Evans v. Kahr

The opinion of the court was delivered by Smith, J. : A judgment was rendered in the court below against plaintiffs in error for $6977, interest, and costs. At the same time a decree was entered foreclosing a mortgage given by them, to secure said debt, and adjudging the amount to be a first lien on three lots in the city of Topeka. The property was sold October 21, 1895, under an order of sale, to John Bushnell for $6000, and the sale confirmed on November 25. Proceedings in error were commenced to review the order confirming the sale, and John Bushnell, the purchaser, was made a party thereto. On'January 11, 1897, while the proceedings in error were pending in this court, John Bushnell, having dispossessed the plaintiffs in error of the premises, sold and conveyed the same to defendants in error for a consideration of $6000. On March 5, 1898, the order of the district court confirming the sale was reversed .and set aside by this court. (Evans v. Bushnell, 59 Kan. 160, 52 Pac. 419.) Thereupon the plaintiffs in error filed a petition in the district court asking that an accounting be had between themselves and defendants in error of the said premises and the amount due and owing by them to said defendants, and that plaintiffs in error be decreed the right to redeem the premises from the mortgage lien by the payment of such sum of money as — 721 — said accounting would find lawfully due the defendants, who were grantees from the purchaser at the sheriff's sale. The mortgage was originally held by the Lombard Investment Company, which assigned the same and the note secured by it to Daniel Bushnell, whose legal representatives, after his death, brought the action to foreclose. The amended petition in the case at bar contains, among others, the following allegations : “That on October 21, 1895, the said premises were sold by the sheriff, as aforesaid, to John Bushnell, for the sum of $6000; that there was due, at the time of said sale, under said judgment of foreclosure, to the plaintiffs in said action to foreclose, a balance of $1697.96 ; that said balance was not assigned to John Bushnell, the purchaser, but has been and is now held by the original plaintiffs against the original defendants ; that said balance due on the judgment in force of about $1697.96 has not been assigned to these defendants; that the judgment creditors offered to assign the said judgment to these defendants, but these defendants refused to accept the same.’’ A general demurrer was sustained to the petition,, and plaintiffs below have brought such action of the trial court here for review. We will consider first the rights of the plaintiffs below to redeem from the grantees of the purchaser at the sheriff’s sale, who are defendants in error here. This suit to redeem is confined to an offer to pay defendants in error the amount they paid John Bushnell for the property less the rents and profits. It is an old rule of equity jurisprudence, so venerable that it would be irreverent to question it, that a mortgagor who seeks to redeem acquires his standing in court by virtue of the mortgage, and must tender the amount thereof. Redemption is regarded as a “ buyiqg back ” by the mortgagor of the legal es — 722 — tate after it has passed to the mortgagee. In Pomeroy’s Equity Jurisprudence, section 1220, it is said: “ No such redemption, however, is possible unless the mortgage debt is due and payable, nor unless the mortgage is wholly redeemed by payment of the entire amount of the mortgage debt.” In Collins v. Riggs, 14 Wall. 491, Mr. Justice Bradley, speaking for the court, said: “To redeem property which has been sold under a mortgage for less than the mortgage debt, it is not sufficient to tender the amount of the sale. The whole mortgage debt must be tendered or paid into court. The party offering to redeem proceeds upon the hypothesis that, as to him, the mortgage has never been foreclosed and is still in existence. Therefore he can only lift it by paying it. The money will be subject to distribution between the mortgagee and the purchaser, in equitable proportions, so as to reimburse the latter his purchase money and pay the-former the balance of his debt.” (Pingree, Mortg., § 2184; Jones, Mortg., §§ 1072-1075; Hasford v. Johnson et al., 74 Ind. 479; Martin v. Fridley, 23 Minn. 13; Bradley v. Snyder et al., 14 Ill. 263-266; Vroom v. Ditmas et al., 4 Paige, 526; Johnson v. Harmon, 19 Iowa, 56.) That the amount the plaintiffs in error must pay to redeem is measured by the amount of the mortgage and interest, is the settled rule. If the amount of the purchase-money paid at the sheriff’s sale was to determine the amount required to redeem, then in case the purchase-money exceeded the mortgage debt, redemption could not be had except by a payment of more than the amount of the mortgage. ' The second question involved in the case relates to the right of the plaintiffs in error to be heard at all as