Hammock v. Qualls

Mr. Justice Lansden delivered the opinion of the Court. This ease is before us upon petition for writs of certiorari to the judgment of the court of civil appeals reversing the decree of the chancellor. The bill is filed by Hammock for the purpose of having a claim of Qualls to an undivided one-fifth interest in a certain tract of land in Overton county removed as a cloud upon his title. The common source of title is one Bil391 brey, who held by descent from bis father. After the death of Bilbrey’s father, complainant Hammock sued Bilbrey before a justice of the peace, and recovered a judgment. An execution issued thereon July 11, 1908. An order of condemnation and sale were had upon the justice’s proceedings in the circuit court of Overton county November 3, 1908, and deed of the sheriff pursuant thereto October 17, 1916. After the sale, • and before the execution of the deed by the sheriff, defendant purchased the same land from Bilbrey by deed dated November 1,1915, which was registered in Over-ton county on the same day. The defendant interposed as defenses to complainant ’s action that he purchased the land without notice of complainant’s purchase at the sheriff’s sale, or his levy lien, and the inexcusable and unexplained delay upon the part of complainant in taking his deed from the sheriff. The case was heard by the chancellor sitting as a jury, who found that the defendant purchased from Bilbrey without notice in fact of the proceedings under which complainant claims. There is evidence to support this finding. The levy of an execution from a justice’s judgment upon land creates a lien in favor of the judgment creditor. Zook v. Smith, 6 Baxt., 213. If the levy is followed up by a return of the papers into the circuit court and a condemnation of the land, and ven-ditioni exponas is issued by order of the circuit court, the sale, had in pursuance thereof, will relate back to — 392 — the date of the levy so as to make the legal title conveyed by the sheriff’s deed operate as of the date of the levy lien. Parker v. Swan, 1 Humph., 83, 34 Am. Dec., 619; Zook v. Smith, supra; Keaton v. Thomasson, 2 Swan, 139, 58 Am. Dec., 55. The levy' of an execution upon real estate does not transfer the title to the land nor create any interest thereto in the sheriff. It merely fixes a lien upon the land for the payment of the debt. Keaton v. Thomasson, supra. The court of civil appeals was of opinion that the record of the condemnation in the circuit court was constructive notice to the defendant of the sheriff’s sale, and of complainant’s equity in the land by virtue of a lis pendens growing out of the condemnation proceedings. This is correct as a general proposition of law, but the order of condemnation is not a judgment, but only a mode of executing the levy. Mann v. Roberts, 11 Lea, 59 ; Ashworth v. Demier, 1 Baxt., 323; Zook v. Smith, supra. In Mann v. Roberts, supra, it is stated that the record of condemnation “is not notice to third persons, nor would it be if a judgment; the notice implied from a pending litigation ceasing with its determination.” It merely continues the lien of the levy to which title of the purchaser at the sale will relate when he procures a deed from the sheriff. “The only proper use of an execution,” said the court in Mann v. Roberts, supra, “is to enforce the collection of a debt, and to enforce it, so far as the rights — 393 — of. third persons are concerned, with reasonable diligence. The creditor cannot use it merely as a security for his debt by a levy on property, for the lien thus created is a secret lien, and may operate to the prejudice of innocent third persons if the debtor be left in possession of the property.” This we conceive to be an accurate statement of the nature and* purpose of an execution upon a justice’s judgment when levied upon real estate. Our registration statutes have been enacted for the purpose of preserving titles to land and giving notice to a prospective purchaser of the manner in which they are held. Our Code, at section 3751 (Shannon) expressly provides as follows: “Any of said instruments first registered or noted for registration shall have preference over one of earlier date, but noted for registration afterwards, unless it is proved in a court of equity, according to the rules of said court, that the party claiming under the subsequent instrument had full notice of the previous instrument.” Wilkins v. McCorkle, 112 Tenn., 688, 80 S. W., 834. In all cases to which our registration laws have application, the deed first registered must be given priority over the constructive notice of lis pendens. The doctrine of notice by lis