§ 236. * 339. Special Statutes Making Assignor of a Thing in Action a Necessary Party. The special provisions in the codes of some States requiring the assignor of a thing in action to be made a defendant under certain circumstances in a suit by the assignee, affects the general doctrine as to parties in foreclosure actions in those States. These provisions, it will be remembered, require the assignor to be made a party "when the thing in action is not assignable by indorsement," or when it is not a negotiable instrument, or when the assignment is not expressly authorized by statute so as to transfer the legal title to the assignee. It has been held in States where these provisions are in force, that if a mortgage is given to secure a negotiable note, and this note is transferred in the usual manner by indorsement, although there is no written assignment of the mortgage, the assignor need not be made a defendant. The transfer of the note by indorsement carries with it the title to the mortgage, and the assignee thus becomes legal owner of both by a form and mode of transfer which permits the action to be brought without the assignor as a party defendant.1 On the other hand, if the mortgage alone is assigned by a written transfer, while the evidence of the debt, for example a bond, is merely transferred by delivery, the assignor, who might be the mortgagee, is a necessary defendant under the provision above referred to.2 This decision would undoubtedly embrace all cases where the instrument which is the principal evidence of debt, whether bond or negotiable note, unless the latter be payable to bearer, is transferred by delivery merely. If a note secured by mortgage is payable to bearer, so that the legal title will pass by mere delivery, it would seem the assignor need not be made a defendant. Such a note being negotiable, the case falls directly within the language of the provision as it is found in several codes.

§ 237.340. Where Holder of less than all of a Series of Notes Secured by same Mortgage brings Foreclosure Suit. When a mortgage is given to secure a series of notes made by the mortgagor,

i Gower v. Howe, 20 Ind. 396. Mortgagees who have assigned their entire interest are not necessary parties. Pullen v. Heron Min. Co., 71 N. C. 567; Smythe v Brown, 25 S. C. 89. It is held in New York that where the mortgage has been assigned by the mortgagee as collateral security for his own debt, and is fore

closed by the assignee without making the assignor a party, the latter may redeem upon payment of his debt. Re Gilbert's Est., 104 N. Y. 200. [See Styers v. Alspaugh (1896), 118 N. C. 631, 24 S. E. 422.] 2 Holdridge v. Sweet, 23 Ind. 118; French v. Turner, 15 Ind. 59. See Kittle v. Van Dyck, 1 Sandf. Ch. 76.

having different periods of time to run, as, for example, one, two and three years, the proceeds of the land when sold upon foreclosure are to be applied to the payment of these notes in the order in which they fall due; that is, the one which first falls due is to be paid in full, and the surplus, if any, goes to the payment of the second, and so on. If the mortgagee assigns one or more of such notes, and retains the others, or if the notes are separately assigned to different persons, the holders cannot unite as coplaintiffs in an action to foreclose, because the debt has been severed and their interests are separate and distinct. Either holder, however, may bring an action to foreclose, and may make the other holder (or holders) defendant, and such defendant can set up his rights in his answer. The facts being thus presented, the decree can adjust the various interests and equities of the different holders, and apportion the proceeds according to the priorities. The foregoing rules are established in Iowa.1

§ 238. *341. Occupant of Premises as Party. Averments of Petition as to each Person Made Defendant. An occupant of the land, that is, a person in possession without alleging the title to be in himself, is not a necessary party; his rights, however, whatever they may be, will not be affected by the decree in a suit to which he was not made a defendant. The complaint or petition must allege, in respect of every person made a defendant, that he has or claims some interest adverse to the plaintiff, or that he is a

1 Rankin v. Major, 9 Iowa, 297. It must be confessed this is a sacrifice of substance to form. If the assignee may have affirmative relief as a defendant, it is difficult to see any substantial reason why he should not be permitted to join as plaintiff in the first instance. For a statement of the varying rules on the subject of mortgages to secure several notes, see 3 Pom. Eq. Jur. §§ 1200-1203. See also Johnston v. McDuffee, 83 Cal. 30; Studebaker Bros. Man. Co. v. McCargur,

20 Neb. 500.

[It was held in the following Nebraska cases that the holders of the different notes secured by the mortgage might maintain separate actions of foreclosure: Todd v. Cremer (1893), 36 Neb. 430, 54 N. W. 674; Burnett v. Hoffman (1894), 40 Neb. 569, 58 N. W. 1134; Sloan v. Thomas (1899), 58 Neb. 713, 79 N. W. 728, but the question of the right to join

was not raised. In the recent case, however, of Guthrie v. Treat (1902), — Neb.

