Bovey De Laittre Lumber Co. v. Tucker

GtleiliíAN, C. J. This is an action to foreclose a mechanic’s lien. Judgment determining the amount due on the lien and directing a sale of the property to satisfy it was entered. A sale was made and confirmed by the court May 24, 1890. At the sale the defendant Lombard was the purchaser. The 24th of May, 1891, fell on Sunday, so that the last day for the owner to redeem was the 25th. On that day one Wolford, a judgment creditor of the owner, filed notice of intention to redeem. On the same day the owner executed to one Pearse a mortgage for two dollars on the premises, which mortgage was duly recorded that day, and on the same day the mortgagee filed with the clerk of the court notice of intention to redeem under the mortgage. June 4th Pearse assigned the mortgage to the respondent* Sloanaker, who the same day, neither the owner nor Wolford having, redeemed, presented to the sheriff the proper papers to show his right to redeem, and paid him for that purpose and for sheriff’s fees for redemption $735, which was 39 cents less than the aggregate of the sum bid at the sale, the interest on it, and the sheriff’s fees. Thereupon the sheriff executed to him the usual certificate of redemption. June 16th Sloanaker gave notice of an application for a final decree vesting the title in him. On this application Lombard filed an affidavit opposing, stating, among other things, that the mortgage to Pearse was not a bona fide mortgage; that th'ere was no valuable or bona fide consideration for it; and that it was made with the understanding between the parties to it that whatever was done under or by virtue of it should be for the use or inure to the benefit of the mortgagor, and he asked for a stay of the proceeding to give him an opportunity to bring an action to test the validity of the mortgage.. The court did not grant the stay, but allowed Sloanaker to pay the 39 cents to the sheriff, and granted the final decree, from which Lombard appealed. He makes these objections to the decree: First. There is no right of redemption from foreclosure of mechanics’ liens. Second. If there be a right of redemption, the notice of intention to redeem must be filed with the register of deeds. Third. The redemption was void, because not enough was paid to the sheriff. [227] Fourth. The mortgage to Pearse created no lien, because one year from the confirmation of the sale had expired before it was executed. Fifth. Sloanaker could not redeem, because he filed no notice of intention to redeem; in other words, he could not redeem under the notice filed by his assignor, Pearse. Sixth. The mortgage to Pearse was invalid, and no lien, for the reason stated in the affidavit filed by Lombard. Seventh. There can be no final.decree except on application of the purchaser, or one to whom he has made a conven-1 tional assignment, and where there has been no redemption. The action to foreclose the lien was brought under 1878 G-. S. ch. 90. Sections ten (10) and eleven (11) of that chapter contain special provisions in eases of liens against railroads, cases where the estate of the owner erecting the building is only equitable, and cases where the property will not sell after having been duly offered. In ordinary cases the only procedure provided is by section eight, (8:) “Any person holding a lien under the provisions of the preceding sections may proceed to obtain judgment, and enforce the same, in the same manner as in actions for the foreclosing of mortgages upon real estate.” The procedure is to be the same, not only to the obtaining of judgment, but to enforcing it when obtained. It is to be enforced by sale of the property, in the same manner as in actions to foreclose mortgages. In those actions the sale is conditional, subject to be defeated, or the interest of the purchaser transferred, by redemption. An absolute sale would be an important departure from the manner of enforcing the judgment in such an action, and would be unauthorized by the statute regulating the manner of enforcing it. In general, the policy of the law is to make enforced sales of real estate to satisfy debts, not absolute, but subject to redemption. It so provides in cases of execution sales, sales under powers in mortgages, sales in actions to foreclose, and sales for taxes. It cannot be supposed that the legislature, in adopting, without exception for mechanic’s lien cases, the provisions of law regulating the obtaining and enforcing of judgments in actions to foreclose mortgages, did not intend to adopt ■ also the provisions with reference to a matter deemed so important, not only to the owner, but to the holders of subsequent liens, as the right to redeem. Those provisions were [228] adopted with the others regulating proceedings in foreclosure actions. .The proposition that the notice of intention to redeem must be filed with the register of deeds is based on the argument that, unless the provisions of 1878 Gr. S. ch. 81, § 16, (that section being in title one, .