Orr v. Sutton

Holt, J. Action to quiet' title. William Sauntrj owned an undivided half of valuable mining lands in St. Louis county, tbis state, which he mortgaged to secure the sum of $30,000. He defaulted and the mortgage was duly foreclosed by advertisement. The year for redemption expired on September 20, 1911. The rights acquired by the purchaser at the sale were on the last named date held by Louis E. Torinus, the sheriff’s certificate having been duly assigned to him. The mortgagor was insolvent, and unsatisfied judgments existed against him. Transcripts of the following judgments were docketed in St. Louis county prior to September 21, 1911: (1) A transcript of a judgment in favor of Nathan E. Eranklin for $8,243.34, docketed July 22, 1910. This judgment was assigned to Louis E. Torinus and proper record made on September 23, 1911; (2) a transcript of judgment in favor of Ered Kossiter for $1,589.35, docketed October 24, 1910; (3) a transcript of a judgment in favor of John J. Kilty for $329, docketed at 5:15 p. m. September 20, 1911, together with proper records showing an assignment of the judgment to William Sutton, September 18, 1911; and (4) a transcript of a judgment in favor of Kobert W. Hunt & Co. for $741.38, docketed at 5:19 p. m. September 20, 1911, with proper records showing an assignment of this judgment to plaintiffs January 11, 1911. In the evening of September 20, 1911, William Sauntry executed a second mortgage on the land to William Sutton to secure a demand note for $50. It appears that this indebtedness represented a portion of attorney’s fees owing to one Grannis from Sauntry which Grannis assigned to William Sutton. This mortgage was filed in the office of the register of deeds at 10 p. m. on the same day. But no mortgage registry tax was paid thereon until long afterwards. No registry number was placed on the mortgage, nor was it indexed until the next morning after it then had been taken to the county treasurer and he had certified thereon that it was exempt from taxation. Proper notices of — 40 — intention to redeem were filed so tbat tbe respective judgment creditors were placed in line of redemptioners in tbe order above given and tbe mortgagee William Sutton last, provided each bad a good right to redeem. Sauntry, tbe mortgagor and owner, did not redeem. Louis E. Torinus redeemed on September 25, 1911, as assignee of tbe Franklin judgment. Fred Rossiter tbe next in line did not offer to redeem. Nor did William Sutton make any attempt to redeem as assignee of tbe Kilty judgment. On October 5, 1911, plaintiffs, as assignees of tbe Robert W. Hunt & Oo. judgment, redeemed; and on October 9,1911, William Sutton in turn redeemed as mortgagee in tbe $50 mortgage mentioned. Tbe sheriff upon each of these re-demptions issued bis certificate to tbe redemptioner. October 10, 1911, William Sutton, claiming to be tbe owner of tbe land under bis redemption, mortgaged tbe same to Louis E. Torinus to secure tbe payment of $10,000. Tbe complaint sets out tbe various matters very fully, alleges conspiracy between tbe defendants to circumvent plaintiffs and deprive them of their right to redeem, and asks that tbe. claims of each defendant to tbe land be barred and tbe cloud cast upon plaintiffs’ title by tbe Sutton redemption, tbe Torinus mortgage, and tbe records thereof be removed. In addition to Torin-us, Sutton and Sauntry, tbe latter’s wife and one Lyman Sutton are made defendants, also tbe lessees of tbe mine, but tbe latter are in no way affected. Tbe court found plaintiffs to be tbe owners, tbat tbe defendants bad no right, title or lien in or to tbe land, and directed judgment quieting title in plaintiffs and removing tbe cloud cast on their title by tbe record of tbe Sutton redemption and mortgage, and tbe mortgage to Torinus. Defendants appeal from tbe order denying their motion for á new trial. Tbe defendants contend for a new trial upon three grounds':' (1) No mortgage registry tax was required upon tbe $50 mortgage under which Sutton redeemed, hence bis redemption vested .title in him; (2) plaintiffs lost their right to redeem by tbe tender of payment of their judgment prior to tbe time when such right could be exercised; (3) even if tbe tax be held applicable to this mortgage, equities will relieve defendants since its nonpayment was tbe result of an honest — 41 — mistake induced by tbe conduct of tbe administrative officers of tbe state and county, and tbe tax was paid before tbe trial. In a former opinion in this case (Orr v. Sutton, 119 Minn. 193, 137 N. W. 973, 42 L.R.A.