claimed, should have been applied first in discharge of his liability as such assignor. The theory of this paragraph of answer, as we understand its allegations, is that the appellant, by his endorsement of the several notes described in the complaint, became liable thereon to appellee's intestate, as the qualified or conditional surety of the maker of said notes; that, by her failure to use "due diligence in the premises" as to each of the first four VOL. 81.-38 Willson v. Binford, Administrator. notes, the appellee's intestate discharged and released the appellant from any liability to her, on each and all of the said first four notes; and that the appellant, as such surety, was entitled to have the proceeds of the sale of the mortgaged premises applied first to the payment of the last six notes, on which he remained liable as such surety, before any part of such proceeds should be applied on the first four notes, from which he had been released by the failure of appellee's intestate to use "due diligence in the premises." The contract of an assignor of a note, negotiable under the statute of this State but not governed by the law merchant, is a warranty that the maker is liable on the note and able to pay it. Black v. Duncan, 60 Ind. 522, on page 532; Ward v. Haggard, 75 Ind. 381. In section 4 of the act of March 11th, 1861, concerning promissory notes, etc., it is provided that the assignee of such a note, having used due diligence in the premises, shall have his action against his immediate or any remote endorser thereof. 1 R. S. 1876, p. 636; section 5504, R. S. 1881. So, where the maker of the note is insolvent, and no part of the debt could have been made, if judgment had been recovered and execution issued thereon with due diligence, the assignee may have his action against his immediate or any remote endorser of the note, whether he has used due diligence in the premises or not. Hubler v. Taylor, 20 Ind. 446; Markel v. Evans, supra. It seems to us, however, that the theory of this third paragraph of answer is in direct contravention of the provisions of section 639 of the code of 1852, which section controls the application of the proceeds of the sale of mortgaged premises, in such a case as the one stated in said paragraph. This section provides, that "If the mortgaged premises can not be sold in parcels, the court shall order the whole to be sold, and the proceeds of the sale shall be applied, first to the payment of the principal due, interest and costs, and then to the residue secured by the mortgage, and not due." Section Willson v. Binford, Administrator. 721, code of 1881; section 1104, R. S. 1881. Under these statutory provisions, the proceeds of the sale of the mortgaged premises were properly applied to the payment of the portion of the mortgage debt then due, and could not have been applied otherwise. We are of the opinion, therefore, that appellee's demurrer to the third paragraph of answer was correctly sustained. In the fourth paragraph of his answer, the appellant alleged that the appellee had delayed the issue of any execution on the judgment rendered on the first four notes, for the space of forty-five days; and that for this want of due diligence in the premises, on the appellee's part, the appellant was discharged from liability as assignor of the six notes which were not then due. This question was presented by the appellant, on the first appeal of this cause, and the court then said: "On this point, he is clearly in error. That negligence only discharged him from liability, as assignor upon the notes then due, and the collection of which that negligence might affect. But that negligence could not affect the collection of the notes not then due." It follows, therefore, that the court did not err in sustaining the appellee's demurrer to the fourth paragraph of answer. The appellant alleged, in the fifth paragraph of his answer, that the notes described in appellee's complaint were merged in the judgment against said Blair. We need not argue for the purpose of showing that this paragraph of answer did not constitute any defence to appellee's action. Certainly, there was no merger of the appellee's causes of action against the appellant, as the assignor of the notes, in the judgment rendered against the maker thereof, in an action wherein the appellant was not a party. The only causes for a new trial, properly assigned in the motion therefor, were that the finding of the court was not sustained by sufficient evidence, and that it was contrary to law. The evidence is not in the record; and, therefore, we Hudson v. Evans et al. can not say that the court erred in overruling the motion for a new trial. The judgment is affirmed, with costs. NOTE. The appellant having died since the submission of the case, the judgment of this court will be rendered as of the November term, 1880, the date of such submission. No. 8292. HUDSON v. EVANS ET AL. MARRIED WOMAN.-Conveyance.-Inchoate Interest in Land of Husband.— Held, in an action by H. to recover possession of the land, that the act of From the Boone Circuit Court. C. S. Wesner, for appellant. WOODS, J.-Complaint by the appellant, in the usual form, for the recovery of possession of real estate. Besides the general denial, the defendants Marcus and Margaret Evans filed a special plea, under which they claimed to be the owners of the undivided one-third of the land as tenants in common |