Thompson v. Dale

58 Minn. 365 | Minn. | 1894

Mitchell, J.

The sole question presented by this appeal is whether, in an action to enforce a lien under the former mechanic’s lien law, 1878, G-. S. ch. 90, a personal judgment for the amount of the debt could be docketed, and become a lien on the general property, of the lienee, or other party personally liable for the debt, before the sale of the premises subject to the specific lien, and the application of the amount realized by the sale.

Section 8 of chapter 90 provided that any person holding a lien under that chapter might proceed to obtain judgment and enforce the same in the same manner as in actions for the foreclosing of mortgages upon real estate. To decide the question here presented, resort must therefore be had to the statutes regulating foreclosure by action.

1878 G-. S. ch. 81, § 29, provides that “judgment shall he entered, under the direction of the court, adjudging the amount due with costs, and disbursements, and the sale of the mortgaged premises or some part thereof to satisfy said amount, and directing the sheriff to proceed and sell the same according to the provisions of law relating to sales of real estate on execution, and make report to the court.”

Section 33 provides that “upon confirmation of the report of sale the clerk shall enter satisfaction of the judgment to the extent of the sum bid for the premises, less expenses and costs, and for any balance of said judgment execution may issue as in other cases; but no such execution shall issue on such judgment until after a sale of the mortgaged premises and the application of the amount realized as aforesaid.”

Under the old equity practice the court of chancery could not render a personal judgment against the mortgagor for the deficiency, after applying the proceeds of the mortgaged premises. The mortgagees had to resort to a court of law for that purpose. But in all or nearly all the American states the right to a personal judgment for such deficiency has been so long conferred by statute that it has become practically a part of the common law of the country. The almost universal practice has been for the decree of foreclosure to determine the amount due on the mortgage, direct a sale of the premises, and provide for the rendition of a personal judgment against the mortgagor for the deficiency after application of the proceeds of the sale; and then, after the amount of the deficiency was thus ascertained, the court would order personal judgment for that definite sum. Such was the practice in this state prior to 1866. 1851 E. S. ch. 94, § 58.

Any such practice as rendering personal judgment, in connection with or as a part of the decree of foreclosure, for the full amount of the debt, and docketing the same so as to become a lien on the other real estate of the mortgagor, before sale of the mortgaged premises, was practically unknown.

The supreme court of California held that section 246 of their practice act (unlike our statute) authorized this, and that such a judgment might be immediately enforced by general execution. See Englund v. Lewis, 25 Cal. 358. This radical departure from the usual practice was evidently unsatisfactory, for the legislature promptly amended the statute in 1861 so as to prohibit this being done. There is nothing in the language of our statute to indicate that the legislature intended to make the radical change in practice and procedure contended for by defendants.

The judgment or decree prescribed in 1878 G. S. ch. 81, § 29, is the ordinary equity form in foreclosure cases, the language being, “adjudging the amount due,” which does not amount to a personal judgment, and only comes to have the effect of one after certain things are done by virtue of subsequent provisions of the statute. The fact that it is called a judgment does not imply that it is a personal one, any more than in the case of the judgment in strict foreclosure provided for in section 43 of the same chapter; and, whatever form of words may be used, it will only have the effect which the statute gives it, viz. an adjudication of the amount due. '

The only authority for issuing a general execution is for the deficiency or balance after the application of the proceeds of sale to the debt. Had section 33 stopped with this, there would probably not have been much doubt about the meaning of the statute. But the last clause of that section, instead of enlarging what went before, was evidently added, for greater caution, to guard against a misconstruction of what preceded. The provision that a general execution can only issue for any balance, and that such execution can only issue after sale of the mortgaged premises and the application of the amount realized, is entirely inconsistent with the idea of a personal judgment for the full amount of the debt before sale; for the general rule is that a lien by judgment does not exist, except in consequence of the right of an execution for its enforcement. The lien of a judgment is a consequence of the right to sell real estate for its satisfaction, and whenever the right is conceded the existence of the lien is generally admitted; but whenever that right is denied the existence of the lien is also denied. Freem. Judgm. § 339. A judgment without the right of execution to enforce it is really no judgment. The docketing of a judgment, and the lien thereby acquired, performs the office, and takes the place of an actual levy on land.

Some of the language used in the statute is somewhat peculiar, and might seem to point towards the idea of a personal judgment for the whole debt in the first instance, upon which is to be subsequently credited the proceeds of sale. But taking all the provisions of the statute together, and construing them according to their legal import rather than their literal language, we are clearly of the opinion that they neither contemplate nor authorize a personal judgment, except for the balance of the debt • remaining after the application of the proceeds of the sale of the mortgaged premises. Under the former statute such judgment could only be rendered upon the order or supplemental decree of the court after sale, and after the amount of the deficiency was definitely ascertained. The only change made by the present statute is that the amount of such deficiency is ascertained by the clerk by the mere act of subtracting the net proceeds of sale from the amount adjudged due; and, that being done, the "adjudication of the amount due” becomes operative, by virtue of the provisions of the statute, as a personal judgment for such balance, thus avoiding the necessity of any further or supplemental order of the court for judgment.

Nothing inconsistent with this view will be found in either Dodge v. Allis, 27 Minn. 376, (7 N. W. 732,) or Slingerland v. Sherer, 46 Minn. 422, (49 N. W. 237,) if the precise questions before the court in those cases are kept in view. What we have said has reference only to personal judgment in connection with the usual relief granted in foreclosure actions. If a plaintiff establishes a cause of action for the recovery of money, but fails to establish his right to a specific lien, he would obtain an ordinary personal judgment, with all its incidents. This serves to distinguish from the present case a line of our decisions which defendants also cite as authority. There is nothing in the point that this is a collateral attack on the judgment. It only goes to the ministerial act of the clerk in docketing this as a personal judgment. If unauthorized by law, the act is void, but this does not affect the validity of the judgment.

Order reversed.

Buck, J., absent, did not sit.

(Opinion published 59 N. W. 1086.)

Reargument denied October 9, 1894.