Dupee v. Salt Lake Valley Loan & Trust Co.

20 Utah 103 | Utah | 1899

OPINION.

After stating the facts,

Miíte®,, J.,

delivers the opinion of the court.

It is urged by the respondent that in the Marshal’s deed to Stephens, and in his notice and certificate of sale no mention was made that the sale was had subject to the lien for the principal sum due upon the mortgage, as provided in the decree, and that the respondent took the property by its redemption free from the lien claimed to be reserved in the decree, and that the sale to Stephens without such reservation vested the title in the respondent as redemptioner. At the time the decree was entered the court found that no part of the principle was due, but did find that the ground rents and taxes were due and had been paid by the plaintiff under the provisions of the deed, and granted a decree for the sale of the property for that amount, but decreed that the plaintiff was not then entitled to a foreclosure for the entire sum secured by the mortgage; that the principal sum of six thousand dollars and interest still remained a lien on the mortgage premises, and that the plaintiff was not entitled to foreclose the same for that sum until a further breach of covenants in the trust deed.

The record shows that lis pendens was duly filed; that the marshal at the time of the first sale publicly announced that it was made subject to the lien of the mortgage and publicly read the clause in the decree providing that the mortgage was a lien upon the premises for the remaining debt secured to be paid by the mortgage. It is claimed that evidence of this announcement was not admissible. We are of the opinion that this evidence was admissible. It shows that independent of the decree the appellant did not intend to waive or release the lien of the mortgage for the balance of the debt covered by the decree, and that all persons at the sale had notice of the lien reserved in the decree outside of the notice contained in the decree itself. The decree directed the principal sum owing upon the mortgage to remain a lien upon the premises, and the first sale was made under an announcement by the Marshal to that effect. There is nothing in the statute requiring such announcement to be incorporated into the certificate, notice, or deed, and the failure of the marshal to so incorporate it does not modify or affect the original decree, or waive or release the lien reserved in the decree. The marshal had no power to set aside or annul a decree of the court. It was sufficient in this case, although not of vital importance, that the marshal announced the lien at the time of the sale. By this means all persons present, including the attorneys in the case, had actual notice. Hughes & McCurt v. Frisby, 81 Ill. 198; Boyer v. Chandler, 106 U. S. 394; 2 Jones on Mortgages, Sec. 1547.

"When the foreclosure suit was commenced a Us pen-dens was filed. The defendants and their attorneys knew of and had actual notice of the pendency of the action, and the subsequent rendition of the decree, and that the mortgage lien was still upon the land. The object of notice of Us pendens is to keep the subject of the suit or res within the power and control of the court until the judgment or decree shall be entered, so that courts can give effect to their judgments and that the public shall have notice of the pendency of the action. (Lis pendens may be defined to be the jurisdiction, power or control which courts acquire over property involved in a suit, pending the continuance of the action, and until its final judgment therein.”) This constructive notice of filing the complaint as required by the statute is equivalent to actual notice. 13 Am. & Eng. Enc. of Law, p. 889; Whittaker v. Greenwood, 17 Utah 33; 53 P. R. 736.

The purchaser at a public sale must take notice of the terms of the decree. McKinley v. Hamer, 72 N. W. Rep. 1042.

The decree was a matter of. public record and notice to the parties and all persons claiming through and under them, that the lien of the mortgage remained on the property. The parties, the purchaser, the attorneys for the parties were present at the sale with notice of the decree, and are supposed to have known its terms, and are bound by its provisions. The respondent, by its attorney, examined the decree before his client redeemed. By the decree it was not intended that the lien of the mortgage for principal and interest should be extinguished by a sale thereunder for ground rent and taxes even if the sale be made to the mortgagor or judgment creditor. The parties, purchasers and redemptioners were anchored to the decree, and were bound by it, and cannot escape its provisions. If the clause referred to had not been contained in the decree, a different conclusion might be reached. By redeeming,, the respondent became, by operation of law, the assignee of the purchaser, and succeeded to his rights and no more. When the decree imposed conditions to the sale, respondent redeemed subject to those conditions. He claims title under that decree now. He cannot be heard to claim under a part of it that is advantageous to him, and reject that part which is to his disadvantage. He redeemed under it; claims title under it, and is bound by it. At most the respondent was but a judgment creditor. By the provisions of the decree all persons claiming under Jones, and all persons having liens by judgment or otherwise subject to the mortgage, or subsequent to the filing of the lis pendens were forever barfed and foreclosed. As owner of the judgment respondent had a right to redeem and pay the lien created by the decree and nothing more.

