282 P. 268 | Mont. | 1929
Lead Opinion
The cross-complaint states a cause of action in equity for relief against the erroneous decree of foreclosure entered in cause No. 3,289 upon the ground of mistake or excusable neglect, and the findings of the court under the evidence not only render the judgment and decree of foreclosure entered herein erroneous, but warrant a judgment in the appellant's favor. *86
By the sale of October 11, 1924, the judgment and decree of foreclosure entered on September 15, 1924, in cause No. 3,289, was satisfied and thereby extinguished. On this point it seems that all parties to this suit and the court as well are agreed. It follows under the settled rule of this jurisdiction that from the beginning relief has been available to the appellant, if at all, only by a suit in equity, and that under the opinions of this court referred to below the appellant never was in a position to correct the error appearing in cause No. 3,289 by motion, whether presented under section 9187, Revised Codes 1921 or otherwise.
In Foster v. Hauswirth,
The principle of these two cases is particularly applicable to the cause at bar in this respect: After October 11, 1924, and the sale of the premises described in cause No. 3,289 to the appellant in full satisfaction of the judgment of September 15, 1924, and of all sums due it thereunder, under the mistaken belief that thereby it was acquiring in consideration of the extinction of its debt the title to all of the property described in its mortgage, there was open to the appellant in the courts of Montana but one remedy, and that an action in equity appropriately brought against all interested parties *87
for reformation of the judgment-roll in cause No. 3,289 and relief from the mistake into which it had fallen. (See Gerig v.Loveland,
As the Minnesota court said in Peterson v. First Nat.Bank, supra, under Code provisions like our sections 7484-7486, relative to mistake, it is immaterial whether in a given case the mistake be one of law or fact. Relief in the courts of Montana may be awarded in either case, sufficient reason therefor appearing. Moreover, this court is committed to the doctrine that such relief will be awarded where the negligence of the party making the mistake is excusable as in the record at bar the trial court has expressly found, particularly where the adverse party knew of the error and acted at all times with such knowledge. Such is the plain import of section 7485, and of subdivision 2, section 7486, supra (Parchen v. Chessman,
Upon the authority of the above cases we submit that by its action in equity the appellant has chosen the appropriate remedy for relief against the mistake occurring in cause No. 3,289, and that the facts of the case clearly make out a cause of action entitling it to the relief sought which is the cancellation of the erroneous proceedings and the foreclosure of its mortgage lien in accordance with the true intent and *88 understanding of the parties when the original complaint in cause No. 3,289 was filed. Any other view of the facts works the grossest injustice in the name of equity and in favor of one who according to the admission of her recognized attorney and confessed agent has not been misled or deceived as to the true facts in the slightest. The language of the learned Chief Justice in Parchen v. Chessman, supra, above, is peculiarly pertinent and applicable at bar: "Relief will be granted when, in view of all the circumstances, to deny it would permit one party to suffer a gross wrong at the hands of the other."
On June 24, 1924, the manager of the Spokane office wrote to Messrs. Grimstad Brown, attorneys at law residing at Billings, advising them that the Kunneke note was wholly unpaid, and that the interest thereon had not been paid since *89 February 1, 1922, and instructing them to foreclose the mortgage.
Grimstad Brown proceeded with the foreclosure. The action instituted was numbered 3,289, and will be so referred to. In preparing the complaint they omitted from the description of the property 320 acres, the most valuable and essential part of the tract mortgaged. Contemporaneously with filing the complaint, the attorneys filed a notice of lis pendens with the county clerk of Carbon county, which contained a correct description of the property. All defendants defaulted. The decree entered September 15, 1924, followed the description set forth in the complaint, and this error was carried into the order of sale, the sheriff's notice of sale, and in the certificate of sale. All these papers were prepared by Grimstad Brown. The appellant, on the sale day, October 11, 1924, bought in the property described in the notice of sale for the full amount of the judgment, and on that day respondent began an action to foreclose her mortgage, making the appellant and others parties defendant.
By letter dated October 30, 1924, an agent of appellant, writing from the Spokane office, called the attention of Grimstad Brown to the fact that there was "a slight error" in the description of the property contained in the sheriff's certificate of sale. Upon receipt of the letter Mr. Brown immediately checked up the various papers and found the errors. Having determined that section 9187, Revised Codes 1921, afforded appellant an appropriate remedy, he prepared a motion to amend the decree. The motion was dated December 16, 1924, but was not filed until February 9, 1925. The district court, on February 24, 1925, granted the motion, whereupon a new decree was filed, embracing the property described in appellant's mortgage, the sale was set aside, and a new order of sale issued. Afterwards, on respondent's motion, the new decree was ordered set aside, and that order was sustained by this court. (Oregon Mortgage Co.,Ltd., v. Kunneke,
In the meantime appellant appeared, first by demurrer, and then by answer, in the action instituted by respondent to foreclose her mortgage. In the answer appellant alleged, in effect, that through inadvertence and clerical error a portion of the lands described in its mortgage was omitted from the decree and order of sale, and consequently was not sold by the sheriff on October 11, 1924, but that upon appellant's motion the court had amended the decree, issued a new order of sale based upon the corrected decree, and that the amended decree declared appellant's lien upon all the lands described in its mortgage to be paramount to the lien or interest claimed by respondent. This answer was filed April 28, 1925, and to it respondent demurred on May 7, 1925. No further action was taken in the case until July 24, 1926, when respondent filed a reply to the complaint, alleging that the district court had set aside the amended decree, that the appellant had appealed from the order, and the supreme court had affirmed the order.