[N.S.] 146) we beld that, tbis mortgage, upon wbicb tbe registry tax imposed by chapter 328, p. 448, Laws 1907, was not paid before it was recorded, fumisbed no sufficient legal basis for redemption from tbe foreclosure sale bere involved. Tbis was following and applying tbe rule announced in State v. Fitzgerald, 117 Minn. 192, 134 N. W. 728, that all mortgages including those of $50 and less are subject to tbe registry tax. We are earnestly importuned to re-examine tbe question, on tbe ground that that decision is wrong and that tbe court was led astray, because counsel on both sides designedly took tbe position that tbe law violated tbe Constitution, unless it was beld applicable to all mortgages however small. Even if tbe court, as now- constituted, entertained doubts concerning tbe soundness of tbe Fitzgerald decision, a well-settled rule of law stands in tbe way of any re-examination of tbe question upon this appeal, for on tbis proposition our former decision herein is tbe law of the case and binding on us. There is nothing in the situation wbicb calls for a deviation from tbis well-established doctrine. No application was made for reargument when tbe former appeal was determined. In Terryll v. City of Faribault, 84 Minn. 341, 87 N. W. 917, it is said: “The case was bere on a former appeal and tbe notice of claim for damages was beld sufficient. 81 Minn. 519, 84 N. W. 458. That decision, whether right or wrong, must be treated as tbe law of tbe case and tbe question cannot be re-examined at tbis time.” Tbe same rule was stated thus in Bradley v. Norris, 67 Minn. 48, 69 N. W. 624: “This court has tbe right to overrule tbe decision made on tbe former appeal in some other case, but in tbis case it must be followed.” See also Schleuder v. Corey, 30 Minn. 501, 16 N. W. 401; Smith v. Glover, 50 Minn. 58, 52 N. W. 210, 912; Tilleny v. Wolverton, 54 Minn. 75, 55 N. W. 822; Maxwell v. Schwartz, 55 Minn. 414, 57 N. W. 141; St. Paul Trust Co. v. Kittson, 67 Minn. 59, 69 N. W. 625; Phelps v. Sargent, 73 Minn. 260, 76 N. W. 25; Piper v. Sawyer, 78 Minn. 221, 80 N. W. 970; Hibbs v. Marpe, 84 Minn. 178, 87 N. W. 363. To tbe same effect many authorities may — 42 — be cited from other jurisdictions: Adams Co. v. B. & M. R. Co. 55 Iowa, 94, 2 N. W. 1054, 7 N. W. 471; Heffner v. Brownell, 75 Iowa, 341, 39 N. W. 640; Bem v. Shoemaker, 10 S. D. 453, 74 N. W. 239; Bolton v. Hey, 168 Pa. St. 418, 31 Atl. 1097; and Case v. Hoffman, 100 Wis. 334, 72 N. W. 330, 74 N. W. 220, 75 N. W. 945, 44 L.R.A. 728. One of the main defenses pleaded is, plaintiffs were tendered payment of their judgment before the time arrived at which it might be used to effect redemption, therefore the one made by them was wrongful and of no validity to pass title. It is undisputed that on September 27, 1911, Lyman Sutton, accompanied by defendants’ attorney, brought $785 in gold coin to plaintiffs’ office and tendered the same to them personally in payment of the judgment held by them. The amount was sufficient and was verified by one of plaintiffs. Beyond quibble written authority from Sauntry to Lyman Sutton to make the payment was exhibited to plaintiffs. The money was not Sauntry’s. It was furnished by Lyman Sutton. When plaintiffs refused to accept, Sutton placed the money in his safe, where it remained ready for plaintiffs until some time in the following December. Defendants insist a valid tender was proven and should have been definitely found by the court, and, in case the findings should be construed as negativing a tender, they contend the evidence does not justify the same. It is commendable to find only the ultimate facts. But in this case tender was set up as a specific defense or ground for contesting the validity of plaintiffs’ redemption. Whether William Sauntry actually offered plaintiffs lawful money in sufficient amount to pay their judgment prior to their redemption, was a matter of pure fact. Whether such fact constituted a legal defense, is a question of law. The court below may have been satisfied of the existence of the fact, but may have concluded that the legal effect was of no consequence to defendants. This court may take a different view. It is thus apparent that an absence of a specific finding upon