National Bank v. King

Mr. Justice Scott delivered the opinion of the Court: The only question in this case in which the National bank is interested, is whether it acquired the title to the land in controversy under the levy and sale on the execution issued on its judgment against Isaac Defenbaugh, or whether the land, as against the claim of the bank, is still subject to the mortgage made by Isaac Defenbaugh to Sweetser, and to the sum he agreed to pay on the Hapgood notes. Other questions are made by the pleadings, but as to some of them the court made no decree, and as to others touching which the court did decree, as the parties affected are not now complaining, they will not here be considered. Narrowing the discussion within the limits indicated, it will only be necessary to consider whether the decree made by the circuit court injuriously affects the bank,—the only party that assigns error in this court. If it does not, then it should be affirmed. Other suggestions of error not affecting the bank can not, of course, be considered on its appeal. On looking into the record it is seen that Isaac Defenbaugh, through whom the bank claims the title to the property, never had any interest in it other than the equity of redemption. He bought the land from Sweetser and Stanchfield, subject to the Hapgood notes and mortgages, which it is conceded were then valid, prior liens upon it. It is not claimed that Isaac Defenbaugh ever paid one dollar upon the property. He occupied the. land from October, 1871, (the time he purchased the equity of redemption,) until October, 1875, when he reconveyed the equity of redemption to Sweetser alone, in satisfaction of his mortgage for the purchase money, and of the sum he had agreed to pay on the Hapgood notes. During all that time he never paid one cent of the principal or interest of the purchase price, of any of the taxes accruing on the property. When it became apparent he could not pay for the land, by way of foreclosing or cutting off his equity of redemption, it was agreed that Isaac Defenbaugh should re-convey the land to Sweetser, which he did, and thereupon Sweetser released the mortgage of record. No money was paid. It was done in consideration the mortgagor should be discharged from his obligation to pay for the land—nothing else. The bank was in no way injured by the release that was entered of record. It was in no manner deceived by it, nor induced to take any action it would not otherwise have done. Had the release not been entered, it would not be claimed the bank could obtain any title under the levy and sale without paying what its judgment debtor would have to pay before he could have become the owner of the land. The mere fact satisfaction was inadvertently entered on the record did not and could not change the equities of the parties concerned. It was far less expensive to foreclose the equity of redemption which Isaac Defenbaugh had in the property, by a voluntary reconveyance, as was done, than by decree of court. It was better for the interests of the bank, if it intended to redeem the property from the prior incumbrances resting upon it, that its judgment might attach to the equitable estate of the mortgagor in it. This case, although not analogous in its facts with Campbell v. Trotter, 100 Ill. 281, is within the just principle of that case. All the bank is equitably entitled to by its levy and sale, is the interest Defenbaugh had in the property. That was absolutely nothing, for he never paid any portion of the purchase price.' Standing in his shoes the bank occupies no better position than he did. Before the bank can obtain any title to the property, it must pay what Defenbaugh was obligated to pay as purchase money, and taxes accruing on the land. The suggestion the bank can take the property as the property of its judgment debtor, discharged from the prior subsisting liens thereon for the purchase money, has absolutely nothing in its support, either in law or justice. The taxes accruing on the property were a prior lien, which the bank’s debtor was obligated to pay, and they follow the property. It is a matter of no consequence whether the taxes were paid by King & Hamilton or Sweetser. Payment of the taxes was necessary to preserve the property for the benefit of all concerned,—the bank as well as others,—and it was not error to charge the property with their payment, and w'hoever obtains the property must take it with that incumbrance resting upon it. It may be the decree requires the payment to the original complainants of more money than they are entitled to receive from the property, as between them and Sweetser. Perhaps all they are entitled to receive is the $4400 due from the estate of Walters, with the interest and the taxes they actually paid on the property. But of that no one can complain but Sweetser, and he has assigned no cross-errors in this court. The bank is in no way interested in adjusting the equities touching the sum secured on the property, as between the original complainants and Sweetser. By the decree the bank was required to pay no more than should be paid to complainants, King & Hamilton, and to Sweetser, and so far as it is concerned it matters little to whom the court directed it to be paid. In no event can the bank obtain title to the property until it shall have paid all that Isaac Defenbaugh was obligated to pay for the land, and the decree does not require it to do more. It is said it was error to decree a strict foreclosure in this case. As this decree is understood, it does not purport to foreclose any of the mortgages on the property. That portion of the prayer of the bill asking for a foreclosure of the mortgages does not seem to have been allowed. It appears the amount due from Isaac Defenbaugh on the property for the purchase money, interest and taxes, is more than its actual value. All the decree does is to declare that unless the bank shall, within ninety days, pay the amount that would have been due from Defenbaugh, it shall thenceforth stand absolutely debarred and foreclosed of and from all right, title and interest, and equity of redemption, in and to the land. Ninety days was a reasonable time in which to pay the money. Although the specific relief asked was not granted, it was proper, under the general prayer for such relief as the facts warranted, to decree as was done. No error appearing in the record which injuriously affects the bank, which is the only party assigning error in this court, the judgment of the Appellate Court must be affirmed. Judgment affirmed.