Pelton v. Farmin

By the Court, PAINE, J. This was an action to foreclose a mortgage, and some of the defendants, who were proceeded against only as persons having some claims in the premises subsequent and subject to the,mortgage, answered setting up a paramount title. This was demurred to, and the demurrer overruled, improperly as we think. A person made a party to a foreclosure suit, merely to bar any interest which he may claim subsequent and subject to the mortgage, if he claims no such interest, has no right to insist on setting up and trying in that suit a claim of paramount title. The two things are incongruous and ought not to be mixed together. And though the respondent’s counsel seems to think that our statute, contrary to all previous practice on the subject in this state or elsewhere, designed to mingle all possible claims to the land in a foreclosure suit, yet we can discover no sufficient evidence of such a design. He relies upon section 6, chapter 134, R. S. 1858, as producing this result, because it provides that the conveyance executed by the sheriff or referee “ shall be effectual to pass the rights and interests of the parties in the property adjudged to be sold.” It is claimed that this is substantially different from the New York statute under which the decision in Lewis v. Smith, 5 Seld., 502, was made; and that as their statute related specially to foreclosure cases, [227] when it provided that the deed given on a sale should be “ an entire bar against all parties to the suit,” the court held that it referred only to rights and interests in the equity of redemption, and not to rights paramount both to the title of the mortgagor and that of the mortgagee. And the counsel then infers that because our statute has no special reference to foreclosure cases, but provides a general rule for all cases, therefore it cannot be applied to mortgage cases with any different effect from what it would have in case a sale was ordered in a partition suit, or in afiy other case where a sale may be had. But this very fact, that the provision of our statute is found in a general chapter on executions, and had no special reference to mortgage cases, leads our minds to a conclusion directly opposite to that at which the counsel has arrived. Eor it shows that the legislature had no special design of providing any new rules in respect to the proper parties to a foreclosure case. It left that untouched. It assumed that the question who were proper parties, would be settled in such cases by the existing law and practice upon the subject; and that when its general provision that the deed should pass “the rights and interests of the parties ” came to be applied to such a suit, it should be interpreted as referring to such rights and interests as were or might have been properly litigated in the suit, and disposed of by the judgment. If they did assume this, then they understood that the object of a foreclosure suit was to bar the mortgagor and those claiming subsequent to the mortgage, from redemption, and not to try paramount titles, and they could not have intended, in applying their general provision to such cases, anything more than was intended by the New York statute having special reference to -mortgages. If they had intended to accomplish any such sweeping change in the entire scope and object of so important a class of actions, they would have done it by some legislation on that special subject, and not in the manner in which it is here claimed to have been done. — If the party alleged to claim some interest [228] subsequent and subject to the mortgage, claims none, be should disclaim, and tbe suit should be dismissed as to him. He would then no longer be a party, and though the deed given on the sale should convey the interests of all the parties, he would not be affected as to any paramount title he might have. His setting up such a paramount title was no answer to the allegations made against him; and if the plaintiff did not choose to litigate his title in this suit, we think he might raise the objection by demurrer. The case of Lewis v. Smith has already been followed by us in Strobe v. Downer, 13 Wis., 10; and without saying what might be the effect where a paramount title was set up in a foreclosure case, and litigated without objection, and a judgment rendered involving a decision upon such title, we decide simply that neither party is bound to litigate such a title in such a way, and that where a party is proceeded against as a subsequent incumbrancer only, it is no answer for him to set up a paramount title. The order appealed from is reversed, with costs, and the cause remanded for further proceedings.