the issue of tender is not fair to defendants, nor, indeed, to plaintiffs were they appellants. It is true the request to make findings on this issue was not in the proper form (Hall v. Sauntry, 72 Minn. 420, 75 N. W. 420, 71 Am. St. 497), nevertheless tender was so important — 43 — a matter to a right decision that the findings should not leave the fact of its being made in doubt. Tljis is a case where a definite finding should have been made on this issue. Turner v. Eryberger, 99 Minn. 236, 107 N. W. 1133, 109 N. W. 229. Moreover, even if the findings, coupled with the court’s refusal to amend the same to show tender, should be construed equivalent to a finding that tender was not proven, we are of opinion that the evidence as it now stands does not so warrant. The money was there. Plaintiffs were lawyers. They knew as well as defendants what it was intended for, and what was at stake. Their refusal to accept payment was no doubt a deliberate act with full knowledge of the situation. They took the chance of defendants not being able to establish that the tender was made by authority and direction of Sauntry, or else that the law did not give the debtor the right to stop plaintiffs at that time from resorting to the land for the satisfaction of their judgment. We shall therefore assume that plaintiffs were tendered payment of their judgment before the arrival of the time when they could use it for the purpose of redemption. True, no one in the line of redemptioners, either ahead of or behind plaintiffs, nor any intermeddler, could extinguish or impair their right to redeem by offering to pay their judgment. The only «one who possessed this right on September 27, 1911, was the judgment debtor. His right was absolute- It is immaterial who furnished him the money, or what his motives were, he was then entitled to pay the judgment or cause it to be paid, for the time had not arrived when plaintiffs could use it for redemption purposes. It is asserted the tender was unavailing because when refused the only way to keep it good was to pay the money into court and begin an action to compel a satisfaction of the judgment. Section 7908, G. S. 1913, is cited. This provision does not in terms apply to this case. But we may admit that the procedure suggested by respondent is not improper. However, it is not absolutely necessary in order to give effect to the tender. The testimony shows that the gold was kept intact for plaintiffs for some time after this action was brought and the answer served. In the answer Sauntry still asserts a readiness to pay. At any time after Sutton’s redemption — 44 — plaintiffs could have received from tbe sheriff full payment of their judgment and all moneys paid by them in their attempt to redeem, including the wrongful payment of the Kilty judgment. We think the tender was kept good and the money is available now. Dunn v. Dewey, 75 Minn. 153, 77 N. W. 793; Murray v. Nickerson, 90 Minn. 197, 95 N. W. 898. The claim is also presented that the tender unaccepted was of no effect. Harking back to the early case of Jackson v. Law, 5 Cow. (N. Y.) 248, Law v. Jackson, 9 Cow. (N. Y.) 641, text books and decisions state that a judgment lien cannot be discharged by tender. There must be actual payment. The argument is that so long as the judgment remains a lien it furnishes a basis under the statute for the right to redeem. But there is quite a unanimity among the authorities, in states where the mortgagee’s estate is considered a lien or pledge merely, that a tender of the debt discharges the lien. Kortright v. Cady, 21 N. Y. 343, 78 Am. Dec. 145; Moore v. Norman, 43 Minn. 428, 45 N. W. 857, 9 L.R.A. 55, 19 Am. St. 247. That there are inherent differences in the quality of a judgment lien and a mortgage lien which justify the rule that a tender of payment of one does not discharge a tract of land from its lien, while it does as to the other, may be doubted. The owner of the debt in either case may voluntarily release any real estate from the one as well as from the other without discharging any part of the debt. Be that as it may, this court has recognized the distinction in Rother v. Monahan, 60 Minn. 186, 62 N. W. 263. But that case also clearly establishes the principle applicable here, namely, that a tender of payment of a judgment by the judgment debtor destroys, and extinguishes the right to make the judgment the basis for a