Davis v. Savage, 4905.

Docket NºNo. 4905.
Citation168 P.2d 851, 50 N.M. 30
Case DateApril 10, 1946
CourtSupreme Court of New Mexico


Appeal from District Court, Chaves County; James B. McGhee, Judge.

Action in ejectment by Nina E. Davis against Mrs. Joan C. Waugh, continued after defendant's death against Margaret Savage, administratrix of the estate of Mrs. Joan C. Waugh, deceased, and others as substituted defendants. Defendants filed a cross-complaint seeking to quiet title in them to the land involved. From a judgment in favor of defendants in the ejectment action, plaintiff appeals, and from that part of the judgment dismissing their cross-complaint, defendants cross-appeal.

Judgment affirmed.

Where senior mortgagee by virtue of contract between her and mortgagor peaceably took possession of mortgaged land mortgagee and those claiming under her were entitled to retain possession until mortgage debt was paid, though foreclosure of mortgage by action or exercise of power of sale was barred by limitations when possession was acquired and though mortgagee, nevertheless, purported to exercise power of sale, bid in the land, and claimed possession by virtue of sale and deed executed pursuant thereto. Laws 1927, c. 10; Laws 1929, c. 139; 1941 Comp. §§ 27-119, 63-407.

[168 P.2d 852 , 50 N.M. 32]

Frazier & Quantius, of Roswell, for appellant and cross-appellee.

George L. Reese, Sr., of Roswell, for appellees and cross-appellants.

BICKLEY, Justice.

This is an action in ejectment commenced by plaintiff (appellant) against Mrs. Joan C. Waugh, and continued after her death against her personal representative, Mar. garet Savage, and Margaret Savage, individually; Melvine N. Robertson, Myrtle F. Stuchal and Peter Charles Viering, sole heirs of Mrs. Waugh, as substituted defendants (appellees and cross-appellants).

The defendants traversed the allegations of the plaintiff's complaint, and cross-complained, seeking to quiet title in them to the land involved.

The District Court concluded that the defendants' cross-complaint that they were the owners of the land, was without foundation, but concluded that defendants, through their predecessor in title, Mrs. J. C. Waugh, were mortgagees in possession of the real estate involved, and concluded as a matter of law that the plaintiff had no right to the possession of the premises, and gave the plaintiff thirty days from the 15th of December, 1944, in which to elect to pay the remainder due on mortgage given to Mrs. J. C. Waugh, deceased, within said thirty days, and in the event the plaintiff did not so elect to pay said amount, judgment should go for the defendants; and the plaintiff, through her attorney, having announced in open court that she declined to pay said amount, the court rendered judgment against plaintiff and in favor of defendants, in the ejectment action, and further adjudged that the cross-complaint of the defendants seeking to quiet title in them be dismissed.

Plaintiff appealed and defendants appealed from that part of the judgment dismissing defendants' cross-complaint to quiet title in the defendants.

The litigation arose out of the execution of senior and junior mortgages.

On December 13, 1921, Dan C. Savage and Margaret Savage, his wife, executed and delivered to Mrs. J. C. Waugh, their real estate mortgage deed to secure a promissory note in the amount of $1,700, bearing date November 28, 1921, and due and payable one year after date, and bearing interest at 8% per annum from date, said mortgage deed containing the familiar power of sale provision.

On November 22, 1929, the said Dan C. Savage and Margaret Savage executed what has been referred to by the parties as a renewal note and mortgage for $1,700 due one year after date and bearing 8% interest from date.

No payments were ever made upon the November 28, 1921 note except payments aggregating about $400, so that it appears from a little calculation that when the November 22, 1929 so-called renewal note was given, it was not for the amount due on the old note, lacking approximately $800 thereof. So far as the language of the 1929 note and mortgage is concerned, there is nothing to indicate that they are not new contracts.

On April 1, 1934, the said Dan C. Savage and Margaret Savage executed and delivered to C. H. Davis their promissory note and mortgage deed securing the same, for the principal sum of $930, bearing interest at the rate of 10% per annum until paid, due on or before the first day of April, 1936, and mortgaging the identical properties described in the mortgages to Mrs. J. C. Waugh, heretofore referred to.

These mortgages will hereafter be referred to as the 1921 Waugh mortgage, 1929 Waugh mortgage and the Davis mortgage.

The Davis mortgage contained the following recital: ‘This mortgage is given subject to two prior mortgages as follows: One mortgage to Mrs. J. C. Waugh, dated December 13th, 1921; for $1700.00. One mortgage to Mrs. J. C. Waugh, dated November 22nd. 1929, for $1700.00.’