[1,] which is devoted to foreclosure under powers,) be applied to foreclosures by action, (which are regulated in title two, [2,]) there •is no provision as to the order in which creditors may redeem, and .that, if any of section sixteen (16) be applied in actions, the whole of it, including the provision that the notice of intention to redeem shall be filed with the register of deeds, must be applied. Section thirty-five (35) (being in title two [2]) provides that certain sections, (in title one, [1,]) sixteen (16) not being one of them, shall apply to the proceedings under title two, (2;) and section thirty-four (34) (in title two [2]) provides that creditors may redeem in the. order and manner specified in title one, (1.) This would adopt for actions the provisions of section sixteen, (16,) so far as relate to the order and manner of redeeming, but no further; and the express provision in section thirty-four, (34,) that the notice of intention to redeem shall be filed with the clerk, excludes the provisions of section sixteen, (16,) requiring it, upon foreclosures under powers, to be filed with the register, even though, in the absence of that provision in section thirty-four, (34,) it might be held that the provisions as to notice relate to the manner of redeeming, instead of merely to the securing or preserving the right to redeem, in the order and manner prescribed. The court below found as a fact that the sheriff accepted the $735 paid him in full payment of the amount required.to redeem and his fees for making redemption, from which we understand that respondent tendered that, gross sum, as all that was necessary for him to pay. to make redemption, including the sheriff’s fees; and that it was so accepted by the sheriff. The application for a final decree is not a collateral proceeding, and it was competent for the court, notwithstanding what might be stated in the sheriff’s certificate, no one having acted in reliance upon its statements, to ascertain what was the fact. Had the amount so tendered been less than the amount ,to. which the purchaser was entitled, or had the respond [229] ent made the distribution himself, paying so much for the purchaser and so much for sheriff’s fees, and the amount paid for the purchaser had been less than he was entitled to, there would not have been a good redemption. But, there being more than enough- to satisfy the purchaser’s claim, we think the court below was right in its conclusion of law “that, inasmuch as the sheriff accepted said sum as covering the full amount required to redeem and his fees, if any shortage exists it must be deducted from his fees, and not from the amount the holder of the certificate of sale is entitled to demand.” If the sheriff should not get the full amount of his fees, that does not concern the purchaser, but is a matter between the sheriff and the redemptioner. So long as the owner had a conveyable interest he could mortgage it. In case of a sale subject to right of redemption the owner has a conveyable interest till it is cut off by expiration of the time allowed him to redeem. The mortgage to Pearse was executed within that time, and was therefore valid. The assignment by Pearse to Sloanaker transferred the mortgage and all rights incident to it, including the right to redeem, secured by the assignor filing notice of intention to redeem. That right was not personal. It belonged to the mortgage lien. We do not see how Lombard is in position to question the bona fides of the mortgage. It did not prejudice him. His only relation to the property was that of purchaser at the sale, which gave him the right to receive back his money and interest if redemption were made, and to hold the land if it were not. Of that right no one could deprive him, and it was not impaired by the mortgage. It is true, the mortgage increased the chances of redemption, as it increased the number of persons entitled to redeem, and it correspondingly diminished the probability of the purchaser holding the land; but that is no ground of objection to it. If it were, it would apply equally to any mortgage or judgment lien acquired after the sale. The last point made by appellant requires a construction of section thirty-six, (36,) chapter eighty-one, (81.) It provides that “at the expiration of the time allowed for redemption, and no one redeeming, the court, upon the application of the purchaser or his assigns, shall grant a final decree,” “and shall adjudge and decree that [230] the title to said premises is in said purchaser or his assigns, free and clear of all equity of redemption on the part of any one who is a party to the judgment,” and that the decree, being recorded, “shall be effectual to pass the title to the same as against the parties aforesaid.” Section fifteen (15) provides that a redemption by the owner, his heirs or assigns, shall annul the sale. If a lien creditor redeem, the certificate (of redemption) operates as an assignment to him of the right acquired under such sale. Does the word “assigns,” in section thirty-six, (36,) include one whose certificate operates, according to section fifteen, (15,) as an assignment to him of the right acquired under the sale ? And does the phrase “the right acquired under the sale” include the right to a final decree ? And does the phrase “no one redeeming” include a redemption which operates to assign the right acquired at the sale, or only such as annuls the sale ? As we can see no reason why the purchaser, or one claiming from him by a conventional assignment, should have the assurance of title afforded by the final decree that does not with equal, if not greater, force apply to the case of one succeeding to the purchaser’s right by redemption, we think the first two questions must be answered in the affirmative, and that the words “no one redeeming” must be held to refer to a redemption which annuls the sale. On such a redemption there could not be a final decree such as the section provides for. Decree and order affirmed. (Opinion published 50 N. W. Rep. 1038.)