pendens by which a bona-fide purchaser without notice is held bound by the result of a suit as though he had notice is held, in Mann v. Roberts, supra, to he one of public policy, and necessary to bring litigation to an end. In Shelton v. Johnson, 4 Sneed, 680, 70 Am. Dec., 265, it was thought the doctrine should be placed upon the ground of notice, — 394 — either actual or constructive, but it was also said that the rule is founded more upon the necessity for it to give effect to the proceedings of courts than upon any presumption of notice. All of the authorities agree that the rule is necessary, and that without it all suits for specific property might be rendered abortive by successive alienations of the property in suit. Authorities infra. As shown heretofore by our cases, the condemnation proceedings is not a judgment, nor does it fix a lien, but it is intended merely to continue the lien fixed by the levy of the execution upon the land, which until condemnation is a secret one. Secret liens are not favored, and it was designed by the legislature, in passing our condemnation statutes, to preserve of record proceedings had before justices of the peace by which the lien of the levy of the execution. was 'obtained. The date between final order of sale, the sale and the return thereof, and the execution of a deed by the sheriff, does not create a hiatus in the operation of the Us pendens of the condemnation proceeding. The lis pendens is operative for a reasonable time after sale until deed of the sheriff is obtained, and purchasers in good faith without notice are bound to take notice of the levy lien so recorded. But reasonable diligence is required of the purchaser at the execution sale in perfecting his title, which should be recorded. In Mann v. Roberts, supra, the opinion was expressed that the lien will not “perhaps” be impaired by ordinary negligence, and will only be lost by unusual and — 395 — unreasonable delay. In so far as this refers to delay which may be explained, we assent to it, bnt we think that ordinary negligence in procuring a sheriff’s deed, unexplained, should defeat the title of the execution purchaser as against one who buys in good faith and without notice of the title claimed by the execution purchaser. No positive rule can be laid down as to what constitutes such delay as will destroy the right to lis pen-dens, and the question must be determined upon the facts of each particular case. Robinson v. Bierce, 102 Tenn., 428, 52 S. W., 992, 47 L. R. A., 275, 17 R. C. L., 1038. The cases generally hold that the rule of Us pendens is a harsh and oppressive one when given operation against a bona-fide purchaser without notice. One relying upon the rule must understand that his claim is strictissimi juris. 25 Cyc., 1452, 17 R. C. L., 1038, 1039. In the case under consideration the complainant waited for more that eight years before procuring a deed from the sheriff. Everything that was to be done in the condemnation proceedings, or. in the suit before the justice, had been done, and more than likely the book containing the record of the condemnation had long since been retired in the clerk’s office. "While it is true under our cases that the .defendant had constructive notice of the condemnation proceedings, the conduct of the complainant toward the lien procured by the levy of his execution was such as warranted the defendant in assuming in law that the complainant — 396 — bad abandoned bis lien, and did not intend to take a deed from tbe sheriff. Tbis delay, unexplained as it is, is gross negligence upon tbe part of complainant, and amounts to an abandonment of bis lien. Tbis being so, tbe deed wbicb be- finally took from tbe sheriff conld not be said to have relation to tbe lien because it was abandoned. It should be borne in mind that tbe lien was secret until condemnation proceedings were bad, and it never conferred any title upon complainant, but merely gave him tbe right to proceed according to law, and ripen bis lien into a title. In order to do tbis, so as to overreach tbe rights of subsequent purchasers without notice who have registered their deeds, tbe levy lienor must follow up bis execution with reasonable diligence and ripen bis lien into a title. Tbe law gives a creditor such relief against his debtor, but it was not intended that such a proceeding could be suspended for an unreasonable length of time and then affect the rights of innocent third parties. Such we think is tbe bolding of our cases as well as those of other jurisdictions. Tbe result is that tbe writ is granted, and tbe decree of tbe court of civil appeals is reversed, and that of tbe chancellor is affirmed.