redemption. It may well be that, before any notice of intention to use the judgment as against any particular land is filed, a tender of payment does not impair or destroy the judgment creditor’s right, to make use of or enforce the judgment generally. But when, after he has so done, the judgment debtor tenders payment, the creditor must accept the money and let that land alone. Any further attempt to proceed against the land in question after such tender must be considered wrongful. Mr. Justice Mitchell thus states the — 45 — view of tbe court in tbe case cited: “Tbe act of tbe defendant in attempting, under tbe circumstances, to use tbis judgment for redemption purposes was wholly in bis own wrong. If, under similar circumstances, be bad attempted to enforce tbe judgment by execution, a court would bave unquestionably enjoined bim from doing so, or, if a sale bad been made on tbe execution, set it aside as wrongful, and an abuse of tbe process of the court, and compelled defendant to accept tbe tender and satisfy bis judgment. Mason v. Sudam, 2 Johns Ch. (N. Y.) 172. Tbe same principle applies where, as in tbis case, tbe defendant has wrongfully attempted, notwithstanding tbe tender, to use tbe statutory process of redemption for tbe purpose of collecting bis judgment out of tbis land. It is wholly immaterial what tbe object of tbe debtor and mortgagor was in making tbe tender, — even if it was to prevent a redemption by defendant. He must be presumed to bave some interest in preventing such a redemption. It may be that be bad made some advantageous arrangement with tbe plaintiff,’ tbe bolder of tbe certificate of sale. But what bis intent or motive was it is not for tbe courts to inquire. He bad a legal right to pay tbe judgment, and thereby prevent a redemption by defendant. Defendant’s duty and only right, under tbe circumstances, was to accept tbe tender and satisfy tbe judgment. His refusal to do so and bis attempt to use bis judgment for redemption purposes were wrongful and a clear abuse of tbe statutory right of redemption. Tbe court will, under such circumstances, set aside tbe attempted redemption, and compel defendant to do what be ought to bave done in tbe first instance, — accept bis money and satisfy bis judgment.” And we think it has been definitely determined in Roberts v. Meighen, 74 Minn. 273, 77 N. W. 139, that it is not necessary, in order to make tbe judgment creditor’s attempt to redeem wrongful, that tbe judgment d&btor prior to redemption bring tbe money into court and commence suit to compel satisfaction -of tbe judgment. In that case payment was merely tendered, no money was brought into court and no action brought until after re-dumption. Tbe point was distinctly made in appellant’s brief that such tender was not sufficient to destroy tbe right to use tbe judgment as a basis for redemption. Chief Justice Start, who tried tbe case — 46 — of Rother v. Monahan, supra, in the court below and therein adverted to the rule that tender of payment of a judgment does not release its lien on real estate, writes the opinion sustaining the court below in the ruling that the tender as made destroyed the right to use the judgment for redemption purposes. Is any defendant in position to object to plaintiffs’ redemption? When the owner fails to redeem from a mortgage foreclosure sale, the purchaser acquires the title the owner had when the mortgage was given. If lienholders redeem under the statutory provisions, the title acquired by the purchaser at the foreclosure sale is thereby vested in such redemptioners. Even when the redemptioner has no right to make it, or does not conform to the law in so doing, the title nevertheless passes to him, if the one from whom redemption is made accepts the redemption money, unless there exists some lien-holder whose redemption is interfered with or prejudiced. Willard v. Finnegan, 42 Minn. 416, 44 N. W. 985, 8 L.R.A. 50; Todd v. Johnson, 50 Minn. 310, 52 N. W. 864; same case in 56 Minn. 60, 57 N. W. 320; Clark v. Butts, 73 Minn. 361, 76 N. W. 199. No doubt Torinus could have objected to plaintiffs’ redemption, but he did not. By accepting the redemption money paid by plaintiffs he relinquished to them the title he had. He turned over his money to be used by Sutton in making the redemption from plaintiffs. There is nothing in the record to suggest that Torinus did not have full knowledge of the tender