Respondent, a judgment creditor of the mortgagor, having redeemed from the purchaser, the mortgage debt being due at the time of the sale, the lien continued to remain in force under the decree, after the sale. Under such circumstances it was proper for the mortgagee on motion, after due notice to the attorney of record in the case, if an appearance had been had, to obtain an order for the sale of the property under section 3502, Rev. Stat. 1888. It would not be necessary to serve this notice of motion on the redemptioner or judgment creditor as claimed by the respondent. It was sufficient to serve it on the attorney of -the defendants, who had appeared in the action.

It was held in Hughes & McCart v. Frishy, 81 Ill. 188, “Where a foreclosure of a mortgage is had before the whole debt is due, and the decree directs a sale for the debt due, subject to the lien for the part not due, if the mortgagee the holder of the entire debt, purchases and receives a deed for the premises, it will be a satisfaction of the whole debt, but if redemption is made from the purchaser by the mortgagor, or judgment creditor of the mortgagor, the debt.not due at sale and the lien will remain in force, and the mortgagee may again foreclose as to it.” Hooker v. Reas, 18 Cal. 651. Bank of Napa v. Godfrey, 77 Cal. 612.

Section 3502 Rev. Stat. 1898, provides: “If the debt for which the mortgage, lien, or incumbrance is held, is not all due, as soon as sufficient of the property has been sold to pay the amount due, with costs, the sale must cease, and afterwards, as often as more becomes due for principal or interest, the court may, on motion, order more to be sold. But if the property cannot be sold in portions without injury to the parties, the whole may be ordered to be sold in the first instance, and the entire debt and costs paid, there being a rebate of interest where such rebate is proper.”

Our statute is like that of California. Under this statute it is held in California, that, “The proper practice under the code is to apply by motion, and not by petition, for a sale of more of the mortgaged premises as often as more becomes due for principal or interest. The failure to sell a portion of mortgaged property under a decree of sale for a first installment of interest will not prevent a sale of tbe whole property on motion, when the unmatured portions of the note fall due. The provision of the code authorizing the court on motion to order more to be sold, after a previous sale of sufficient of the property to pay the amount due, is construed to be for the benefit of the debtor, and not to impose upon him the cost of several sales.” Bank of Napa v. Godfrey, supra.

The statute points out the proper procedure in such cases. Under it, if the debt secured is not all due, as soon as sufficient of the property has been sold to satisfy the amount decreed to be paid the sale should cease, and thereafter as soon as more becomes due for principal or interest, the court may or may not in the same proceeding order more sold. But if it is made to appear to the court" in the first instance that the property cannot be divided or sold in portions without injury to the parties, the whole may be ordered sold, and the entire debt and costs paid making proper rebate in interest.

The decree permits a sale of the property or so much thereof as may be necessary, to satisfy the decree and which may be sold separately without material injury to the parties, to be sold.

In this case the mortgage not being due it would have been better practice, if the facts justified it, to have made a showing to the court that the property was so situated that it could not be sold in portions without injury to the parties, and thereon to have obtained a decree for sale accordingly. Then the sale could have been made in one parcel without any question arising thereon, and without calling upon the officer to act upon his judgment or discretion to sell the property in parcels or as a whole. Or if it appeared to the court that the property could be divided and sold in parcels without injury to the parties, then the decree should have been rendered accordingly. The proceeding to obtain the order on motion for the sale of the property under the decree was in conformity with the statute. The appellant, under his decree, obtained a title to the mortgaged premises, but subject to redemption by those in a position to redeem.

The first sale to Stephens, from which respondent redeemed was made subject to the lien of the principal and interest of the mortgaged debt referred to in the decree, and all rights of the-respondent except to redeem, were extinguished by the subsequent sale to appellant under such decree and order.

Mortgage sales in equity will be controlled by courts of equity, so that no injustice may be done to either party. Campbell v. Macomb, 4 John. Ch. 534.

Other questions are discussed in the briefs of the respective counsel, but upon careful examination we find that the findings and judgment appealed from are erroneous, and not sustained by the evidence.

The case is reversed and remanded to the district court with directions to set aside the judgment and findings, and to enter findings and judgment in favor of the appellant, as prayed for in the complaint.

Appellant is entitled to costs.

Bartch, J. and Baskin, J., concur.