20 S.D. 587 | S.D. | 1906
This is an appeal by Carl Malmberg from, the judgment and from the order denying a new trial. The respondents, Chilson and Haugen, commenced an action to foreclose a certain mortgage executed by Elmer E. Youngs and wife to Gilbert D.. Peterson, to which the appellant in this action filed an answer. Subsequently the appellant commenced an action to quiet his title to the premises covered by the mortgage to Peterson, in which action the respondents- Chilson and Haugen, filed a complaint in intervention. The two actions were consolidated and tried as one action by the .court without a jury. The facts necessary to a proper understanding..of .the questions, presented in. this case, may be; briefly stated as .follows: In. 189.8. Youngs and wife, being the. owners .of certain lots, in the city of Webster, Day county, mortgaged.
The court, however, in its eighth finding of facts, finds as follows : “That the defendant Carl Malmberg, at the 'time of the purchase of the hereinbefore described premises, knew that the mortgage in finding ]\To. 1 above described was not paid by Elmer E. Youngs and Rora A. Youngs, or by either of them, o’r by any person for them, and that said defendant Malmberg had such information in relation thereto as to put a reasonably prudent and cautious man upon his inquiry, and that in pursuing such inquiry said Malm-berg did not exercise such diligence as a reasonably prudent man
“Sec. 2451. Constructive notice is notice imputed by the law to a person not having actual notice.
“Sec. 2452. Every person who has actual notice of circumstances sufficient to put a prudent man upon inquiry as to a particular fact, and who omits to make such inquiry with reasonable diligence, is deemed to have constructive notice of the fact itself.”
It is clear, therefore, that the appellant did not make such in
Section 2035 of our Revised Civil Code provides as 'follows: “One who has 'a lien inferior to another upon the same property, has a right: (1)' To redeem the property in the same manner as its owner might, from the superior lien; and (2) to be subrogated to all the benefits of the superior lien when necessary for the protection of his interests, upon satisfying the claim secured thereby.” Chilson and Haugen had the undoubted right under the statute o pay the Peterson mortgage and to be subrogated to all the rights of Peterson therein. It was the duty of the appellant, therefore, to ascertain by whom and for what reason the Peterson mortgage was paid. The appellant must be presumed to know the law, and to know that the payment might be made by the holder of a subsequent lien on the property and that in such case the party paying would have the right to be subrogated to all the rights of Peterson, the mortgagee. The fact that the mortgage was recorded and no satisfaction or assignment of the same appeared upon the record was notice to him as 'a prudent man that he should not only have .inquired of Peterson as to whether or not the mortgage was paid, but he should have pursued the inquiry by ascertaining by whom the payment was made, and followed that up by inquiries as to their reasons for paying the same. The appellant, therefore, failing to make the necessary inquiries, the law cannot' regard him as an innocent purchaser without notice, and his contention that he is protected in the purchase of the certificate and is entitled to the property by virtue of the deed issued thereon as against the claims of Chilson and Haugen cannot be sustained.
The contention of appellant that Chilson and Haugen should have taken an assignment of the Peterson mortgage at the time they paid the same and had the same recorded is not teiiable. The law does not require a subsequent purchaser or incumbrancer, who pays off a prior mortgage or lien, to take any assignment of the same,
In our opinion, the judgment of the circuit court was right, .and the judgment and order denying a new trial are affirmed.