Nothing was paid on the Davis note except small sums on the interest due thereon. The Davis mortgage also contained a power of sale provision.

C. H. Davis died intestate prior to the commencement of this litigation, and his widow, Nina E. Davis, was appointed administratrix of his estate, and thereafter on the 22d of October, 1941, instituted a suit in the district court against Mrs. J. C. Waugh, Margaret Savage, et al., to foreclose the Davis mortgage. In this action, Margaret Savage filed her separate answer and Mrs. J. C. Waugh appeared in said cause by answer and cross-complaint seeking to foreclose her purported mortgage on the property, but subsequently filed a motion to dismiss her cross-complaint and filed her first amended answer, which was granted, and her amended answer was filed, to which a demurrer was interposed, and subsequently on the motion of the plaintiff in the action here for review, the defendant, Mrs. J. C. Waugh, was dismissed as a party defendant. Thereafter, and on March 23, 1942, Mrs. Waugh filed a petition of intervention in the Davis foreclosure suit to which a demurrer was filed. On May 19, 1942, Mrs. Waugh moved the court to dismiss her petition of intervention without prejudice, and on May 19, 1942, an order was entered by the court allowing the petition to be dismissed without prejudice, and thereafter the cause proceeded to final decree as to the other defendants and the Davis mortgage was foreclosed by said decree and such proceedings were had that the property was bought in at the special master's sale by the plaintiff in the cause here for review, Nina E. Davis.

Nothing was done by Mrs. J. C. Waugh to foreclose her mortgages prior to the Davis foreclosure proceeding.

On May 18, 1942, Mrs. J. C. Waugh, by her attorney G. L. Reese, Sr., under the power of sale contained in the 1921 Waugh mortgage, issued a notice of sale of the property involved herein, stating among other things that on June 24, 1942, the real property described in the notice would be sold at public auction to the highest bidder for cash for the purpose of applying the proceeds of such sale to the satisfaction of the indebtedness evidenced by the 1921 Waugh mortgage note. The trial court found that on the 24th of June, 1942, the real property involved was sold pursuant to said notice of sale and bid in by Mrs. J. C. Waugh, for the sum of $3,000, said sale being made by her attorney G. L. Reese, Sr., for her, she being absent at such sale, and that a deed was issued by said attorney to the said Mrs. J. C. Waugh on the 25th day of June, 1942, and filed for record on June 29, 1942.

The trial court found that Mrs. J. C. Waugh, through her attorney, took possession of the real estate involved herein on the 20th day of May, 1942, by the service of a written notice upon Margaret Savage, who had theretofore been looking after said real estate and the rentals thereof; that Margaret Savage made no objection to the taking of possession of said premises by the said Mrs. J. C. Waugh; and that since said date, the said Mrs. J. C. Waugh had possession of said premises until her death on the 13th day of May, 1943, and that since the appointment of Margaret Savage as administratrix of the estate of Mrs. J. C. Waugh, she has had charge and possession of said real estate, and that the said Margaret Savage as administratrix for herself and the other heirs of the said Mrs. J. C. Waugh, deceased, is claiming possession by virtue of the sale and deed above mentioned.

We will first consider the appeal of the cross-appellants. They assign errors as follows:

(1) The court erred in its conclusion of law No. 1 appearing at Tr.R. 88 as follows: ‘That at the time of the purported sale on May 18, 1942, by Mrs. J. C. Waugh, under the 1921 mortgage, the right of action on said mortgage as well as the power of sale therein contained was barred by our statutes and such sale was a nullity.’

(2) The district court erred in its conclusion of law No. 4 appearing at page 88 Tr.R. as follows: ‘The claim of the defendant that she is the owner in fee simple of the real estate in this action is without foundation and should be denied.’

(3) The district court erred in dismissing the cross-complaint of the defendants to quiet title as shown by the final judgment of the court at page 128 Tr.R. as follows: ‘The cross-complaint of the defendants seeking to quiet title is dismissed. Defendants except.’

The District Court doubtless based its decision complained of upon Ch. 10, Laws 1927, 1941 Comp. 27-119, as follows:

Section 1. No lands, tenements, hereditaments, goods or chattels shall be sold under any power of sale contained in any mortgage, deed of trust or other written instrument of like effect, where an action or suit upon the indebtedness secured thereby is barred by the provisions of Chapter 68, New Mexico Code of 1915. Sec. 2. This Act shall not in any wise affect, limit or impair any right any person may now have to exercise a power of...

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