28 P.2d 487 | Wyo. | 1934
Charles H. Peterson, as plaintiff, brought this action against Charles A. Johnson and W.G. McIlvain on March 17, 1931. He alleged in all of his causes of action that on April 10, 1910, he and his wife executed a promissory note to defendant Charles A. Johnson, for $1200.00, due in one year, drawing ten per cent interest per annum, until due, and drawing *477 interest at one and one-half per cent per month after it was due, the note being secured by a mortgage, containing the ordinary power of sale on 160 acres of land in what is now Lincoln County, Wyoming. It appears that defendant McIlvain was the sheriff of Lincoln County, and that, commencing on January 22, 1931, notice of foreclosure under the power of sale of the aforesaid mortgage was given, in which the amount due on January 22nd, 1931, was given as the sum of $1892.10 and $150 attorneys' fee, the sale to take place on March 7, 1931. In the first cause of action it was further alleged that the sheriff promised to postpone the sale following an unforeseen accident which disabled plaintiff's attorney to do anything in the case, but that the promise was not kept. Inasmuch as there is no evidence in the record as to these allegations, we shall make no further reference to it. In the second cause of action plaintiff further pleaded that the amount of $1892.10, stated in the notice of foreclosure, was greatly excessive; that there was actually due only the sum of $155.40 and an attorney's fee, which plaintiff offered to pay; that no credit had been given for the sum of $1000 which was paid by plaintiff on the note. In the third and fourth causes of action the plaintiff alleges that the note was given for a one half interest of defendant in a mercantile store, but that the store was insolvent, which defendant Johnson, but not the plaintiff, knew at the time, and that the note was without consideration, and was obtained under duress. In the fifth cause of action the plaintiff pleaded among other things that the note was barred by limitations; these allegations, too, were ignored by the court, so that we need not give them any consideration herein. Plaintiff accordingly prayed that the sale of the premises be declared void; that it be set aside and held for naught, that the sheriff be enjoined *478 and restrained from proceeding further with the issue of a certificate of sale or deed; that a preliminary injunction be issued and on the trial be made permanent, and for such other relief as to the court might appear to be equitable. A preliminary injunction was issued as prayed. The defendant Johnson filed an answer, admitting the execution of the note and mortgage in question, and the foreclosure of the mortgage, and denied all the other allegations of plaintiff; he further pleaded the execution of the note and mortgage; that it was unpaid, except certain items endorsed thereon; that the mortgage was foreclosed on March 7, 1931, ten days previous to the commencement of this action, and that the defendant Johnson became the purchaser of the premises, bidding the amount claimed to be due and the costs of the proceeding, and that a certificate of sale was issued, subject to the right of redemption of the plaintiff within six months. The case herein was tried to the court, without a jury. The court found that there was due to defendant Johnson on the note the sum of $229.10, plus the sum of $150 for attorneys' fees; judgment was given for that amount against the plaintiff; the preliminary injunction theretofore issued was made permanent, and the premises in question were ordered to be sold to satisfy the sum so found to be due.
1. We must first of all consider the assignment of error that the judgment is not sustained by sufficient evidence. In that connection counsel for the defendant say that the preponderance of the evidence is in favor of the defendant. But that is not the criterion. We have held that the criterion is as to whether or not there is substantial evidence to support the finding of the court. Farmers' State Bank v. Trust Company,
Oct. 18, 1911 — Interest to date __________ $190.75 Oct. 18, 1911 — On note ___________________ 356.92 April 1, 1912 — Paid ______________________ 15.73 July 15, 1913 — Jensen order ______________ 61.00 Oct. 7, 1912 — Check ______________________ 100.00 Dec. 13, 1913 — Five cows Heber Jensen 105.00 *480 Dec. 13, 1913 — Heber Jensen ______________ 10.50 April 27, 1915 — Check ____________________ 50.00 April 13, 1918 — Check ____________________ 60.00 Jan. 30, 1921 — Cattle ____________________ 100.00 July 8, 1925 — Check ______________________ 25.00 Sept. 3, 1925 — Check _____________________ 25.00
The plaintiff, in his testimony, denied not only, as counsel for defendant claim, that he paid the last two items, but he also twice testified that he had no recollection whatever of paying the first two items, thus putting these items, as well as that of $61.00, in doubt. (Record, 59, 76, 79). He further testified that about the month of October, 1911, he paid the sum of $1000, with which he was not credited. Later, however, he testified that this amount should take the place of the item of $100 placed on the note as of date Oct. 7, 1912, and he further stated that he had no recollection of the item of $60.00 (Record 121). Plaintiff further testified that when he bought the defendant Johnson out, he was coerced in giving the note, but subsequently found, contrary to representations made to him, that there were outstanding a number of accounts against the store; that he was compelled to pay them; that the store was in fact insolvent; that he paid about $800 or $900 on the accounts outstanding, specifically identifying $275.00; and he claims that by reason of the facts the giving of the note was void and without consideration. No request for finding the facts and the law was made, and we can not, accordingly, tell how much of the plaintiff's testimony was believed by the court, except that it is certain that the court rejected the testimony that plaintiff was coerced in executing the note, and that it was wholly without consideration. It also appears that certain amounts were expended in connection with the foreclosure. Hence there are many ways in which the ultimate amount due might be figured. Counsel *481