On August 20, 1926, the district court granted appellant leave to file an amended answer and cross-complaint, which was done on that day. The cross-complaint gives a history of the entire proceedings. It alleges that the omission of the property from the complaint, judgment, order of sale and certificate of sale was suffered by accident, and from the mistake, inadvertence and excusable neglect of appellant, its officers, agents and attorneys, which is explained at length. It is alleged that appellant has suffered injury, for the reason that the lands purchased at the sheriff's sale are worth much less than the debts secured by the mortgage; that respondent was cognizant of the mistake at all times, and will not be injured by an amendment of the complaint in cause No. 3,289, and the foreclosure of appellant's mortgage which is alleged to be prior and superior to the lien of respondent's mortgage; that Kunneke and Lemley, at all times since February 1, 1922, have been and are now insolvent, and a judgment against them, or either of them, would be entirely worthless. *91
The essential allegations of the cross-complaint, except those as to the existence of appellant's mortgage, the foreclosure thereof, and what took place after the foreclosure, were denied by respondent. Replying further, respondent alleged that, by bidding in the property for the full amount of the judgment, appellant fully satisfied and extinguished the sale in all respects; that appellant's mortgage, at the time of the filing of the cross-complaint, was barred by the provisions of section 8267, Revised Codes 1921, for the reason that the appellant never filed any affidavit of renewal thereof as required by that section; that, although appellant claimed to have discovered the error or mistake in the description of the property purchased by it at sheriff's sale on or about the 30th of October, 1924, it made no attempt to correct the error or to have the same corrected until about the 9th of February, 1925, when it filed a motion for that purpose; appellant's failure in that proceeding is then set forth, and respondent pleads that, having selected that procedure for the purpose of correcting the alleged errors, and having pursued that remedy even to the supreme court without avail, it ought now to be barred and estopped from maintaining the cross-complaint and from obtaining any relief thereunder.
After trial, the court made findings of fact and conclusions of law. The findings are contradictory in many ways. As illustrating this, in finding 26 the court says that the failure of appellant to include all of the lands described in this mortgage in its complaint and subsequent papers in cause 3,289 was caused by the negligence and carelessness of appellant and its attorneys, agents and servants, and without fault or negligence on part of respondent or Meyer Chapman State Bank, her predecessor in interest, while in finding No. 36 it is said that the error complained of was occasioned and suffered by accident and from the mistake, inadvertence and excusable neglect of the attorneys for the appellant.
In view of the law as we have been constrained to determine it, it is unnecessary to refer to other findings. *92
The court concluded that judgment should go in favor of respondent for the full amount of her notes, interest and costs, and that she should have a decree foreclosing her mortgage as prayed for, and that appellant should take nothing. Judgment and decree were entered accordingly. Both parties made numerous exceptions to the findings, all of which were overruled. Thereupon appellant brought the cause to this court. From out the exhaustive and able arguments and briefs of counsel there appears one determinative question: Is the appellant upon its own showing entitled to relief in equity?
The rules in this state governing the vacation of decrees in equity and judgments at law are the same. With us decrees are but judgments. (Raymond v. Blancgrass,
The general rule is that the equity power of a court "may not be invoked by a litigant to obtain any relief, when a plain, adequate, and speedy remedy is afforded in the ordinary course of law. Inadequacy or deficiency of the legal remedy is the fundamental concept of equity jurisdiction." (Philbrick v.American Bank Trust Co.,
Section 9187, Revised Codes 1921, provides that the court, in its discretion, may, upon such terms as may be just, relieve a party or his legal representative from a judgment taken against him through his mistake, inadvertence, surprise or excusable neglect, provided that application therefor be made within a reasonable time, but in no case exceeding six months after the judgment was taken.
