People's Saving Bank v. McCarthy

Ladd, J. A judgment becomes a lien on any present' interest of the judgment defendant in real estate owned by him as soon as entered of record. Code, section 3801: Taylor v. Taylor, 118 Iowa, 407. One of plaintiff’s judgments attached the day before the sheriff’s sale under Marshall Field & Co.’s judgment, and the other eleven months thereafter. Curtis v. Millard, 14 Iowa, 128; Barnes v. Cavanagh, 53 Iowa, 27. Redemption from this sale was made by the defendants precisely one year thereafter, and on the very day they acquired the property by conveyance from the Aborns. The effect thereof was to extinguish the indebtedness and destroy the lien, for the equitable interest in the land represented by the [588] sheriff’s certificate never ripened into title by the execution of the sheriff’s deed. What, then, devested the'liens of plaintiff’s judgments? Had defendants procured an assignment of the certificate, and obtained a sheriff’s deed thereon, there is no doubt, under the statute, but that they would “hold the property absolutely.” Section 4054, Code. But the redemption operated merely to discharge the lien of Marshall Field & Co.’s judgment, and left the title precisely as before. Varnum v. Winslow, 106 Iowa, 287; Everingham v. Braden, 58 Iowa, 134; Shimer v. Hammond, 51 Iowa, 401. If so, then nothing has occurred since the rendition of the judgments in question to relieve the lots from their burden. Such is the doctrine of Curtis v. Millard, supra, and it has not been impinged in succeeding decisions. True, it was misapplied in Crosby v. Elkader Lodge, 16 Iowa, 399, in holding that redemption from a sale for part of a judgment by the owner’s grantee left the property subject to the lien of the unsatisfied portion. That case was overruled by Clayton v. Ellis, 50 Iowa, 590, on the ground, shortly stated, that a sale under execution exhausted the judgment lien, and, when title passes to a third party., it does not again attach, as against him, upon redemption, as it would if held by the debtor. If title continues in the debtor, redemption operates merely to satisfy the portion of the indebtedness for which sold, and the lien of the unsatisfied balance of .the judgment immediately reattaches to the realty. Campbell v. Maginnis, 70 Iowa, 589. In other words, the right of redemption is secured to the debtor, exclusively, during the first, six months and the last three months after the sheriff’s sale, to protect him in his property rights, but not to in any way assist him in the evasion of his just obligations. He may arrange with his creditors, satisfy the lien, or dispose of his equity of redemption. If the latter course is pursued, the grantee takes the property subject to and charged with all existing liens, and redemption by [589] him amounts to nothing more or less than the satisfaction of those from which such redemption is made. Indeed, the statute expressly provides that “the rights of a debtor in relation to redemption are transferable, and the assignee has the like power to redeem.” Section 4061, Code. The difference in the situation of the debtor and the grantee is this: Redemption by the former leaves the realty exposed to the satisfaction of his debts, while in the hands of the latter it is relieved from all these, not existing liens at the time of the transfer. The same principle has been applied to mortgage foreclosures. Harms v. Palmer, 73 Iowa, 446; Todd v. Davey, 60 Iowa, 532. In the latter case appear dicta to the contrary, as is made evident by the decision of Campbell v. Maginnis, supra, rendered some years later. In Harms v. Palmer, 73 Iowa, 446, the court held that upon the foreclosure of a mortgage, and sale of the property for one installment of the debt secured, the grantee of the mortgagor might redeem from the sale, and take the property devested from the lien of any unsatisfied portion or installment, and is. clearly within .the doctrine of the cases already mentioned. In Moody v. Funk, 82 Iowa, 1, and Bevans v. Dewey, 82 Iowa, 85, junior lien holders were made parties to the decree, and the court held that, because of this, their liens expired upon the failure to redeem from the sale within the period prescribed, and the mortgagor’s grantee took the land freed from their claims. The ground of the decision is thus stated in Bevan's Case: “We think her rights are the same as thfey would have been had she fore-, closed her mortgage in an original proceeding, instead of doing so by means of a cross-petition in the action commenced by Fullerton. She was a party to the Fullerton decree, and is chargeable „with the notice of the sale under it. She has had the opportunity of redeeming from it, but neglected to improve it. As a junior incumbrancer, by permitting redemption to be made, not by the judgment [590] ■debtor, but by one who held title as his widow and as grantee of his heirs, she lost the right to enforce her judgment against the property so redeemed.” See Cooperative Savings & Loan Ass'n v. Kent, 108 Iowa, 146; Wells v. Ordway, 108 Iowa, 86. In the instant case, neither plaintiff nor its assignor were made parties to any other action, nor have their liens been affected by any decrees, and in these respects are distinguishable from the decisions last cited. Expressions may be found in several opinions somewhat inconsistent with Curtis v. Millard, but it has never been overruled, and, as already indicated, we regard it'as sound in principle. The judgment creditor, in order to acquire the right of the certificate holder, must redeem within nine months from the sale. Jack v. Cald, 114 Iowa, 349. And on failure to do so, his lien may be devested by a sheriff’s deed. Nothing in the Code indicates that his lien is otherwise terminated at the end of that period. In declaring that the equity of redemption is the subject of levy and sale, a contrary conclusion is necessarily involved. See Harrison v. Wilmering, 72 Iowa, 727, where such equity was sold by the sheriff eleven months after the first sale. Barnes v. Cavanagh, 53 Iowa, 27. As plaintiff’s liens were never devested by-virtue of a decree of court, or the execution of a sheriff’s deed, and are not barred by any statute, they may be enforced against the lots of defendants acquired subject thereto. The ruling on the demurrer was erroneous, and must be REVERSED. Bishop, C. J., took no part.