National Bank of Commerce v. Lock

The opinion of the court was delivered by Dunbar, J. On March 16, 1891, the Rainier Avenue Electric Railway Company was the owner in fee simple and in possession, free from incumbrance, of the east half of lot 20 (excepting a strip 66 feet wide off the south side thereof), of the plat of Lake Dell in King county, "Washington, containing two acres of land. On that date said company executed and delivered to defendant Luke Lock a bond for a deed of said two acres, agreeing on or before two years to convey said premises to Lock, provided Lock on or before said two years paid to it the sum of $600 with ten per cent, interest. Lock at that time, in consideration of the bond, executed and delivered to the order of the said Rainier Avenue Electric Railway Company his promissory note for $600, payable on or before two years from said date, bearing ten per cent, interest. Lock entered into possession of the land, erected a dwelling house thereon and made other improvements, remaining in possession until about September, 1894, when he left the premises. On October 1, 1892, the note was transferred by the Rainier Avenue Electric Railway Company to the appellant, the Rational Bank of Commerce of Seattle. At the time said note was assigned appellant was informed by said payee, the Rainier Avenue Electric Railway Company, that the payment of the note was secured by a lien upon real estate near Columbia, which is in the vicinity of said two acres of land. There is no dispute but that the plaintiff is still the owner and holder of said [530] note, no part of which has ever been paid. In fact, the court found that the plaintiff was the owner and holder of said note. Prior to the transfer of this note, viz.: on August 20, 1892, the Rainier Avenue Electric Railway Company executed to one Edmiston a mortgage to secure payment of a promissory note, which said mortgage was, on October 7, 1892, duly filed for record in Bang county. Said note and mortgage were thereafter, for a valuable consideration and before maturity, assigned to Charles E. Cotting, who foreclosed said mortgage. At the sheriff’s sale under said proceeding the property was purchased by E. H. Osgood, who subsequently sold the same to defendant, the Seattle & Rainier Beach Railway Company. This action was brought to foreclose the lien of the Rational Bank of Commerce of Seattle on the said two acres of land. The bond given to Lock was never recorded. At the trial, however, the allegations of the complaint in reference to the execution and delivery of the bond for the deed were proven, also the execution and delivery of the $600 note to said Rainier Avenue Electric Railway Company, and the assignment to plaintiff of the $600 note. Rone of the defendants except the Seattle & Rainier Beach Railway Company appeared to contest plaintiff’s claim to said two acres. Said defendant (respondent here) offered in evidence the mortgage of the Rainier Avenue Electric Railway Company to Edmiston, the sheriff’s deed to Osgood, and the deed fiom Osgood to defendant, the Seattle & Rainier Beach Railway Company. The conclusion of the court was, after finding the facts which were substantially conceded, that the plaintiff had no interest; that plaintiff’s complaint should be dismissed for lack of equity, and that the defendant, the Seattle & Rainier Beach Railway Company, is the owner of said premises free and clear from any right, title or interest that said [531] Lock may have therein by, through or under the "bond or agreement hereinabove referred to. It is contended by the appellant that with the assignment to defendant of the Lock note of $600, there passed also the lien on said two acres. This contention, we think, is correct under the authorities. 2 Jones, Liens, § 1119; Gessner v. Palmateer, 89 Cal. 89 (24 Pac. 608). And it is insisted that if this he true there can be no adverse claim raised to plaintiff’s title thereto except by the defendant, Seattle & Rainier Railway Company. It is also insisted by the appellant that the mortgage executed to Edmiston by the Rainier Avenue Electric Railway Company was too indefinite in its description to establish a lien upon the land in question, and that the sheriff’s deed to Osgood, the purchaser at the foreclosure sale, and the deed from Osgood to defendant, the Seattle & Rainier Beach Railway Company, were equally indefinite and fatal to the interests of the respondent. It is conceded that the respondent obtains its title, if title it has, through these instruments. In none of these instruments is the land in question referred to other than in the general description of all the property, real, personal and mixed, now owned or hereafter tO' be acquired hv the Rainier Avenue Electric Railway Company. The decree and order of sale provide that “said mortgaged property shall be sold as an entirety in one lot and shall not be severed or sold in parcels, hut the same shall be sold absolutely and without any right of redemption, statutory or otherwise, after such sale.” It is contended by the respondent that there was no lien incident to the transfer or assignment of the Lock note, for the reason that it was given as security for the payment of the note already in existence. But it seems to us that under the finding of the court that the plaintiff was owner [532] and holder of said note and that it had not been paid, the manner in which it came into possession or ownership of it would not be material. The authorities are uniform in holding that a deed of this kind is invalid so far as the property not described is concerned. Passing the want of description in the other exhibits, Mr. Freeman in his work on Executions, vol. 2 (2d ed.), § 281, says: “ So the deed, being the conveyance of the defendant’s title, and the final evidence of the extent of the purchaser’s acquisition, ought to be specific and free from ambiguity.” Again: “Where the description is so imperfect that it cannot be ascertained therefrom what property, was levied upon or sold, the proceedings must be regarded as void, and, as a general rule, cannot be supported by showing by the officer what he intended to sell.” The description in all these exhibits, it must be seen, is of the character spoken of by the author. It would be impossible from the mortgage recorded, from the notice of sale or from the deed, for a person to tell that the particular land in question here was mortgaged, levied upon or sold. See, also, 2 Devlin, Deeds, § 1432; Herrick v. Ammerman, 32 Minn. 544 (21 N. W. 836). Our statutes provide that the execution enforcing the decree shall contain a description of the mortgaged property. They also provide (Code Proc., § 500), that the notice of sale shall particularly describe the property to be sold. This rule of law in fact is not gainsaid by the respondent, but he insists that the law is different when applied to mortgages given by railroad companies, and many cases are cited to sustain the proposition that a decree ordering the sale of a railroad and of property rights and franchises thereunto appertaining or thereafter ac [533] quired would be construed to cover tbe entire real estate owned by sucb company at tbe time of mailing tbe mortgage, and real estate subsequently acquired. We bave examined tbe cases cited by tbe respondent, but do not consider them in point from tbe fact tbat tbe cases involve real estate wbicb was owned and operated for railroad purposes; for while tbe courts unquestionably bold tbis to be tbe law, none of them bave gone to tbe extent of bolding tbat tbis rule applies to land that is not owned by tbe companies for tbe purpose of aiding tbe operations of tbe railroad; but tbe inference, and even tbe announcement, in many of tbe cases cited is exactly to tbe contrary. It does not appear tbat tbis land was in any way connected with tbe operation of tbe road. In fact, it was situated a considerable distance from tbe road, and could not bave been used in tbe operation of tbe road. !STo one would, therefore, bave bad notice of tbe transfer of tbis land either by tbe mortgage or any subsequent proceeding. In fact, in tbis case Osgood, tbe execution purchaser and respondent’s grantor, frankly testified tbat be bad no knowledge at tbe time of bis purchase at said sheriff’s sale tbat be was acquiring any title to tbe property in litigation herein; also tbat be bad no knowledge tbat be was conveying any interest or title in or to said land in bis deed to defendant, and tbat said respondent herein did not know of any claim or title tbat it bad to said land until approached by counsel for plaintiff in regard to tbe same about tbe time of tbe beginning of tbe present action. We think tbe court misunderstood tbe law relative to mortgages by railroad companies and tbat it committed error in its conclusions of law. Tbe judgment will, therefore, be reversed and tbe cause remanded with instructions to grant tbe prayer of tbe plaintiff. Scott, O. J., and Reavis and Andees, JJ., concur.