The statute, though providing a remedy at law, is founded upon equitable principles. It is liberal, and designed to promote justice, but the suitor must be diligent in asserting his rights. Indeed, the statute is designed to afford a speedy remedy *93
in the action itself, rather than to subject the litigant to the delay and expense of a separate suit. The remedy provided is available to one in whose favor a judgment is rendered, as well as to one against whom judgment has gone. This has been held in California, from which state we borrowed the statute, many times. (Brackett v. Banegas,
That the sale could be set aside upon motion is settled in this jurisdiction by the exhaustive opinion of Mr. Justice Holloway in State ex rel. Coffey v. District Court,
In Foster v. Hauswirth,
It is thus made clear that the court did not intend to hold that the remedy by motion would not have been available to the defendant, even if property had been sold under the judgment, unless the rights of others had intervened. And we may *95 say that, when third parties take the property with full knowledge of all the facts, if the facts would warrant relief to the injured party, the remedy should also run against the third parties.
Green v. Wiederhold,
In the case at bar the statutory remedy was plain, speedy and adequate. Under it appellant could have obtained complete relief. It could have had the decree, and all subsequent proceedings thereunder, set aside, and have obtained an order permitting an amendment of its complaint. Having served the amended complaint upon the defendants, appellant could then have pursued its action in due course. Appellant invoked the aid of the statute, but through its own fault failed to pursue properly the remedy it afforded. (Oregon Mortgage Co. v. Kunneke,
When counsel for appellant invoked the legal remedy, when they filed their motion to amend the decree, they knew all the facts respecting the commission of the errors that were known to present counsel when the cross-complaint asking relief in equity was filed. Under the circumstances, equity shuts its doors against them. "As appears upon the face of their complaint," said Mr. Justice Sharpstein in Ede v. Hazen,
"If the complaining party has resorted to an adequate legal remedy, and been denied relief, this adjudication should bar any relief in equity on grounds then available which were or might have been there urged." The form of the legal remedy is immaterial, if it be adequate. (3 Freeman on Judgments, 5th ed., sec. 1194.)
When a party seeking relief from a judgment has an adequate remedy at law by motion in the original case, equity will not interpose in his favor while that remedy is available, nor thereafter if he does not show a sufficient excuse for not having resorted to it at the proper time. (Dunne v. Yund,
But if fraud enters in, or if the misconduct of his adversary has brought about the result (Bullard v. Zimmerman,
The unavoidable conclusion reached above makes it unnecessary to consider other problems presented in the briefs. And in view of the result reached the fact that the court's findings are inconsistent is inconsequential.
The court reached the correct conclusion, and its judgment is affirmed.
ASSOCIATE JUSTICES MATTHEWS, GALEN and FORD concur. *98
Dissenting Opinion
I am unable to concur in the views announced in the majority opinion, to the effect that appellant had a full, complete and adequate remedy by motion. When appellant learned of the facts constituting the basis of the relief sought by this proceeding, the judgment in the foreclosure action was already fully satisfied and discharged by a sale of the property. Under such circumstances, it had no remedy by motion, by force of the decision of this court in the case of Foster v. Hauswirth,
True, in the cases cited above, the defendant was the moving party; but, if section 9187 extends to those in whose favor judgment has been rendered, as well as to those against whom judgment has been entered, then it must so operate upon like terms and conditions and subject to the same limitations, one of which is that the remedy by motion is not available after the judgment has been satisfied. Also it is true that in theHauswirth Case the objection was one that went to the jurisdiction of the court to enter the judgment complained of, but such was not true in the Green Case, and neither was want of jurisdiction assigned as the reason for the conclusion in theHauswirth Case. The reason assigned was that the judgment had been satisfied. There was no right of any third party involved in the Hauswirth Case. There, as here, the plaintiff had become the purchaser of the property at the execution sale, and this fact alone is what the court referred to in its opinion, wherein it said: "The rights of third persons have intervened, or, at least, additional rights have been created thereby."
In my opinion, also, no part of the opinion in the GreenCase may properly be characterized as obiter dictum. The court, after giving one reason why the action of the lower court, in granting the motion to set aside the judgment, could not be sustained, said: "There is still another ample reason why the action of the court below can[not] be sustained. Upon the judgment rendered and entered October 13, 1916, *99
a writ of execution was issued, delivered to the sheriff, and by him returned, showing complete satisfaction of the judgment. The matter had therefore passed beyond the jurisdiction of the court in this proceeding." When more than one reason is assigned by an appellate court for sustaining or overruling the action of the lower court, both become the judgment and decision of the court, and neither is dictum. As was pertinently observed by Mr. Justice Brewer, speaking for the United States supreme court inUnion P. R. Co. v. Mason City etc. R. Co.,
The above decisions of this court, whether right or wrong (and that is a question not here involved), constituted the law of this state at the time of the discovery of the facts relied upon here, and at the time the cross-complaint in this action was filed.
Since appellant had no remedy by motion, in view of these decisions, it is my opinion that the remedy invoked by appellant in the cross-complaint is available, and that the cause should be considered on its merits.
I express no opinion whether the judgment should be affirmed on the merits, since that question has not been considered in the majority opinion.
Rehearing denied December 5, 1929. *100