have not given us any aid in this connection, and we have been compelled to spend a large amount of time to determine whether or not the court was justified in giving judgment for the amount it did, that is to say, what items of credit the court was justified in deducting from the note in order to arrive at the result which it did. We have been unable to arrive at the result reached by the trial court. But the judgment is presumed to be correct, and appellant must make an affirmative showing of error. Iowa State Savings Bank v. Henry,
2. At the close of the evidence introduced on behalf of the plaintiff, defendant moved for judgment in his favor. The ruling of the court was in the following words: "If you rest, I will entertain the motion, if not, the motion will be overruled and you can have an exception." Counsel for the defendant contends that thereby the court refused to entertain any motion unless he rested. But the effect of the ruling of the court was simply that the motion was not good *483 at that time, and that in its judgment the plaintiff had made out a prima facie case. After the ruling the defendant introduced his testimony, and it is at least doubtful whether he did not thereby waive the error in the ruling on the motion, if error it was. 4 C.J. 721. But we do not think it was error. The plaintiff had testified that he was entitled to a credit of $1000, and amounts paid on account of debts of the store; that he was not entitled to the last two items of credit endorsed on the note, and he threw doubt on the first two items credited on the note and on the $61 item. If the court believed plaintiff's testimony which it had the right to do, it appeared plainly that the amount claimed in the notice of foreclosure was grossly excessive, which, as hereinafter mentioned, made the foreclosure voidable.
3. The defendant claims that the petition did not state a cause of action for the reason that the various causes of action, or counts, were inconsistent with each other. We do not think that the contention is well taken. The main bases of the petition, stated in different counts, so far as the point now under consideration is concerned, were (1) invalidity of the note in question on the ground of duress; (2) invalidity of the note on the ground of want of consideration; (3) payment of the note except a small amount thereof, and (4) limitation of action. We see no inconsistency in these claims. Though a man may execute a note under duress, or because of want of consideration, or because it is barred by limitations, he may yet, on grounds deemed by him to be advisable, go ahead and pay it, or any part thereof. It is held that a denial, want of consideration, and payment may all be pleaded in the same pleading. 49 C.J. 220.
4. Counsel argue further that the preliminary injunction should not have been issued. It is evident, however, in so far as that injunction is concerned, that *484
we could not reverse the case, if error was committed in issuing it, if the ultimate decision rendered herein is correct, for the error would then be without prejudice. State ex rel. v. Luckuck,
"It is sufficient if the amount is given with reasonable certainty, or data given from which it can be computed without going into details * * * * and a mistake or inaccuracy of the amount or an overestimate of what is due, especially if the excess is small, will not vitiate the sale, unless shown to have *485 been fraudulently intended or to have resulted in injury to the mortgagor; but a gross overstatement of the amount, so excessive that it might deter and discourage bidder, will render the sale invalid."
In Wiltse on Mortgage Foreclosure, (4th Ed.), Sec. 839, it is said:
"If the advertisement of sale contains a false statement tending to deceive the public as to the amount of the incumbrances and thereby deter bidders, the sale will be irregular and void."
Jones on Mortgages, 8th Ed., Sec. 2396, says:
"Where the amount is grossly overstated, or so excessive that it might deter and discourage bidders, it will render the sale invalid."
And the same authority, in treating of the nature of the action to set aside a sale, says in Sec. 2451:
"A mortgage or trustee, in the exercise of a power of sale, must act fairly, and is under very much the same obligation to other parties in interest as a trustee in other cases. So far as other persons are interested in the property, the power is regarded as a trust, and the mortgagee is treated as a trustee in the exercise of it. Fairness and good faith are demanded of him. * * * The right to disaffirm a sale does not partake of the nature of an estate or interest giving rise to it, but is the product of the trust relation under which the vending mortgagee performs the duty raised by the terms of the instrument of mortgage with due regard to the interests of the cestui que trust."
The case of Schwarz v. Sears, Harrington (Mich.) 440, is a case very similar to the case at bar. It was a case brought to set aside the sale on the ground that an excessive amount was charged. The amount, however, does not appear. An injunction was granted on the filing of the bill to restrain the defendant from perfecting the steps necessary in the proceeding *486
and in procuring the deed from the sheriff. It was held among other things that "a foreclosure under a power of sale, if made for an excessive amount, may be set aside before the proceedings under it are perfected, on a bill filed by the debtor for leave to redeem on paying the amount due." See also the case of Huyck v. Graham,
"The advertisement of sale contained false assertions, and was an imposition upon the public, and a fraud upon the rights of all concerned. It stated, that the 70 acres were to be sold for default of payment of three several mortgages given upon that land, to secure those payments. One of these mortgages was the third one, already mentioned, upon other lands, being 11 acres and a garden spot, and *487 confessedly not the 70 acres in question. There were, therefore, but two mortgages upon the land to be sold. Such a false allegation tended to deceive the public as to the extent of the incumbrances, and to deter purchasers from bidding."