92 N. W. 595, in an elaborate and well reasoned opinion in which the rule in Rankin v. Major (supra), and the similar case of Swenson v. Plow Co., 14 Kan. 387, is thoroughly discussed, the court holds that under the facts of this case a joinder is proper. The Iowa and Kansas rule is explained on the basis of the different methods of procedure in foreclosure in those States. But in Bacon v. O'Keefe (1896), 13 Wash. 655, 43 Pac. 886, that court held that a joinder was not only proper but necessary, and refused to sanetion the rule in Burnett v. Hoffman (supra).]

2 Suiter v. Turner, 10 Iowa, 517. See Richardson v. Hadsall, 106 Ill. 476. That he is a proper party, see Ruyter r. Reid, 121 N. Y. 498 (motion for rehearing denied, Oct. 14, 1890, 25 N. E. 377).

necessary party to a complete settlement of the questions involved in the controversy. A defendant concerning whom no such averment is made may demur for want of sufficient facts.1 Parties remotely and contingently interested in the result, although having no estate in or lien on the land, may be proper defendants in order to protect their rights and to effect the settlement of the questions.2

§ 239. *342. Subsequent and Prior Incumbrancers as Parties. Husband in Case of Mortgage on Wife's Land. It is a rule universally established that all subsequent incumbrancers, who are holders of general or specific liens on the land, whether mortgagees, judgment creditors, or whatever be the nature of the lien if it can be enforced against the land, are not necessary parties in the sense that their presence is indispensable to the rendition of a decree of sale; but they are necessary parties defendant to the recovery of a judgment which shall give to the purchaser thereunder a title free from their liens and incumbrances. If they are not joined as defendants, their rights are unaffected; their liens remain undisturbed and continue upon the land while in the hands of the purchaser; and they retain the right of redemption from the holder of the mortgage before the sale, and from the purchaser after the sale. It is not, in general, considered that

terest.

1 Martin v. Noble, 29 Ind. 216. It is not necessary to allege any particular inA general averment, as stated in the text, is sufficient in respect to all the defendants, except those against whom a personal judgment is asked, and those who are owners of the land. See Anthony v. Nye, 30 Cal. 401; Sichler v. Look, 93 Cal. 600; Carpenter v. Ingalls (S. Dak. 1892), 51 N. W. 948. [McKibben v. Worthington's Ex'r (1898), 103 Ky. 356, 45 S. W. 233; Commonwealth v. Robinson (1895), 96 Ky. 553, 29 S. W. 306.]

2 See, as illustrations, Johnson v. Britton, 23 Ind. 105; Parrott v. Hughes, 10 Iowa, 459. Such persons are not, however, necessary parties: United States Trust Co. of N. Y. v. Roche, 116 N. Y. 120, 130.

3 Kay v. Whittaker, 44 N. Y. 565, 572; Bloomer v. Sturges, 58 N. Y. 168; Rathbone v. Hooney, 58 N. Y. 463; Gaines v. Walker, 16 Ind. 361; Proctor v. Baker, 15 Ind. 178; Wright v. Howell, 35 Iowa,

