Wilson v. Tarter

Strahan, C. J. It must be taken as the settled law of this court that if the mortgagor, the owner of the mortgaged premises, or a subsequent lien-holder, is not made a party to a foreclosure suit, his interest is ui ¡affected by the suit, and the decree of foreclosure does not pind his rights. (Besser v. Hawthorne, 3 Or. 512; DeLashmurt v. Sellwood, 10 Or. 319; Wiltsie Forecl. 126.) This principle is elemen-. tary, and was not controverted on the argi iment by appellant’s counsel. The real contention g, 'ows out of its application. The respondent’s contention is, that inasmuch as the several lots and parcels of ¡land mortgaged were sold at the’foreclosure sale at an aggregate sum. and not separately, it is now impossible to det ermine what proportion of the burden created by the mortgage each should bear, and that therefore they' have the right to redeem the entire property; and’that by virtue of said redemption they are entitled to have all the mortgaged property transferred to them by the defendant. On the other hand, the appellant’s contention is, that in exercising the right of redemption, the plaintiffs simply pay off the mortgage, by which means they become subrogated to Tarter’s interest therein, with the right to hold and foreclose the same against the mortgaged property except the Riggs interest now held by' the plaintiffs. It is proper to observe that the proceedings [511] in Tarter’s foreclosure suit against Baird’s heirs and representative are in every respect regular and sufficient in law to pass to him the Baird title in the entire property except the block deeded by Baird to Riggs. As to Baird’s interest, then, Tarter’s title is complete, and the only defect in the title as to the Riggs interest is that the mortgage was not foreclosed because the owner of the block was not made a party to the suit. Do these facts create in the owners of that interest such a controlling equity as to enable them to wrest from the defendant against his will the title to the property, as to which there is no question? The right claimed on the part of the plaintiffs is placed upon the ground that the right of redemption as to the block they hold has not been foreclosed, and that they cannot exercise the right of redemption as to part without redeeming all; but this rule seems to have been made for the benefit of the mortgagee. The authorities say he shall not be compelled to divide his debt and security into portions. (Green v. Dixon, 9 Wis. 532.) But even this rule, it is said by the same authority, does not apply after a foreclosure and sale in a suit when the owner of one of the tracts mortgaged was not made a party. The same reason is suggested by another authority: “The debt being a unit, no party interested in the whole premises or in any portion of them, can compel the mortgagee to accept a part of the debt and relieve the property pro tanto from the lien.” (3 Pom. Eq. Jur. § 1220.) In Robinson v. Fife, 3 Ohio St. 551, the principle is thus stated: “The right to p.laiiu that the whole, and not a part, shall be redeemed, is a right which appertains to the mortgagees, and not to the mortgagor. The reason of the rule is, that the mortgagee shall not be compelled to divide or apportion his security.” (Boqut v. Coburn, 27 Barb. 230.) “But this rule does not apply,” it is said, “where the mortgage has been foreclosed without making all of the several owners of the land parties to the suit, and the mortgagee has purchased at the [512] sale, because he has by such proceeding and purchase voluntarily severed his right, and obtained an indefeasible title to part of the land, and only a defeasible title to another part. The owner not made a party, may redeem the portion owned by him on paying a part of the mortgage debt bearing such proportion to the whole as the value of his land bears to that part ot the whole mortgaged premises.” (2 Jones, Mort. § 1074.) It was insisted by the respondents that in exercising the right of redemption they were entitled to a decree vesting in them all the estate of Tarter in the mortgaged premises, if he failed to convey the same upon receiving the entire amount of his mortgage and interest; and they cited several authorities to sustain their contention. (Calkins v. Mensel, 2 Root, 333; Noyes v. Hall, 97 U. S. 34.) But the authorities are not uniform on this subject. The appellants’ contention is, that in redeeming, the respondents would acquire the security which the appellant held, and nothing else; that by paying his debt due by Baird; they simply became subrogated to his rights under the mortgage, and they cite Renard v. Brown, 7 Neb. 449; Pardee v. Van Anken, 3 Barb. 534. But without undertaking to reconcile these cases, or to adopt one theory to the exclusion of the other, it seems to us that complete equity may be administered in this case by applying Boqut v. Coburn, supra, to the facts of this case. According to the doctrine of that case, Tarter would have an election to say whether the entire premises should be redeemed or not.. He may submit to a redemption by accepting the amount found due by the court, in which event he will convey his interest in the premises to the plaintiffs within thirty days after this decree is entered in the court below, or in default, the decree to operate to convey the same; or should he elect to retain the property, except the Riggs interest, now owned by the plaintiffs, he will, by good and sufficient deed, convey that to the plain [513] tiffs within twenty days after the entry of this decree in the co'urt below covenanting against his own acts; and, in default of his executing said last-named deed within said time, then the defendant shall be deemed to have eleeted to accept his debt and transfer his interest as above provided. Under the circumstances of this case, neither party will recover costs against the other in this court.