Mansfield v. Kilgore

Barnes, J. Action by a junior mortgagee to redeem certain real estate from prior mortgages and for a foreclosure. Defendants had judgment, and the plaintiff has appealed. The facts are not in dispute, and it appears from, the record that on the 21st day of September, 1896, one David P. Kilgore, who theretofore had been, and then was, the owner of the southeast quarter of section 23, township 15 north, of range 1 east, in Butler county, Nebraska, together with his wife, executed and delivered to the plaintiff, William J. Mansfield, a mortgage on said premises to secure the payment of a promissory note for the sum [453] of $1,032, due on the 21st day of September,-1900, with certain coupon interest notes attached for $61 each, payable on the 21st day of September of each year, successively, from and after the date of the execution of the mortgage, to and including the year 1900; that theretofore Kilgore had executed certain other mortgages on the same land as follows: One to Fayette L. Rounds for $1,000, covering the south 80; one to Ira Davenport for $800 upon .the north 80; one to Dwight Carey for $1,400, and one to George P. Sheesley for $250 upon the entire quarter section; that in the year 1897 Rounds instituted foreclosure proceeding's making the plaintiff and all other lien-holders parties thereto. Cross-petitions in that action were filed by Davenport and Carey, and service was had upon the plaintiff, as W. J. Mansfield, by publication. A decree of foreclosure was entered upon Carey’s cross-petition, in which the court found and declared the priority of liens and the amounts due thereon, the plaintiff herein being decreed to be the fifth lien-liolder. In 1898 the premises were sold under the decree to C. IT. Aldrich, trustee, for one Helen T. Campbell, and the purchase price was absorbed by the four prior liens. In 1901 Helen T. Campbell sold and conveyed the premises of the defendant, Louis Henfling, who is the present owner, who went into possession and has made valuable improvements thereon. In the foreclosure proceedings above mentioned, plaintiff Mansfield, as above stated, was served by publication, he being a nonresident of this state. It appears, however, that he had actual notice of the proceedings, and before any decree Avas rendered therein he wrote to one S. H. Steele, an attorney at David City, and asked him to ascertain the exact nature and extent of all the liens on the premises and the order of their priority. Steele made this examination, and Avrote a letter to the plaintiff, in which he gave in detail all of the proceedings, the amounts and order of priority of the respective liens, hOAV service was obtained on each of the defendants, including himself, and the then status of the case. At that time Kilgore was in default [454] of his payments to plaintiff, and a cause of action had accrued upon his mortgage. The plaintiff, on receiving this information, paid the attorney his fee and gave the matter no further attention. Thereafter he continued to sustain business relations with Kilgore, who was his tenant, and dealt with a resident agent in Butler county for several years after the termination of the foreclosure proceedings. In 1902 he sold an adjoining piece of land which he owned to the defendant Henfling, who, as above stated, had bought the Kilgore land from Helen T. Campbell.' However, he neglected to commence foreclosure proceedings until all the coupon interest notes except one were barred by the statute of limitations. He never attempted to collect them, or secure the payment of the principal note, and never made any application to open the decree in the foreclosure case. In fact, he took no action in the premises whatever until the commencement of this suit in November, 1905. Upon this state of the facts, the district court found that plaintiff was guilty of laches, and dismissed his action for want of equity. Plaintiff assails the decree of the district court upon two grounds: First, that the court, in the original foreclosure proceedings, acquired no jurisdiction over him, because, as he alleges, his true name is William James Mansfield, and therefore he is not bound by the decree in that case; second, that he Avas not guilty of laches, as found by the district court, because he commenced this action for the foreclosure of his mortgage well within the time provided by the statute of limitations. Considering the first question, it may be said that the district court adopted plaintiff’s theory that he was not bound by the decree of the foreclosure, and a majority of this court are of the same opinion. Plaintiff’s second contention is not Ayithout strong support in the authorities, many of which hold that one cannot be held guilty of laches in instituting judicial proceedings if -they are commenced Avithin the period of the statutory limitations. While this is true, still one may [455] be guilty of such conduct as will amount to at least an equitable estoppel, and we think, the facts of tills case bring the plaintiff well within that rule. The record discloses beyond question that plaintiffs mortgage constituted a fifth lien upon the premises in question; that when the decree was rendered in the Rounds foreclosure proceeding the value of the land was insufficient to satisfy the four prior liens; that the proceedings in that case were regular, with the single exception that the plaintiff herein was made a defendant in that suit by the name of W. J. Mansfield in place of William James Mansfield, which he now contends is his true name. That plaintiff had actual notice of the pendency of that action is frankly conceded by his counsel. It is not contended that the land when sold under the decree in that case brought less than its actual value. It is also shown that the proceeds of the sale, when applied to the payment of the four prior liens, not only failed to satisfy them, but left a deficiency thereon; that with full knowledge of those facts defendant abandoned any attempt to enforce his mortgage lien or collect his mortgage debt, and it is now conceded that but for the recent unusual and unprecedented rise in the value of real estate in Butler county he Avould never have commenced this action. It thus Appears that-plaintiff abandoned his security, and it is shoAvn that he has lost the notes which were secured by the mortgage in question. It further appears that having full knowledge of the pendency of the foreclosure proceedings, and Avell knoAving that the land embraced in his mortgage Avould be offered at the foreclosure sale, wherein the public Avould be expected to purchase it upon the faith and credit of such proceedings, he took no steps whatever to assert his lien, either at that time or until long after the defendant Henfling had purchased and paid full value therefor, and had made valuable and lasting improAements thereon. We are therefore of opinion that by reason of the abandonment of his security, and his subsequent conduct, the plaintiff is now estopped [456] from attempting to assert his mortgage lien, as against the purchaser at judicial sale or those claiming under him. Gillespie v. Sawyer, 15 Neb. 536; Lydick v. Gill, 68 Neb. 273, 281; Bausman v. Kelley, 38 Minn. 197, 8 Am. St. Rep. 661. It is contended by the plaintiff, however, that the defendants have not pleaded an estoppel, and therefore they are not entitled to a decree upon that ground. It is true that the answer is somewhat informal, and the word estoppel may not be found therein, still all of the facts constituting such a defense are set forth in the answer, and in our opinion it is sufficient to sustain a decree upon that ground. For the foregoing reasons, we are of opinion that the judgment of the district court was right; and the fact that a wrong reason was given for the decision does not warrant us in reversing it. The judgment of the district court is therefore Affirmed.