96 N.W. 261 | N.D. | 1903
This is an action to foreclose a mortgage upon 160' acres of land situated in Ramsey county. The mortgage was executed and delivered by Andrew Osthus to the Bank of Minot on January 25, 1888, and was given to secure his promissory note for $991',. of even date therewith, payable to said bank, which said note, by its terms, became due on January 25, 1893. The plaintiff rests his-, claim of ownership of the note upon a purchase of all the assets-, of the Bank of Minot from the receiver- The complaint, in addition to the usual averments of a foreclosure complaint, avers that “the defendants, Andrew Osthus, Bank of Minot, A. B. Guptill as receiver of the Bank of Minot, Edgar Anderson, T. A. Luros, Hannah Luros, Ernest Anderson, Lorina Anderson and F. C. Sherman, have, or claim to have, some interest in or lien upon said mortgaged premises, or some part thereof, which interest or lien is subsequent and. inferior to the interest or lien of plaintiff’s said mortgage.” The-Bank of Minot, the original mortgagee, and F. C. Sherman, who appears to have owned the note in suit at one time, did not answer.. It is alleged in the complaint, and admitted by the answers filed by the five contesting defendants, that no part of the principal or interest secured by the mortgage has been paid. The execution and delivery of the note and mortgage are also admitted. The contesting defendants deny that the plaintiff is the owner of the note, and claim that the title thereof, and of the mortgage securing it, passed from the-Bank of Minot to Eliza V. Hoffman, and from her to the defendants,. Annie Anderson and Hannah Luros, through an equitable assignment. The trial court gave judgment in favor of plaintiff, as-prayed for in his complaint. The five contesting defendants, above named, have appealed from the judgment, and demand a trial denovo in this ccurt.
With the exceptions to be hereafter noted, the facts upon which the case turns are not in dispute, and may be stated as follows: On January 25, 1888, Andrew Osthus, who was then the owner of the-land in question, gave the mortgage in suit to the Bank of Minot,, and the same was duly recorded in Book I, page 12, of Mortgage Records of Ramsey county.. On November 8, 1888, the Bank of Minot transferred the note to F. C. Sherman, and at the same time executed and delivered to him a purported assignment of the mort
It is plaintiff’s contention that the title and the right of possession ■of this note passed to the receiver from the bank upon his appointment, and that through the subsequent sale by the receiver to him he
It is undoubtedly true, as counsel for defendants contends, that a sale under a void foreclosure of a real estate mortgage has the effect of assigning the mortgage attempted to be foreclosed to the purchaser at the foreclosure sale. Salvage v. Haydock, 68 N. H. 484, 44 Atl. 696; Smithson Land Co. v. Brautigan, 16 Wash. 174, 47 Pac. 434; Anderson v. Minnesota Loan & Trust Co., 68 Minn. 491, 71 N. W. 665; Stillman v. Rosenberg (Iowa), 78 N. W. 913; Sawyers v. Baker, 77 Ala. 461; Johnson v. Sandhoff (Minn.), 14 N. W. 889; Rogers v. Benton (Minn.), 38 N. W. 765; Grosvenor v. Day, 1 Clarke, Ch. 109; Hoffman v. Harrington, 33 Mich. 392; Gilbert v. Cooley, Walk. Ch. (Mich.) 494; Stallings v. Thomas (Ark.) 18 3. W. 184. It is also true that the execution and delivery of a deed by the purchaser at the void foreclosure sale to a third person, according to a number of cases, has the effect of assigning the mortgage to the grantee. Whether the doctrine goes further, and sustains the view that all subsequent grantees acquire the ownership of the mortgage successively by virtue of their deeds — -and that is this case — we need not discuss or determine. In this case it is entirely clear, we think, that Eliza V. Hoffman never was the owner of the note and mortgage in suit, by virtue of an equitable assignment, purchase or otherwise. If she was not, then, of course her deed to the defendants could not, in any event, operate as an equitable assignment of
The defendants also urge in this court that the plaintiff has not established the assignment of the mortgage to him by the receiver by competent proof. The original assignment was not introduced in evidence. The plaintiff relied entirely upon the record of the assignment, which was introduced over defendants’ objection that it was not the best evidence, and that no foundation had been laid for its introduction. Whether secondary evidence was admissible, under chapter 145, p. 189, Laws 1901, we need not determine. The plaintiff established by competent evidence the purchase of all the assets of the bank from the receiver, and the approval of the sale by the court, and, as we have seen, this note constituted a part of the assets. The note was delivered by the plaintiff to his attorneys in 1899, and was offered in evidence by them. F. C. Sherman, who at one time owned the note, was made defendant, and made default; and this is true also of the Bank of Minot, the original payee. Its possession and production in evidence was prima facie evidence of the plaintiff’s title and ownership. Section 812, Daniel on Neg. Instruments, and cases cited. No evidence whatever was offered to overcome this prima facie showing. It was entirely unnecessary to prove a formal written assignment of the mortgage. Plaintiff was. entitled to maintain the present foreclosure action, even without a formal written assignment. The mortgage wa,s merely an incident of the debt, and followed it. The rule stated by Wiltsie on Mortgage Foreclosure, at section 347, is that “in those states where the transfer of a note carries with it the security collateral thereto, in an action by
It was suggested by defendant’s counsel on oral argument that inasmuch as the defendant Andrew Osthus was not a party to the former action, in which the foreclosure by the Bank of Minot was adjudged void, he is not bound by that judgment, and that he can therefore insist in this action that the former foreclosure was valid, and that the note secured by this mortgage was in fact paid by that foreclosure. It must be admitted that the defendant is not concluded by that judgment, and that this defense was available to him, had he elected to interpose it. He has not done so, however. It is not pleaded. Neither has the defendant Osthus brought into the record any evidence from which we could, even if this defense were pleaded, judicially determine that the former foreclosure was valid. The pleadings do not present this issue. The complaint alleges that the former foreclosure sale was adjudged void. Osthus’ answer specifically admits this allegation, and nowhere in his answer does he allege that the debt secured by the mortgage in suit was discharged by payment, foreclosure or otherwise. On the contrary, he rests his defense upon a denial of plaintiff’s ownership of the note. There is therefore no foundation either in the pleadings or in the evidence upon which to rest defendants’ contention that the former foreclosure was in fact valid and satisfied the note in suit.
The defendants also attack the plaintiff’s ownership of the note, by claiming that the entire receivership proceedings through which the plaintiff obtained title to the note were void for the reason, as they allege, that the action wherein the receiver was appointed was collusive. This question is not before us. The jurisdiction of the court which appointed the receiver to make' the appointment and to ■order and confirm the sale of the assets is not, and cannot be, challenged. The court had jurisdiction of the persons and the subject-matter, and the validity of its orders in the receivership proceedings, including the order appointing the receiver, authorizing the sale of the assets, and approval of the same, cannot be attacked in this collateral way. High on Rec. section 39a; 1 Black on Judg. sections 245-246, and cases cited.
The defendants T. A. Luros and Edgar Anderson also relied in . the district court upon a tax deed issued to them by the county audi
For the reasons stated, we have reached the conclusion that the judgment rendered and entered by the district court should in all things be affirmed, and it is so ordered.