In the case of West v. Bates, supra, it is held that "foreclosure of a trust deed, being for more than due, issuance of a trustee's deed will be enjoined and the certificate of sale cancelled, but without prejudice to right to foreclosure for the proper amount."
In the case of Jencks v. Alexander, 11 Paige (N.Y.) 619, 627, the court held that when any misstatement as to the amount due is made which is calculated to deter bidders, it is sufficient to avoid the sale. In the case of Spencer v. Annon,
"A sale made under such circumstances ought not to be sustained. When the holder of a mortgage, instead of proceeding to foreclosure by judicial proceedings, wherein all interested are necessary parties, and in which all questions may be regularly determined by a competent tribunal, resorts to the power contained in the mortgage, thus taking the remedy in his own hands, by an ex parte proceeding, it is but reasonable that he should be kept strictly within the terms of the power, and held to a rigid observance of all the requirements of the statutes which regulate its exercise. The published notice that the property will be sold, is all the notice that parties interested have of this proceeding, and this notice the Statute declared must contain certain specifications, any one of which it would be fatal to omit. One of these specifications is that the notice shall state the amount claimed to be due upon the mortgage at the date of the notice. *488
We do not hold that it is absolutely necessary to state with certainty the exact amount legally due; for a party under a mistake of law or fact, may honestly claim more than by law he would be entitled to, and if the other party is not shown to be prejudiced thereby, the sale should not be disturbed. The mortgagee may be ignorant of, or contest certain alleged payments. He may estimate the amount according to the strict terms of the contract, or may err simply in a computation of the interest. And if, under such circumstances, he claims more than he could legally recover, it does not necessarily vitiate the sale. Perhaps any amount within the terms of the contract may in good faith be claimed without affecting the legality of the notice. But we do hold that a party cannot arbitrarily or wantonly claim in his notice a sum which neither the terms of the contract, nor any legitimate calculation based thereon will justify. An excess, of trifling amount, arising from a mere error of computation, will not be deemed material, but we cannot regard the present case as one of that kind; for here the sum claimed exceeds, by more than one half, the amount which any calculation based upon the note would produce; and whether this was done arbitrarily and wantonly, or through ignorance merely, it cannot be excused. We think the notice given by the Plaintiff was not in accordance with the Statute, and that it tended to prejudice the mortgagor, and to discourage competition at the sale."
That case, so far as we can find, has never been overruled. But counsel for the defendant has cited us to the case of Dickerson v. Hayes,
"That after a sale for such excessive claim, where the mortgagee bids in and still holds the property, the mortgagor may be allowed to pay what is actually due, and so redeem, upon a proper showing, is undoubtedly true."
But the case then proceeds to hold that to grant such relief a showing should be made that the mortgagee *489
was hindered in making such payment before the sale actually took place; that ordinarily the amount bid should be paid. That is perhaps the general rule. Section 89-2967, Rev. St. 1931; 42 C.J. 401. But in a later case, namely, Seiler v. Wilber,
"None of them (the cases) suggest that the mortgagor is bound, merely by his silence during the foreclosure proceedings by a claim in the notice of sale not justified by the express stipulations of the parties, or by a claim which ignores payments that have reduced the amount that the mortgagee may claim under those stipulations."
In that case the mortgagor sued for the excess bid in at the sale over and above the actual amount due, and while in one way it supports, perhaps, Dickerson v. Hayes, supra, in another it is antagonistic thereto, and one of the justices in the later case stated that "it seems to me that the two cases are in principle inconsistent with each other, and that the present case virtually overrules Dickerson v. Hayes." The point now before us was decided in Bean v. Pearce,
"It may be said that the complainant should have tendered the $150, the consideration expressed in the deed executed by respondent to himself as purchaser at the foreclosure sale; that this sum is the purchase money which was necessary to be tendered to effectuate the redemption under sction 3507 of the Code of 1896, not withstanding the difference between this sum and the amount due upon the mortgage debt has never been paid to the mortgagor. It is true that section requires the debtor to pay or tender to the purchaser the purchase money, with ten per cent *490 per annum thereon and all other lawful charges; but the purchase money, when the mortgagee, as here, purchases at his own sale, is the amount due upon the mortgage indebtedness, and not such as he may have bid in excess of that amount. Suppose the mortgage debt is $100, and the mortgagee at the sale should bid $1000, to require the mortgagor (debtor) to pay the $1000 and ten per cent per annum thereon would oftentimes absolutely defeat his right to redeem. The $900 in excess of the $100, if the mortgagee is bound by his bid, would belong to the mortgagor, and it would be wholly inequitable and unconscionable to require the mortgagor to pay the mortgagee money which he has in his hands which belongs to the former."
The reasoning in that case appears to us to be so sound that we deem it unnecessary to add anything further to it. We believe that the court was right in entertaining a suit to set the sale aside, and, incidental thereto, issue an injunction, and having found no prejudicial error in the proceeding, the judgment rendered should be and is affirmed.
Affirmed.
KIMBALL, Ch. J., and RINER, J., concur. *491