against defendants in error who were purchasers from the grantee in the sheriff’s deed. They bought the — 723 — property from the purchaser intermediate between the confirmation of the sale and the reversal of the order of confirmation'by this court. It is insisted by counsel for plaintiffs in error that the doctrine of Us pendens applies. We differ with them in this contention. No supersedeas bond was given on the proceedings in error from the order confirming the sale. An order confirming a sheriff’s sale is a final order within the meaning of our statute. (Koehler v. Ball, 2 Kan. 160.) According to the averments of the petition, the sale was confirmed by the court below and a deed ordered to be made and delivered to the purchaser. In section 591, chapter 95, General Statutes of 1897 (Gen. Stat. 1889, ¶ 4652), it is provided : “No proceeding to reverse, vacate or modify any judgment or final order rendered in the probate court or district court, except as provided in the next section and the fourth subdivision of this section, shall operate to stay execution, unless the clerk of the court in which the record of such judgment or final order shall be shall take a written undertaking, to be executed on the part of the plaintiff in error to the adverse party, with one or more sufficient sureties, as follows : . . . Second. When it directs the execution of a conveyance or other instrument, the undertaking shall be in such a sum as may be prescribed by any court of record in this state, or any judge thereof, to the effect that the plaintiff in error will abide the judgment, if the same shall be affirmed, and pay the costs.” Again, by section 19, chapter 83 (Gen. Stat. 1889, ¶ 4674), it is provided that a party seeking to vacate or modify a judgment or order may obtain an order suspending proceedings upon the execution of an undertaking to the adverse party to pay all damages that may be caused by granting the same. It will be seen, that, at the time the sale was confirmed, by the same' order the court directed a deed to be made by the> — 724 — sheriff and delivered to the purchaser. The defendants in error were not parties to any of the proceedings in the original foreclosure suit; but were purchasers from the grantee in the sheriff’s deed. Even as to John Bushnell, however, we think that unless the effect of the order confirming the sale was stayed,- his title would not be affected by a reversal of the order. It is important that property offered for sale in such cases bring the highest price after competition; and to permit interference with the sale after confirmation upon a review of the proceedings in a higher court, which might be delayed years after the purchase, without supersedeas bond, would have the effect of making bidders timid, for they would remain in a state of insecurity as to their titles until the final disposition of the cause in the court of review. In Freeman on Judgments, 4th ed., section 484, it is said : “The law permits judgments and decrees to be in force during the time in which appeals may be taken, and also while appeals are pending and undetermined, unless some bond or other security given as required by law operates to stay proceedings. Courts have always construed the law so as to impart confidence in judicial sales by protecting purchasers thereat from those ill consequences which the latter might suffer if the title acquired by them depended upon the freedom of prior proceedings from all errors of law. It was thought to be unjust to require purchasers to suffer for errors committed by the judges of subordinate courts, and impolitic, by making such a requirement, to discourage bidders at such sales and thereby to expose large amounts of property to the hazard of being sacrificed at nominal prices. Therefore, it is a rule nowhere disputed, that third persons purchasing at a sale made under the authoi'ity of a jxxdgmexit or decree xiot suspended by any stay of proceedings, thereby acquire rights which no subsequent reversal of sucli judgment or decree can in any respect impair; nor is — 725 — the fact that the purchaser was notified not to purchase, because the judgment was claimed to be erroneous, and that an attempt would be made to procure its reversal, of any consequence.” The rule above stated tends to the security of titles. It is laid down in the books as a general rule that when the purchaser at a sheriff’s sale is an innocent third person, and is a bona fide purchaser who has paid the purchase-price before obtaining knowledge of the reversal of the judgment, he shall be protected in his title to the property, notwithstanding the reversal of the judgment. (Rorer, Jud. Sales, §§ 1142, 1143; Smith v. Dixon, 27 Ohio St. 471; Range v. Brown, 29 Neb. 116, 122, 45 N. W. 271; McAusland v. Pundt, 1 id. 211.) The decision of the court below was correct. The petition did not state a cause of action. The judgment is affirmed. Johnston, J., concurring.