288, 293; Newcomb v. Dewey, 27 Iowa, 381; Auson v. Anson, 20 Iowa, 55; Ten Eyck v. Casad, 15 Iowa, 524; Knowles v. Rablin, 20 Iowa, 101; Chase v. Abbott, 20 Iowa, 154; Street v. Beal, 16 Iowa, 68; Heimstreet v. Winnie, 10 Iowa, 430; Veach v. Schaup, 3 Iowa, 194; Bates v. Ruddick, 2 Iowa, 423; Hayward v. Stearns, 39 Cal. 58, 60; Green v. Dixon, 9 Wis. 532; Story's Eq. Pl. § 193; Haines v. Beach, 3 Johns. Ch. 459; Draper v. Lord Clarendon, 2 Vern. 518; Lomax v. Hide, 2 Vern. 186; Godfrey v. Chadwell, 2 Vern. 601; Morret v. Westerne, 2 Vern. 663; Rolleston v. Morton, 1 Dr. & W. 171 ; Besser v. Hawthorne, 3 Ore. 129; Pardee v. Steward, 37 Hun, 259; Douthit v. Hipp, 23 S. C. 205; Hensley v. Whiffin, 54 Iowa, 555; Stanbrough v. Daniels, 77 Iowa, 561; Williams v. Brownlee, 101 Mo. 309; De Lashmutt v. Sellwood, 10 Ore. 319; Johnson v. Hosford (Ind., 1887), 10 N. E. 407. See, however, per contra, Morris v. Wheeler, 45 N. Y. 708,- a

prior incumbrancers are even proper defendants, for as their liens are paramount to the mortgage, they cannot be in any manner affected by the action or the decree therein.1 It is said in Iowa, however, that they are proper parties.2 If a mortgage is given by a husband and wife on lands which are her separate estate, he is a necessary co-defendant with his wife, except in the very few States whose statutes expressly exclude him in actions having reference to the wife's separate property. If he united with the wife in the note, bond, or other obligation secured by the mort

gage, he is a proper defendant in Minnesota, for the further reason that a judgment for deficiency may be rendered against him in the action.1

§ 240. *343. Joinder of Wife of Mortgagor. In regard to the necessity or propriety of joining the wife of the mortgagor, or of any subsequent owner of the mortgaged premises, there is some conflict among the decisions. The solution of this question depends mainly upon the law of the State regulating the wife's right of dower.2 In most of the States the common-law doctrines as to dower prevail without substantial alteration. In some, however, they have been entirely abrogated, or at least radically changed. As at the common law, the wife's inchoate dower right attached to all lands owned in fee by the husband during the marriage, any mortgage, except for purchase-money, given by the husband, in which the wife does not join, is subject to her dower right. When such a mortgage-not for purchase-money — is executed by the husband alone, a foreclosure thereof by an action in which she is even made a party defendant does not affect her rights; she can assert her claim to dower in the land after her husband's death without redemption; the decree as to her is a mere nullity. If the wife unites with her husband in executing the mortgage, her dower right becomes subject to the mortgage lien; in other words, she is entitled to dower in the equity of redemption. This entitles her to redeem upon the same principle that any other junior incumbrancer is thus entitled. In all those States where the common-law doctrines as to dower have not been abrogated, the wife of the mortgagor, who has united in executing the mortgage, though not an absolutely necessary party, must be made a defendant in order to cut off her right of redemption. If not a party to the foreclosure suit, she may come in and redeem from the purchaser.

1 Wolf v. Banning, 3 Minn. 202, 204. [In Padley v. Neill (1896), 134 Mo. 364, 35 S. W. 997, a wife commenced an action to cancel a mortgage on her property, and a foreclosure was allowed on a cross bill without joining her husband.]

2 [But where a wife renounces her dower right, she is not a necessary party: Miller. Bank (1897), 49 S. C. 427, 27 S. C. 514.]

3 Moomey v. Maas, 22 Iowa, 380; Merchants' Bank v. Thomson, 55 N. Y. 7, 11.

The same is, of course,

4 McArthur v. Franklin, 15 Ohio St. 485; 16 id. 193; Chambers v. Nicholson, 30 Ind. 349; Chase v. Abbott, 20 Iowa, 154; Anthony v. Nye, 30 Cal. 401; Mills v. Van Voorhies, 20 N. Y. 412. For the peculiar law of North Carolina, see Creecy v. Pearce, 69 N. C. 67; Etheridge v. Vernoy, 71 N. C. 184, 185-187; Nimrock v. Scanlin, 87 N. C. 119. Wife is a necessary defendant in Wisconsin: Foster v. Hickox, 38 Wis. 408, overruling Cary v. Wheeler, 14 id. 281. In Alabama, she is