when he accepted and receipted for the money. And we think it follows from the authorities hereinbefore cited that the only person who may attack a redemption fair on the face of the record, but wrongful in fact, where the redemption money has been accepted by the one holding the title of the purchaser at the foreclosure sale, is one who has still some beneficial interest in the land, or one who, being a subsequent lienholder, has availed himself of the right to redeem strictly in accordance with the provisions of the statute. Whether Torinus be regarded as acting for Sutton or for himself alone, the fact remains that plaintiffs’ right to redeem was conceded by both in that their redemption money was accepted and in that both plant themselves on the redemption by which Sutton — 47 — claims to have succeeded to the title plaintiffs secured by their redemption. The defendant Sutton insists that in equity he should be relieved from the mistake he made in not paying the mortgage registry tax, notwithstanding the former decision that he had no legal statutory right to redeem. For the purpose of considering the equities urged, let us for the moment assume that the provisions of the redemption statute may be suspended or abrogated by the courts. The one who asks equitable relief, even against a wrongdoer, must show equities of some merit and clean hands. If we take plaintiffs on the one hand and Torinus and the Suttons on the other, we look in vain for any appealing equities. The Suttons sought the land. So did plaintiffs. Each party bought up judgments against Sauntry for the sole purpose, apparently, of thereby securing title to this land. William Sutton made no attempt to redeem under the Kilty judgment, but the money plaintiffs paid on that was also accepted and receipted for by Torinus, presumably under Sutton’s direction, so that, on October 5, 1911, when Sutton attempted to redeem, the only equity or right he had was this $50 mortgage. It is perfectly obvious that the only reason for purchasing this small, stale claim against Sauntry was to circumvent plaintiffs who had outwitted him in the race to be the last in the line of redemptioners. Both Saun-try and the Suttons are very careful in the pleadings, as well as in the testimony, to deny any intent to obtain for Sauntry either the land or any beneficial interest whatever therein. Sauntry and his wife would be the only persons in all this company entitled to consideration in the search for equities, and they disclaim. Torinus got in to make $2,500, the Suttons to get the land, and when the means provided for that purpose slipped from under, this mortgage was obtained as a last resort. Neither the claim supporting the mortgage, nor the circumstances under which it was procured, furnish equities of merit. It is also apparent that William Sutton was not misled by the interpretations placed on the mortgage registry law by either state or county officials, even if this should be held excusable. Ilis attorneys counseled together on this proposition, evidently without — 48 — placing reliance on the advice given, or the practice adopted, by any ■official. In fact, no attempt was made, on the night the mortgage was filed for record, to have the indorsement made on.the mortgage by the proper official, that it was exempt from taxation in accordance with the custom adopted in St. Louis county. Neither does it appear to us that William Sauntry may invoke equities to vest title in Sutton under his attempted redemption. Sauntry’s failure to redeem terminated his estate in the land. His title had vested in Torinus as assignee of the purchaser at the foreclosure. It did not harm Sauntry if Torinus allowed plaintiffs to redeem without right. On the contrary Sauntry’s debt to plaintiffs •of over $700 was thereby effaced. If there had been any claim on the part of Sauntry that he had some beneficial interest in or to the land which the Suttons were assisting him to secure, the case might have been brought under the principle controlling in' Roberts v. Meighen, supra. But it is clear from the pleadings and from the evidence that both Sauntry and the Suttons take the position that Sauntry has no interest whatever in the land, that the redemption under the $50 mortgage was for the benefit of the Suttons alone, outside of the $2,50.0 bonus to Torinus, and that the sole ground “upon which Sauntry contests plaintiffs’ redemption is that he is entitled to have the land appropriated to pay his debts to the greatest possible extent. However, he could not compel Sutton to redeem. The right of Sauntry to have the land appropriated to the payment of the liens of his creditors was all the time subject to the condition that such creditors availed themselves of the redemption statute in strict conformity to its provisions. That was wholly within their choice. Hoover v. Johnson, 47 Minn. 434, 50 N. W. 475; State v. Kerr, 51 Minn. 417, 53 N. W. 719; Bartleson v. Munson, 105 Minn. 348, 117 N. W. 512. If Sutton because of noncompliance with the redemption laws failed to appropriate the land to the satisfaction of Sauntry’s debts, and cannot be relieved, it would seem to follow that the only right which Sauntry now claims, namely, to have his $50 ■debt to Sutton wiped out, is also gone. But we do not believe provisions of the redemption statute can be abrogated, or in particular cases relieved against by the courts — 49 — in the absence of some agreement or act of waiver of the party whose rights are to be affected. No one will claim that, if through a mistake a mechanic’s lien was filed too late, equity could relieve. Nor can an owner be heard to be relieved against his mistake in permitting the year of redemption to expire, or a creditor against the mistake or omission .to file his lien as the statute requires, except in cases where the mistake or omission has been induced by the agreement or acts in the nature of waiver on the part of the person who is to be affected by the relief. No act of plaintiffs can be pointed to as inducing William Sutton or Torinus to accept the redemption money, or to refrain from paying the mortgage tax, or to take any other step to acquire the land. It is true, the mortgage without the tax paid was not a nullity, except as a basis for redemption. Cases like Forest Lake State Bank v. Ekstrand, 112 Minn. 412, 128 N. W. 455; Mason v. Fichner, 120 Minn. 185, 139 N. W. 485; State Bank of Boyd v. Hayden, 121 Minn. 45, 140 N. W. 132; Staples v. East St. Paul State Bank, 122 Minn. 419, 142 N. W. 721, are cited to the effect that equity will relieve against mistake in not paying the mortgage registry tax. But these cases relate to a reformation of instruments which defectively expressed the intention of the parties because of mutual mistake. In none did the court attempt to affect the rights of third parties who had neither taken part nor induced the transaction. In State v. Kerr, supra, it is said the court does not possess the power to enlarge the redemption statute: “The right of redemption is a strict legal right, to be exercised, if at all, in accordance with the terms of statute' by which the right is conferred, unless waived or extended by the party whose interests are to be affected. * * * As a general rule, it may be said that when a valid legislative act has determined conditions on which rights shall vest or be forfeited, and no fraud has been practiced, no court can interpose conditions or qualifications in violation of the statute. The courts have no power to relieve against statutory forfeitures.” When William Sutton attempted to use his $50 mortgage as a basis of redemption, the right had been forfeited because the mortgage was not legally on record. As tending in the same direction, see Bagley v. McCarthy Brothers Co. 95 Minn. 286, 104 N. W. 7; Brady v. — 50 — Gilman, 96 Minn. 234, 104 N. W. 897, 1 L.R.A.(N.S.) 835, 113 Am. St. 622. So that, assuming the tender of payment of plaintiffs’ judgment made their attempt to redeem wrongful, they nevertheless are now owners, because their redemption, fair on the face of the record, was acquiesced in by Torinus, from whom they redeemed by his accepting their money, thereby transferring the purchaser’s title at the foreclosure sale to them; and as to William Sauntry he has foreclosed himself from attacking plaintiffs’ title, because he disclaims all bene-eficial interest in or to the land through the Sutton redemption; and as to William Sutton, if Torinus acted for him, he is bound by the acceptance of plaintiffs’ redemption money, and if he relies on his redemption, he had no legal or equitable right to make it. Taking the view of the evidence most favorable to defendants on all controverted matters, we nevertheless reach the conclusion that the decision of the trial court must be affirmed.